So clear, thanks for posting. This is very interesting. That is a great built in incentive to consider after the distribution phase is done . Power down over 90 and power up under 90!
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So clear, thanks for posting. This is very interesting. That is a great built in incentive to consider after the distribution phase is done . Power down over 90 and power up under 90!
I'm not necessarily advocating that
I was saying that there is an incentive to do so. I am personally staying powered up, because in Gross terms I will have 312% more Steem Power in one year, and I don't believe the price will be 70% lower... Thanks for the reply @dennygalindo
Yes this is a rule for after the distribution phase. But there is no use swimming against the tide. This is interest rate parity for Steem. ( where the interest rates suggest currencies will go)
You just made a great point most do not understand. If you were to power up at current market prices at $1 and bought 1000 SP, you'd have approx. $3 next year or about 3000 SP if price stayed around $1. This is without curation rewards and posting.
The distinction to make is that when there's above 90% of Steem in Steem Power (the actual number is a little lower) then the 9/10 Steem awarded to SP holders will be shared with more people so there will be an effective negative rate of return holding Steem Power.
For simplicity, lets say we have 95% vested in SP, the 9/10 reward will be relatively smaller as there's an extra 5% of holders to pay.
If we have 85% in vested SP then those SP holders get a larger proportion of the 9/10 reward.
On top of that SP holders are essentially taxed by the 1/10 rewarded for content if they are completely inactive.
Once we see the overall vested SP tend towards 90% ish - we'll see different behaviours with regard to powering up and down.