I like to join up somewhat unrelated events and see if there is a unifying narrative. Last night, a few things happened in chat and on platform that pointed to what many have been saying all along. My aim for these is to give some ideas about the platform and Steem to consider for their future here. Hopefully, it will help some develop a better plan and support their success. 

https://i.imgur.com/9rRyAoV.jpg

<h3>Convo 1: Payouts</h3>

It seems, that many do not understand the basics of how the payout works and someone mentioned this again not understanding the 50/50 Split. Considering this is a *pretty big* part of the platform and why many are here, let's take a very brief look. I am going to use whole numbers to make things easy and a little poetic licence. 

Imagine you have a 20 dollar payout after the curation portion is removed and you chose a 50/50 split. That means 10/10, 10 SBD/ *the rest* in Steem Power. This does not mean 10 Steem but is calculated on the Steem price (about a 3.5 day market average). The SBD is always counted as 1 dollar by the system.

So, if the 3.5 day average for Steem was 1 dollar US, you would in fact get 10 Steem to go into your Steem Power bank (your voting power comes from here).

You will get 10 SBD + 10 Steem Power on a 20 dollar payout.

But, if the Steem average price is 2 dollars US, the Steem Power portion reflects it. That means on the 20 dollar payout:

10 SBD + 5 Steem.

If Steem average price is 5 dollars:

10 SBD + 2 Steem

If Steem price is 100 dollars (Yay right?):

10 SBD + 0.1 Steem

See how it basically works? The higher the price of Steem, the less you will get in your payouts. This is also when you go 100% Power Up. If Steem is 1 dollar US, a 20 dollar payout is 20 Steem, but at 100 dollar Steem it will be 0.2 Steem.

*How soon do you want Steem to hit 100? How big is your wallet now? How much Steem are you collecting? How much of the SBD portion did you convert to Steem?*

Now, because SBD prices are not pegged at 1 dollar US, they have an *actual* market value (Currently about 8 US). That means the 10 dollars of SBD you got in the payout has a real-world value of 80 dollars US. Fantastically awesome and many people have taken full advantage of the prices and taken them all to market, to buy a fat pig. 

At one point, it was possible on the internal market to convert at a ratio of 1 SBD:11 Steem. Those days are gone and the ratio is now about 1:1.2. How many changed significant amounts of their SBD to Steem  when the ratio was brilliant?

This ratio reduction is because Steem has also been increasing in price and as they excitedly take the SBD, their Steem Power is gathering less and less Steem which means, in the future, they have a very limited influence on the platform as it is the SP that gives the weight. Does this matter?

Well, SBD prices aren't likely to last forever which means in the a future of high Steem prices, curation is going to be an important revenue stream for many. With only dust in the Steem Power account though, there is little influence available. 

Now, one can always buy into Steem with the returns they made on taking the SBD to market. As long as they made returns above the growth of the Steem price, this will work out 'OK' but, Steem has grown about 300  (up to 400)  percent in the last month and if the SBD prices drop back and the tap turns off, how many can buy in without a *'loss'?* These things are something to think about. 

The other thing to consider is that when the ratio was 1:11, 1 SBD had a value of 22 dollars. Wow!! The 11 Steem that could have been bought  had a 22 dollar value too, but now has a value of about 66 dollars. If you took the SBD to market, you would have to go 3x on your investments with it in the last month to get the same return. How are you doing?

Another thing that was mentioned along these lines was from a new user was 'I am poor and need the money'. He had joined two weeks ago. He was poor before Steemit too right? Converting any SBD he got to fiat is a positive gain and helps, but converting *ALL* means that his future influence on the platform is more restricted. I do understand financial struggle well but, I try to also consider the future in a hope I will not have to experience the struggle forever.

This was longer than anticipated but has a few basic things to think about (and look further into for precision) in regards to payouts and prices. The next parts will come a little later as I must rush off to work and I don't want it to be massively disjointed and still want to be able to answer a question or two or adjust the post if something is found to be incorrect.

Taraz
[ a Steemit original ]