So you may or may not have noticed, but recently a proposal has been put forth to begin paying out the SPS reward pool allocated for the land expansion to land token holders. If take a look at the SPS whitepaper, we can see that 6.25m SPS per month will be distributed equally per plot of land held within Splinterlands. This will be distributed on a daily basis. The total amount of SPS equates to approximately 40 SPS per month per plot of land, claimable through the SPS claiming window as you normally would for your daily battles and SPS staking.
The total amount paid over 65 months of land ownership will be roughly 2600 SPS equating to roughly $185 USD at SPS's current price. With the current value of a single plot going for only $190 dollars. In total, this plot of land is going to basically cost you $5 dollars if you consider the rewards you will be earning over the months - at SPS's current value. If you're however bullish on SPS and you believe that over the next 65 months SPS conservatively could go to say $0.25 cents, the amount of SPS earnt over the 65 months would in fact be enough to cover over 3 plots of land. On top of this, we have the opportunity for the land itself to increase in value too. Last year we saw the rise in value of a plot of land to over $1000 dollars and if you've been in the crypto space for some time, you will know that tokens tend to always test and or break their all time highs.
Furthermore and on top of these potential rewards that we can see, we also have the ability to either rent out our plots of land, or mint item and spell cards which will be a pivotal mechanic in the game once land releases. These item and spell cards will be minted exclusively by players using resources and buildings that are harvested from or built on the land, meaning that any players who wish to acquire Item & Spell cards for use in battles will either need to mint them for themselves, or buy them on the market from other players who have minted them.
For fun, I wanted to do a comparison here on validator licenses and land plots comparing purely the reward component to see how they stack up. I think this has the potential to help a lot of people who perhaps don't have the capital to invest in to a validator node.
So currently, there are 5005 licenses sold and each license will cost $2500 in SPS and 500 vouchers, in total with the cost of vouchers included this will set you back $2727 dollars for a license.
There is a pool of 3.75m SPS which will go to license holders as rewards per month. Meaning each node will reward a player roughly 749 SPS per month currently, however, this will continue to decrease as more nodes are sold and there are a larger amount of nodes to distribute these earnings to.
Alternatively there are 150,000 plots of land in total, with each plot costing $190 USD currently. In this instance, the SPS rewards will not reduce as more plots of land are exchanged and sold over third party exchanges and there will be a set distribution of the 6.25m per month to land holders rendering earnings of around 40 SPS per month to land token holders.
So now we have a cost of $2727 for the validator earning 749 SPS currently and $190 for a plot of land for 40 SPS per month.
Obviously the license would realize more rewards, and would be preferable over land - but in saying that - the difference isn't too bad at all. For the same cost of a license, you would be able to purchase 14.35 plots of land rendering passive rewards of approximately 575 SPS per month. That's not taking into consideration the additional costs to run a validator when they are required, the decrease in rewards as more licenses are sold, and also the earnings from land once we can harvest resources and item and spell cards.
So for the individuals who do not have the initial capital to invest into a validator node but still don't want to miss out on those passive SPS rewards, a plot of land is certainly a viable alternative when we take their SPS rewards, resources, potential increase in value of the actual plot, potential to get a castle or keep, as well as the cost of item and spell cards into consideration. Either way, due to their scarcity and the ability to deploy game changing assets, these plots of land are going to be a fantastic investment moving forwards.
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