Thought experiment: SBD-only rewards at high SBD price
The Steem blockchain has an interesting feature when SBD debt is too high. If the SBD debt exceeds 2% of Steem market cap, author rewards split starts deviating from 50% SP + 50% SBD, producing some Steem instead of SBD. At 3.5%, it is 50% SP + 25% SBD + 25% Steem. At SBD debt hitting and exceeding 5%, all SBD production stops, and author rewards are given out at 50% SP + 50% Steem.
So why not have the reverse? If traders are going to pump SBD ignorantly, we should fully exploit the opportunity. Let's say if SBD hits $2, SP rewards start diminishing, replaced by SBD. At $3.5, if it is 25% SP + 75% SBD. At $5, it can be 100% SBD rewards.
Of course, this is far more complicated than the SBD debt balancing feature, as it would need witnesses to signal SBD price, and a rewrite of the code to decrease SP production. If feasible, this could even extend to witness and curation rewards.
This will have several benefits -
- Authors will earn more, fully leveraging the opportunity of highly priced SBDs. It should also attract more people to join Steem.
- Steem production will reduce significantly, thus reducing the expected rate of inflation (supply increase). If the high SBD price is sustained, it's going to start putting buying pressure on Steem due to a lower-than-expected supply. In short, higher Steem price.
- On a related note, I see a lot of authors sell SBDs and buy Steem. This would also be accelerated two folds, again leading to a higher Steem price.
- A way to try and achieve a better SBD peg. Of course, this won't be very successful as even if doubled SBD production is too slow to retain the peg. It will happen eventually, but not fast enough to call SBD a stable coin.
It'll basically be a win-win situation for everyone. Well, except those ignorant crypto traders who were buying the SBD highs.
I'm trying to get the hang of all this. Thank you for the info. I'm new to crypto, but Ive been posting here since July. Just now started learning about how the market works, so thank you for the info. Is our goal as a site to get as many new people as possible? If so, I have a lot of reach with my youtube channel. Should I bring them here?
Yes, that's exactly what you should do! Get your entire viewership on Steem, so they can read and upvote your content.
Thank you for the reply
107K New sub you guys are hilarious!
Not even sure what you are getting at.
I agree with your idea...
Very interesting. That was new to me. Where can one read about the feature when SBD debt is too high? In the white paper or blue paper?
Maybe I have an intersting chart for you. I made a post about SBD price, SBD supply and inflation. https://steemit.com/steem/@sevenseals/new-chart-steem-dollar-price-and-steem-dollar-supply-calculation-of-sbd-inflation
Hi, I do not know if you can support me. I made some delegations of my SP, but I want to recover them and I can not find a way to do it. According to Vessel, I already canceled them but they have not all been charged to my account. Only one amount is charged but I have another amount pending, and I have only delegated three accounts, which no longer have the vest that I had delegated to them.
Thanks @liberosist
Was your offer adopted?
Is this why I see miniscule SP rewards when choosing the 50%/50% ?
Is 100% SP always as beneficial as a 50%/50% in the moment of reward redemption?
Only difference being the same USD value distributed only in STEEM?
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SBD is slightly keeping or losing its price, while Steem is hitting new hights today. Steem is at around 50% of SBD. Remember when it was worth 14% of SBD and all traders were hording Steem?
Mhh, I think you are too hard on those "ignorant crypto traders". After all the high SBD price is not really hurting the platform (maybe the 3 merchants we have here), quite the opposite we get 5x our rewards in USD.
There might also be the case that SBD provides certain utility through its properties (scarce, limited mining, 1-Dollar floor) that give it an additional Use Case that was not originally intended.
I dont think we should fight the SBD high, just enjoy it :D
I agree. The "ignorant" crypto traders are just doing their thing -- and it's not like we're not benefitting from it. Sometimes, we Steemians can claim unnecessarily hard that the money doesn't matter to us. Well, it sure as heck matters to me and this SBD pump has been a literal lifesaver this holiday -- and I use the literal meaning of the term "literal".
@liberosist, the issuance ratio is actually dynamically adjusted based on the witnesses signaling. 100% SBD issuance sounds tempting, however I think this is unsustainable as it would break the 5% "debt-to-ownership" ratio that is outlined as a balanced state for the STEEM economy in the whitepaper.
At this stage, it is less than 0.5%. It would take years of high SBD pricing and a collapse of Steem for this to happen. Point taken, though. If the debt exceeds 2% of course it should switch back to producing Steem.
Thats a great content i appreciate to your blog..especially thanks for discuss about sbd...And steem..Carry on my friend..Resteemit..
Good post you...