I Finally Understand 50/50 Steemit Author Rewards, and So Can You

in #steemit7 years ago

Eureka! I Finally Understand 50/50 Author Rewards

I have certainly seen plenty of good posts about calculating rewards. Somehow, the way that Steem calculates 50/50 rewards was never clear to me from these posts, probably because they also discussed many other topics as well.

This post just focuses on understanding how much SBD (easy) and Steem (more complicated) that you will get rewarded if you choose the 50/50 option. It also uses this understanding to help you decide which option is better and why.

I think the reason this was confusing is because SBD is supposed to be worth about $1, but that hasn't been true since I joined. That's why the SBD half of the payout always seems so much larger than the Steem half.

Choosing the 50/50 Default

So, you have a Rewards selection at the right, bottom of each post that allows you to choose how you want to take your rewards. You have three options:

  • Default of 50/50: This is the most common option and the one I only finally understood and want to explain in this post:
  • Power Up 100%: You take all of your rewards in Steem Power.
  • Decline Payout: For some reason, you decline to take any rewards from the post.

How To Predict Your Payouts for Rewards With the 50/50 Payout Option

First, you will see a payout amount that looks like it is stated in dollars. It is NOT in US dollars or any other fiat currency. In fact, it's NOT EVEN in SBD or Steem. At the same time, SBD, Steem, and the Steem value in US dollars all factor into the calculations.

Let's say that your post earned $10 in this currency unit that we'll now simply call "tokens."

  • First, a maximum of 25 percent of this $10 (in tokens) could go to curators, so figure your author rewards are $7.50.
  • Out of this $7.50, it's easy to figure out that half -- or $3.75 -- will be rewarded to you in SBD.
  • How the heck do you figure out how the system calculates the other half for your Steem rewards?

Steem Rewards are Tied to Steem Value in US Dollars

Now, how do you figure out the other half that is paid in Steem? This is the more complex question that I just understood this morning after several weeks on Steemit. Hang on for the explanation.

The payout for this half depends upon the current price of Steem in US dollars. In other words, it's paid out to be worth the other half in US dollars, but it's paid out in Steem. If Steem is worth $4.00, your $3.75 payout would be:

3.74/4 = .9375

This is a handy tool and another explanation of this same topic: http://steem.supply/rewards

Conclusion

It seems like taking the 50/50 default is better than powering up as long as SBD is worth considerably more than $1 in USD. You can always convert your SBD into Steem Power with a tool like blocktrades, and you'll get considerably more Steem for that half of the rewards than you would if you just took Steem directly.

Disclaimer: I'm just figuring this out, so please consider this post as informative but not advice.

Tell Me if I'm Wrong

Please offer your RELEVANT feedback, and I'll probably vote and comment. I don't care if you tell me that I'm wrong or make me feel bad for being too dim to grasp this before.

Thanks for stopping by, and I hope you FOLLOW me too.

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niiiiiice. Glad to get onto this early in my Steeming Career! thanks

Thanks. I wrote this awhile back when SBD was always considerably higher in value than Steem. Things change when Steem has more value than SBD too.

Soo... basically if Steem takes a dip (like it is right now) we will actually get more Steem? This would seem an incentive to write good content now while the rates are low.

I do not think that this view is right. Because the value of the votes goes down as well, your totally reward will not be 10 Dollar anymore but maybe only 6 Dollar.

But i must admit, that I have not fully understood how this is calculated exactly....

Yeah, I guess he's right if he's betting the price will rise again soon. When I started, SBD was about 3x Steem. Now they're about equal. Still, you get more from the SBD half of the rewards because the Steem is calculated as the USD value of it. If SBD was actually worth $1 USD, it would be different. Right now, it's sort of depressing as I watch my rewards drop on all the posts that haven't paid out yet just because of the changing values/ratios.

It's purely based on steem price averaged over the last 3.5 days. You are right.

I guess you could look at it that way. If you get $1.00 USD worth of Steem, you'd get more when the Steem value is lower.

No this is incorrect. The value of your post to begin with is in terms of steem. The value displayed in the UI multiplies by the steem price because the blockchain thinks 1 SBD is worth 1 USD.
In the post I point you to where the actual estimate is computed, and you can see starting from where it takes a fraction of the reward pot.

Thus, as steem price fluctuates, so does that number in the UI. Which by the way, is not immediate-- it averages the price in the last 3.5 days.

Thanks for this clarification. I was just assuming that the OP was looking at it in a "glass half full" vs "half empty" sort of way. :) I'm impressed by your understanding!

Thanks, I didn't get it either. So the Steem is less than the SBD because it's being paid as the value in USD, but the SBD is just getting directly paid out in SBD. Got it. Thanks!

Yup, it's simple to understand. But it's not easy to figure out. :)

It took me a couple months to figure this out! This will be helpful for a lot of people

Thanks for the explanation, I was wondering about the curation rewards. Another one that puzzles me is how reputation works. Do you get vests for any votes including your own? Or only from votes from people who has more steem power than you?

I think reputation is mostly just a vanity metric in that it doesn't really seem to do anything. There are whales here with lots of Steem Power and low reputations because they've gotten into flagging wars. So far as I know, it's purely calculated from the upvotes you get (or flags).

Yes, the voting power of the people who upvote you matters in the calculation for reputation. I think all votes count, but people with higher power matter a lot more. People with more power usually have higher reps (but not always) just because they have had the chance to gain more votes.

Good point. It does seem like when people look through new posts they are more likely to vote or comment if they see for example (72) next to the post authors name.

Sure, one vote from a whale can be worth dozens of votes from plankton like me. Since it's hard to gain those votes, a less stressful and more fun approach is to just try to network with Steemians who interest you. Nice to meet you!

If you don't know about steemworld.org, it's really helpful to check your account there. For example, your reputation actually goes up by fractions of points, but it won't show here until you cross a whole number. You just enter steemworld.org/@youruserid

Did not know about that tool, have been looking at steemd. Thanks!

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