The Importance Of Compounding
I thought it best to start with the above example and ignore the dollar values as this is representing 100K Hive Power staked for 10 years with an average APR of 3% and an estimated 10% for curation giving a total of 13% which is compounded daily. This is not taking into account the posting or commenting rewards. 100K HP grown into 366K HP which is a 266HP growth at an average of 72HP daily. Compounding is when the rewards are added to the stake and are now included in the next days interest earnings so these numbers continue to rise.
This is actually quite incredible as this does no involve any trading or work on your part besides doing some curating and staking the earned rewards daily. Who knows what is possible if you posted regularly as everyone earns differently. Just for having an example if one earned 10 HIVE daily and powered up these rewards adding to the HIVE Power this number increases by another 74K bringing the total to 440K HP.
As you can clearly see crypto as an investment vehicle is rather powerful and this method only requires time. The strange thing is this is not that difficult and all you need to do is leave your crypto bags alone without selling and diluting for FIAT. How is anyone going to financially benefit if you are eating away at any growth? The reality is the ones who need this the most are the ones who are going to keep missing out.
I tend to keep a close eye on my crypto portfolio growth and especially HIVE as unlike other crypto our stake or HIVE Power has multiple earning faucets and not just the 3% APR which is added continuously as each block on the block chain is completed. This is why growth is happening all the time even when you are not online.
I have mentioned this before I tend to monitor my growth on the HIVE vote and not necessarily on the number of HIVE in the wallet. Each day is a new ATH with regard to token numbers so growth is obviously happening.
Just 48 days ago my HIVE vote was on 7.25 HIVE and it has slowly inched it's way to 7.40 HIVE which was achieved last night. The problem is this is never a constant and has already plummeted back to 7.29 HIVE per 100% vote. The good part is this will bounce back and surpass last nights figure which ultimately means the growth in stake is helping you hand out more for curation through a higher HIVE value vote whilst increasing your reward earnings at the same time.
I do not see HIVE as a passive income stream currently even though it is the perfect vehicle for this in the future. I have no idea what my pension will be worth in 10 years from now even though I have no intentions of retiring. The inflation should have everyone concerned because the pensions will never be enough on their own long term. $1 15 years ago could reportedly buy 47% more than it could today. The same would happen to your pension and the value you once thought was a comfortable number is now nearly 50% less. We definitely need more than one source of income and having crypto stake is vitally important. You can understand the horror stories of pensioners eating dog food to survive as their pension was not enough. Nothing is ever guaranteed in life and why we need to make sure our futures are financially secure.
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Impressive! 💪🏻📈
Love this! Thank you for sharing.
Compounding with Hive = a beautiful thing!
Excellent post! What also tempts me is the 15% on HBD. For example if one was crazy enough to place a million dollars into HBD savings at 15% in ten years you will have almost $5 million dollars doing NOTHING:
Yes but not now with HIVE so low in price. Converting HIVE into HBD when it is well over a dollar is the only way as the upside from where we are now is just too much. Make the gains first and then change over and then take the 15%.
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Impressive growth scenario and a motivator to those who like math and understand the numbers.
Key points seem to be : not touching the principle, reinvesting earnings as they come and gradually growing the HP. This in turn grow the vote's size, which grows the earnings. last key point; consistency- reinvesting earnings, voting, collecting, reinvesting, rinse and repeat. The importance of not letting HIve sit idle in your wallet, reinvest, grow the vote, grow the yield, rinse and repeat. Upvotes from actual posting are a bonus play.
I really appreciated your insights into this subject. I am still new to Hive, but it is cool to see you break down its feasibility as a long-term investment tool. With the current inflation going the way it is worldwide, I agree with your take on the importance of not having all of your eggs in one basket. I don't think anyone really knows what the financial future holds, and it is good to have different income sources to fall back on.
We have to have many different streams of income even if they are smallish they all add up. How many will be out of work due to AI so if you can achieve an income doing other things then that is kind of important. I will do some more HIVE posts as everyone needs to understand the numbers and how this place functions.