Few days ago, I made a post stating why I've been powering down. Afterwards, more thoughts on that matter arose, which I thought would deserve another post. So here it is.
What happened after the HIVE Airdrop
Shortly after HIVE was airdropped in March 2020 and it got listed on the first few exchanges (incl. Bittrex) the price was stable at around 2k sats or 20 cents.
A few weeks later, around early April, some stakeholders decided to dump their airdropped HIVE, which resulted in a drop to the 10 cents mark or 1k sats.
Then a few more weeks later, HIVE was listed in Huobi and the Koreans seemingly did what they do best: pumping prices to insane amounts. HIVE reached a dollar or based on CMC 92 cents / 12k sats.
This sadly didn't last long: peak lasted only a few hours. And then from ~50 cents back to 10cents of the next half a year.
Gains USD !== Gains BTC
You might have already realized it. Even though HIVE recently reached the 90 cents mark as well, the satoshi value was far lower. Around 2k sats, compared to 12k sats a year ago. (In case you don't know: 1 sat is the smallest unit of a bitcoin, 0.00000001 BTC)
So if you sold some HIVE for 1 BTC total in this years' run to 90 cents, you would have gotten 6 BTC for the same amount of HIVE last year. Imagine that person would have even put some in ETH, SOl, BNB, or DOGE. Yeah, massive gains. F********!
Now, if the difference was that much, one would have sold for sure some of their Hive last year, right?
Well yes, but my experience was as follows:
What does every active & loyal Hiver do?
Exactly: powering up.
So when HIVE reached 12k sats/~90 cents, I couldn't do anything besides watching - watching as the price went down.
Even if I'd started a powerdown just when the pump started, on the 23rd April 2020, I would have gotten 1/13th of my stake 7 days later (not counting possible 5 days of undelegation), on the 30th, when the price was back down to 40 cents. Next three months, prices were: 30 cents, 25 cents, 20 cents (2k sats).
Who benefitted the most?
Traders & people who keep their HIVE liquid on exchanges or their wallet.
Those who are active on HIVE and even powered up their stake previously to secure Steem and then Hive were passive bystanders. Maybe some of them had some spare liquid HIVE on the exchanges. I bet most didn't.
Why does this matter? Well, if I had sold - let's say - 50% of my HIVE (12k sats was a very, very solid number), I would have been able to buy right now up to 12 times (if kept as BTC) the same amount of HIVE than before, even more, when HIVE was at 500 sats or if sold for any other well-performing altcoin before - even ETH.
Again, why does this matter? It would have given HIVE stakeholders a major capital boost. The wealthier passionate HIVE stakeholders are, the higher & stable the price baseline becomes.
What's the lesson?
We can't predict pumps. At least I can't. STEEM has always performed somewhat as a latebloomer. If HIVE does it the same way (they do seem to correlate somewhat, even nowadays), HIVE could pump once again late.
What if it would pump to 12k sats or higher? With current BTC prices, that would be 5$. I'm obviously not talking about "dumping bags", mainly about "taking profits". Getting some fat on for the crypto winter or red sea.
The only way to truly benefit from those times, as long as power down takes 13 weeks, is to have a liquid position.
Longterm Solution: Reduce Powerdown
In my opinion, it should be the goal to let people participate/earn within the system without having to lock up funds for months.
Even if that means to lock certain rights (governance voting, etc.) under specific conditions. And if the concern is that fewer people will vote, then let me say this: powered-down stake won't/can't be used to vote either.
PS: If you haven't - consider following me on https://twitter.com/NFTimo