Hello, LBIers. Now that LBI has suspended its weekly LEO dividends for a while it's time to build and grow.
For those interested to know for how long dividends will be suspended, the @lbi-gov account will be releasing a token holder vote soon to decide on how long to hold off on dividends as a minimum time, say 6-12 months as an example and when this passes, we'll do a vote every say... 13 weeks to decide on restarting dividends or not. It'll work the same way as it did for when we started issuing dividends and voted every 3 months. I know a few people will want the answer to that.
So what's the plan for account growth?
Before I start explaining, let me explain things from my POV so you can better understand my thought process. Ok so, right now we are in a bear market, I believe the bottom is not in yet and we'll not see it for 1-4 months. After this, the market will go sideways for at least 1 year and then it'll start to increase. There are 514 days until the next BTC halving event, this has a smaller impact on the market as each cycle passes but it still has an effect and can be used as an indicator. I don't think about next month are in 6 months from now, I tend to think in market cycles because with crypto, we can plan in cycles because they are only 4-5 years long which is much shorter than stock, housing and commodity cycles.
For LEO token and to be realistic its price is down over 95% and inflation is massive. I don't care what the reported number for LEO inflation is, I know for a fact that the total LEO circulating has doubled since LBI launched almost 3 years ago which would suggest the real inflation rate is close to 25%. This is not good for the future price of the LEO token and inflation compounds. This would be ok if LEO were a utility token that could be used for something in the same that HIVE works but it has no use cases. Im not hating on it, I do like LeoFinance, it is my favourite tribe on HIVE but I don't have a lot of faith in the token price long term. I believe the community of LeoFinace will keep alive for many many years. I sound bearish on it but I'd like LBI to have 1 million LEO someday, I just think we'll be able to get it cheaper than it is today. If something is down 50%, it has to increase by 100% to get back to break even. If LEO is down 95%, it has to increase by 1900% to get back to $1. For LEO to go back to $1, its market cap would need to double from its last peak because there are now twice as many tokens in circulation. Getting back to $1 gets harder each week/month.
My goal is to increase the LEO value of the LBI token and when the price of LEO is dropping and has been dropping, the best thing that I can do is get assets that act as a hedge against this with the hope of someday converting the hedge assets into LEO when the ratio is crazy good. As an example, the last bear market peaked at a ratio of 400k HIVE to 1 BTC, at the height of the bull market last year 1 BTC was worth under 25k HIVE. Knowing this, we can see that converting HIVE to BTC in a bull market will pay 10x plus returns in HIVE during the bear market. The dollar value might be lower but the trade is between BTC and HIVE so not important. BTC is gold and the most stable crypto, ETH and everything below are silver and more volatile compared to BTC. If BTC jumps 10%, everything else jumps 15-20% and the same in reverse for when things are tanking. We've all seen this.
You might not agree with me but this is what I honestly think, I'm going to bullshit you and say one thing and do another. I hope the above helps to give some sort of idea of how I operate.
The Growth Plan
There's not really a lot to it, I like the keep things simple because it cuts out variables that cost time and money and to be honest, doing less yields more.
From weekly earnings, I will have access to 100% of income because we're not paying the weekly dividend of 50% or the 10% operator fee for SPI. What I will do is do the same thing every week and I will do it until the market changes from bear to bull and then I will start to do something else every week until the market changes again. So for the foreseeable future, LBI will...
Save 50 HBD per week
Wrap LEO to BSC, convert to stables and add to the bHBD/BUSD LP
Compound all CUB farm harvests into the bHBD/BUSD LP
We build dollar balances while waiting for the bottom to be confirmed. When the market bottom is confirmed, normally 2-3 months after it happens, we'll convert these stables into cryptos like BTC, ETH and BNB. The next 12-18 months after this, LBI will...
Convert bHBD/BUSD LP to BTC, ETH and BNB
Convert HBD content rewards into LEO and stake
Let the HP balance grow and increase our leo.voter rewards
Convert CUB harvests into BTC, ETH and BNB to dollar cost average
Do this until the bull market is in full swing and then decide what to do from there. By this point, we should have built up decent values of non-HIVE assets which could be used to start offering an LBI token buyback. We should also be able to start to convert defi earnings into LEO. From this point on, I have a rough idea but it would only be repeating the above steps.
We can plan into the future but within crypto, we have no idea what the ecosystem will look like in 3-4 years' time for now. We can loosely plan around market cycles but for the finer things, we can only plan at the time. The top 10 crypto-list changes each year as new ETH killers or meme tokens are created and pumped. STEEM HIVE was once a top 10 token believe it are not. Fun fact, all of Dan Larimer's crypto have been top 10 tokens at one point, Bitshares, STEEM and EOS.
The above plan is just a list of things to do and when to do them. What I know is being consistent pays off, savings into something should not be something you do for 2-3 weeks before you move on to the next thing that peaks your interest. Building up non-HIVE holdings is something we need to do for at least 18 months to make sure we give ourselves the best chance of maxing growth. I think setting a time is a bad idea because our actions should be based more on what's happening in the markets but we'll see what happens.
As an example of what I mean. If we start issuing dividends when the bottom is confirmed, we miss out on dollar cost averaging and getting cheap crypto that will never be that price again. Last bear market BTC traded at under $10k for over a year, Do you think we'll ever see under $10k BTC again? Do you think we'll ever see under $20k BTC again or under $1300 ETH after the next bullrun?
Anyways, that's what I've got for today. I've written this to help give some sort of idea of what I plan to do to grow LBI. It might not look like alot but I've been through a few cycles now and almost a full cycle as a token operator, I take what I learn from SPI and apply it to LBI in the best way that suits it. My goal so to increase the LEO value of the LBI token by increasing its assets and then incomes. We don't plant a seed today thinking we'll be eating fruit tomorrow. The seed needs to be taken care of and loved for months/years before you get the fruit.
Thanks for taking the time, I could keep writing but I think I would start repeating myself. Let me know your thoughts below please and have a great day if you don't have time.
