Will the SBD stop printing soon?
Over the last couple of weeks I have been watching the SBD/Steem Debt ratio slowly climb (Steemreports) as the prices have fallen. So much SBD got issued when prices were high in comparison to Steem that even though it is now sitting around $1.07, the ratio is 3.63% but, that is calculated on the 3.5 day moving average which is how the blockchain calculates it.
But, if you factor in current prices from coinmarketcap (which Steemreports handily does), the real ratio is:
4.33%
At 5%, SBD stops printing so, what then?
Note: the liquids get paid in Steem instead.
Oh, in the time I started writing this:
The current price for STEEM is $1.34 and its market cap is: $352 Million USD
The current price for SBD is: $1.07 and its market cap is: $16 Million USD
If Steem drops a little more from it's 1.34 down to around about 1.21 and SBD stays the same, that should be approximately a 5% debt ratio. Alternatively, if SBD goes up about 7 cents and Steem stays the same, that too will be a 5% debt ratio. Both of these are quite likely and considering how little SBD is on the market, it isn't hard to get it to pump ~6%.
So, now what?
What happens if SBD stops printing in a few days and payouts are only in STEEM? Will the bots still function as they have done, will the extra Steem on the market push prices even lower? Will SBD get pumped really hard by those who have it to cash in while others are unable to earn it?
The last time this actually happened was somewhere around March 2017 if I remember when Steem prices were 7 cents-ish. At the time I thought I was somehow getting ripped off because I had even less idea than now, but in hindsight, getting paid in Steem wasn't such a bad thing ;) but, this time I am still relatively clueless as to what to expect from the market and, from the people who are sitting on SBD. All it takes is one little pump to get the ball rolling.
What are your predictions on what will happen if SBD stops printing in a few days?
Taraz
[ a Steemit original ]
Wow. Id like to get paid in Steem but reading what you said makes me think itd be nice to have an accumulation of SBD.
Oh well, c'est la vie.
I don't know if it will pump or not but I figure low supply gives it a good chance.
SBD confuses me loads.
"Alternatively, if SBD goes up about 7 cents and Steem stays the same, that too will be a 5% debt ratio."
On this point, i was reading this post https://steemit.com/witness-category/@dragosroua/adjusting-my-price-feed-to-2-sbd-may-cross-below-usd1
so maybe you can explain to me, if witnesses have a negative bias this could push up the price of SBD as less will be printed? If I am correct on this assumption then if the price of STEEM goes down and SBD up, then the 5% would be reached rather quick. Stopping the printing of SBD pushing the price up more, moving further away from the $1 peg. Or do I have this all wrong?
I am pretty sure that is how it works
@eonwarped ?
i am reading the white paper now to try get more clarity on this. Taken directly
"The primary concern of Steem feed producers is to maintain a stable one-to-one conversion between SBD
and the US dollar (USD). In a market where debt still demands a premium, it is safe to say the market is
willing to extend more credit than the debt the community is willing to take on. If this happens a SBD will
be valued at more than $1.00 and there is little the community can do.
If SBD trades for less than $1.00 USD and the debt-to-ownership ratio is high, then the feeds should be
adjusted upward to give more STEEM per SBD. This will increase demand for SBD while also reducing
the debt-to-ownership ratio and returning SBD to parity with USD.
"
So I think that if a negative bias is used as per @dragosroua is put into play, we could see that pump happen! that's interesting.
However I also believe that higher price SBD give shorter term thinking for many, long term I am happy with a pegged price, but who does not love a pump.
yeah, I am not sure how the witnesses handle it but it is obvious that some are happy with a peg and some are happy o have a lot more SBD on the market place riding very high
Good analysis. My predictions are simple, if SBD stops printing, there will be a pump and SBD will be worth more than Steem and i'm still surprised that 1 steem is worth 1.24 sbd....it should be getting closer to 1:1
I think it will pump.
Low supply + asshole bid bot users + holders + $1 SBD = PUMP
it is getting closer. 4.14%
CMC = 4.46% so give it 3 days-ish
Steem technically should see a small pump in the case that sbd stops printing. There is no ‘debt instrument’ (SBD) so the distribution of Steem as rewards will be lower. I don’t know the maths for the debt to equity, but I’d assume there will be up to 50% less ‘rewards’ paid due to it being tied up as Steem. If someone knows the actual answer here, please chime in.
I think a pump on SBD is highly likely. I am thinking in the future that SBD may eventually disappear though.
Yeah, if it can't do the job it has been tasked with, why keep it employed?
Yeah, if it can't do
The job it has been tasked with,
Why keep it employed?
- tarazkp
I'm a bot. I detect haiku.
I just came to vote the bot.
lol... finally!!!
Ahhahaha that haiku bot
why do you think its highly likely?
I really don't know what to expect. I do hope SBD manages to hold above that 'tipping point' though
I am so ignorant on this subject
Paying for bots is not an issue for me as I currently use it to power up and collecting Steem . So getting paid in Steem to me with my vast knowledge is a good thing.
I like the low Steem prices because I can get more Steem for the dollar when purchasing. When I started Steemit I was paying the $7 for Steem. Then number of Steem that I purchased at that level then compared to now I should or would have 6 times higher Steem.
I don't see it as a negative because I am a long term Steemit and this current price is a good opportunity for me
Getting paid out in Steem rather than SBD is fine by me - means I dont have to manually power up :)
It is still liquid so you will :D
I'm glad i didn't hoard a bunch of SBD. I thought what if the 12 dollar SBD comes back? I'm going to stop making my posts 50/50 steem/sbd payouts.
Good news, everyone seems to have stopped using bidbots, steemit bot tracker looks way different today than a month ago
because the margins are so tight and prices are falling, too many are making a loss.
I just hope it's something positive and that it helps us all, it would be good if they paid everything for STEEM would be an interesting experiment, do not you think?
people have been talking about getting rid of SBD for a long time and focusing on Steem only.
I'm solidly for that!
I hope not to lose the SBD forever, the balance of two currency options has worked for us.
I am not sure which is better but it would be great to have a steady coin like a tether.