What's Going To Happen With The Price Of SBD? (PS - Check Out @Haejin!)
Many Steemians are asking me to give them pointers on what to do with their Steem-Backed Dollars. The recent and sudden spike to $12 has made posting very profitable on Steemit, but it also triggers a new round of FOMO, and nobody wants to miss out on gains, however ephemeral.
So, if you're trying to decide what to do with your SBD, consider the following question: are you an "employee", an investor, or a gambler?
If you're an "employee", or in other words, you rely significantly on your regular income from SBD, I recommend selling your SBD for Steem as they become available. This will dollar-cost average your sales, giving you a less volatile income rate. This ensures you will benefit from the price spike with a large increase in your post payouts, and will keep your income regular.
If you're an "investor", you probably want to regularly sell your SBD also. Nobody becomes a successful investor by making a 1200% gain and hodl'ing back down to $1. Take some profits and pick your points to take more, either on the upside or the downside. Don't get greedy. I'd sell at least half and I'd be biased to selling more if we saw $6-$8 again, or $15.
But what if you want to get greedy and gamble? Truly, many of you reading this post are really here hoping for some secret sauce that will let you double your SBD payments yet again from $12 to $24. I can't provide that, and I can't claim to know which way SBD will go. Frankly, all logic and fundamentals outside a Tether-related "conspiracy theory" points to SBD going back down.
What I can do is point you to @Haejin, one of the hottest technical analysts on Steem the last couple of months. He has some seemingly provocative price calls (BTS $342) based completely on technical analysis - no news or fundamentals. Even though many of his calls make no "rational/fundamental" sense, his accuracy is uncanny and his calls not to be underestimated. He has earned one of the highest rankings on my auto-voter.
@Haejin's calls highlight a philosophy of trading I've adjusted to this past year despite extreme difficulty. I call it the "George Costanza" trading strategy - do the opposite of whatever seems right.
Often, the less I think a trade should work out on fundamentals, the more profitable it has been. The market seems to have no worries about silly things like scalability and $20+fees, so we must resist the urge to care as well. Often, Haejin's charts give me the confidence to do just that.
If you're looking for an excuse to buy/hodl your SBD, cross your fingers and print out the above chart!
Also, please visit Haejin's blog and his recent SBD post: https://steemit.com/bitcoin/@haejin/steem-dollars-sbd-target-usd28-80-check-out-this-chart
If you have any additions or errata for this post, please let me know! I will see that they are voted to the top of the comments, and will make the appropriate edits (if possible).
We also have a Radio Station! (click me)
...and a 5000+ active user Discord Chat Server! (click me)
Sources: @Haejin, Google
Copyright: OpenClipArt.org, @flick, @hisnameisollie, O.A.R., Seinfeld
Just stumbled on this post. I think it is especially relevant considering steem's blue sky breakout above $4 to start off 2018.
I just published a post about the breakout; admittedly, before steem's run up this week, I thought that SBD's head start ascension was due to its limited supply relative to steem (5M versus 260M). It now appears that the crypto market is acknowledging the potential of the steem blockchain itself, despite Steemit's issues, and SBD is perhaps retaining its appreciated value as a consequence of steem's rise.
On page 12 of 32 of the Steem White Paper, the founders stated that, "We fully expect there to be a narrow trading range between $0.95 and $1.05 for SBD under normal market conditions." See: https://steem.io/SteemWhitePaper.pdf
Clearly, their expectation is not the present reality. However, I have read alternative views that SBD's floor price is what is pegged to $1 USD and that there is consequently no ceiling as to how high it can trade. Nonetheless, it will be interesting to see if steem's price soon surpasses SBD's, or whether they continue to trade in unison.
Going into 2018, the broader investment community is paying attention to the Smart Media Token roll out and its potential to disrupt online publishing. Articles like this one published on NASDAQ may explain the recent surge in steem's price and volume traded: http://www.nasdaq.com/article/how-blockchain-based-cryptocurrency-can-make-online-publishing-more-profitable-cm895389
Great comment. I hope more people see it.
