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RE: Steem experiment: Burn post #156
I'm concerned that SBD and Steem will hit $1 at nearly the same time. Smooth will then need to begin the power down on this account. Selling Steem and burning SBD... lol. That's going to be great.
Next time the market pumps, sbd will have a limited supply and pump even harder.
How do you guys see it playing out?
There will be no selling of STEEM (see other reply below).
You are right about this. The white paper suggests (and I agree) that when the SBD supply is relatively low, paying interest should be used to support the price of SBD rather than converting/destroying it. I agree with that. The advantage of using interest is that unlike conversions (currently; there is a proposal to allow conversions in both direction) it is fully reversible. The SBD then still exists later when the price may tend to increase, Interest can then be lowered or removed, hopefully weakening it.
In another thread there was a suggestion made that burnpost would just hold the SBD when SBD is weak instead of converting or burning it, for similar reasons. I have mixed feelings about that, but may consider it.
Thank you. I will read the blog.
The account is not going to sell STEEM. From the description:
By reducing the overall STEEM supply, this will put upward pressure on the price. Not sure if that really means "None of the coins" or if it should say "None of the STEEM". Unti now, I believe that the account's SBD has been sold for STEEM. It's not really clear to me if he's going to switch from selling SBD to using the "convert" function while SBDs are priced near or below $1.00.
Good point, that language could be improved. Anyway, you are right it won't be selling STEEM.
There is a new update on my main blog describing the procedure that will be followed when SBD is at or below $1.
Well, it will be interesting to see it play out. I am interested to see what he does now.