RE: Steem Prices Rising And You - Not So Awesome (SBD, Steem, and Steemians' Wallets)
It's possible I got some things wrong here. I'll explain what, why, and how it may affect things. If anyone has confirmation or corrections for what is posted in this comment, I'm all ears.
I assumed that the number we see in pay-out next to posts is actually mediated by "Steem Power Tokens," so if say, you have 100 "Steem Power Tokens," your vote will be worth "$100", which could then be worth more SBD if its prices rise, but give a constant value of SP, based on Steem's price.
But of course, Steemit likes to keep things obfuscated. The real currency in which votes are measured is VESTS. And the worth of an upvote in a way we can track (the $ figure) is the value of those VESTS in Steem, which does vary when Steem's price changes.
So, Steem goes up, what does it mean to us? It means the $ value of posts will go up. Of course, because the value of Steem is calculated over a 3.5 day average, a spike that goes down immediately after won't help you much, and even if the spike up becomes the new consistent value, you'll need to wait 3.5 days for the value to fully affect posts' payouts.
So, Steem goes up 100%. The payout of posts also goes up 100%. Let's look back at the situation and go step by step:
Current Steem value: $2.5 USD. Current SBD Value: $5 USD. Current post author payout: $100 (Steem numbers).
What do we get?
We receive 50 SBD, worth a total of $250 USD.
We receive 20 Steem Power, worth $50 USD, which we can't translate to money easily.
Double Steem Situation: Steem value: $5 USD. Current SBD Value: $5 USD. Current post author payout: $200 (Steem numbers).
What do we get?
We receive 100 SBD, worth a total of $500 USD.
We receive 40 Steem Power, worth $100 USD, which we can't translate to money easily.
If this is indeed the case, then Steem doubling in price does look like it's double the rewards for us, right? Well, I do want you to look at this post by @eonwarped. Steem's price doubling does not increase the amount of raw Steem out there, because we receive it in the form of SP, but it does double the amount of SBD, which in turn, increases supply, which should lower its value. Furthermore, if SBD ends up too common, it won't be printed at all, and we'd only receive SP (consult this post. And to reiterate, how much SBD gets printed is entirely dependent on the price of Steem, not SBD, so if Steem becomes "valuable" enough, you'll have to rely on powering down and it retaining its value
It's SBD being too common relative to the market cap of STEEM, and this is important. In your example, there's no risk of this SBD being too common, because the market cap of STEEM has increased, increasing all ceiling caps for SBD. So this is a good thing. The blockchain is willing to print more of these "debt tokens" because it is backed by a higher market cap.
So you see, the double steem situation is even better for the debt cap. More SBD ends up being printed but still it is all according to plan.
I'm more asking which situation is correct, the one in my main post, or the one here. Caveats can come later.
The main caveat is that, well, if the "correction case" is correct, SBD has an even larger downward push power when Steem rises, due to more of it being pumped out, while Steem's rising count is chained in SP.
Aha... I completely missed the part of the main post that is misleading, about "getting less SP the higher it is". The main point that was missing is that rewards start from STEEM, not from the $ amount displayed on the UI, and that is fixed and affected solely by SP and votes.
So the comment in this thread is what is correct. STEEM price doubling -> rewards doubling.