There is really no mechanism by which SBD is effectively pegged. It's more of a price-floor than a price peg. The measures available to curb its price rise are very minute.
Thank you for the kind words and feedback, lex.
I am actually in the midst of discussing SBDs in a thread with Tim Cliff. Feel free to chime in. It starts here.
I think it is critical for Steemit Inc to definitively and clearly distinguish between STEEM and SBDs in light of STEEM's recent price breakout and the sustained rise of SBDs far above the initially defined peg outlined in the Steem White Paper. As public interest in the steem blockchain grows, it is imperative that the distinction be made clear in layman's terms so that any unintended market confusion is abated, especially in light of the fact that free market forces have demonstrated since the end of 2017 that the peg as originally explained in the white paper is not a proper characterization of how SBDs can actually be expected to fluctuate in value.
On a separate yet somewhat related note, I delved into the Steem White Paper to similarly address the recently announced initiative by Grumpy Cat to combat voting abuse. I understand that there are many that question his intentions. In the interest of a civil conversation, I didn't scrutinize that but rather pointed out items from the white paper itself which controvert his proposed approach to addressing abuse of the reward pool. Any thoughts/feedback are appreciated. The comment starts here.
It floors me that SBD are moving and not really steem you would think steem is the one that should be holding the value and not SBD
See, this is what I'm talking about. You're using logic, so you come to the conclusion that SBD should not be $12. However, if we acted opposite to that conclusion previously, we'd be sitting pretty right now!
I must direct you to the late edit/addition to my post:
Let me redirect you to this post on luck in trading. The Seinfeld scene is funny precisely because it's so unlikely for it to work out for George.
It seems like it has been maintaining a 5:1 ratio recently.
Yep, that's simply because Steem has been around $2-$2.20. The market settles to the price ratio.
Not too long ago, it was $5:$1 for SBD:STEEM. Prior to that, the correlation was closer to 1:1.
Now, in retrospect, we've seen that ratio tighten, yet at much higher prices.
True. If it keeps that ratio, SBD could go very high. Interesting.
The ratio has fallen now, but we're at significantly higher Steem prices.
well it is still steem...even if backed by dollars
xD
My strategy is to sell my Steem Backed Dollars, and then buy Steem with it, and then power-up with it!
I'm currently selling SBD as soon as I get the rewards, and I don't think I'll have any regrets if SBD does pump again. Playing it safe sometimes is not bad at all.
Same here.
Prudent plan. Should work out.
I think it is a supply issue. SBDs are rare(<3MIL) and there are 250 million steem.
Bingo. The tiny market cap is a critical factor. Most SBDs are eventually burned in one of several ways.
This is what I keep saying. SBD is only created by the content flowing though the blockchain. This means the content creator is the only person who can make it and it is the rarest currency. This is like a video game thing and I don't know why people can't see it. When the platform value and interest in it goes up, then the rarest currency should go up the most.
Interesting perspective....I wonder if it will prove to be true, of if this SBD price remains some sort of transient pump.
I vote for my idea! I got it from pokemon red. The coins you have to work for are the ones to keep. Don't put it all to currency you battle with.
Everyone else powers up and then no one has free cash to spend when needed.
In steemit - only some people can generate sbd - very few people.
Can you expand on this @lexiconical? I'm struggling to come to grips with the relationship between steem and SBD.
There are very few total SBD circulating, as many of them are destroyed eventually (via @null, promotion, Conversion option in wallet).
This keeps supply very low, as you can see on CoinMarketCap.
Cheers mate. I just read the white paper now to try and find out about the "debt" thing. I didn't realise they were a debt instrument.
Exactly. Think the witnesses should start working on more aggressive pegging strategies, maybe introduce a 100% SBD payout option and enable it whenever one SBD exceeds a value of something like1.5 USD. It really seems they are sleeping through this one at the moment. Pegging needs to start happening much more aggressively. The current pump clearly shows that. If SBD can't be made to handle silly pumps like this, how can we expect it to handle it if (when) the BTC bubble bursts and pulls other crypto currency down with it?
