Investing/Trading versus Content creation: what is the best way to live on STEEM ecosystem (e.g earning Steem or TOKEN like LEO or PAL).

What is the best way to live on STEEM ecosystem (e.g earning Steem or TOKEN like LEO or PAL). For example, earning $50 a day from your 50K Steem/SP. You have to invest around $12.5K to buy Steem or Tokens like LEO or PAL to live of Steem ecosystem at current price.

Yesterday, I was answering @whatageek's question on how to earn $20-30 form 25K Steem power (SP) with few hours of working. From his blog and answering his question, I found the idea's for today's blog: How to earn decent amount of fiat say, $50 for your 50K SP in the altcoin bear market. The blog is also based on one of my previous blog.

Best skill in crypto is to know to when to sell them and when to buy back.

Imagine selling 25K Steem even at half the ATH price ($4), and buying at 25 cents will give you 400K Steem, then earning $50 would have not been an issue with delegating them to few projects. However, one need uncanny amount of knowledge, experience and luck to pull out such endevor. My gut feeling is that large number of traders cum speculators are going for that alpha outcome. It could be one of the reasons that more than 70M Steem are sitting on exchanges but the volume sucks!

Big traders or speculators with 10Ks to 1Ms of Steem are waiting for the right moment to dump the Steem to incoming investors in the next altcoin bull market.

The most earners of STEEM are the investors/traders/speculators, period.

It is the reality of cryptocurrency, in fact any cryptocurrency. For example, whoever, bought BTC at $100 or LTC at $5, able to sold at $10K a BTC and $200 a LTC are the real winners. Even STEEM was both 10 cents and $8, theoretically, one with $10K could have bought 100K STEEM and sell it for $800K (i.e. almost a million). How many bloggers will be millionaires someday, if they just have started blogging today (without investing) even if they the best in the world. Is it not an irony that a cyrptocurrency to reward content creators has made few fractional millionaires in the last altcoin mega-bull run who are not the content creators!

However, what effort investors/traders put: learn some skills(i.e. gut feeling or prediction) and hoard some extra cash (i.e. savings through other work). They are not PoW miners or Proof-of-Brain (PoB) workers. In fact, the investor class is the richest class in the world. They control most of the world's capital. Indirectly, they control the whole economy such as our jobs, interest rates, living standard and even Steem's price.

Look at the two accounts, they were earning more than 150 SBD/200 Steem per day when Steem was more than dollar a piece: @davidding had 206K SP delegated to @minnowbooster and @spmarkets had 171K SP delegated to @postpromoter. Both of them went out before the great altcoin bear market. My rough guess is that they have sold out above $1 and waiting to buy back Steem at 15-20 cents. They will make 5X Steem form their 200K Steem which is a millions of Steem. How many bloggers or content creators can make 1M Steem in lifetime by blogging.

Therefore, when both STEEM and SBD drive up above $5, the average bloggers are earning handsomely but when they sink below 25 cents, bloggers are floundering. It depends mainly if the content creators live on the earning on the STEEM blockchain.

STEEM, even the all cryptocurrencies are in the mercy of Investors (or, traders, speculators). In fact, they have more control over blogger's living standard than the stakeholders of large company (e.g. Intel) have over its employees. If investor/trader class lose their hope in a stock of a company, the company will simply cut some jobs. Employees will just find another job with similar level of income. In case of blogger in Steem chain, his/her earning will drop 10X and there are little to no option to earn anywhere else.

In STEEM blockchain, earning drastically drops in bear market as investors keep selling their holdings gradually and sharply. However, most jobs are safe and at least, earn steady income while they are functional. In STEEM blockchain nobody will be fired unless STEEM's value goes to zero, which is very unlikely. But earning can really sink to a level that can be felt like more than joblessness.

Therefore, I personally recommend to understand and learn investing/trading along with blogging. For example, sell your STEEM or SBD during bull run, buy them back with a portion when they sink. For example, one can sell STEEM/SBD above $2, use half of profit to buy back Steem at 25 cents. This way, half of the income can be consumed in bull run and half are used for hedging. Find other skills to survive during bear market: such as stock or crypto-trading. However, it is only possible for the bloggers who are not fully depended on STEEM's earning.

