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RE: What Pegs Up Must Peg Down - Is SBD Really A Tether and Is It Doomed?
I thought SBD’s being pegged were supposed to possibly go up but never go down below a preset amount . Because all markets are crashing it appears SBD’s are just a another crypto. Same game different name......
Just two crypto’s....
Yup, as I tried to tell people at the time, we should have just left it.
The fact that it jumped so high was a clear indication that it is indeed, another crypto. However people thought that just by saying over and over again, that it was a stable tether coin, and it was good for Steem, would somehow make it true.
Obviously I just stopped making my point after awhile, I was 'convinced' that I was wrong and that everything would be hunky-dory.
So unless that price can be got back to $1 pretty damn sharpish, I was right and they were wrong, it's pretty bloody binary, there can be no in between.
Cg
Disagree. If literally nothing had been changed in the SBD code, it is a mathematical fact that there still would not be enough backing to support SBD at $1 given the current price of STEEM (or at least at recent lows; technically I'm not sure about the current price, I haven't recalculated). Now we can't say for sure that the price of SBD would be below $1. Perhaps that could have worked out through nothing more than wishful thinking. But in reality, the system would not be guaranteeing what it is supposed to guarantee. Again, this is with no action from the devs/witneses.
The crypto market has just been too harsh to Steem this year (as it was in 2016) for everything to continue to work perfectly. Interestingly, in 2016 everyone blamed the 95% decline on "hyperinflation". Well, here we are in 2018 with another 95% decline and no hyperinflation. It seems things are a bit more complicated.
It is a mathematical fact. Ohh really, lol ... look where we are now.
Yes. About 600K SBD was printed after HF20. If you subtract that out, the supply of SBD is still too high.
When it comes down to it, Steem just can't handle 95% price declines without things starting to break and SBD won't be the only thing to break either. Development projects will find their budgets strained, exchanges will avoid listing Steem and some may even consider dropping it, nodes will start to shut down further centralizing the whole network around Steemit Inc, etc.
We need to get our act together when it comes to communicating Steem's value to the market. Otherwise SBD will be the least of our problems.
We are on the same page Smooth.
This part is not true. Regardless of what @cryptogee seems to be claiming here, the fact that SBD can, and does, sometimes go below $1 has been part of the design since 2016.
There are no 100% guarantees. SBD is backed to a value of $1 by steem but only as long as STEEM itself has enough value to support it. When there are major crashes in the price of STEEM, as was the case during most of 2018 (and previously in 2016), then SBD is no longer backed to a value of $1 and can go below $1.
SBD aims to provide a stable value which is a very useful thing (which is why the past several months have seen a half dozen or so stable coins released, with a similar or greater number under development), and it does so reasonably well, as long as Steem itself is healthy. Unfortunately Steem is not healthy. It has lost approximately 95% of its value. At that point, things are going to start to break, and they have (and not only SBD either).