The design of the Steem Dollar (SBD) looks to me like a huge and deadly accident in the making. The currency must be removed or it should at least be reformed and modified to make sure that all users, investors and speculators know what it is and what they can expect from it. Not changing the way SBD are handled on the other hand will eventually harm both Steemit and the cryptocurrency market.

In this article, I will argue that SBD are a major liability and its removal should be treated as a priority matter by the witnesses.

1. SBD Has No Proper Function

According to the Whitepaper, SBDs were supposed to be a simple exchange intermediate between US-Dollar and Steem. I don't know if the author of the document outlined why he wanted a pegged artificial currency named SBD to represent the exchange ratio to the US-Dollar on Steemit. But there is absolutely nothing that could convince me of the rationality not to use the US-Dollar directly. Imaginable are only security or legal concerns. It's probably simpler to use a make-belief currency instead of the real thing.

But even if there were concerns in the beginning that made it a good idea to invent SBD, now is a different time with very different variables and a very different environment. Steemit is established, the blockchain works reliably (most of the time) and Steem has a value of more than zero in US-Dollar and it doesn't look like it was going down soon and users increasingly learn how to handle cryptos and exchange them freely.

Some witnesses seem to see new or additional functions for SBD, but I haven't read anything what they could be - except maybe that SBDs are ideal for market manipulation. That again is nothing Steemit should allow or even embrace. All other possible functions for SBD can be filled by the official currency Steem or by the US-Dollar if necessary.

I conclude: There is no more reason for SBD to exist except. The only reason why it is still there is that someone introduced it and it costs time and effort to remove it again. If SBD was gone though, nothing would change. Nothing on system level in the world of Steemit and Steem would need any change.

2. Users Don't Know The Difference And They Are Confused About The Distinction Between Steem And SBD

Almost all users are confused about Steem and Steem Dollar. Steemit is quite a complex environment and reading the Whitepaper is something I have only heard @timcliff bragging about. The rest - including experienced users - usually have only a vague image about the inner functionality of the site. But it is not just the deeper and complex elements. One major ill-understood aspect is also the distinction between Steem/Steem Power and Steem Dollar which affects everyone. Even the way the wallet is designed implies that Steem Dollar is the official currency and not Steem (if you don't know the difference between Steem and Steem Dollar, try this) .

It took me personally several months to realize what the difference is! I bet the majority of users here still believes, it's SBD and not Steem that plays the crucial role for the platform.

Add to that the fact that users don't really know what a blockchain is, what "crypto" specifically means and how the concept works on Steemit. The reason for that is that they don't care and because it isn't important for their blogging, commenting and networking activities. They simply like the idea of being part of this latest and coolest of all concepts and they blindly trust the developers. But effectively, almost nobody has any clue and most users just see the happy side with the Dollar signs.

Of course, there are these rules like "buyer beware", "your return - your risk", "a system for dummies attracts dummies" and so on. But should it really be a characteristic of Steemit that its users take part in a comprehensive computer and business education course before they can start having fun here? The sad and scary truth is that not even all witnesses seem to understand the underlying system.

I conclude: Why does Steemit have to be more complex than it has to be? At least remove the most confusing and unnecessary parts of it and that is more than anything else the SBD.

3. Stupid, It's A Fiat Currency!

The by far biggest surprise to me was when I learned that SBD is a textbook fiat currency. Imagine: The currency of the first big blockchain blogging platform situated in the center of the crypto universe is being created out of thin air. Let that sink in! Wow!

But that insult is not even the biggest problem. Fiat currencies can be made working. There are several examples in real life showing the proof-of-work pretty impressively. And after all, isn't SBD traded higher than Steem? Looks like the market even prefers an asset which is made out of thin air to an asset made of blog posts. (If that is not another insult, I don't know what is..).

I conclude: Running a fiat currency while pretending to be a crypto enterprise reminds me of that hedge fond that put the word blockchain into its name and tripled its value on the stock market. But do we really want that?

4. Unethical Business Practices - Do You Want Your Name To Be Connected With That?

The points 2 and 3 can be summarized as "unethical business practices". It just isn't a good thing to confuse users (and developers!) more than necessary, even if it's something "new" and a "work in progress" and then do the opposite of what you are implying to represent. (Hell, it's almost like what Socialists do!)

