What Is Hive Backed Dollars (HBD)?
HBD is the native stable coin on the Hive blockchain, built to hold $1. Hive offers interest rates of 20% APR on HBD savings. While this makes HBD Savings a superb opportunity and a great option for anyone looking for the best way to earn interest on crypto, especially compared to interest rates offered on USD balances by traditional banks, I want to talk more about the real value of HBD.
Hive with HBD Savings gives you control over your asset, high-interest rate, a fast withdrawal period, and is built to hold $1, so it is an incredible option if you're looking for a savings account. It's unbeatable at this point with these impeccable and outstanding features and benefits.
If you save $100 per month for 5 years, you'll be the owner of almost $9000 due to compounding. I doubt that you have been offered that by your traditional bank. And if that was not good enough, Hive also gives you numerous opportunities to earn money from many different things on the blockchain, so you can start your savings account with the money you’ve earned on Hive.
I doubt that you'll ever stumble across something that awesome again.
That being said, HBD is definitely something that can be changing lives for people all over the world, in various ways, and I want to share some details from my own life and how HBD can- and will have an impact on mine.
My Living Expenses
I live a rather normal life, having bills to pay and various expenses each month. A lot of people I know are living paycheck to paycheck and due to certain circumstances, I've been doing that as well from time to time, for several years. Let's take a look at my living expenses and some of my fixed expenses each month.
I live in Sweden (with SEK as my currency) but I will use USD $ in this table.
| Rent | Internet/TV | Phone Bill | Student loan | Insurances |
|---|---|---|---|---|
| $394.85 | $99.96 | $24.99 | $147.44 | $49.98 |
I have a monthly salary of ~$2300 after taxes, currently living in a small, cheap apartment and the fixed expenses I have shown you above equate to $717.22. This leaves me with $1582.78 per month. The majority of my colleagues pay up to $1199.54 per month in rent alone.
I have not included all my expenses for personal reasons though, but I can tell you that I have other fixed expenses of roughly $500 per month. Then we need to look at other living expenses, such as groceries, clothes, and things like that. After paying my fixed expenses each month, I have roughly $1082.78 left in my bank account.
Out of those ~$1082.78, I also need to put something into my savings account, as “that’s what you’re supposed to do in life”. So, to make things easier, let’s say that I have roughly $782.78 left in my bank account after doing these things. Add in another $100-$200 for this or that I might not have included and we’re quickly down to ~$550.
That’s what I have to live off of. That’s what I need to buy food and groceries for, clothes, going to the movies, having a beer or twelve at a pub or whatever. While this might sound like a decent amount, things aren’t really as good as they might seem.
More Living Expenses
These are some of the prices for some random stuff at “Ica Maxi”, a supermarket that definitely counts as one of the most favorable stores to buy at in Sweden, in terms of prices, supply, and things like that.
1KG/Kilogram = 1000 gram. I will use the price for kg. The price for milk is 1 Litre.
| Meatballs | Potatoes | Banana | Lemon | Carrots | Bread | Coffee | Butter | Milk |
|---|---|---|---|---|---|---|---|---|
| SEK 72.95 | SEK 22.90 | SEK 20.09 | SEK 39.50 | SEK 17.90 | SEK 34.39 | SEK 108.78 | SEK 86.58 | SEK 10.40 |
| USD 7.29 | USD 2.29 | USD 2.90 | USD 3.95 | USD 1.79 | USD 3.44 | USD 10.87 | USD 8.65 | USD 1.04 |
These details are taken from Swedbank. Swedbank AB is a Nordic-Baltic banking group based in Stockholm, Sweden, offering retail banking, asset management, financial, and other services. In 2019 Swedbank had 900,000 private and 130,000 corporate clients and a 60% market share of Estonia’s payments.
The information is in Swedish, but I’ll give you a quick translation to give you a gist of it:
Mat = Food.
Kläder = Clothes.
Hygien, hälsovård = hygiene, health care.
Sport, fritid = Sports, leisure.
Lokala resor = local travel.
Avgift till arbetslöshets-kassa = Contribution to unemployment fund.
Försäkring olycksfall = Insurance accidents.
Försäkring hem = Home insurance.
Hushållsel = Household electricity.
Tv, telefon, internet = TV, telephone, internet.
Förbrukningsvaror = Consumables.
Betaltjänster = Payment services.
Bil = Car.
Totalt per månad = Total per month.
Totalt per år = Total per year.
The first column (Ensamboende) is the costs for a single. Second column (Married, Partners). The other columns are for Kids. <1 year, 1-3 years and so forth.
So, taking a look at the first column, if we add everything up we have a total of 11480 SEK per month. That's 1147.56 USD $.
- Remember what I said above about having ~$550 left in my bank account?
I did not include costs for electricity, car, and other stuff from this list. I also did not include the 285.89 USD for food that you see in this list, even though I gave you some examples of what the food prices are in Sweden.
As we've already used Swedbank as a reference, we can take a look at the interest rate they offer before going into the real value of HBD.
The interest rate depends on the binding period, which can vary from three months up to five years.
- The minimum savings amount is SEK 5,000 ($499.81) for a private person and SEK 50,000 ($4998.10) for a legal person.
If you go with a binding period of 3 months you’ll get 0.10% interest. That’s right, 0.10%. 6 months is better, currently sitting at 0,63%. This goes on and on all the way up to 5 years, where you’ll earn 2,34% interest.
The Real Value Of HBD?
If I were to invest $500 (the minimum savings amount Swedbank requires), I would end up with $506,20 after one year on Swedbank. In 5 years, my savings on Swedbank would be up to $552.04..
- HBD Savings would be:
It is easy to see that HBD savings can- and will change lives in many different ways. It's up to each and everyone to do what they feel is best, but nothing beats HBD savings in terms of interest rate.
HBD that is built to hold $1 is absolutely fantastic in its own ways, but I can’t use HBD in Sweden directly, so I need to cash out those tokens and convert them into FIAT before I can actually use them. This comes with various fees. Conversion fees to sell HBD for BTC or other cryptocurrencies I can withdraw. There's also a fee when sending them to Coinbase for instance, before I eventually send them to my Paypal account. From Paypal to my bank account doesn't involve further fees though.
I could skip the Coinbase to Paypal option and send money directly to my bank account from various exchanges and probably reduce the fees a bit. But that is not all..
- There’s also a 30% tax on crypto in Sweden.
I haven’t tried to look at these things in-depth so I might be somewhat off in my guesstimation, but if I were to cash out HBD to my bank account, going through these steps and wanted to have $100 (1000 SEK) in total, I would most likely have to pay up towards $175 in total.
That being said, finding out the best way to convert tokens into FIAT, and minimizing various fees is something I recommend everyone to do when they are about to cash out.
How About An Extra $XXX Per Month?
With all these things said, and covered, there is one more thing I want to show you: Hivestats. By entering my username I can easily track my progress and we can see that I have earned 283.36 HBD in the last 30 days.
I mentioned this earlier in the post as well, that Hive gives you many different opportunities to earn money. You can be an active post-producing author who receives rewards for contributions, a curator who earns by curating other people's content, you can play any of the different blockchain games, and so on. With communities like LeoFinance, you'll be rewarded multiple tokens, which you can easily power up or trade for other tokens, which increase your overall token income.
What you do, how you do it, and how consistent you are is what will eventually determine the amount you earn. That means, that you decide how much you want- and are going to earn each month.
- How does 283.36 HBD per month sound?
According to the list, I showed you earlier, that is 25% of my total monthly living expenses, or enough to cover my food and almost the monthly costs of having a car.
That Is The Real Value Of Hive Backed Dollars (HBD)