Hello everyone, in this post that I made about a week ago (How To Steem - Part 1 - Learn, Learn, Learn!) I talked about how one of the most important things for being successful here on Steem - or most anywhere else for that matter - is learning. The more you know and the more you understand about how something works, the more success you will have with it.
In that post, I said that: “Whenever I am finally able to understand a topic that was very hard to find a detailed explanation for, I note it down, since that’s probably a good topic for a post.” Recently I have been working to understand how exactly the rewards for each upvote on a post or comment are calculated. This is something I have not been able to find any in-depth explanation of with some Google searching, so - like I said - it’s probably a good topic for a post since others may have the same questions.
Additionally, there are some parts that I still don’t fully understand - so I would really appreciate it someone reading this can help fill in the gaps for me in the comments! Anyway, here goes…
Calculate Your VESTS
The first part of calculating the value of your upvote is determining how many VESTS you have. VESTS are like shares in a company, but in this case they are shares in Steem itself, meaning how much influence you have over the reward fund from which your vote value comes (more on that later).
When you “power up” and purchase Steem Power you are really purchasing VESTS. The reason behind this is important to understand, but it is out of the scope of this post, so I will refer you to this great post if you wish to learn about it: https://steemit.com/interest/@sigmajin/understanding-the-steem-economic-system-vests-sbd-steem-dilution-interest-and-all-those-crazy-things It is a little outdated so the specific numbers have changed a bit, but I believe the concepts still all remain the same.
To find the number of VESTS you have is pretty easy - you can look it up on http://steemd.com/@yourname. You want to look for the following values: “Vesting shares”, “Delegated vesting shares” and “Received vesting shares”. You can see the values for my account below (http://steemd.com/@yabapmatt):
“Vesting shares” is the number of VESTS have received from purchasing Steem Power, “Received vesting shares” is the number of VESTS that have been delegated to me by others, and “Delegated vesting shares” is the number of VESTS that I have delegated to others. To calculate my total VESTS used when voting, you add “Vesting shares” to “Received vesting shares” and subtract “Delegated vesting shares”. In my case that is:
8,860,656.464688 VESTS + 4,999,492.045680 VESTS - 59,696.776925 VESTS = 13,800,451.733443 VESTS
Then we multiply by 1,000,000 to make it a whole number of: 13,800,451,733,443 VESTS
Calculate Your Voting Power
Now that we’ve calculated how many VESTS I have, we need to apply the amount of my voting power that will be used. For now we will assume that I am at 100% voting power and giving a 100% weighted vote. You may have noticed that such a vote will use 2% of your total available voting power. I’m not going to go into the details as to how that is specified / calculated (since I’m still a little unclear about all of that myself) but for the purposes of our calculations we need to multiply the number of VESTS we calculated above by 2% which gives us:
13,800,451,733,443 VESTS * 0.02 = 276,009,034,669 VESTS (276 billion, woohoo!)
We now have the exact number of vesting shares which will be applied to one 100% upvote at 100% vote power. The next thing we need to figure out is how much those vesting shares are currently worth.
The Reward Fund
There is only a fixed amount of STEEM available for rewards at any time and this is called the Reward Fund. The amount of STEEM your vote gets from the Reward Fund is determined by the percent of the total amount of vesting shares from all recent votes in the entire Steem blockchain that your vote makes up. We can see what the total amount of vesting shares from all recent votes on the entire Steem blockchain is on http://steemd.com in the “Reward Fund” section under the “recent_claims” property:
At the time of writing the value is: 296,277,010,153,854,712. That's only 296 Quadrillion, let's be glad this is done by computers!
So now we can calculate what percent of the total my vote comprises:
276,009,034,669 VESTS / 296,277,010,153,854,712 VESTS = 0.00000093159113 (we just went from really big, to really small, really fast!)
We can also see the total amount of STEEM currently available in the Reward Fund by looking at the “reward_balance” property which, at the time of writing, is: 706,497.619 STEEM.
This means my 100% vote at 100% power is currently worth:
0.00000093159113 * 706,497.619 STEEM = 0.65816691522 STEEM (ok, not so bad!)
Convert to SBD
We’re almost there! Post rewards are displayed in SBD, not STEEM, so the last step we need to do to calculate our upvote value is to convert the STEEM we calculated above to SBD using the current price feed. Once again we can get this from http://steemd.com as you can see below:
To get the current conversion rate from STEEM to SBD we divide the “base” by the “quote” so at the time of writing we have:
1.024 SBD / 1.000 STEEM = 1.024 SBD / STEEM
So finally we can take our vote value in STEEM, multiply it by the conversion rate and get our final vote value of:
0.65816691522 STEEM * 1.024 SBD / STEEM = 0.67396292119 SBD
We can round that to a nice easy $0.67 SBD and whew, we’re done! Now you can multiply the vote value we just calculated by different voting power and vote weights to see what the value will be of your vote in other scenarios. For example at 75% voting power and using a 20% vote weight my vote would currently be worth:
0.67 SBD * 0.75 * 0.2 = $0.1005 SBD
What Factors Affect Vote Value?
