Nothing changes really
I think from an investor perspective, a lot changes.
I'm also told that it is possible to perform conversions using steemconnect
I believe you are right, but you can also use cli wallet to do it. The blockchain still supports it, it's just missing from the UI as it is a bad idea to do it when SBD is more than $1.
The price will drop! If it drops to $1 or below then people will start converting it and the ratio will drop.
I'm suspecting the same.
As you noted there are improvements already being made in the upcoming hard fork. Also, at a current price of $1.03, I wouldn't consider it to be all that unpegged
I disagree, it is extremely unpegged, just happens to be near $1 right now. If Steem was to rise to $2 or even $3, I would bet SBD will travel with it, albeit slightly behind. So I don't think it's come down to it's peg as much as just happens to be following Steem which happens to be near $1.
Yup marky wins :)
Here is an interesting chart to test the hypothesis of SBD being linked with STEEM.
https://www.tradingview.com/symbols/spread/BITTREX%3ASTEEMBTC%2FBITTREX%3ASBDBTC/
In fact, there isn't that strong of a link. The ratio has varied from 0.2 in December (SBD worth 5x more than STEEM) to a high of about 1.6 in mid May (SBD worth only 62% as much as STEEM) before reversing and heading back down. What happened in mid May to cause such a clear and rapid reversal after an 8x increase?
Well that was exactly when the the debt ratio reached 2% and SBD printing started getting reduced (and STEEM printing increased)! This had precisely the effect one would expect from the change in supply (though not what one would normally want): SBD got relatively stronger and STEEM got relatively weaker.
The improvements made in HF20 (mostly increasing the 2-5% threshold to 9-10% instead) should be very helpful, although it still may not be enough. It's a step in the right direction for sure.
I’m not saying link as closely related, more like BTC / alt coins. When BTC falls they all fall. Some faster some slower. But they go in the same general direction. If Steem went to $2 I am not saying SBD would as well but I would expect it to move to $1.25-$1.50+ until something changes to actually peg it. It was $1 a while ago and went up when Steem had a bump.
It is true that all or almost all cryptocurrencies seem to move together to a large extent. I still find the chart pretty interesting (the movements of which show how SBD and STEEM sometimes don't move together), especially the reversal when the soft limit was hit, which seems to say quite a bit about the pegging mechanism. But of course I can't prove any sort of causal relationship from a chart, it could be coincidence or some other factor involved.
Maybe a wager is in order :). You a betting man?
100 Steem and we set conditions and deadline? Donate it to a good cause like @Helpie.
I'm not against making a wager but I'm not sure what we are wagering on? That SBD and STEEM more together to some extent and to some extent don't? We probably agree on that. That SBD probably won't stay 'close' to $1 all the time unless other mechanism improvements are made? We probably agree on that too. That HF20 will improve the peg to some extent? We may not agree on that but it may also be difficult to measure or define.
You don't really need to wager with me though, you can buy SBD for about $1.05. If you are sure of a big pump (maybe to $10+ like last time) then just buy as much as you can. Not doing so would be giving up an 'easy' 10x.
I just wanna say markymark for president real quick.. ok, done
STEEM investor or SBD investor? Actually in neither case does much change right at 10%. As the ratio exceeds 10% then SBD becomes gradually less backed by STEEM. If SBD is worth more than $1 then clearly SBD investors aren't counting on being fully backed by STEEM anyway (they aren't). If isn't worth more than $1, then it would be getting converted and its supply would be shrinking, effectively resolving the situation (albeit at an uncertain rate).
Of course, if the ratio hits 10% that would currently mean that STEEM has dropped another 50% which clearly matters a lot to STEEM investors, but again the exact 10% threshold doesn't change anything here, its just an arbitrary number when looking at the STEEM price doing what it does (fluctuate).
So I'm not sure what you are getting at here.
Possibly you are right, but this is really just guesswork. Market conditions change and just because SBD got pumped, apparently mostly from Korea, in the past doesn't mean it would happen exactly that way in the future. There are some dramatic differences, for example the supply of SBD being 15 million rather than 1 million, where it was before the first SBD pump in 2017 (the increase occurred due to the slow, but not nonexistant, action of the pegging mechanism). That 15x ratio might matter, or it might not. Likewise for the planned changes in HF20. I don't see any way to know for sure in advance.
@smooth Can you make a youtube tutorial with animation of how sbd debt ratio and steem relates to each other? Im hardly a financial guy and im having hardtime understanding. Since i noticed youre so actively trying to explain it to everyone. I think making a youtube animation tutorial will save you lots of breath and make potential investors to understand more about the system. I really appreciatee if @steemitblog will consider this when releasing a new update each time. Not everyone is technically skilled at this. But an attempt to make it more digestable is highly appreciated.
Honestly I have not the slightest idea how to make a youtube tutorial, but if someone wants to create one I would be happy to proofread the script (or whatever it is that you write to make an animated tutorial).
Well if you're motivated enough, you can make a post on hiring some creative content producer to do it.. Considering the amount of stake you have in this platform, it should be easy? But it's just my suggestion.
That's a really big point
That's the pegging mechanism in action. It it just really slow unfortunately, and has other issues. But it isn't nonexistent or completely ineffective (I think).
This is my understanding. On the low side it has a hard ped (redeemable at $1) and on the high side it has a soft peg (prints more and no one redeems).
The UI still has it:
Much better than when it did not even have this option
No, that is not the SBD conversion. That's the payout rewards option.
I think it is pegged in one direction only.
We should add a way to convert steem to SBD for a small fee. This would create a better peg.