Who is buying all the SBD's?
Over the last week steem has seen some awesome gains, but nothing compared to the mooning SBD's have been going through leaving those of us who have been holding steem, and not so much SBD's, scratching our heads. If I would have known SBD would be trading for over $10 on some platforms, I would have held a lot more. I sold what little I had and I'm super happy with how much SP I got out of it, but the whole situation leaves me confused. Who is buying all these SBD? Everyone who is actually on the steemit platform is using the opportunity to sell, sell, sell, and power up some steem. Why? Because we're confident steem will outperform SBD, and SBD will eventually return to it's peg at $1. So who is buying these steem dollars at $12? Are these buyers unaware of the $1 peg, or are they just throwing their money at whatever seems hot at the moment? I understand traders buying at $1-$1.5, maybe even $2 because to protect their investment against dips in other currencies because they know SBD will be worth at least $1, but how does someone expect to make a profit at $12? Does anyone out there actually know anyone buying SBD right now? I don't. All I see is sell, sell, sell. All this sell pressure and it's still not dipping below $6. I it possible this could be a coordinated pump? With a total supply of only 3.5 million, SBD would be easier than most currencies to manipulate, pump, and dump. I personally think it would be best for the ecosystem if SBD stayed around $1 like it was intended. Having as stable liquid currency for post payouts, and transactions make steemit a lot easier for newbies to understand, and bring confidence in the value of SBD in the world of volatility that is crypto. This isn't gonna keep me from taking advantage and powering up every SBD I get, but still somewhat worrisome. What do you guys think? Is their some manipulation going on driving up the price of SBD? I'm not an expert by any means but this pump seems suspicious to me. It's not gonna keep me from taking advantage and powering up every SBD I get until the peg is restored, but still somewhat worrisome. Is there anyone out there that can bring some clarity to this situation? Who the hell is buying all the SBD's?
-Daniel
My theory is people is using SBD to make arbitrage on BTC and other altcoins between different exchanges... BTC have been so volatile, increase and decrease 2k or 3k in one day, but the price may very from exchange to exchange, so lets say in one exchange BTC hit 19K while in other is still at 17K, it takes a few minutes for the price to level up on all exchanges, so people will sell BTC at 19K, and buy it at 17K for a 2K gain... This is only possible using a coin like SBD that transfers almost instantly, so they can move the money from different exchanges and take advantages of the price difference... Also there is a very little SBD circulation out there compared to any other coin, so the price pumps every time BTC goes up, its a win win, when BTC price goes down, SBD also goes down and people can buy cheap SBD and get ready to arbitrage once BTC goes up again...
Makes some sense!
Yeah it would only be logical if they're selling them on another exchange right away, but at $12 it seems risky. Wouldn't steem have the same liquidity and instant transactions? How many exchanges have SBD's? I thought there was only a couple.
Its a bit risky, but these are people who knows what they do, also they buy and sell instantly, thats why you see those big bumps and drops so quickly... The exchanges trading SBD are the same trading steem... Only steem have a huge circulating coins compared to SBD which is very little... Steem have 250 million circulating coins and SBD only 3,6 million, difference is huge.... Also my bet is there is people arbitraging between bittrex and hitbtc, prices there are usually different and change slowly compared to SBD transactions speed...
I don't see the problem with the high price of SBD. I've read through the white paper and it seems that when the price of SBD is trading above $1, then the interest payment that is paid out by holding SBD stops. The white paper also says they expect, under normal market conditions, for SBD to trade between $0.95 - $1.05. The key word, however, is 'normal' market conditions. The market is anything but normal right now with the skyrocketing of BTC. The market is highly volatile.
The good thing is, the white paper reads like the developers knew this might happen which is why they mention the "Impossible Trinity" as being built into the design of SBD. So if I read it right, the Impossible Trinity prevents something terrible from happening with major price movement of SBD.
SBD was tethered to the USD to make it a safe investment where people are unlikely to lose money. Doesn't mean large amounts of money can't be made in a volatile market though. I think if people invested in SBD at $1.00 and the price rockets up between $10 - $20, that's a good thing for the investor, not a bad thing. It also increases the value of Author Rewards which helps content creation.
Its not a bad thing, but it is not what its supposed to happen, steem should be our most valued coin so people would invest in steem, not SBD, the SBD are meant to spend, not to speculate... Of course whats happening now was an unpredictable event, i think there was some bots while ago that used to try to drag SBD price down to 1$, but these bots are now banned from exchanges... Though they still work on steem internal market (i think), thats why steem price moves at the same time with SBD...
but if someone wants to buy SBD to pay for a product or service and the price is at $10, then drops back down to $1 before they spend it all then i doubt they are going to try to make transactions with SBD again, which I understood was the purpose. It has been nice to see all the minnows cashing out their SBD for decent rewards. I had an $8 dollar post that paid me 3.5 SBD and like 2.5 steem. Sold the SBD on the internal market for 19.3 steem. So total I made 21.8 steem worth like $38 right now.
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