Are you stacking up Hive Power? Or are you perhaps adding HBD to your savings account? What about trading HBD to HIVE and vice versa on the internal market?
Me too, doing it all. However, in this post, I'll be focusing on my strategy to benefit from HIVE & HBD price pumps and drops.
Scalping is a style of trading that means profiting off of small price changes and making fast profits by reselling.
Hive being feeless makes it a good idea to do some scalping here by trading HBD and HIVE back and forth even with very low amounts. While the profits may also be low, at least they won't disappear into fees like on so many other centralized and decentralized exchanges.
Coingecko Price & Hive Internal Market
When you go to PeakD and open your Hive Wallet you can see the current HIVE & HBD values in USD provided by Coingecko.
Just recently I've noticed that the HBD price has dropped almost 10%. Apparently, I haven't been the only one to pay attention to this since there have been some worried threads on Leo asking what is happening.
Since the HBD price is pulled from Coingecko, I decided to head out over there and take a closer look. It seems that the HBD price shown on PeakD comes from an exchange called Bittrex Global. There are two other exchanges on Coingecko's list but Bittrex's price has matched exactly the price on PeakD on both times the sudden drop has occurred. So I think it's safe to say that it's the Bittrex price that is shown to us hivians.
This picture above was taken when the recent drop happened and if take a look at the 24-hour volume column we can see that the volume has been extremely low - only $6.37.
So instead of panicking over this, I would suggest paying more attention to the HBD/HIVE trading pair on the internal market instead. You can access the HiveHub from PeakD by clicking on the dropdown menu arrow under either HBD or HIVE and then choosing 'market'.
This will take you to HiveHub's main page where you can see the swap function which you can use to quickly trade HIVE to HBD or vice versa. Here you can also set the slippage %, meaning how much less you are willing to receive if you want to make sure the trade is executed. However, the trade usually gets executed using the lower percentages so I wouldn't go above 0.5%.
To check the HIVE/HBD price chart you can click either the 'basic' or 'advanced' buttons.
Here you can monitor the pairs trading ratio and spot some sudden surges and drops - and these, by the way, happen once in a while so having some HBD & HIVE as liquid isn't a bad idea at all.
Here we can see the price increasing and then dropping in a relatively short period of time. Not long ago there was an even bigger fluctuation when the HBD price suddenly pumped ~20%. I immediately used most of my liquid HBD to buy HIVE and once the price was back to normal, I then moved back to HBD making some nice profit.
The Plan
Here's my strategy to grow my Hive account:
- My post rewards are set to be paid 50/50 in HIVE/HBD where the HIVE part is in fact HP and while HBD is added as liquid.
- The idea is to keep growing the liquid HBD by trading it back and forth to HIVE.
- The profits either in HBD or HIVE I will stake and therefore slowly grow both my HP and HBD savings.
- I also have an ongoing powering down which will add to my liquid HIVE amount.
- This is paid once a week.
- The amount is smaller than what I'm getting from post-rewards so my HP is still growing.
With this plan, I'm able to grow HP, and HBD savings and have more chips to do HBD/HIVE trading and that way increasing my profits on both sides.
As you can see, my liquid HIVE or HBD isn't that much currently but that's because I just moved 100 HBD to savings to get that part going on with the juicy 20% APR. Here you can also see the amount of my HIVE power down which is ~15 HIVE. So basically if and when I make more than that in a week, I'm able to grow my HP while releasing HIVE for trading.
Conclusion
Even though my main source of income on Hive is post-rewards, this little trading scheme is a nice addition to growing my account. The best thing is it is not that time-consuming as I usually check out the charts in the morning while drinking coffee. Also, you can add limit orders on top or bottom to get some peace of mind and just forget the whole thing for a while.
Also, I would imagine this kind of circular trading system isn't harmful to Hive as the assets aren't leaving the ecosystem.
Besides saying this is not financial advice, I would like to add one more thing. Making small profits can be frustrating and it's better to look at this as a long-term game that requires some patience. Nowadays I try not to get caught in trading that much while trying to maintain my focus on other things and consider trading HIVE/HBD as a sort of nice side hustle.
What's your Hive strategy? Let me know in the comments section!
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