RE: Debate: There is no incentive for NOT powering down
I simply subscribed to the "Powering Up is good " logic, though have been reconsidering lately...
To my understanding, if holding in for the long term, staying powered up is the way to go. Inevitably, the price of Steem likely will rise, hence the value of keeping locked in - and earning a cut of the new Steem created while holding on.
Though, the other factor to be brought into the equation is opportunity cost.
I think there's a potential benefit in powering down, as it offers the option of investing a percentage of funds elsewhere if the potential for rewards is greater elsewhere.
i.e. When Steem was around $4, that might have been a good time to take some out via Powering Down to throw into some other cryptos. For instance, I earned 3x ROI on ETC in the first 24 hours I'd heard about it. Had I powered down, I could have thrown more down. And/or - I've been looking at investing more into Bitshares... Had I powered down at $4, I could've invested double versus now...
I've been thinking about it... Though still not well educated enough, and may wait until Steem's next wave up until it's past its first high.
And as you say, there's no reason you can't just turn around and reinvest the weekly payouts straight back into power ups.
Though, do you know - are weekly power down payouts at the official rate you'd get on an external market, or the higher rate of the internal market?
I think this has a degree of inevitability if the user growth rates and content production continues.
@spiz0r here dropped a truth bomb that I didn't even consider --
That changes my calculus a good deal. Need to to look at some models of those rates now.
yeah, SP incentives make it about 300apy right now, more like 90apy generally (now is higher becaue its the first year)... assuming the price remains steady thats a great deal. then again, a guy who powered up a bunch at $4/steem might not feel the same way.
ALso, its important to realize that powerdown doesnt take as long as you think because of the increased conversion rate.
For example, if you have 10000SP in your balance right now and you start a power down, it would probably take you somewhere around 8 months toa year get your 10K SP (the remaining year or more would be the effect of SP incentives)
assumes facts not in evidence.
the powerdown payouts are in steem, not SBD.
Yes - though the STEEM that's paid out weekly - do you know if that's at the "official" rate on the external markets like Poloniex/Bittrex, or the going rate on the internal market (which may be average 10% higher)?
I don't get what you mean... the steem is paid out in steem... there's no "rate" to it... maybe im just not getting what youre saying.
So like if you power down, say your balance is 104000 steem. The first week, you get 1000 steem, it has nothing to do with a rate because there's no kind of exchange to it.
Like the internal market is just the conversion of steem$, not steem. When you power down, steem$ never come into play. You have steem as SP and you convert it to "liquid steem"
Ah ok, yes of course. I got it now.
So if were to power down, would end up better selling Steem (if choosing to do so) on the internal market as the rate is higher...
All cleared up. Thanks.