I'm sure that someone else has already started this discussion, but I thought I'd voice my opinions on this. I'm not a top 19 witness, but my voice can still be heard.
Right now, SBD is trading at $1.5 - today it has fluctuated between $1.3 and $2, possibly thanks to the BTC flash crash from $2600 to $2200.
Why is this a problem?
- Steemit believes SBD is a price stable asset. When your post says you're earning $100, it actually means you're earning 100 SBD. This is quite confusing when you find out you're getting 150 USD. It's at least a lot better than it saying $100 and you get $50 USD.
- One benefit of SBD over other altcoins, was the price stability. I found it extremely convenient to bill my customers in SBD, as it was usually 1:1 to USD. Sadly it's not now, and I have to use Steem Value every time I bill someone by hand.
- Without the stability, businesses are more likely to use payment gateways, rather than hold SBD, as they fear that they may lose money due to price flux.
What can we do as witnesses?
- (1) Negative biases. A few witnesses have done this, but it doesn't have a strong effect, because it mainly affects the internal 3-day conversion. Nobody will want to use the 3-day conversion if they'd earn LESS than they would selling at Poloniex or Bittrex.
- (2) Agree on a higher SBD price. If we can't stabilize the price back to $1, as witnesses we could agree that SBD is now worth 2 USD, and report a positive bias, to encourage people to convert their SBD for $2 amounts of STEEM. This would help to stabilize the price around $2, which is a nice easy number for calculating prices by hand.
- (3) Wait it out. We're currently in an bubble that just burst, and it may recover back to $1. On the other hand, we currently have just 1.2 MIL SBD (compare that to the US's 19tril) in circulation, and with the current boom, it's possible that the people believe that SBD should be worth more, and that we should push for option 2.
- (4) A feature suggestion by @timcliff is to allow STEEM tokens to be converted to SBD (you can only do SBD->STEEM right now). This would require another hard fork, but it could definitely help to create downward pressure on SBD. It may be the most permanent fix.
Please, leave a comment. Even if you're not a witness. Help others understand what YOU think we should do to fix the SBD price.
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I think we should allow creation of steem like timcliff suggested, however I would add a little fee to it: something like 5-15% which could be set by witnesses similar to the price of steem. The fee could be burned, creating further price increase for steem.
This would keep the price close to the peg right away and be awesome for steem price. It would create demand for steem and reduce money supply.
Also it would make Sbd usable for the entire crypto space and make steem relevant.
I really like this suggestion!
We wait it out, changing the value of SBD is a bad idea because it sets the precedent that changing the price is acceptable. Why have SBD stay $2 or $4 we can just change it again and again. Issuance of SBD over time will correct the price. It just might take a while. I like Tims idea to speed up this process and get it back to $1. Keeping the pegged value constant at $1 is important IMO.
Think we should wait it out. Good to think about ideas in the mean time.
Noticed this reently and confused many things although a benefit getting more it is not really
$butSBDapparently. Made post suggesting maybe the payout should be in STEEM and now I learn it really is in Steem Dollars. So maybe the$should be changed to reflect this so it is better understood.Don't think we should allow for STEEM to SBD conversion because that could result in too much downward pressure at some point. That could be a worse problem to have.
My suggestion is to adjust the witness support to 1.50 SBD since this is 1/2 as much and related to a Fibonacci level. Then consider levels from $1 to $1.50 and $1.50 to $2.25. This may allow for support at $1.50 as soft peg until this changes from the current apparent range of approximately $1.50 to $2.25.
What do you think of Tim's idea to have a reverse conversion to create downward pressure as needed?
Possibly a good idea too. I saw it a few days ago and forgot about that. I'll add that as option 4 :)
I like the idea, however for those of us at the bottom it would just devalue the holdings. I like option #2 above, find a stable point and hold SBD at that point, be it back at $1, or my preference at the $1.5 to $2 where is has been recently!
I don't get the logic for trying to keep it "stable" if the tools only allow for it to be stable in one direction. If a merchant wants SBD to be $1 (the original intention) then it going to $2 is a problem. If the "fix" involves pegging it at $2, what prevents it from going to $3 and how is that any better than when it went from $1 to $2? The point of a pegged asset is that it has to be pegged. That means it can't go up or down. Trying to keep it at $2 won't help if speculators push it higher.
The holdings won't be devalued if you do the reverse conversion (if it existed). You'd get a premium as long as it's above the peg.
I do see your point, either way I think your right there are tools that need to be worked out to keep it from going up just as much as they need to be in place from it falling.
The only issue I have is that those who are not aware of the reverse conversion or are not around in time to get there could potentially lose a small amount of value, so being it was at $2, I would say develop tools too keep it at $2 not higher and not to much lower!
I understand that, but $2 is confusing to me. That would have to be explained every time while the wallet and the code already assume a $1 value right now. I'd rather we just fix it now and be done with it. Some may miss out, but they already have more than they should right now anyway as it was never meant to be more than $1. If they want, they can sell their SBD now for a premium. It can't be taking something away if it wasn't ever meant to be given out in the first place, IMO.
I see what you mean! Guess, I'm just liking the bubble to much! Your right though $1 would be easier to understand than $2. Not entirely sure on what to do to make the tools needed to keep it down beyond the reverse compensation!
I enjoy paying you using fat dollars.
Genius. Let's rename SBD to FD :)
Fat dollars.
Haha!
Although I do agree with a stable SBD. It's also nice when the SBD shoots up.
I think some may have gotten confused and drove up the price of sbd thinking it was steem. I would not be surprised.
