Let's not bury the lead. Don't power up your post 100% right now! This is insane to do and you're missing larger payouts because of this mistake! Let's go over some economics of how Steem works!
Steem, Steem Power, and SBD
There are three tokens on Steem. Steem, Steem Power, and SBD. Steem and Steem Power have a 1:1 price ration, but serve different purposes. SBDs have a different price point and have contention around how they work and what they do.
Steem is a tradeable token that can be turned into Steem power. It's roughly worth $3 USD right now. It's a pretty awesome token. It moves in 3 seconds. It doesn't cost anything to use. And despite there being 260M of them there are less than 100M that are liquid. It's a nice coin.
Steem can also be "powered up" into Steem Power. When you own Steem Power it's like owning a stock in a company that has dividends. Unlike a classic stock like IBM where you really only have two choices with your dividends (reinvest or cash out) Steem gives you lots of options of what to do with these dividends. The Steem Blockchain has a little under 10% inflation and that inflation goes into new steem tokens that are distributed to authors, curators, stake holders, and witnesses. The more Steem Power that you have the more you can control where those dividends go. By voting (and flagging) you have the power to direct how funds are distributed on the platform.
Steem Power also attracts people to you. People like to follow and interact with folks that have more Steem Power than themselves. This way they can earn a fair amount of money by catching votes through interaction and friendship. There is more visible financial advantage to having whale friends than minnow friends. So, having Steem Power (or even just renting it) can help you grow your following and get sustainable rewards.
SBDs don't allow you to choose where dividends or freshly minted Steem will go. They are simply rewarded when your posts finally payout. These have a different value than Steem. They are currently worth a little less than $10 USD each.
Quick and Dirty Post Reward Math
Here's a post that just paid out for me: https://steemit.com/mspwaves/@aggroed/minnow-mayor-town-hall-tonight-1-6m-youtubers-represented-news-flash-btc-hits-20k
In part because of bid bot use the total rewards listed on steemit.com was $280.
Curators got 59.
I got "$221." This isn't actually listed in USD. It's a mix of USD and SBD.
SBD 110.7
Steem 34.5
It's deciding this price ratio from the average witness price feed you can find by checking out steemdb.com.
The value of those coins is pretty different. If I round SBD to 10 and Steem to 3 then that post was worth $1107 from the SBD and a little over $100 for Steem. If you 100% power up your Steem you're gonna end up with roughly 70 Steem, which could be a nice payout, but it's missing out on the $1107 in favor of something worth $100. That's CRAZY.
So, here's what I'm doing roughly to figure out the math. The total value is 4.3X what's shown on Steemit. The liquid portion right now is basically 4X. If you accept 100% powerup it'll pay you author rewards in Steem exactly equal to what's shown as the author portion, but the challenge is you'd be missing out on nearly 4X the rewards.
So what should you be doing right now?
Thank you for the reminder on how to best profit.
tip!
This is a total noob question, and I apologize in advance. How do you tip?
Thanks
All that, and there’s another reason to convert SBD and then accrue Steem Power. It earns interest:
https://steemit.com/steemit/@preparedwombat/how-much-interest-does-your-steem-power-earn-i-finally-figure-it-out
Thank you @aggroed for promoting this post together with https://steemit.com/budget/@jerrybanfield/introducing-steem-budget-proposals
Thanks so much for explaining this.
This issue is very important to know.
Not everyone get it.
Thanks and resteemed.
Made such mistake recently. Lost $60 for one misclick.
Be carefull!
The 50-50 rule seems to be best right now then you can buy steem in the internal market! Steem On ! And Merry Christmas to All 🎄
Good post , Well written as well .. upvoted
Yeah the rewards on SBD have been crazy some simple posts are making nearly $1,000!
Yes good to know!
very good information, thanks you for sharing this with us
I have to admit, I didn’t really pay attention to steem price nor SBD price until just recently and OMG! What just happened?!!!! Awesome news!
This was VERY helpful. I am still relatively new here on Steemit, I have been trying to invest in the platform for long term success but I have been questioning how best to do that.
Thank you so much. This very clearly explained SBD and Steem rewards, and it confirms what I thought was happening but now I feel much more confident now that I saw this.
Thanks again. Merry Christmas.
Thanks to the Crypto Growth Forum and the Steemit Bluepaper, I was able to grasp this logic, and agg's post makes it crystal SBD dips below 1 USD, in which case the payout for STEEM should be 100% PowerUp for that duration to maximize payout potential.
Thank you aggroed, that is real useful information and good advice. Upvoted & resteemed.
