Authors Can Obtain a 30%+ Premium on Steem Backed Dollars (SBD)

Good news, everybody!

For those of you who are new to the cryptotoken, distributed ledger, or blockchain world (these all are nearly synonomous, depending on the implementation, although there are very few non-blockchain tokens), there exists different exchanges where you can CASH OUT your hard earned Steem Backed Dollars (Ticker: SBD).

A simple exchange is run by (current) witness blocktrades at blocktrades.us.

Ignoring OpenLedger options (sorry, guys! you can find out more about OL if you are interested), the other two options that exist are two popular cryptocurrency exchanges: poloniex and bittrex.

Premium Prices on SBD

As of the time of this writing, there exists a shortage of SBD which has inadvertently allowed for the speculators (traders and the like) to drive the price of 1 SBD beyond its peg.

Currently, the price of SBD is somewhere around 1.30 - 1.40 USD, a premium of 30-40%!

Wow! That means you can receive more on your post than you expected.

In fact, there are two different ways that you can achieve a premium. I will describe both and show you how to calculate which way is best via (semi-contrived, but currently close to real world) examples.

Sell SBD directly on Poloniex or Bittrex, OR
Buy STEEM on internal exchange and sell on Poloniex or Bittrex.
We will assume, as of now, a price of 675 USD / bitcoin.

Selling SBD directly

As of the time of this post, there is approximate 15 bitcoin supporting a price of .002 btc / SBD (approximately 7600 SBD worth), which is approximately a 34.6% premium on your SBD.

Similarly, Bittrex has 1.5114 btc support (around 800 sbd) to .002 btc (once more, 34.6% premium).

Instead of choosing the 'convert SBD to STEEM' option (which, incidentally uses the median price feed for conversion rate, which is currently much lower), one could consider either of these two exchanges as options instead.

However, there is an additional alternative ...

Buying STEEM Directly on Internal Market and Selling on External Exchanges

Right now, due to the high premium of SBD, users have been selling STEEM for SBD on the internal market, forcing the STEEM internal market to be way down in comparison to the external market.

This means that there is a premium going the other way, as well.

One could buy 4000 STEEM for about 12400 SBD all the way up to 3.170 SBD / steem (average around the prices of 3.10 SBD / STEEM). This could then be sold on either Poloniex or Bittrex.

Note that current prices of STEEM on the two external exchanges is approximately .0068 at the time of this writing. That means that 1000 STEEM could be purchased for about 3100 SBD and then sold for 6.8 btc, or approximately 4590 USD. This is an increase of 48% on the value of your SBD! Note that 4590/3100 is approximately 1.48.

Conclusion

How do you determine which is best for you? Unfortunately, this takes a little bit of mathematics (but not too much!) and is a matter of simple ratios (i.e. fractions) and multiplication. Nothing more, nothing less.

All you do, in order to determine the best option, is multiply the amount of SBD by the best rate on either of the
two exchanges (possibly a combination of both) and compare this with how much STEEM you can buy on the internal exchange and then sell on either Poloniex or Bittrex.

Once you compare the ratios of your gains, you can see which one is best.