Don't power up 100% !!
At least not yet!
keep choosing 50/50 payout
I have gotten the question in chat a few times lately, and seen it numerous other times
"Since SBD is getting lower than steem, is it better to power up?"
The short answer is absolutely not
Why? cuz math, thats why!!
I am going to show you an example. In the example STEEM is worth $5 and SBD worth $4.
(These numbers are strictly for ease of use)
So you have a $40 payout, assuming exactly 25% goes to curators, you should expect $30 dollars in normal circumstances. If you choose 100% power up, that is exactly what you should receive in SP. So $30 would equal 6 STEEM POWER if STEEM is $5. (see chart to the right below)
BUT
If you choose 50/50 when SBD is worth MORE THAN 1 DOLLAR... your returns will be MUCH GREATER. Since it is hard to explain in text format see the chart to the left below which will show you the result of your payout even if SBD is lower than STEEM ($4 SBD in this scenario)
As you can see. Even though SBD is lower than STEEM. You still make 2.5 times more by going 50/50 over 100% power up. If you want STEEM and not SBD you can always exchange in the internal market for the best rate. Seriously don't use blocktrades for SBD to STEEM
AS LONG AS SBD IS MORE THAN $1 USD CHOOSE 50/50
please share so people don't miss out on free money
Ugh this is why you watch the market often, @cabernet. Haha, that's me shaking my head at myself 😧 Thanks for the short, simple explanation!
very smart . proved mathematically.
This makes a ton of sense, and I had never thought of it this way. Resteem'd
Yeah I wish the Steemit wallet showed you the current market value for SBD instead of just assuming it's $1. It's pretty misleading. I had to figure this out the hard way when I started and I've had to explain this to all my friends and family whom I've gotten into Steemit.
Good post for sure, some newer users are losing out when they choose that! Instead sell the SBD for steem in the internal market, then use that to power up so you get more steem power in your account overall!
boom. exactly ;)
Cheers, nice explanation.
Thx for the info. Loved the chart :p
Thank you for this post. It explains well that 50/50 is the right choice at this point. I had always wondered.
I'm a noob here & I'm wondering why I haven't seen that option to select how the rewards are allocated.
Do I have to get to some threshold of steem power before I see what's in the graphic at the top of this post or is there an option somewhere I've missed or unchecked or something ?
good info. thanks
And that math is why the system is so brilliant. Over $1, SBD is chosen to be generated so that it can be sold. This increases the supply of SBD and puts downward pressure on the price. When SBD is below $1 people either power up directly if they want SP or they choose to hold the SBD for the interest. Both of these keep the supply of SBD in the markets low. The economics of SBD make the price trend toward $1.