This all may be legal, but it leaves a very strange taste and you must never forget that what goes around that comes around. In the case of Steemit this counts especially for the witnesses. You have a lot of responsibility for which you receive a lot of money. But if you aren't willing to reform a highly volatile and complex element that you don't have any real control over - and not to speak about understanding it - and that very thing is now pumping itself up more and more every day, you will at one point wake up and see how somebody or something blew up the entire platform. And you will have the responsibility for burning >44 Million US-$ and this for no real reason.

I conclude: Keeping SBD as a part of the Steemit system and even more keeping it in circulation outside of it will at one point come back to you. There is already way to much money involved and even if the entire market is very risky and experimental, SBD is like a balloon with a built in needle and there won't be excuses for you when this becomes relevant.

5. Uncontrollable And Already Out Of Control

SBD were planned as being pegged 1:1 to the US-Dollar. Well, that worked pretty well so far and in case you found sarcasm in that statement, you found the right ingredient. If you can believe @timcliff in this interview (min28-32) SBD by design only has a dampener for dropping below 1 US-Dollar but none when it goes in the other direction. That is like asking for trouble and obviously that trouble is already relevant.

If you design a currency - no matter if its a fiat one or of any other sort - and you build in such a flaw, you must remove the flaw as soon as it becomes apparent or you have pull the currency out of circulation as soon as possible. Because if you don't do this, it is very, very likely that it will happen again and it will happen worse and it will happen until something breaks.

In the case of SBD, this means that the price for this fiat currency will go up again and more than before and maybe even more rapid. And users, speculators and investors still think of it as the official Steemit currency and they also believe that it is a cryptocurrency - although it isn't.

I conclude: SBD in the current shape is a ticking and self-replicating time bomb. It already blew up before and it will blow up until it breaks. Breaking in this case means until Steemit is gone.

6. A Liability And A Point Of Attack For Very Big Players

In a post in which I defended @haejin I stated that the only thing about him that frightens me is the (small but bigger than zero) chance that he isn't some talented analyst but the North Korean government trying to play the crypto market. The same can be said about @berniesanders. Are you really sure he's just some fatty loser living in his moms basement - or is he maybe Jamie Dimons other daughter who does what daddy tells her to do?

Cryptocurrencies are a major threat to classic banks. They are growing at a lightning pace and the outlook is non othr than the take-over of the entire classic banking market. You all know that. The banks and the players behind it plus others who have to lose a lot as well (=governments) surely don't just sit put and wait for the inevitable to happen. And just as there could be users on Steemit causing unnecessary trouble in the interest of hidden third parties, I find it at least equally likely that JPMorgan, Goldman Sachs and all the other banks gave some of their well paid interns the task to read the Whitepapers of all well running crypto projects and look for weaknesses that can be exploited for profit and for the destruction of the respective project.

Or do you think the whole Bicoin theater with the blocksize, the hardforks and some Bilderberg guy taking over the whole thing at the end was just another coincidence?

They know exactly what is going on. Only fools see this as coincidence and thinking the prices went up because "Christmas" or whatever is dangerously naive, as I think. And accordingly, I don't think it is a coincidence or a funny confusion that SBD is trading higher than Steem. It is there to keep the possibility open to use SBD as means to disrupt the market and possibly destroy Steemit as a whole. Or at least to kill off the trust, Steemit and the market enjoy right now.

I conclude: Banks have Billions and they have Billions to lose and that is why it is absolutely dominant for them to penetrate the crypto market where they can. If you think, Steemit and its biggest and by far most expensive weakness SBD are protected is a false hope. SBD is an open door for hostile market activities and therefore it must be removed.

Bottom Line

I am convinced that the design of SBD is an imminent threat for Steemit. Therefore, the removal of SBD or a comprehensive modification must be treated as a priority by the witnesses. As soon as possible, there should be a hard fork to retire this strange currency in its current shape. SBD doesn't fit to Steemit, it doesn't fit on the crypto market, there is no relevant reason to keep it around - but there is at least half a dozen reasons to get rid of it.

That's why: SBD must go!

...or, to address the title of this post: Print SBD. Give every user 1,000 SBD at once and the market will know.

What do you think about SBD, did you know, SBD were a fiat currency and what possible sense could it make to keep them on the platform?