In my last post, I introduced you to Bob the Facemeister, an ordinary guy who could have earned a modest income posting to Facebook regularly for 18 years, if Facebook had a blockchain, but I made some basic assumptions about the value of Facebook that are quite conservative. There are a number of factors that determine the value of a cryptocurrency. The law of supply and demand, of course, is one of those. But there are also fundamentals such as product, underlying technology, company leadership, etc.
My assumptions were based on the relative growth of XRP, which has had a modest trajectory compared to other cryptocurrencies. What if, instead of holding a value of .45 USD in 2021, Facebit held a value of $1.45 USD?
If that were the case, instead of expecting to earn $1,788.48 in 2021, Bob’s income expectations from making fun of Mark Zuckerberg all day would be $5,715.90. And if he had earned, let’s say, $2,100 additional income from liking, commenting, and sharing the posts of others, his income would be $7,815.90. At Steemit’s height, STEEM was over $3, so that kind of that growth would not outrageous. In fact, given Facebook’s popularity (with users and investors), I’d say $3 is even conservative. Imagine the income Bob would have had if the price of Facebit was $10 in 2021. He could be making a full-time living.
How else could he have increased his income?
Staking Bob’s Claim
Being the visionary that he is, let’s say Bob decided not to cash out any of his earnings. Instead, he staked them.
Staking is a process that allows blockchain users to sock away their crypto earnings into an account to boost the economy of the blockchain. Some blockchains have a special account for this. Others simply require you to hold your tokens in your on-chain wallet. Whatever the case, Facebook’s fictitious Facechain rewards users who stake their crypto an extra 10 percent of their earnings. In other words, instead of earning 87 cents of the $1.45 generated for his posts, Bob earned an additional 8.7 cents for each Facebit he generated with his content.
Keep in mind that, over time, there’s a compound effect. If Bob had $100 to start with and earned 10 percent, he’d have $110. But on the next 10 percent earnings report, he wouldn’t get an additional $10. Rather, he’d get $11 (10 percent of the account total). But I’m going to stick with easy math. I’ll make another assumption.
We’re going to say the value of Facebit in 2021 is $5.55. Bob makes 18 posts per day for 365 days this year. His posts generate a total of $99.90 per day in Facebits. Of that, he gets to keep 60 percent. His portion of that is $59.94. Because he’s staking his rewards, he gets an additional $5.99. Multiply that by 365 days in the year and Facechain income in 2021 will be $24,065.91.
Remember, Bob got in on the groundfloor of Facebook’s operation with the idea that it was going to be something big someday. He went all in. So, on day one, he purchased 10,000 Facebits at the chump change price of .005 USD. His total investment was $50. But in 18 years, the value of Facebit has climbed to $5.55. Therefore, his $50 investment grew to a whopping $14,500. But, since he’s been staking that investment for 18 years, it is now worth $55,500 in my lazy, easy math calculation. His Facechain account holds a total of $79,565.91 in Facebits.
Power and Influence on Facechain
There’s another way staking could benefit Bob in this fictitious Facebook blockchain scenario. On the Steem blockchain, staking STEEM, a process that converts the liquid form of the cryptocurrency into something called Steem Power, increases the power and influence of the account holder on the blockchain. The Steem blockchain uses the same consensus mechanism that our fictitious Facechain uses—delegated proof-of-stake.
The way it works on Steemit is the account holder’s vote on the value of posts goes up based on that account’s Steem Power. In other words, the wealthier you are, the more power and influence you have (even if you acquire that wealth through questionable means). That’s not unlike the real world, however, it isn’t exactly a fair system either. If we assume that Facechain operates similarly, then Bob’s likes and shares would grow in power and influence as his staking account grows. The problem is, each vote creates X amount of STEEM and Steem Dollars (Steemit’s alleged stablecoin), and the voter gets a portion of that based on their Steem Power. That creates a conflict of interest. To prevent that, Facechain rewards all likes, comments, and shares equally and rewards conflict creators a little more if they are also stakers.
We’re not done with Bob yet. In Part 3, we’ll cover even more revenue streams.
DISCLAIMER
I am not a financial advisor, nor do I give financial advice. The above information should not be considered financial advice but is for informational purposes only. Neither I nor Cryptowriter are responsible for financial losses incurred as a result of acting on this information. Please consult a financial advisor before making any financial decisions.
This post is published for Cryptowriter in association with Voice.
If you enjoyed this content feel free to use our ️EXCLUSIVE SIGN UP PAGE to skip the queue and gain full access to our Cryptowriter community.
Follow Our Socials – Twitter– Telegram– Instagram
Follow Me:
➡ Cryptobloggers: https://cryptobloggers.us
➡ Cryptocracy Newsletter: https://cryptocracy.substack.com/
➡ Cryptocracy on Twitter: https://twitter.com/Cryptocracy3
➡ Allen Taylor Twitter: https://twitter.com/allen_taylor
➡ Taylored Content: https://tayloredcontent.com
This post was first published at Voice.