There are always been some confusion with the reward payout option. Not only newbies even some of the regular users too have basic confusions and many others questions related to working of reward system on Hive blockchain. I think a refresher is needed to clarify some of the doubts. There are few regular questions like :
- How do I earn a rewards on Hive?
- What are Hive, Hive Based Dollar (HBD) and Hive Power?
- What is better post payout option?
I hope this post will help current users, and also few newbie to understand the rewards payout better and benefit from that understanding.
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Hive Currencies
By now most of us already know that Hive blockchain broadly works on three currencies. The three currencies that appears in our wallet are :
Hive : It is the main cryptocurrency token of our blockchain. It is very similar to #Bitcoin. On Hive it is known as liquid currency and can be powered up into Hive Power, or traded for HBD , or transferred to other accounts. These are the same token which are traded in exchanges like #Binance or others.
Hive Power (HP): Abbreviated as HP. I prefer to call them as staked Hive. It is Hive that is vested into the platform and does not remain liquid for making any transaction. They remain locked until it was powered down. It determine the stake of a particular user on the platform. More the Hive Power, the more they have influence on the platform. It determines the upvote value which in returns generate higher curation reward.
Hive Based Dollar (HBD): Generally abbreviated as HBD. It is the liquid, stable value currency tokens designed to be pegged to 1 USD. HBD can be traded with Hive, and transferred to other accounts for different transaction. The value of this currency remain approx. to $1.
Earning Hive
Somewhere, all of is have joined Hive after knowing it as a social networking platform that rewards users. The users are getting rewarded in Hive token. But how to earn Hive rewards?
There are two common ways of earning Hive from this platform which are mentioned below.
Author Rewards: Whenever we make a post or put out a comment on other user post and if any users upvote it i.e curate it, we earn rewards. These are called author rewards.
Curation Rewards: When any user publishes a post or made any comment and you find them valuable enough to be rewarded, we upvote them. Then we get rewarded a share of the value of our upvote as curation reward.
Creating content and upvoting content based on its quality are basic activities that are carried out on the Hive platform.
Choosing the Payout.
Coming back to the main topic of choosing the best payout option. Basically, when an user authored a post, the platform allow them to choose three payout options. These are :
Default 50%/50% : The default option is most common option that appears on the drafting page. It distributes the whole reward that the post will make into HBD and HP. For example:
Suppose one of your post earns total $60. With default payout option, reward will gets divided between authors and curators in 50 % / 50% ratio. The $30 that the author generate will further be divided in two equal parts i.e HBD and HP. $15 to HBD and the remaining amount will converted into HP as per the internal price matrix.Power Up 100 %: This option is solely on the user preference. In this option the reward share of Author will be converted and paid out as Hive Power. This option is better for those who focus on increasing the Hive Power solely through content sharing on the platform.
Decline Payout : The third option on the payout page. In this option the author will not receive any payout. As the name itself suggest, the author has opted out of the payout. Nothing will be added to your wallet. The amount corresponding to upvotes will be appearing but with a strike mark.
Advantages of Payouts
It is solely on the author to choose the preferred mode of post payout. The user need to consider, and understand how they wanted to grow their account. While the "default" payout is set out 50/50, it gives the author the liberty holding some HBD, which can be transacted to get Hive. On the other hand the "100% Power up" makes everything goes into the staking account.
In my personal opinion, under the "default" option the user gets the benefit of #HBD which allows the user to keep certain liquid amount into their wallet. While these amount can be cashed, it can also the easily converted to "Hive" through internal market. Do keep this into account that powering down the Hive Power takes 13 weeks to get converted in liquid Hive. The first instalment of it will be received in 7 days.
Basic Rewards Exchanging.
Many user are not aware that, all the available three currencies can be exchanged with each other easily and that too in the Internal market.
- We can buy #hive directly from the internal market against HBD.
- We can convert HP into HBD or Hive. But we need to un-stake the HP, which is termed as "Power Down".
- The power down is lengthy process. The available HP is converted to Hive in 13 equal installments over a period of 13 weeks.
- To convert HP into HBD, first we have to power down to Hive and then sell them in internal market for HBD.
Conclusion
The details shared above is solely based on my own understanding. If you have any question or like to add more on these topic, please feel free to share it on comments.
