Nope more complicated then that.(though not rocket science) SBD transfers its volatility to Steem, which is BAD for all kinds of token, Also it causes FEED DISCOUNT . FEED DISCOUNT requires Steem network to print Steem and sell it on market. Lastly, there are ridiculously high interest rate.
Which is all bad for steem price. Maintaining SBD is not free. It's actually quite expensive. ( Cost to maintain SBD ) > (Benefit from SBD)
So to keep SBD stable we have to sell more Steem on the market and that drives the price of Steem down, especially when the price is already low. Have I got that right?
I disagree. It adds simplicity in explaining how this works to someone and to a merchant.
Ask a business owner pricing his products in Steem or SBD if they see any value of having SBD. What do you think the answer will be?
All we'll be doing is shifting the "complexity" to the end user when they have to price conversions on an hourly basis.
No, It adds unnecessary complexity on Steem system.
More seriously, it adds downward pressure on Steem.
To clarify, it adds downward pressure on Steem because SBD that gets cashed out has to be paid for by Steem at its current lower prices?
Nope more complicated then that.(though not rocket science) SBD transfers its volatility to Steem, which is BAD for all kinds of token, Also it causes FEED DISCOUNT . FEED DISCOUNT requires Steem network to print Steem and sell it on market. Lastly, there are ridiculously high interest rate.
Which is all bad for steem price. Maintaining SBD is not free. It's actually quite expensive. ( Cost to maintain SBD ) > (Benefit from SBD)
So to keep SBD stable we have to sell more Steem on the market and that drives the price of Steem down, especially when the price is already low. Have I got that right?
If this is true, then post HF16 means that Steemit has become the Federal Reserve and SBD is Quantitative Easing QE4.