If a blogger is serious about overall cryptocurrency, I would recommend to learn trading or investing. If they have save up some decent cash, you can hedge your earning on STEEM through trading during the down time. Also, I would recommend to learn about mining and staking. Mining is very risky and however, if one can manage a decent GPU/ASIC and cheap power, it is worth trying. These days ASIC mining has become expensive and risky.

Cryptocurrency is a very volatile asset. However, volatility has created some opportunities for shrewd investors and traders. And, depending solely in blogging skill in Steemit/Steemleo (i.e. one does not have at least orca level SP) for earning (living) is very inconvenient, specially, during the long bear trend. Therefore, it is recommended to learn some trading and investing or mining and staking skills to hedge some earnings if one is serious about living on cryptos.

However, it is theoretically possible to earn $50 for one's 50K SP. One can convert 50K Steem to 400K LEO at 0.125 LEO/Steem. Then he/she will have 2000 LEO VP (2.5x80x10=2000 LEO, 2.5 LEO VP for my current 5K LEO, ). With curation one can earn 1000 LEO= 1000x0.125x.25=$32 and then, writing 2 blogs per day with self-vote will earn $40. Assuming you can earn another $10 from fellow investors/traders voting, then $50 is possible.

Problem is that 50K SP power down will take 13 weeks and currently there is not enough volume for LEO (10K LEO volume per day in @steem-engine, may be possible with periodic power down of SP and buying for 90 days ) and there is not enough LEO to be sold at 0.125 Steem. And there is risk involved too which is LEO can fall much below from the buying average say, 0.125 Steem, slippage cost of selling and more LEO get staked, thus reducing the voting power.

Another scenario would be to earn Steem/SBD in passive way with 20% APR from @steemhunt or @ocdb. Then it is around 28 Steem. At 25 cents a Steem, it will be mere $7, not even close to $50. Moreover, since Steem is most probably at all time low (other than 7 cents in 2016), then selling like @davidding or @spmarkets is not even possible.

Currently, the best case scenario would be to daytrade with Steem in @binance-hot or @hitbtc, then you have to earn 200 Steem per day for $50 (25c a Steem) with 50K Steem. One only has to increase your portfolio by 0.4 % (less than 0.5%) which is quite reasonable. Even with 20000 Steem it is possible to earn 200 Steem daily on average. However, one has to understand the risk with day-trade and spend few hours a day.

However, a trading bot with 20K Steem can do the task. However, I have doubt whether such bot will succeed in the longer term, if the parameters are not tuned. I am personally interested in such bots, let me know if you know ones. However, google search returned me a nice link, I would be interested to know someone's personal experience with the bot (https://coinrule.io/trade/bot-automation/binance/steem-steem/).

I had personal experience with daytrading Primecoin (XRM) in 2013. I used to earn on average 50 XRM from my 3500 XRM for two months.

Another idea would be to manage $25K USD if you are living in US. Then you can earn $200-500 just by spending few hours in Robinhood (with $25K margin off course). Interestingly, when Steem was above $1 few months back (or a year by now), then converting them to USD and daytrading stock would have been the most interesting outcome. Then you could have buy back 25K Steem in few months at this low price! The lesson is that when Steem goes above sell some to make $25K cash from 50K Steem to daytrade during the next (altcoin) bear market.

You can earn up to $50 in EOS then buy 200 Steem with this Coinbase referral link: https://coinbase.com/earn/eos/invite/273pvq85

Disclaimer: This opinion is not a financial advice, it my personal perspective and opinion. Please seek professionals for financial decisions.

Image sources: Most images are open sourced (e.g. Pixabay, Wikimedia etc.) with Creative common license. Some images are used with due courtesy to respected owners.

Peace
@dtrade
Crypto-miner, trader and blogger since 2013