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RE: Hive Backed Dollar: Showing Need For Decentralization And Distribution

in LeoFinance3 years ago

The low side peg for HBD automatically breaks when it exceeds 10% of the virtual supply. So in the scenario described, where someone buys HBD while Hive is high, then waits for Hive to drop, they still can only create 10% more Hive, no matter how far the price drops. Similarly, if the debt limit is increased to 20%, only 20% more could be created.

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Ah okay. Thank you for the clarification. That solves a lot of the proposed issue.

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Thank you. This is a mechanic I wasn't aware of. Great! I feel secure about it now.