On Discord in Drip's channel via the Bro Discord, we got this announcement. Read below.
Normally we would get Swap.Hive from out Staked Drip holdings + Drip. Good deal.
From what I can see, we are still getting Drip, but they changed the Swap.Hive for SPS (Useless token, if you ask me) and cut the dividend way way down.
I don't play SPS, I dont really care about Splinterlands, I just want dividends in Hive or Swap.Hive, so I can decide myself which tokens to buy. Which isn't going to be Drip going forward.
Normally I would get 0.11 Swap.Hive a day for 330-ish Drip staked + 0.083 Drip daily. I was quite happy about this, since it would build over time automatically.
They now switched to paying out SPS. So I get 0.25 SPS daily. Now if I were to sell those SPS daily.
That would give me 0.0037 Hive at current prices. Thats such a fking huge drop in the Dividends and I guess at lot more sell pressure on SPS will follow, moving the price down even more.
What a shitty move. I am unstaking Drip and selling.
It was announced the 4 of January and the price of the tokens have drop by half at this point. lol.
What a terrible decision.
Discord announcement from Drip.
I wanted to give everyone a notice that the swap.hive payments will be halted and in place of them we will be paying out SPS. This is effective immediately. This isn't a decision taken lightly but a majority decision made with holders of more than 50% of the circulating supply. Our main goal is still to grow the project and we believe this is an inevitable step that needs to be done and it's better to be done quickly.
There are three main reasons for the decision below in no particular order.
1.) The GameFI landscape is still in bear market territory. It's not only Splinterlands but most other gamefi projects in general have not seen new money coming into the ecosystems. You can see this by looking at the prices of SPS , GALA, AXS, Prime etc. We do believe an alt coin bull market is coming. Right now is a better time to be buying more assets and building than paying out our liquid capital. . Our initial focus of the project was buying Splinterlands assets as that's the main game on Hive and a game we believe in. We still have some diversification and plan to diversify more in the future but with the amount of funds we have we want to go heavier on our top conviction which is Splinterlands. Specifically, we want to increase our SPS token holdings substantially. We believe there are some good catalysts for the project including the new set coming out in April in addition to marketing being done and SPS validators going live that will bring value to the SPS token.
2.) After speaking with several larger investors, we've realized that paying out a coin or something considered a currency raises our tax liability. What this means is most large investors won't touch us. The only alternative is paying out a token that isn't considered a currency or cutting payouts altogether. This project is about rewarding our holders so we still want to have distributions, they will just be in a token like sps.
3.) We haven't sold much DRIP lately in our last tranche pricing of 2.0 swap.hive. We have some selling pressure and profit taking going on. This is coupled with the price of Hive going up and people are looking to trade and make profits. While this is actually healthy and a temporary problem it doesn't help us add funds now to the treasury when we want to be buying. We have, however, taken on assets from OTC swaps though and that has helped us grow our treasury.
I just did a rough tally of our treasury holdings and we're still over $90k. I'm happy with this considering how the market has been and considering the price of SPS has dropped under $.01. Our exposure to SPS is only 15% of our total funds. At current prices we want to transition into a heavier exposure to the token for several reasons including some of the catalysts I mentioned.
Let me be clear though that the goal is still to grow our treasury and reward our holders. Your DRIP holdings represent your ownership in the project in addition to some other perks. While some may see this hive payout cut as a negative, we believe it will allow us to focus on growing our treasury faster and paying even more at a later time.
Byee