That's an interesting idea I haven't seen presented anywhere else.
What do you see as the primary benefit(s) of a more aggressive peg?
I think the main advantage of whatever measure could be devised to make SBD relatively stable in price would be the possibility to offer fixed price services of the not done in a jiffy type. For example, I'm in the market for a good editor who could help me turn my series of steemit fiction posts into something of high enough quality to self publish. If I had hired an editor when SBD was still round and about 1 USD , agreeing to pay 0.00018 SBD per word, I'dd be looking at a real sour deal if that editor delivers while SBD is stuck at over 10 SBD after a pump. The opposite would be true if BTC would tumble down to $3000, pulling SBD to maybe under $0.10 for a longer period of time. I think aggressive pegging could help attenuate these prolonged deviations from the peg and thus could open up an SBD based service economy that today seems to be inhibited by insufficient effacacy of the pegging mechanism.
It's my opinion that the best thing to do is to trade for STEEM and convert to STEEM POWER, increasing your status in the platform. Unless you're desperate for cash, then sell for litecoin and sell for cash. I have a gut feeling SBD will eventually return to $1.00. However, my gut is not always correct. @ironshield
It's a tether, so definitely the $1 point is inevitable. The wise person stacks lots of steem or other great low currencies now.
Every "tether" in history has eventually broken. So, it would seem inevitable that it eventually breaks.
Food for though.
I agree with you on this one. Keep stacking.
In order to revert, clearly some stronger measures are required.
Solid, risk-minimizing advice.
I hope @haejin 's prophecy comes true tho. Being able to pay back a house loan earlier than foreseen for example, would really loosen the noose on us salaryslaves. ;-)
AL! Love me some Katy Sagal and the gang
Haha!
i can hang to this
I particularly like it when he uses his tie in a similar fashion.
I have a tie of the same color for whenever the occasional bitcoin correction happens :)
@haejin is my new boyfriend. I love him the most even though we just met a few weeks ago. His you tube videos are the best videos ever made in the history of videos. His calm voice of certainty and stats gives me great confidence in his wisdom. He only believes in trends that have previous history of being right. He explains this is a way that makes sense as you watch his words unfold. I will do everything he says forever.
"I will do everything he says forever."
Sounds like you've reached "cult member" status...what is that, OT-3?
lol - I had to back away. This is too much of a hot button and I am just trying to post 18 hours a day here. I have no need to be killed by a whale when I am just down here trying to help gasping minnows.
I followed the guy for about three months and I have notes, leaned about laddering etc.the lave affair is over for my own self-protection in this snake pit.
My other boyfriend - jerrybanfield must be so happy to have the heat somewhere else.
Meanwhile I have my own major troubles. Lots of steemit cash and I can't get any of it!!!!
Can you look at my recent post and gives any ideas? This was a hail mary...
https://steemit.com/steemgigs/@fitinfun/fitinfun-faucet-steemgigs-money-transfer-offer-hot-hot-hot
I've been following @haejin too and he does seem to have a knack for reading the charts and making good predictions. Excellent info! 👏
I would say he's a talented chartist, and TA via charts seems to be a self-fulfilling prophecy in this market.
This is defiantly a question I wrestle with myself, so far I've been marketing it instantly for Steem then powering up my account. But yesterday I decided to send some to bittrex and diversify into a few more alt coins.
I had planned to go back to powering up, but it may just be a good option to sit on some, just in case it does keep skyrocketing.
As we're seeing now 2 weeks later, having some Steem available to sell would allow you get a great price in the current market.
You are absolutely right, nobody has any idea.
SBD's 12$ bump is receding n is likely to come down more. Although everyone of us would like it to be otherwise but that is unlikely in near times. Moreover, I would like to see Steem Swell instead of SBD.
It would appear you are getting your requested bump in the Steem price, as well as a corresponding drop in the price of SBD.
yea, over the past week it has happened. Now SMT roll out is going to further boost the Steem Market. Hopefully the steem would be at 15$ to 20$ by the end of this year!! Considering SMTs as well.