Steemit 101 - Why are your potential payouts decreasing over time?

Welcome back to steemit 101.

In this episode we talk about the reward pool, how it works and why your pending payouts decrease.

Steem price on the market

Obviously the price of Steem on the market is going to affect the value of your posts and pending payouts, if Steem was worth $2 one day and you had $2 pending payout then all of a sudden the price of Steem crashed to $1 then the value of your post is going to go down with it.

It's still about the whales

I'll try explain this in as simple a form as possible. When you post an article and someone upvotes it your post receives rshares and Steemit then gives you a value based on how much Steem Power that person has.

Let's give an example.

• The reward pool balance is 100 steem for example

• Steemit calculates that you get $1 per 1 million rshares. Which results in a balance of 1 billion rshares

• Minnows vote and the calculated rshare per $1 works and theirs plenty of Steem for everyone.

• If whales vote more than usual the number of rshares demanding for payout exceeds 1 billion so that initial estimate of $1 per million rshares is void.

• Steemit adjusts the rshare calculation so the reward pool doesnt deplete.

• Now it's 2 million rshares per $1 payout so your pending payouts adjust accordingly.

It really depends on how the whales upvote, their upvotes are worth enormous value in rshares and if the amount of rshares demanding payout exceeds the initial estimate then it has to adjust or the reward pool will be empty and the entire system breaks.

Simple explanation

• A man has 10 oranges.
• he has been told to share these oranges between 10 people equally.
• he calculates everyone gets 1 orange.

Simple.

• The first 7 arrive and are handed their oranges.
• The next 2 people have families and need more.
• Those 2 people get 2 oranges so the man has to go back to the first 7 people and take a little back from them.
• The last person has a baby so they will need 1.5 oranges instead of one so the man has to go back to the families and take a little back then go to the single people and take even more.

Take it that the man caluculated on the basis 10 minnows needed oranges.

When they arrived 2 were whales and got an extra share meaning everyone else lost a little of what they were initially being given.

Then a Dolphin arrived and they had to take a little back from the whales and more from the minnows.

I hope you all stayed with me and understand what I was saying?

So now when you see your potential payouts decreasing over time you now understand why....I hope. 😂

This was just a basic explanation and I hope it will stop you sitting there tearing your hair out wondering why you got a whale vote and waiting on a $10 payout and by the end of the week you get $8, It's all based on maths.

For more help blogs check out:

• Upvoting
• Payouts, Steem dollars, Steem power, Steem
• How to Power up!
• Using Markdown to liven up your content
• Introduce yourself!
• Use of Tags
• Cashing out Steem into your bank account - Part 1
• Cashing out Steem into your bank account - Part 2
• Interacting with your viewers
• Writing posts and plagiarism

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