An opinion post that doesn't need to get paid. None of this is financial advice. If you haven't read about Deathwing's post Decreasing HBD APR and Posting Rewards and Increasing the Importance of Hive Power (HP), you may need to read that first before proceeding to read further about my ramblings on the suggested changes. One of the shortest posts I made for the year.
Decreasing the 20% APR on HBD seems like a good move, considering this amount of return for a stable coin seems too good to be true.
If you're not an active shitposter, you're missing out on the Hive inflation as this favors the active authors from the author reward pool. You can get around 10-11% APR from automated curation in HP but what does that even mean when the price of Hive sits at 0.288$ (at the time of this writing). That's like 0.028$ worth of Hive per year per Hive (hypothetically).
If you had 1 HBD staked, you get 0.2$ per year. So in order to get even with these rates, you need around 3.472 Hive for every HBD just to match the income generated by passively staking HBD. If the price of Hive gets to 0.15$ per Hive, you would need 6.667 Hive just to beat the returns 1 HBD gives at 20% APR.
There was a mention about decreasing author rewards with 10% going to Hive's inflation. Authors get 10% less for their content and that sounds like it sucks but 10% is a small change for those earning with an average of 1$ posts (50% goes to curators), the ones that would really see a marked changed in their income would be users that rake in 2 digit income on average.
Well that sucks because that would reduce the number of enthusiastic authors to share their content here. But how much value is the content of an average person contribute for the general ecosystem? I know my shitposts don't entice people off the platform to sign up and join Hive.
I'm pretty sure if I made an review post, or talk my travels, no one else outside the platform would give a fuck. But if I started writing about NFTgames and how it generates income here and people can earn extra for shitposting about those games, then there's a better chance that people outside can get motivated to sign up.
12% APR on HBD is still good despite the decrease. For people dependent on their Hive income living in developing countries and struggling with inflation, this is an advantage having a Hive wallet. My country's inflation rate hovers around 4.7% versus the USD, and if HBD is pegged to USD, I'm really getting more returns but this is just me thinking over possibilities that haven't yet been implemented.
Also stressing the importance of using stake HP for governance. These changes are decided by the top 20 witnesses people voted to make the calls where this blockchain is heading. If you like or dislike the changings, perhaps consider casting your votes because it matters.
Why would people want to buy Hive when they can get it for free?
The question that keeps popping up whenever I think about author rewards. If you got an take on the question quoted above, share them under the comment section.
If you made it this far reading, thank you for your time.
Posted Using LeoFinance Alpha
Even before the witnesses start signaling a decrease in the APR of the HBD, I have already started switching from HBD to HIVE, because if the hive doubles the price, it is almost 5 years of 20% of the APR of the HBD.
It's not 5 years, the 20% was a recent changes, it was a gradual rise from 3, 5, 8, 12, 15, 20 over the course of Hive's existence starting in 2020.
you misunderstand me
I wanted to say, if the HIVE go up and go to 60 cents, it's almost the same thing as leaving it in savings for 5 years with 20% APR
If 1 HBD at 20% APR will generate 0.2$ yearly
and 1 Hive at 0.6$ averages around 10% APR, that just means 0.06$.
If you have 2 Hive at 10% APR and valued at 0.6$ that's still 0.12$ yearly
Now why would you park your capital on something as volatile as Hive when you can generate that in a shorter period of time and even more if within the same period of time as leaving it as HBD? Is there something I missed here or I missed the mark again?
I don't know about you 😂😂
But I haven't gotten any hive reward from my post even though it's listed as a possible reward.
Only way I've gotten hive is through tips, delegations of HP to hive sharing accounts, rewards from competitions and me buying em.
Plus I think the importance of HP is clear enough for someone who has stayed at least 3 weeks on here, then you need hive to get HP (if you haven't enough HP to post and earn more.)
Hence you buy hive.
Plus isn't buying hive also good for the Blockchain?
I haven't read death wing's post on why HBD APRs percentage should be reduced, so I'm gonna read that and come back...
Prolly..😂😂
It is but if you think of the number of accounts/people that actually do, maybe the price outside would change. I'll circle back to the question, if you were a prolific author and well rewarded here on Hive, why would you spend extra money to purchase Hive when your holdings can be freely handed out to you by other people without you risking anything?
I guess there's no reason to buy then😂😂
Why waste money on something you get freely
It's a good question, but new people being onboarded are not going to know about the change in APR so that doesn't really matter - as for those of us here now, I don't think it's such a bad thing but I can possibly see people not being too happy about the 10% decrease to author rewards. However, side this up to any other blogging platform and you're still getting paid to write here - not like any other social media so I don't think that anyone can actually justifiably complain.
As for your last question, well at the price Hive is now, every little bit of extra income I scrape together, I put into an exchange and buy Hive. It's not here staked yet, but I still think it's a steal at the current price.
The ones who are greatly affected are those authors that earn a lot from a single post. Not the bottom feeders that rake in 0.1$ per post which half of that value is shared to curators. I'm not going to lose sleep if I knew 0.01 Hive got redistributed to other stakeholders. But for people who are used to generate high payouts per post, that takes a significant amount of their monthly income which their life may be dependent on.
It took me a while to grow out of the freeloader phase wherein I need to have some skin in the game to care about what happens here. Then what followed was getting interested in governance and developments. Habits became more than just shitposting. I think majority have less motivations to buy Hive and increase its value if they are freely handed the value by current bagholders who take in more risks when they can just exit without the risk.
I personally am against the reduction of APR in HBD but they do have a point that it might not be sustainable in the long run. but why would they reduce the posting rewards? I already have a hard time getting upvote in my post. haha
I think of the posting rewards a nerf to those reliant on posting rewards for income, and an upgrade to those that stake their Hive because they're in it for the long haul. Yes, it sucks because whatever quality content people splurge out gets less but the people who help reward the authors are also authors themselves and bagholders taking in the risk long term. 13 weeks power down time isn't a pleasant experience.
I think the solution is given as a choice to the author by way of sending a percentage of their reward to @null that way there is less amount of hive in circulation. But then again any Tom Dick and Harry just had to post and get that give we all so want.
I could be blowing air here.
I'm not even sure if there was a problem that people wanted to provide a solution to begin with. If this was a means to put more value on Hive, the suggestion to reduce author rewards and redistribute that value to the HP staked holders was already good. If the argument was about demotivating authors to produce content, I'll raise an eyebrow to that idea and ask which authors and how many are actually generating content that drives people to be onboard? It only takes 1 shitpost about this nftproject here and hundreds could come and play the game, invest their time and start a community, that post just generated new accounts and money in whereas 1 shitpost about someone's life story earning high but isn't enough to drive people to sign up is viewed as valuable. I'm not really getting it. What is clear to me is putting in more incentives to people that actually hold Hive for the long haul.