So hopefully that exercise was as helpful to everyone else as it was to me. The most important thing it helped me realize was the different factors that affect the value of votes. The current price of STEEM is the most obvious one, but the less obvious one (at least initially, to me) was the “recent_claims” in the Reward Fund.
Since there is only a fixed amount of STEEM available in the Reward Fund at any given time, if all of a sudden double the amount of vesting shares worth of votes were submitted then the amount of STEEM available for each individual vote would be cut in half.
This initially seemed very worrying to me, but I only recently came to realize that if double the amount of vesting shares worth of votes are submitted, then that means a LOT more STEEM would have to be purchased on the open markets. This would likely more than double the value of STEEM and therefore have a net increase to the value of each vote in SBD.
That’s all for now, it’s getting late and I’ve spent way more time than I anticipated on this post! Please let me know in the comments if I’ve gotten anything wrong and I will correct it asap. Thanks for reading!
hey @yabapmatt, great post and please comment here so I can upvote you.
Please upvote me :)
Please upvote me....
I googled this post because I needed the formula for my bot - thank you! tip! 1
Thanks man! Let me know if you need any other help with your bot!
Wow, this article is so helpful @yabapmatt
This is just what im looking for in order to know how much $$$ with respect to my voting power. It gives us insight and idea how much we give or earn in our every vote.
This is a must read article. Im gonna resteem this!
Thanks @elizahfhaye, glad it was helpful!
Thank you! This answers so many questions I’ve had. Esp when I go to Steemd I had no idea what I was looking at. This is a well researched post!
Glad it helped, perhaps I should also do a post explaining what all of the other global Steem properties are that you can see on steemd.
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This wonderful comment has received a bellyrub 1.52 % upvote from @bellyrub thanks to this cool cat: @yabapmatt. My pops @zeartul is one of your top steemit witness, if you like my bellyrubs please go vote for him, if you love what he is doing vote for this comment as well.
Thanks @yabapmatt for the insides. I'm still kinda new to the community and as you said, learning is the best way to get the most out of it. Obvious my voting power is almost irrelevant now but as I said, I'm new, and I'm building up, at least I'm trying :) . Anyway, I've upvoted and resteemed the post in hopes it will get the attention it deserves. Great post that shows why we love this community. Thanks
Thank you! Good luck building up!
as always keep up the good work. upvoted of course :).
Great post, so informative and helpful yabapmatt.
@luxury-sa
quite impressive work @yabapmatt
love this article and feel happy to know about the power of upvote
:)
upvoted
Wow the most informative post so far regarding the reward system.
You made it very clear mate thank you for that ! =)
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very good explanation, I understand now what is vests ☺
I've been looking for this formula for an app im building for the longest time. Thanks!
Thank you @yabapmatt. I notice that there is a LOT of information already out there about the ins and outs of steem but it's distributed and not organised. Thanks for sharing this with us.
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Nice, you got a 5.0% @minnowbooster upgoat, thanks to @yabapmatt
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thanks for doing the math way above my head
oh my god im so confused hahaha
thanks for this info, upvoting this.
Commenting here hopefully you'll respond.
Can I translate this post and post it on @hebrewguides? this account is dedicated to guides in Hebrew to help new Steemit users.
Thanks in advance!
Thank you very much,
I will put this into good use in one of my projects! :)
@yabapatt, from what I have found you're the best at explaining this sort of thing. Good enough that you have earned my only witness vote so far. Would you consider updating this post, the terminology seems to have changed.
Thank you and keep up the good work.
Thank you! What terminology has changed?
My bad, I figured it out. The terminology hasn't changed, I just needed follow the instructions and look in the right place. Thanks for your response though.
So when Steem value goes up in the market where does that price impact? Does it impact the base FEED_PRICE or something else?
Also how long does it take to make that impact?
It impacts the dollar values of the post payouts shown on steemit.com and other sites built on the Steem blockchain. The price that is used by the blockchain is the 3.5 day average price as reported by the witnesses who supply a price feed.
So a witness just chooses which market they're keen to looking at? And it's the average of all submissions during the last 3 days?
Yes, most witnesses use an average price across all markets. I actually wrote a price feed tool for witnesses which lets them choose which markets they use. In the end it's the witnesses responsibility to report the price as accurately as possible.
Wow, l love this. You made the calculation breakdown very very simple to understand.
I will follow your #yabamatt
I love your work. You are such a genius.
Good work dear
Such a great post I'm finding value 10 months later thanks to @braaiboy!
@yabapmatt , i followed through right p until
I like math but...whew! Anyway, I am still unclear on this strange phenomenon: I vote for one person's work and they recieve $0.04 from me, and then I go to another person to vote, and they get nothing but a vote, then the next one really baffled me: I voted for someone and the LOST $0.01. I don't understand.