The original idea of buying vests (ie. powering up) was to have a longer term share into Steemit and I thought that idea was great. In order to power down it would take 2 years (1% per week) to get the full amount you wanted to power down.
It gave me reasonable comfort as new investor.
However even with 1% per week I was a little worried that whales powering down could still flood the system with steem.
Right now the system is unbalanced in terms of very few steemers holding the majority of steem power and basically even with 1% per week there could be a massive flood of steem coming in.
Surprise!!
I found out (I am relatively new to Steemit) that the powerdown is not 2 years but only 13 weeks.
where lies the problem?
I am not sure why they went for 13 weeks but it seems very odd to just change it, I haven't read a valid reason as of yet and I am on the case with this one.
I read one comment about the witnesses requiring to pay out in time as they get paid in steem power, but I can't believe that was the only reason for shortening the payout.
It "feels" very much like (not saying this is the reason they did it) those who are involved were not comfortable with having 2 years in place. Which shows a lack of trust from my point of view.
what are the implications of this?
There is no control apart from the 13 weeks over the people powering down. Whales and dolphins have no direct way of knowing whether their combined power down will flood the market.
If there is no limit in terms of how many whales can power down during those 13 weeks we are just hoping this will never happen.
when will the market crash by whales/ dolphins/ steemers powering down
Well this is probably a tough question to answer with many variables involved. But in the end it doesn't make for a healthy system if in periods where less investments comes in, there could still be an unlimited amount of people powering down albeit in 13 weeks.
Right now it should be possible to see how much steem is being bought and how much steem is powered up and down.
We can see that the price is reasonably stable.
However if in the near future (by coincedence) couple of whales and dolphins power down a lot more then usual, for whatever reason, at a time where investments are low and hardly any power ups have happened for a few weeks... things can go south very quickly.
It isn't unreasonable to think a worst case scenario will happen in the future and those 13 weeks will be an absolute nightmare for everyone.
solutions
Make the 13 weeks variable based on how the economy goes. In a healthy economy, 13 weeks would be fine. However if we are near the max amount of steem power that can reasonably be powered down before the economy get's flooded. We should increase the 13 weeks to alleviate the system rather then collapsing Steem.
Steemit I feel will fail once the system collapses on itself through power downs, it will lose investor confidence and the curation reward system be non- existant.
I just don't see any benefits for having the 13 weeks. Unless we get rid of the entire power up system.
Please put my mind to ease by telling me I got it all wrong! As that happens all the time 😄