Hive is an appreciating and performing asset.
I read investment books, I listen to investment Podcasts and I read investment articles. One concept I read in a recurring fashion is the categorization of assets as appreciating assets and appreciating performing assets.
Performing Assets
I define appreciating assets of course as assets which increase in value over time. I define performing asset as one which not only increases in value each year, but also produces income each year.
Stocks traditionally are performing assets.
Interestingly, the stock market use to be mainly performing assets, as in stocks which increase in value every year, but also generate income in the way of dividends. These stocks are called dividend paying stocks and they are performing assets. Ironically in the way of linguistic play, dividend stocks were historically referred to as investments, while stocks which didn’t pay a dividend weren’t called investments, instead they were called Speculative Ventures. A nice term for gambling.
Real Estate can be a performing asset.
The most valuable asset most people acquire in their lifetime is their home. It’s no mystery that real estate is the most common way people use to become millionaires. As a primary home, which you live in, it’s a appreciating asset. The special characteristic of rental real estate is that in addition to appreciating/ increasing in value each year, they pay income.
So your home is an asset, but your rental property is a performing asset.
Hive is a performing asset
Appreciation
Hive is considered an asset because in general it increases in value each year. An important thing to remember about assets is that they don’t have to gain value every year to be an asset. Every graph of asset value over time should show a gradual rise in value as you move from left to right on the graph, but this line is usually choppy and full of ups and downs in price. This isn’t always evident in real estate, but is very evident in stocks and cryptocurrency.
####### Performance
So Hives tendency to increase in price over time is why it’s an asset. The additional bonus of Hive over many other cryptocurrency assets is the Hive you hold can generate income. On the Hive blogging platform you can Stake your Hive in a process we call Powering Up on Hive, which locks up your tokens for weeks, and creates something called Hive Power. This Hive Power can be used two ways. One is active in that it gives your upvotes monetary value or Hive value. And when you upvote a post you receive one half the value of your vote as income. Thus you can actively earn additional Hive by owning and Staking or Powering Up your Hive to Hive Power, which gives your Upvote monetary value.
In addition you can Stake or Power Up your Hive and loan out your Upvoting Power to others, so they use your Upvote Power to earn Hive and pay some of that Hive back to you. This form of income from your Hive is passive, and the loan process is called Delegation. Delegation is special because although you loan out your upvote power called Hive Power, your Hive never leaves your account, so it’s one of the most secure ways to loan monetary value that exists in the world.
Hive Savings Account pays dividends.
The Hive Cryptocurrency can be a performing asset on this Active or Passive Upvote model, But it can be a performing asset if you deposit Hive into your Hive Wallet Savings Account and it earns 12% interest there a year.
Future ways Hive can model Real Estate
Real Estate is an appreciating asset in general, and rental real estate is a performing asset, in that it earns you income. But another important way you can extract value or income from real estate, which is tax free in most jurisdictions is to borrow money against it. This means take out a loan, using the real estate as collateral or security for the loan.
Thus us a very attractive thing about real estate because the only way you can traditionally realize a profit from assets is to sell them for a profit. But because you can borrow money against certain types of assets, you can derive income without selling the asset. In fact, if structured properly this loan can reduce your taxes, if the interest paid on the loan is tax deductible.
In the future if we have a credit debt facility on Hive, like for example the MakerDao on Ethereum, which could deposit our Hive into, we could borrow our Hive Blockchain Stable coin, the Hive Backed Dollar, called HBD against the market value of our Hive. This could mean we could deposit all our earned Hive in to such a facility, then borrow against it and use the borrowing proceeds for taxes, rent, food or other everyday expenses.
Food for thought, the possibilities are only limited by imagination and coding skill. Current cryptocurrency technology would require a side chain with an Ethereum Virtual Machine to allow smart contracts of the scale of a Credit Debt Facility like MakerDao, but that’s not impossible, it just takes resources.
About 
Shortsegments is a writer focused on cryptocurrency, the blockchain, non-fungible digital tokens or NFTs, and decentralized finance for over four years.
He is also a project builder, with two current projects:
- No Loss lottery, a prize linked savings account here on Hive, which awards more the 100 Leo in prizes weekly, and which recent surpassed 5000 tickets sold.
- Easy DeFi, which creates a community investment pool allowing community members to invest in the Cubfinance DeFi project created by a known Hive Community member and whose code is audited and modeled after PanCakeSwap, the largest and perhaps safest project on Binance.
- This allows pool members to benefit from being liquidity providers and earning high APR yields as high as 128% on their investment capitol.
- Cubfinance is the Hive communities home grown Yield Farm and is audited by CertiK, a third party which certifies DeFi projects on Ethereum, Binance and polygon ecosystems.
