Thread by @JackNiewold

Alright, so the lovely #CardanoCommunity has been brigading me for about 24 hours now, and I invited @Beastlyorion to chat about how much he's making from his stake pools.

My invitation was condescendingly declined.

Ok, challenge accepted. Let's do the math.

(THREAD)

https://twitter.com/Beastlyorion/status/1468315493819830273

If you're behind, here's the tweet that spawned this discussion:

https://twitter.com/JackNiewold/status/1466823469564248068?s=20

Also, invest wherever you want, I'm relatively bullish on Cardano defi. I really didn't talk about the asset itself, just this staking-influencer conflict of interest.

And I'm happy to not feed the trolls.

But calling me a liar is where I draw the line.

Alright, here's how staking rewards get distributed:

Beast gets 340 ADA per epoch (5 days) as well as a fee of all the interest generated by stakers. He sets this fee at 3%.

Stakers have to pledge an amount up front as well, and Beast has pledged 1m ADA. That's way more than what most stakers pledge, so good for him.

He's got two pools so we'll look at the main one, happy to do the same math for the second one.

Lifetime return on stake: 4.69%
Current active stake: 47 million ADA

We'll use those numbers.

So all the stakers yearly get about 4.69% on their 47 million, that's 2,204,300 per year.

Beast gets 3% of that.

That's 66,129 ADA per year.

Also, he gets staking rewards on his own stake, so 46,900 more ADA per year.

He also makes 340 per epoch. 73 epochs/yr = 24820 ADA.

In total, Beast makes (approx) 137,849 ADA/year, about $199,881 off his 1 million deposit, that's 19% yield per year. It's only that high because he pledges a ton, which I commend him for. He could get away with 100,000 ADA, which would push his ROS up to over 90.9%

That's the math, if you think it's fair, great, if you don't, great.

I just think YouTubers who operate staking pools should disclose how they typically make anywhere from 10-20x the yield on their stake as their subscribers.

That's my only point.

So while his numbers are *kind of* accurate for THE WHOLE STAKE POOL, he makes A LOT MORE because his investment in the stake pool is A LOT LESS.

https://twitter.com/Beastlyorion/status/1468312277598101506?s=20

This will be my last tweet about Cardano for the foreseeable future.