I hope for a steady increase in price rather than stability
I honestly think that awareness would resolve the issue. The recent influx of new users don't really know what their best options are and choose to hoard SBD.
I recommend brightly highlighting (in wallet) the current %APR and the fact that SBD is intended go down around $1. An easily viewable conversion rate would further convince people to trade up.
Alternatively, I wonder what would happen if inactive accounts had their SBD suspended and removed from circulation until they logged in once again.
I was thing about the idea yesterday after reading the another post! SBD needs to be stable, being I'm one with not a large balance to me it does not matter if SBD is pegged at $1, or if SBD is pegged at $2, but your right to have a stable floor, no matter the price, is a great thing. So I would say if there is a way to peg it now at $2 since it did make it there that could be a great idea!
My personal opinion is to just keep the price stable, even if it is at the higher price. To me it seems like a better idea to keep it from falling or dropping back once it has risen. Not sure if the witnesses have a range it should fluctuate between such as lets say $0.10 to $0.50 from the target price! Raising the target price I think would benefit the full community as opposed to option 1 where you mention working to move it back to the $1. I would vote option $2, so long as it does not hurt the community as a whole.
I think the 1$ peg was partially intended as a resource for regular users to be able to quickly and accurately view the approximate value of every transaction on steemit, including the true value of their posts and wallet in reference to $1 USD.
That does make lots of sense!
I just received my first SBD last night, picking my brain as to what to do with it, I want Steem power, but not sure waiting 3 days, when in site claims it @ $1 value. For now I'm doing nothing, Because my conclusion was - its more valuable than steem, and far rarer, making it, in my mind a keeper ?
Your post made me Happy therefore:
(https://postimg.org/image/6bmht2omd/)
"I just received my first SBD last night, picking my brain as to what to do with it"
You might be wise to trade it on the external market for more extra steem before your SBD devalues.
"its more valuable than steem, and far rarer, making it, in my mind a keeper ?"
This post is an attempt to solve the problem that SBD is too high. In other words, the powers that be want it back down to $1 where it's most useful. It's only a matter of time before this happens.
Good call, I wasn't here when it spiked to $20, but did notice :-)
being my first pay, its insignificant in size, and Im looking for more steem Power
So will heed your advice, and learn how to trade this stuff, its much different than your basic coin.
learn the cheap lessons First
Thanks for the reply ( now following) :-)
Good call, that's exactly what I did.
I used this tutorial V and a bit of advice from a friend to learn how. It's quite a process.
https://steemit.com/steemit/@nxtblg/how-to-withdraw-steem-and-steem-dollars-from-your-account-poloniex-and-bittrex
Меньше спекуляцией занимайтесь..и будет все о'кей..))
This is too easy because Steemit needs to be obscure, obtuse and confusing by tradition, but here is a simple answer:
Issue a token worth 1 USD of steem or SP.
Call it a dollar coupon or whatever. You can't call it a dollar because the feds will be all over you in 2 minutes, but there is no law saying you can't have something worth a dollar.
It could be the SBD, but that can of worms is too far gone to even bother to mess with it. I say get rid of that.
Steemers can convert the dollar coupon to SP if they want the voting power or convert it to steem if they want to trade it for bitcoin to trade for local currency.
All the complex algorithms underpinning Steemit are calculated the same except that rewards are posted in do11ar coupons (or whatever you want to call it) instead of SP and SBD.
Make the $1 coupon one way in that you can only get out of it by exchanging it for steem or steem power.
I don't know. It's a tricky issue. I feel like waiting for now.
If the peg doesn't hold, the feature has failed. So what to do?
Fix it? There is more demand than supply for SBD so the price goes up. It doesn't matter if the peg is changed to 2 dollars because then it just goes even higher because of the demand. So the only way to resolve the situation is to find a way to create so much new SBD to the markets that the demand is fulfilled.
But there are some systemic risks. If there happens to be a big bubble in the price of steem someday, it will mean that a lot more SBD will be printed, and when the price of steem goes down again, SBD will create huge liability to the blockchain.
Remove it? If we can't find a real solution to have a fully pegged asset on this blockchain, maybe it's best to admit that the feature just didn't work as intended and remove it. Remember the KISS principle!
Can't we just wait? Nope. By now everybody can see that the feature is broken. If something is fundamentally broken, it should be either fixed or removed.
I always thought that the Steem-dollar was a bit dodgy. In reality Steemit inc. is not a central bank. It might have been a good idea in the beginning to get people in, but when it comes to money people are fast learners. Many an old Steem-granny has been to Poloniex, and that is complicated stuff..
I'd like to see it left alone, if folks want to pay 2usd for a 1usd floor, that is going to get priced into the markets.
The same way the internal price is near half the external price.
An sbd that is not going to go below the peg is an assurance that has value in excess of it's face value, imo.
I did like @timcliff's idea, but don't have near the insight of those that originally shot it down, perhaps it could be an interim, emergency step that is suspended when the peg is within what ever range?
Here is my take: SBD is broken, why not just remove it?
What's confusing to me is that SBD is just a placeholder. I know the original whitepaper is out of date; however as I understood it, each SBD is a holder containing roughly $1 worth of Steem, so if Steem is 0.50 then 1 SBD has 2 Steem in it.
If Steem is $2 then each SBD has 0.5 Steem in it, and so on. So surely any price fluctuations are temporary, as we wait for the Steem price to settle no?
Please explain, in as simple terms as you can.
Thanks
Cg
Interesting.