In this post I will demonstrate why taking a 50/50 option is currently better than receiving 100% in Steem Power.
I’m not suggesting withdrawing your investment away from Steemit, rather, I’m saying you can increase your Steem Power by taking the 50/50 option. As you will see in this post, the difference is currently significant for the effort required.
This morning I received a payout for a post. My payout setting is 50/50 so I received 12.463 units of Steem Power and 30.408 units of Steem Backed Dollars (SBD). This was based on an author reward of 60.8 SBD so 50% (30.4) was paid in Steem Backed Dollars and the other in Steem Power.
Now, with my SBD, I can transfer them to Poloniex and the value of my SBDs on Poloniex is currently $58.97 since one unit of SBD is worth $1.94 at the time of writing.
Now, what about my other 50%, the Steem Power allocation of my reward. This seems to be allocated assuming the value of SBD is worth $1 so it allocates the number of units of Steem that you could buy with 30.4 Dollars, NOT 30.4 STEEM BACKED DOLLARS. If the Steem Power allocation was based on 30.4 SBD, I would have received 58.97/2.27(current price of Steem) or 25.97 Steem Power.
So, what if I had elected for the 100% Steem Power option? Well then the total allocation of my reward would have been based on the assumption that Dollar/Steem Dollar exchange rate is 1:1. I would have received 12.463×2 = 24.926 SP.
A good way of looking at this is to compare the total value (in US dollars) of the reward under both options.
Option 1 (50/50)
- Steem Power: 12.463 = 12.463*2.27 = $28.29
- Steem Backed Dollars = 30.408 = 30.408*1.94 = $59.13
Total = 28.29+59.13 = $87.42
##Option2 (100% Steem Power)
- Steem Power: 24.926 = 24.926*2.27 = $56.58
- Steem Backed Dollars = 0
Total = $56.58
So, option 1 gives me $87.42 and option 2 gives me $56.58. In other words, you will receive a payout of 54% higher under the 50/50 option right now.
This all depends on the market price of Steem Backed Dollars.
When the price of SBD equates to dollars, there will be no difference. If the value of SBD is less than dollars, option 2 will be more profitable.
Thank you for reading.