Splinterlands - Fewer rentals and lower prices per rental.... how much lower can it go!?!
If yer renting yer Splinertlands cards out, you've probably noticed a significant decline in yer DEC earnings this season compared to last season.
The rental stats ($rentals in SM Voters Hut on Discord) clearly show the macro trend:
How does this relate to the DEC supply?
The current rental market is down significantly compared to the same point last season.
Around the mid point of last season there were
- 500K active daily rental contracts
- worth around $20K a day
At the same point in this season we have the following:
- 350K active rental contracts
- worth around $10K a day.
So there are fewer rentals going out and players are paying less for them
The current DEC price seems to be holding steady at around $0.55
At this price, the current DEC print rate is around 5.5 Million DEC a day - the base DEC print rate is 1 Million a day, it reduces when the price falls below $1 (not an issue right now!) and increases when the price rises above $1, proportionate to how much below or above the $1 DEC PEG the current price is.
If this formula is to be believed then Splinterlands is currently printing $30 000 of DEC EVERY SINGLE DAY - 5.5M times the current price of $0.0055.
And approximately one third of that is currently finding its way to the rentals market - which doesn't sound too bad from my perspective as someone who rents out cards.
NOTE that I think the early part of September was a one of unnatural sweet spot for Splnterlands renters - with the high DEC price, pumping because of SPS early dayz fomo and rewards cards out of print and relatively few players then compared to now - we had a perfect storm for HIGH DEC REWARDS and thus a lot more money to pumpity pump into rentals.
Now, with the declining DEC price (still GOOD, but down 25% on its high) and twice the number of players and reward cars things are about three times as tight.
And I expect returns to go lower.... looked at from purely an investment perspective it simply isn't worth renting out cards to advance up the leagues to try and increase your DEC earnings, because even with 5 Million DEC a day being printed that doesn't go very far when distributed between a growing number of players....
There are 300 000 active daily players, and so this means that each player, on average, is receiving 5.5 Million DEC/ 300 000 per day, or 18 DEC per day.
NB keep in mind that the DEC rewards distribution is most certainly NOT equal, it is influenced by the following:
- The League you are in (by far the most significant factor)
- Your DEC capture rate
= The cards you play - DEC bonus for Alpha, Promo, Gold.
- Whether you are on a win streak, 5% extra per win up to 50% extra.
- How many other people are playing, which given the number of bots probably won't have that much of an affect on yer earnings.
Based on feedback from people currently batting in different leagues on Discord, you can expect to earn the following, on average, per battle in each league:
- 0.2 in Bronze
- 6 DEC in Gold League
- 30 DEC in Diamond League.
Assuming you're not a bot and that you can win around 30 battles per day (by which time your DEC capture rate would make it sub-optimal to carry on) you can expect to earn around.....
- 30 DEC per day in Bronze
- 180 DEC per day in Gold
- 900 DEC per day in Diamond
To focus on the top league, 900 DEC doesn't get you very far at current market prices - you need at least a few maxed summoners to play at that level - if you want to GUARANTEE staying up there, you'll need a Valnamor and a Yodin - and renting JUST THESE would currently cost you nearly your whole daily earnings....
And then there's all the other cards on top.
I know from having played recently with a deck worth just over $100K (no real surplus in there), that you need that kind of Vest to stay competitive, and so unless you already have a deck worth >$100K it's going to cost you your entire DEC earnings to stay competitive and keep on earning.
If you've got 'half a deck' and are supplementing with rentals to grind to my mind it just makes more sense to rent out that half a deck for DEC, meaning more rentals meaning lower prices.
The new rewards cards aren't going to help the rentals market either, they are just going to encourage people to spend their DEC earned on levelling up those cards, which makes total sense, vesting in your own deck rather than renting.
And finally, rather than playing and spending money renting to earn DEC it probably makes more financial sense to just take out a loan, BUY DEC and hold it for the 200% return on SPS - rather than giving it to someone like me, who then does exactly that!
And then, looking ahead, there's no way that the release of CHAOS LEGION isn't going to dampen the current rentals market even further!
Mitigating factors - what might keep rental prices up?
I might of course be wrong in my slight pessimism - more users seeking to try out the game could increase demand for rentals, and once SPS rewards become a factor that might make renting for rewards more viable too.
It's also possible that MORE demand for DEC pushes the price up further in the build up to Chaos, meaning more gets printed, meaning more rewards, but I'm not sure that's something I'd want, there's SO MUCH DEC supply already!
So maybe a sudden DEC dump could increase DEC returns on rentals, hmmm not too desirable either.
Or maybe people might suddenly start enjoying the game and want to rent for enjoyment rather than profit?
Then again, I'm a realist, so I'll enjoy my still relatively NOICE DEC earnings on rentals which I can!
In the long term of course there is LAND - which is going to be so awesome and sort out ALL of our financial problems FOR EVER, so who cares if things are an ickle bit tighter now compared to this time two weeks ago anyway!
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