1 STEEM = 1 SBD: And So It Begins!
If you looked up the price of both Steem and SBD, you'll have noticed they are virtually the same now... what does this mean?
I was minding my own business and checking my upcoming rewards in Steem Supply when I found this:
So... it happened!
Steem Backed Dollars finally stopped being worth more than STEEM. I was expecting this, powering up like crazy while a lot of people were holding on to their SBDs waiting for what technical analysts pointed as a correction for a HUGE SKYROCKETING of the price.
Well, I don't regret it one bit, the numbers are on my side and now Powering Up will be tougher.
Through this article I'm going to discuss the relation between Steem Backed Dollars and STEEM - the Blockchain's Flagship token.
I Was Warning Everyone to Take Advantage of Powering UP:
I know I'm only 1 month old, but as I am quite active I made a lot of friends here already. I was advising them to power up as much as they could, because you could buy more than 1 Steem per SBD and that was a ratio I didn't expect would stick.
Some considered my words, others shared the same view, but most people referred to technical analysis and claimed that SBD would skyrocket, hitting $30 soon.
Well, SBD has all the reasons in the world to go down, not up, and being a fundamental analysis fan myself, I kept powering up... I'm glad I did, and even if SBD would rise substantially as they say... I wouldn't regret it.
The trend is down for SBD, and let me tell you why.
SBD May Recover: But THIS is the Trend!
So, continuing with my line of thought, Steem Backed Dollars have all the reasons in the world to go down, not up.
These reasons are:
- It was initially meant to be pegged to 1 USD;
- SBD Quantities are Perpetually Rising at a Fast Rate;
- SBD is a currency that gets sold more than bought - people use it to buy STEEM or Cash Out!
- There's no reason to keep SBD other than to pay for Bots;
- @grumpycat and some others are trying to decrease the price by printing more SBDs.
Among other things.
If you understand the market, you'll see that speculation is what keeps SBD up... that and the Fear of Missing Out.
If SBD increases in value and gets back up, it won't be because of a reason that is inherent to the market, but one emotional one inherent to humans instead.
There's no fundamental reason on why SBD shouldn't continue its decline.
STEEM is Now Capable of Constant Rising: Room for Growth
On the other hand, STEEM has all the reasons in the world to go up.
Some of those reasons are:
- You are Incentivized Not to Sell it Through Steem Power;
- You have liquidity restrictions such as savings and, again, Steem Power;
- The platform is growing and developing;
- The token is getting more attention lately;
Among others.
Now, with SBD not higher than STEEM, people will need more rewards in order to buy STEEM Power, and as such they will have to spend more and more to get it.
It becomes rarer, so supply and demand. It will grow. The harder it is to get Steem Power, the higher the price will go.
As such, this marks the beggining of the growth for STEEM, in my honest opinion, though I'm far from an expert.
Only time will tell.
Did You Stock Enough SP? I Sure Didn't!
If SBD keeps going down, it will be harder to get SP... so the question is, did you power up enough? Did you manage to get enough SP?
Well, I certainly wish I could have gotten more when I could buy 2 Steem per 1 SBD, that one is a sure thing.
I'll conclude the article by telling you that, if you're a newbie, you should still power up all you can, because the difference will only become larger with time, and there will be a time in which 1 SBD can only buy 0.01 Steem and so on... so grab it now while it is still a great bargain.
This is my advice, but I'm not responsible for your decisions, and it is only my opinion - again, I know nothing, if I did I would be rich, and I'm certainly not.
Just consider these words and think about them on your own.
Cheers!
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I haven't powered up with SBD. I've been using my SBD to cash out and buy other alts on Bittrex and I use a few to pay bots. I'll just hold the Steem I have now and "earn" new Steem. I like diversifying and SBD has allowed me to diversify.
Well, you have a lot of Steem by now so the rules don't apply to you :p I wrote this mostly for newbies.
With steem overtaking sbd in price, would it be advantageous taking 100% steem payout instead of 50/50?
NOPE... I am making a post NOW that explains this, but in short, you get SBD like it was $1 U$D, and in amounts that "equalize" with STEEM. If Steem is $6, you will get 6 SBD with a 50/50 reward. You can then use this 6 SBD to grab 6 steem. If you use 100% payouts to power-up, you will get 2 steem. The system sees 1 steem @ $6 as equal to 6 SBD, regardless of SBD prices. It was REALLY CRAZY when I was getting 10 SP for 1 SBD, I Loved It! My article comes out tomorrow... I will link Max's article here, and resteem.
I'm hoping Max will resteem and link back for me, once I have a link LOL ;)
Here it is: https://steemit.com/steem/@underground/we-have-reached-parity-and-passed-it-so-do-i-keep-powering-up
Hi @underground, QUESTION: I have post payout set at 50/50. On my latest post I got $94.42 in author rewards. This was split SBD 47.21 and only 8.22 Steem. If they are in parity, why is the STEEM payout 6x less than the SBD payout? Why am i not getting SBD 47.21 and only 47.21 Steem?
the system sees STEEM as worth $5.74 so it awards 8.22 steem (8.22x5.743309) so the numbers work, 8.22 steem = $47.21... The system also stills awards 47.21 SBD because it is presumably pegged to the U$D, so you get an "Equal Payout" in SBD... but wait! SBD went a lot higher, so this is a temporary "BONUS" or rather, a Glitch in the system. I bet they "fix" this in HF 20, and SBD rewards will be adjustable according to market value. So Take Advantage of it while you can! HF 20 is still being worked on as far as I know. Good Q, Colin!
