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RE: Steemit Vlog #4: Steemit 101 - Steem, Steem Dollars, and Steem Power

in #steemit8 years ago

After you elect to "power down" X steem power, a week later X/104 IOUs (Steem Power Units) are removed from your Steem Power account and you are transferred X/104 Steem. Those X/104 Steem will be worth whatever the market rate for Steem is in the present moment. So yes, if you power down and a week later the value of steem plummets right before you are going to receive your Steem payout, then yes the Steem you receive will have a low price. BUT if 3 days later the price of Steem spikes, then obviously the "cheap" Steem you received three days ago will now be worth whatever the new price is. For steem power the time at which it is converted into Steem is IRRELEVANT. To understand this, think about Steem Dollars. For Steem Dollars, the time at which you convert IS relevant. For example, let's say Steem is having a bad day and it is trading for 10 cents. That means that if you cash out 1 Steem dollar, the Steem system will give you 10 Steem. If the next day the price were to jump to 50 cents, the Steem you received yesterday went up in value 500% and you made a very good profit. And if you were to cash out another Steem Dollar on that day you would only receive 2 Steem. None of this happens when you are dealing with Steem Power because 1 unit of Steem Power is equal to 1 Steem. Price is irrelevant.

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