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RE: Rambling Thoughts on Steem Stuff
The ability of the blockchain to hold the SBD peg from the downside is a very interesting topic. Whether or not buying SBD now that it's very close to 1 USD in price heavily depends on the debt ratio. I guess what you have to follow is the SBD Debt Ratio. If you go to steemworld.com and see the Steem Info tab you can see that it's 5.295% right now. At 5% SBD completely stops being printed. Bear in mind that SBD is actually a debt instrument that blockchain guarantees can be traded for exactly one STEEM at any time. But how do you figure that the peg would break at a STEEM price of around $0.50? Is this based on how much SBD has already been printed? By what method do you quantify that?
SBD stops being able to be converted for $1 worth of STEEM when the debt ratio hits 10%. I didn't do the exact math but since the debt ratio is around 5% now and the price is around $1 then if the price drops to $0.50 it will be at 10% and the downside peg would start to break.
Thank you for informing me about this!