Guess what y'all, under current market conditions the power up 100% option is your OPTIMAL CHOICE for maximizing post rewards! This may sound like crazy talk but bear with me, I promise you there is method in my madness.
If you have been on this platform for any length of time, and particularly if you can recall the halcyon days when SBD soared high above $1 USD, you have undoubtedly been told that selecting the 100% power up option is a BAD IDEA with capital letters. However, this is actually only true when SBD is over $1. At the time of my writing, SBD has fallen to $.92 and let's just say the overall crypto market tide doesn't seem to be flowing in a positive direction.
So let's revisit the logic behind choosing between 50% SP / 50% SBD and 100% power up.
Steem Blockchain always assumes that SBD = $1
This is the key thing to understand. The Steem blockchain has a mechanism for determining the actual market price of Steem (the witnesses' price feeds), and pays out the SP portion of a post payout in the USD equivalent amount of Steem. The lower the price of Steem, the more Steem you get to equal the USD amount shown in the pending post payout.
There is no equivalent to the witness Steem price feed for SBD
The blockchain has absolutely no mechanism for determining the actual market price of SBD. If you select 50% SBD / 50% SP, the Steem Power portion of the payout will be in the amount of Steem equal to half the pending USD payout value... but the SBD portion will simply assume SBD = $1 and will pay you out SBD accordingly. This is great if SBD is actually worth more than $1 (you get more USD value than the pending post payout actually shows), but if SBD is less than a dollar you actually lose $!
Let's see some examples
Imagine you have a post displaying $13.333 pending payout. Assuming 75% author reward, $10 of the pending payout will go to you as the author. We will use the current prices of SBD= $.9327 and Steem = $.6077
Scenario #1: $10 author reward payout, 50% SP / 50% SBD
SP portion: 50% of $10 author reward = $5. $5 / $.6077 = 8.228 Steem paid out
SBD portion: 50% of $10 author reward = $5. $5 / $1 (remember, Steem blockchain assumes SBD = $1) = 5 SBD paid out
TOTAL USD payout value: (8.228 Steem * $.6077) + (5 SBD * $.9327) = $9.66 USD payout value
Scenario #2: $10 author reward payout, 100% power up
100% of $10 author reward = $10. $10 / $.6077 = 16.455 Steem paid out
Total USD payout value: 16.455 Steem * $.6077 = $10 USD payout value
Maybe SBD will jolt back up above $1 within the week, but it has already been 3 weeks since the last time this happened.
If you think there is a good chance SBD will remain below $1 a week after you publish a post, you should select the power up 100% option if you are trying to maximize post rewards.
NOTE If it is important to you that you can immediately withdraw a portion of your post earnings, then the 50% SP / 50% SBD may still be preferable as you can immediately withdraw the SBD portion without waiting for a power down.
How to choose 100% power up on Steemit.com
This option has become kind of buried with recent UX "improvements" to the main steemit.com website. These instructions may not be applicable to other front ends.
- At the bottom of the post editor, select "Advanced Settings"
- In the popup window select "Power Up 100%" from the drop down menu and "save".
Any questions?
Please feel free to ask questions in the comments. This isn't necessarily an intuitive subject, and I personally feel the existence of SBD, without a hard peg of any sort to the dollar, and without an internal price feed, just complicates things unnecessarily. If I had my druthers SBD would be eliminated entirely if it cannot be hard pegged to the dollar (my first preference).