I agree this is not good for the platform and could make some people more skeptical about Steemit posting articles like this from one of the founders of Steemit. This is no better then a government bailout to save there own fiat currency. @dantheman should update this or add more clarification or else this will make people more skeptical of the platform.
This was added to make people more confident. The alternative is to deny reality and pretend this could never happen. The odds are slim, but having insurance is better than denial.
Better lock the SBD (fixed deposit style) than convert it automatically to Steem, and then let the option to users to decide if they want to liquidate the position or keep it as vesting SBD. This has the advantage that people who are not paying attention won't mind if the SBD are vesting, and people who are paying attention will at least get to chose between accepting their SBD to be let in vesting (with higher interest rate) or liquidate the vesting SBD into liquid Steem or Steem Power after the 1-week conversion period. This effectively prevents a run on the bank on SBD and doesn't risk exposing people who are not paying attention to Steem volatility unbeknownst to them.
For more leeway, and to avoid making Vesting SBD feel like capital controls, you could create already a new type of asset called Vesting SBD (the very same to which you will convert liquid SBDs in case of black swan) so that people will already be familiar with it as a form of longer term asset and won't have a knee jerk reaction when they find their liquid SBD was converted to vesting SBD. And to encourage people to put their SBD in vesting proactively (and therefore give the network more leeway), you could pay an interest rate that is a function of the "Liquid SBD supply"/"Total SP market cap" so that the higher the ratio, the higher the interest will be and the higher the incentive to put SBD to vest.
To finance higher interests on Vesting SBD, and desincentivize holding liquid SBD, the interest rate on liquid SBD should be lower, but not that low as to discourage market makers from holding liquid SBD. That way people will keep liquid SBD if they want to cash out soon or do trading, or put it to vest if they just want to hold it there to make interests or until Steem hits the price at which they are keen on converting the vesting SBD to Steem or Steem Power.
Dan, with all due respect but it seems you might be in denial of a whole other scenario ...
(I love steemit and you're a genius, but ...)
what if ... there's no black swan event, but you got so caught up with the mathematics and the monetary side of it all that you lost sight of the community and you're ignoring clear warning signs that somethings is wrong
People are complaining, and whether or not their complaints are valid is irrelevant, they're your costumers and they're not happy!
I'm talking about the way posts sort on the tag-pages, on top it looks great, which means the system as a whole is working ... but the top is still minuscule, while the middle is basically non-existing and there's a massacre going on at the bottom!
Forget about the numbers and listen to your FANS!!
here's my suggestion; take the full list of users, filter out those that got enough steem, those that are not active enough etc etc etc ... but don't be too strict, so you're left with a list of a few thousands minnows and give them each 100 steem power
whether or not that will mathematical work out doesn't matter; it's for the people, it's to get them enthusiastic again ...
what if ... your black swan event is unfolding right now, as you read this ...
The clients are always right, especially when they're are wrong!
Their mood, their perception, their emotions matter more than the facts!
Do something, whatever it is ... do something, do it public and do it NOW!
Yeah true. You should really think about making it only take 1 day to convert SBD to SP, because I always transfer my SBD to Poloniex because I don't want to wait 7 days to convert to SP. Steemit should buy back SBD with advertising revenue too.
yeah you should be able to convert direct from SBD to SP