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RE: Steem Power Interest Is Not Compound Interest!

in #interest8 years ago

Yes, that's a good point, but this (I'd imagine) is a slightly different type of article. It only takes a quick scan to see what the content is about.

As far as I understand, VESTS don't change over time unless you curate or post. Steem Power is just a reflection of your VEST holdings given the current ratio of 1MV to Steem Power (234 right now) . To me, it seems like share dilution, not compounding interest. That said, I understand how easy it is to get this confused because I wrote two posts myself on the Steem Power "interest" before better understanding things.

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If the money supply of the dollar remains constant, yet we use an accounting ledger which moves dollars from one person to another when an interest payment is made, is that not an interest payment because the total supply of dollars didn't change.

Just because you invent some orthogonal ratio token that remains constant doesn't mean value wasn't transferred. Duh!

Come on guys, I don't have time for middle school math tards.