The great thing about Steem is that it constantly challenges our thoughts and encourages discussion and healthy debate. One area which I have had a huge change in thinking recently is my strategy around powering up to Steem Power.
I have been following @tarazkp who speaks alot about the benefits of powering up. Powering up is not for everyone, as we are all here for different reasons and have different goals - today I thought id share some of the pros and cons of powering up.
Liquid versus illiquid funds
Although there are three different currencies on Steem, for simplicity we can narrow them down to liquid, i.e easily turned into cash and illiquid, i.e. less easily turned into cash. With this in mind:
- Steem and SBD are liquid funds
- Steem power is illiquid
Steem and SBD have different values on the market but can easily be traded for Bitcoin and then for FIAT. Steem Power is 'vested' and takes 13 weeks to power down to liquid Steem.
Benefits of holding liquid currencies
Because of the transparent nature of Steem, from time to time I get nosy and check in people's wallets. Some have a massive amount of liquid funds and the minimum amount of Steem Power. Some of this comes down to miseducation - why would you want to lock away your money, and not be able to withdrawal it for 13 weeks??! I know until being on here 2 months I had nearly 40 SBD sitting there not being used - now I have around 2 - 5!
I have read stories on here about how people live on the money they make on Steem - in this case it seems that having liquid funds is necessary.
One of old saying around investment is to ‘spread your risk’ - so one possible reason for holding liquid funds could be to trade some on the open market and become invested in a wider range of cryptos (of you aren't in the position to invest your own FIAT).
The only reason I hold liquid funds currently is to purchase upvotes/resteems - I don't spend alot on these! I also alway keep a bit spare incase I want to run any competitions (such as giving away @steembasicincome shares).
Benefits of powering up
I essentially see powering up similar to investing money - when you invest money you get extra benefits (in the form of higher interest rates). Similarly, when you power up and ‘invest’ in Steem Power, your upvote becomes worth more, and you can also earn greater curation rewards. If you power up and want a chance to earn some passive income you also have the option of delegating your Steem power to a bot or a project.
Powering up takes a bit of a ‘leap of faith’, and also a change of mindset - you need to think about Steems long term future. If, like me, you see real value and success for the future of Steem, then powering up might be a good option.
Also, for me I don't need any of the money I make on here so if I power up and Steem crashes then it isn't the end of the world for me
I would love to hear everyone's thoughts on this - are you powering up or holding liquid funds?
The Steem Power I receive I obviously keep. The SBD and Steem I earn I usually invest into Bit Bots, which means that I will receive half of that investment as steem power later down the road, meaning that sooner or later, everything I make ends up being steem power eventually.
That way, I can also give people upvoting me some nice curations rewards while also farming some rep. Probably not perfect, but it has been working out decently for me.
Sounds like a solid plan to me. I dont get to caught up in what my rep level is. Doesnt mean alot to me. As you said you can just increase it by paying for votes - loads of people have been on here just a few weeks and have rep scores of 60+
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I powered up everything, but now I'm powering down one fifth so I can send it over to trade in 13 weeks when the powering up has finished. I was worried about someone taking my account and all my steem, but because it takes 12 weeks to power up before you can move it then I think steem is safe. I did do bots for a while but have noticed that after I stop using them the upvotes go down...
Am powering up fine. I have a long time view about steem and so am powering up never to power down as long as steemit exists. 😁
In for the long term! 😄
If you watched social network, you will know Mark Zuckerberg had the option to cash out for a million, but he powered up, held on to the equity and became a billionaire.
We are only two years into this project. Most projects are not accessible to retail until the institutions have got in and then IPO. You have the opportunity to be part of a project at the ground floor, I wonder how many people realise this?
I think people selling steem/SBD to "live off" will feel like that guy who paid 10,000 BTC for pizza... Lots of regret.
I can't predict the future, maybe they are right... But I doubt it
@kabir88
I haven't watched it but heard that it is good so maybe i will ☺
Id say loads of people have no idea how big Steem and other cryptos have the potential to become - alot on here just see this as a quick cash grab (completely the wrong attitude to have in my opinion!).
Haha good analogy with comparing it to the pizza guy - he must wake up every morning with that 'what if' feeling!
Haha, I might right a blog called "Don't be that bitcoin pizza guy" 😂😂😂
Good post i too power up, it is also much safer. You hear of hacks all the time, when you power up your steem/steem power would take 10 weeks to be emptied and you earn interest!
I resteemed this post!😎
I am blessed in that I do not depend on earnings from here to live; actually, I could lose it all and it would not impact my lifestyle. My strategy is to continue gaining SP by earnings and buying STEEM to power up. I woukd eventually like for this to be stream of income for other ventures. SBD is the only one that has me thinking as I am not totally convinced on bid bots. I am leaning towards using it to buy more SP.
Очень интересная статья.
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I am going to power up 100% of my earnings until I reach a decent amount of SP.
The moment I get some SBD I sell it for STEEM and than I power up. Having only 90SP right now this seems like the best option for me.
@conradt
I am here for the long run. Will surely power up after I gain some more steem power.
I am here for long run i will defineny work hard and increase power
Great insight!
I am thankfully not in a financial position where I need any profit made on here to survive. I see my blog as a needed creative outlet, and any profits made a nifty bonus. I have been powering up most of my profits as a longterm investment into SP. I see Steemit's potential as well as the steem blockchain's great potential for growth and widespread use.
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