Wow, I have looking for answers on Steemit all day. That explains it very well. Thank you, thank you, thank you
it giving more sbd in this case isn't much of a glitch in my opinion, it just provides a way to stabalize the share prices into higher trading values afaik its not pegged down to a dollar its only pegged to not drop under a dollar, its only a way to measure a relative value of capital and shares, and it does that quite accurately even considering rewards, since shares are now handed out in a higher degree of scarecity when while they were worth 3 times less than sbd it brought the reward quantities closer together, and as that drifts apart the value drifts together, bringing steem up and sbd down and permanently making both relative sides of the market worth more to the outside world, creating that rising trend in combined value we see now.
hi
@underground Got it. Looked into payouts again and how quickly I forget. I've figured it out (again). Here's an example: say the payout that shows is $12. 75% goes to the author and 25% goes to the curators, so the split is $9 and $3, respectively. The $9 payout to the author is split 50/50 in SP and SBD, $4.50 each.
Since the SBD was originally pegged to $1USD, you receive 4.50 SBD and $4.50 worth of SP. Assuming the avg price of STEEM was trading at $6 during the earning period of your post, you would get 0.75 SP (4.50/6). So the final payout you would receive from the post is 4.50 SBD + 0.75 SP. I think there are other factors that go into the final payout numbers, but this is general idea of the payout structure from my research.
@colinbrazendale If SBD was trading at $1USD as it was intended to be, you would have received 8.22 SBD and 8.22 STEEM, but since SBD is trading around $6 you are actually making more in USD than originally intended. Assuming a $6 price in SBD and STEEM, your approximate payout for the post in USD is around (47.21 * $6) + (8.22 * $6) = $332.58.
I have been watching this too and expect SBD to go down to $1 USD. I wasn't sure what the effect on Steem would be but I hope you're right!
Great post and very wise words, it was good while it lasted. Thanks for sharing.
Agree... that price difference will be missed!
Thanks for this well written and insightful article. This is info that I haven't found on any other blog or channel. Are there any tools you can recommend to us that allow one to gain more insight into what Steem is doing?
I don't see any tools that enable you to see what the market is doing, you can hear what fundamental analysis like me think or technical analysts like @haejin say.
@nzfxtrader If you're looking for tracking price action, I'd recommend tradingview.com
YES, I've been following your (and of course there were some others...) advise and have, without checking rates, bought SP for my SBD! I wasn't even having SBD when you still could by 2 STEEM for 1 SBD, so I was late to the game anyway, but I have bought SP while it was still a bargain (and will keep on doing so...)
Thanks for writing clear pieces, you're definitely part of the reason why I at least have been able to build 'some' SP while I still could :-)
That means a lot, the fact that I'm helping :)
I'm glad to see you again here in my comments section and that you liked the piece.
Will see you around! Cheers!
Here goes @spiritualmax again!! Super stuff my guy, as always, enjoy reading and learning from your posts... stocking up that SP while we can bc, like you said, it's only going to get tougher from here on out
Yeap... in a year or so people will have a tough job even getting 50 SP without investment, so the more you can get now the better!
@spiritualmax your energy here in gaining perspective and sharing it is very much appreciated. I am one of those you advised and immediate took action to correct my previous choice. I am grateful for your influence on this community with sharing what you are passionate about, for we are expanding into this "newness" together!
This is great content here and it is helping me tremendously, very blessed for us to be connected. Just like you said in the article, you have met many on here and that speaks volumes to who you are!
Happy New Moon my friend and hope we physically can connect one day too!
Thank you for taking the time to comment and I'm glad you feel that way my friend.
Who knows what life has in store for us, maybe one day we'll cross paths.
Glad to see you around here!
Cheers
Another great read. I noticed the 1 = 1 myself. Today I was finally able to reach the 500 SP, which is worth a little celebration. Let's see how things turn out over the next couple of months, but I feel like there's a lot of truth in what you're saying here.
Saludos,
Vince
I still couldn't reach 500 SP, but my goal is 1000 to complete the 1KSP program.
It is getting harder and harder to build up, but once it is done with Steem prices climbing we'll both be well off :D
Cheers Vince!
You're doing great buddy.
I'm not that goal oriented, but I try to enjoy the process as much as possible.
Have a great day!
your bro from another mo
You were smart to power up! I did half and half, I had JUST gotten s crypto wallet to start collecting some crypto so I kind of went nuts.
I do hope that SMT release will pump sbd up again, and hopefully before Steem rises more but we will have to see. I may hold on to my sbd in anticipation for this but only if its low enough to justify not buying crypto. Once my crypto goes up, I’ll be back to power up!
Yeah, only time will tell... just the market being the market here.
I'm currently taking a little slice out of the SBDs to purchase EOS.