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RE: If you have over 2500 SP, you can retire*
You probably shouldn't, is the honest answer. You can't expect every single STEEM to stay at $3-4 forever.
That would be the equivalent of the marketcap of STEEM growing 100% year over year. Which means next year the market cap will be like 700M, then 1.4B, 2.8B, 5.6B, 11.2B, 22.4B, 44.8B, 89.6B, 179.2B, 358.4B in 10 years...
and in 20 years, STEEM's marketcap has to be 367 TRILLION DOLLARS to maintain the $3-4 dollars per steem. Laughable.
In actuality, holding steem power means you're LOSING 10% every year. Of course, if the market cap increases by more than 10%, you still end up with a net gain. But it doesn't compound like people make it seem.
every five years the number of steem goes back to the original amount correct.
You are forgetting that every three years the total number of steem is reverse split 10:1.
That doesn't change what I'm saying in the least. Your 1 steem becomes 0.1 steem. It's still worth the same; getting less and less as time goes on (assuming the marketcap stays the same)
It does because you are assuming the market cap grows exponentally when it very much does not. Steem is not exponentially inflationary.
Hmmm....
Does this mean that we can mitigate that quantitative loss
by just buying/selling just before it's occurrence?
Thanks,
obfuscate-me
Can you explain that a little more?
Every three years the total number of steem is reduced and you get back 1 steem for every 10. While the total valuation remains the same. So if you had $300 worth of steem worth 1 dollar pre split you would have steems worth $10 after the split. Just less numbers of them. For more description of this check out the white paper.
Fantastic explanation of how the system works; Thank you so much!
On a slightly unrelated note/question though:
Should SMD be converted into STEEM or SP?
Thanks,
obfuscate-me