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RE: Steemit Power Down Proposal

in #steemit • 4 years ago

First keep in mind that the example given only of the Indian banking system not of steemit.
The given example rate is annually. For 2 weeks it should be calculated as 4% * 2weeks / 52weeks = 0.154% for two weeks. and for 2 years it will be 7% * 2year / 1year = 14% for two year. So you can see the difference in return.
For flexibility issue, we have option in banking system.

  1. If we choose 2 weeks but not taken that amount back after period finished then no interest will given thereafter, but if we continue again then we receive again return without gap in that period.
  2. If we choose 2 year, but want return back amount earlier, then we receive interest on only period which we have actually lock the money with mentioned rate for that period and some minor penalty on that. Example: if we lock for 2 year and wanted money back after 15 weeks then we received 5.5 % * 15 weeks / 52weeks = 1.59% and additional penalty say 0.1% means we get 1.59 -0.1 = 1.49% return.
    This is the banking system. We can think this type of system OR any similar type, whatever can be done suitably for steemit, not exactly same. I am just agree the practical concept propose by the @steemit, that's it. Hope this will be clear now.
    I am not expert of vest, SP etc.
4 years ago in #steemit by
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     4 years ago (edited) 

    @mehta, I don't think you understood what @acidyo was talking about.
    Besides, your calculations are too simple.

    2weeks / 52weeks = 0.154% for two weeks. and for 2 years it will be 7% * 2year / 1year = 14% for two year.

    Dude, you forgot to calculate for compound interest in your equations.

    Let's imagine a 1000$ deposit at 7% a year compounded monthly (Steem is compounded much more frequently
    Year | Year Interest | Total Deposits | Total Interest | Balance
    1 | $72.29 | $1,000.00 | $72.29 | $1,072.29
    2 | $77.52 | $1,000.00 | $149.81 | $1,149.81

    Compounded monthly, 7APR will net you 14.981% over 2 years, not 14%. (Daily compounded would net 15.026%) Please get yourself a financial education.

    Do you not know how banks work?

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       4 years ago  

      @abitcoinskeptic I understand what is @acidyo is talking. I am just explaining the banking general concept for clarifying his confusion. Which i think he understand.
      Here are we just discussing agree or disagree the concept of steemit proposal not 100% right calculation. You know what i means. Hope you understand.

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