Is HBD Interest Tailored For The Sake Of Compounding Alone?

josediccus in #hive-167922 • 3 years ago

My HBD interest arrived today, and I found myself counting down the hours, minutes, and seconds.

This was because my interest for last month was just a bit over 22 HBD but this month it's about 27.697. I added over 250 HBD through the period of 30 days, this includes the 22 HBD I got in April. Now it's exciting to have my interest.

I think if these interests were directly paid to HBD wallet rather than being added to the Savings, I might have just been tempted to use it to buy Hive seeing how ridiculously low one can buy Hive at the moment.

However, it's directly deposited into the same Savings where you originally have your funds. This means that this model might be slightly tailored to tilt people to compound their 20% interest rather than take it out.

A Time To Own HBD?

I think the reason why it's so is that getting one's funds out of their savings would take three days which automatically translates to the fact that interests aren't supposed to be emergency funds.

Sometimes these 3 days waiting periods might shift one's plans to take advantage of a buying opportunity and this is why it feels like it pays more to just accumulate and compound it. However, for some others, they're happy to just wait till the end of that 30 days window, then withdraw their interests from their saving.

One thing I know is that this dip might just be a blessing in disguise because this is just the opportunity to buy as much Hive as possible. However, it's still possible to save up and keep waiting for the bottom, then pounce to buy when it bottoms. But do we know the actual bottom?

The Peg You've Been Seeking

I don't think we do, we just trust our intuition to buy at a supposed dip especially when we've sold high at one time. One interesting thing to note is that I like the fact that HBD is holding on strongly. I kept tabs on USDT and about 12 hours ago I saw it trading at $0.97 (USDT is like the most trusted stablecoin out there) and slightly off the $1 peg.

This has made me appreciate how strongly HBD has held against some of the best out there. Because we have our issues with stabilizing HBD, this dip has tested the capability of HBD and I must say we haven't done badly.

This is an even bigger incentive to hold it rather than spread the 20% APR interests into assets like SPS, LEO DEC, LVL, POB, or the second layer tokens. Although it depends on whether you're seeking more stability or willing to grow your stake by throwing it into other tokens in the Hive ecosystem.

Compounding Is Sophistication

However, at this moment the juiciest incentive is buying back hive with the interest or holding HBD and compounding it for more interests. This is the biggest dilemma at the moment.

As for me, most of my Hive stake is in Hive, powered up, so at the moment I won't be looking to convert my HBD so quickly unless we approach 15 to 20 cents (hopefully we won't). This is the part where it gets Irresistible and this is where I'll begin to say "oh we've bottomed"

I don't think I'll convert my HBD interests to anything higher than this range. How some people might want to use this dip as an opportunity to trade, maybe take advantage of that LUNA situation to make some profit. But this isn't me. I like to keep my holdings short and compact, instead of chasing more profits.

Buying Hive Hasn't Been Juicier

However, it's exciting to see that if I withdraw my HBD interest for May, which is over 27 HBD, I could get up to 3x the number of Hive and that should be up to 60 or 70 Hive at the moment (price-wise), now imagine Hive getting back to $1.2 at least.

After I repeat this process for at least 6 months then I'll use some of that Hive again to buy HBD. The sophistication of compounding is unimaginable.

This is all happening in my mind, it might turn out badly and it might turn out to be way better than I planned. However it is, it's exciting to bask in the feeling of stability that HBD brings and that juicy 20% at the moment. What will you do with your interest?