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RE: Burnpost three month status and update

in #steem6 years ago

The and price won't be able to go down to the peg for a long while, the low supply allows anyone with a good amount of money to manipulate it... especially of you keep throwing more sbd their way by selling it. the only way to take down the price is to increase printing rates in my opinion.

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Selling SBD never helps someone increase the price of it, no matter how much they already own. At a minimum it is at least an additional incremental cost they need to incur to keep the price propped up, and depending on the presence of other selling pressure (from others who also want to cash out) may have secondary effects sending the price lower still. No one has unlimited funds, and even if they do, propping up SBD is not always going to be the best use for those funds in the entire world.

BTW, how is the printing rate determined?

The printing rate is determined by the witnesses by modifying their feed bias? There was a movement to bring the price down by increasing the bias but as soon as steem went over and most of witnesses reduced their print bias down to 0 and now we are back at having sbd higher than steem.

Unfortuantely the bias is a poor tool for this because the single input affects multiple behaviors. That was behind a lot of the witness reluctance to use it in that manner. Hopefully in the future we can improve the mechanism to offer better tools.

To answer my own question (rhetorical of course) the printing rate is determined in part according to the market cap. So raising the price and market cap of STEEM by buying it and powering it up to designated burn account indirectly increases the print rate. Of course, so far the magnitude of this effect has been somewhat small, at only about $500 per day. But the steady growth in support for @burnpost raises the prospect of much higher buy and power up rates. Taking a lot of liquid STEEM off the market could have a dramatic effect.

I certainly don't expect to turn the world around on $500/day, but the feedback loops within @burnpost have been carefully designed to always operate in a beneficial direction at least, with the magnitude left up to the voters.

I was not aware that the bias modified other behaviors other than the printing of more sbds.

The sbd down to the peg will be better for the platform in the long run and for future businesses that want to run on a stable currency on the platform. So I wish you luck in your endeavours, I'll try to help out by dropping my 0.03c vote every once in a while.

Thank you for your support and thoughts.

I'm all in support for this. I had questions before checking the comments, but this conversation answered it all.

Good work, @smooth, Thanks.

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