Some great news for both delegators and token-holders of M.
Delegators have received their token distribution and token-holders see the price rise a significant amount.
M News
A decent week, with returns about the same as past two weeks at around 17% APR.
I mentioned this last week, and as can be seen, the official buy price has remained fixed at 0.95 HIVE while the buyback price has nudged up, now at 0.874 HIVE. This will continue till that buyback reaches 0.90 HIVE, then both prices will rise together. The aim is to slowly narrow the spread.
I trust all members and delegators are satisfied with this. This means everyone will see some value growth and the overall fund remains fully funded and close to its asset value per token.
We now have a modest-sized DCity that produces some additional income.
Also, a reminder that the delegator percentage returns are calculated on the basis of the previous week's price, plus obviously the income we generated. It is also based on the proportion of our voting SP that comes from delegators rather than from our own capital. Now, to make this a bit easier we shall publish two values: one for delegators; the other for token-holders.
The third number is merely the product of the first two weekly percentage increases and gives the true value of the distribution to delegators; it gives the true profit for that week on the assumption that those distributed tokens are sold at the new price.
I hope that makes sense. Let's have a look at this week's numbers.
Our buyback price has increased from 0.871 to 0.874 HIVE, an increase of 0.344%, equivalent to 17.9% APR.
Our distribution to delegators is 0.319%, equivalent to 16.64% APR.
Hence, total value distributed to delegators, adjusted for the token price increase, is 16.70% APR equivalent.
That value is the distribution of tokens plus their increase in market price. Thus, I hope you can see that the third calculation is hardly necessary, but I also hope it has illuminated how such calculations are done.
In the ideal situation, as M was conceived, those three numbers would be almost identical, save possibly for the third or fourth decimal place.
This week, the token price has risen more than the rewar amount. As always, such adjustments are designed so that the buyback price remains essentially the asset-backed price. Also, I'm trying to keep the official prices to 3 decimal places, really just to make them easier to read, hence the prices may oscillate at slightly above and below the distribution. Over the medium term, such variations balance out so that token holders and delegators get about the same returns.
Hive News
As Hive started as a fork of Steem, and the economic model has not changed, it is worth comparing the two reward pools: Hive has some 840k HP and edging upwards this week, whereas Steem has levelled off at about 810k SP and is now lower than Hive.
Also, taking 1 million as our whale HP/SP, a Steem upvote is worth around 42% APR, and falling, whereas a Hive upvote is worth about 25% APR and holding steady. Most users are still getting just above half of these numbers for their own upvotes due to the non-linear rewards curve, and then half again for just the author rewards. Hence, our returns of about 17% APR for this week is very good value for both delegators and token holders.
Last week I mentioned that I thought such figures somewhat puzzling, but note that the recent claims on the two chains are in exactly the same ratio as their yields. Thus the reward pool is being shared among many more claims on Hive, hence the lower yield.
Have a fine week!
Any questions, please ask in the comments below or in our public chatroom.
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