50/50 is a go this time, as there is a major price gap between SBD and STEEM.
What should I be doing now? Should I be powering up to 100%? Should I be voting by default 50/50 or should I be enjoying Christmas with my family and just forget this? Any suggestion... please let me know. Or should I decline payment? Should I upvote my own post before I post to curate it? Some how I missed the point of your math. Please guide me a little.
50/50. Wait until after your followers have voted to upvote your own post (or don't at all). If you upvote your post after your followers have, you're increasing the curation rewards they get, and the next time they vote on a post of yours, you will get even more rewards.
I like to think of it as increasing your hash rate.
Thank you. Very logical and concise.
And next time you will get even more rewards or they will get even more rewards... I don't quite get this
So you are of the opinion that it is better not to upvote your own post at all
Thanks for information but what to do now.
Hello dear, Merry Christmas, I have a gift for you, I included you on this contest Contest: Find the Best 25 Posts on Steem! , if you want you can upvote the comment there to make it visible so Jerry may choose your post to promote it. You are number 8 there. ☺
Very informative post, I am learning!
So it's that fact...not too good...
Not sure I completely understand but I will make this change. Thanks!
Great post and I did a similar post a while back warning people they might be missing out on some major bank by picking the wrong payout rewards. I even went as far to comment on a bunch of higher value posts that had 100% Power Up telling them that they were missing out on more rewards due to their choice, but unfortunatly almost every single one of those high value posts didn't seem to give 2 shits, and basically told me to stop posting non-post related comments and to go away. Needless to say, it wasn't exactly the response I expected since I was just trying to tell them how they were overlooking literally THOUSANDS of dollars a week with their post reward decisions, but again they didn't seem to care and were quite rude to me in general. I guess that's what I get for trying to help people...
Thanks for the tip... It can be confusing which is the better choice...
Hi @aggroed! You have received 0.1 SBD tip + 0.02 SBD @tipU
from @sneakgeekz :)
Check out new tipuvote! feature :)
seems like people are taking a loss on 100% powerup any time SBD is above $1usd, and since it has a floor value of $1usd that's pretty much the only time the 100% thing is useful but even then it just breaks even with the other option I think
Excellent post about steem and SBD. Follow and upvoted you. Merry Christmas
Very informative... I misunderstood how it worked... Thank you!
Great info! I’m new here and every bit helps!
i used to loose by powering 100% until a friend corrected me, now i do 50/50 which is good for my steem power. thanks for reminding people on this important issue
At this night DogeCoin do a revenge all its history... 😞
Nice your post @aggroed
Good job
ok now it start to make sence I appreciate the informative details 👍
Does ANYONE actually know how SBD's got to around $10?
Don't they almost have to stay there,
after spoiling the hell out of everyone here,
with 10 times the "payouts" than would have been expected?
I have this strange feeling,
that what happens at $10 SBD,
is very different from what happens at 1SBD/$1.
I'm only like 5 weeks old on steemit though,
but i think i'd cry if we all lost 90% of what we might earn here.
Alx
Thank you for this good post :-)
Nice. Lots and lots of information to take in. Between the overall crypto space and steemit, I am in a bit of information overload.
It was thinking, that this something every current steemian should know and not be told.
@aggroed
This has been informative as a new member to steemit thank you!
Yes. Great post for newbies. I had to figure this out on my own. SBD is definitely the better of the 2 right now. It is worth much more. I’m holding my SBD until it goes back up. Hopefully soon!! Lol
Wonderful it hurts to watch!!!!!!!!!!.
There are there tokens for on steem. Steemit, steem power, and SBD... If you 100 %Power Rangers up your steem. Thanks for so much for your photography sharing.
nice info @aggroed keep sharing informative post
Very clear, well written explanation. I'm going to follow this suggestion.
Very helpful as I'm still coming to grips with the system. I'm going to have to re-read this a few times.
You are right. I think as long as sbd is higher than 1$ it’s better to use the 50 50 option right?
That was what I was considering as the deciding factor as well. Somebody hypothesized a few people going for those super-sleeper alts were helping increase the SBD value temporarily. I suppose best bet is make steem while the water's boiling ;)
🤙🤙
Wow, I did manage to grasp the differences between this tokens, but this point eluded me. Thank you! I will surely use this advice, and anyone else who cares about his money.
Thanks for your clear explanation. 50/50 Makes sense under current circumstances
I will be watching for your update post when STEEM creeps up to $5 and SBD has a pull back to $5. Then, the reward pool should get interesting.
I was having a hard time understanding the difference of Steem, Steem Power, and SBD. Thanks for explaining. Following you!