Theory on SBD price: Is the reward pool being 'raped' to pump up the price, thereby increasing rewards? 🤔
I have developed a theory on the seemingly unexplainable high price of SBD, which is currently still trading at about 10x it's intended value. It's not a pretty theory, I fear, and I lack the technical expertise to know for certain if this is possible, but it feels like it could be. Perhaps one of you may know.
STEP 1: RAPING THE REWARD POOL
There is a lot of talk about the reward pool being 'raped' by some high profile Steemians, and for sure some people are raking in thousands of dollars daily. It's not just people posting on Trending, but also a large amount of people are abusing bots to drain the pool. Recently one Steemian uncovered a user draining the pool significantly through abusive ways by upvoting his own empty comments.
STEP 2: USING THE PROFITS TO PUMP UP SBD
Now, the SBD market is a small market with not that much volume in the grand scheme of things. How many people are there buying SBD, truly? How much money would be required in order to increase the price of SBD?Would it be possible to first drain the reward pool for thousands of dollars, then use those dollars to buy up all the SBD in order to make the price rise?
STEP 3: HIGHER SBD = EVEN HIGHER REWARDS
After one increases the price of SBD using the payouts of STEEM, the rewards that are paid out are also increased. The spent money from the reward pool gets cycled back to the reward pool because it's value rises, which is then paid out and this increased value allows us to move the market upwards once more because there's more money to spend on buying even more SBD... which then increases the price further.STEP 4: REPEAT
If my theory is correct, using this technique it could go on for quite a while. At least until the market is too big to move it for those pumping it. At which point an exit strategy would be required.As I said though, I lack the technical expertise and insight in the deeper mechanisms of the STEEM reward pool to know if this is possible for certain. I kind of hope that one of you, my readers, can clear this up for me. I'd love to be proven wrong!
Because if I am right - then at some point there must be an exit strategy also for those pumping up the price, a 'Step 5'. It is amazing to hold a lot of tokens with a high value but if you cannot monetize that value it is worthless. So at some point a potential abuser will want to cash out, potentially causing a downward spiral and crash of the SBD price as he takes with him all the money that went into it.
I'd love to hear your thoughts on this theory.
a small market ? Wikipedia tells there is nearly 1 Billion USD marketcapitalization in Steem...
If Steem is a scam it would be a pitty - not just because a lot of people were fooled but also because it is waste and burning of a very very good idea with great great potential: Social Marketing, Bloging, Cryptomarket, Blockchaintechnology - 4 of the greatest winners of the last 10 years combined in one project...
If it is legit - we all are part and witness of one of the greatest revolutions since the invention of the Internet...
I welcome you making up your mind about what is going on but I guess we won't change this anyway...
@upv4life resp. @honolulu
Oh no, I meant the SBD market is small enough to manipulate. STEEM itself is a lot bigger and harder to manipulate.
But the SBD markets.. who really (used to) pay attention to those? The volume is a lot lower, so it's easier to move. I don't think there's 'stuff' going on in the STEEM market, but I do suspect there may be fishy things going on in the SBD markets which 'spill over' to STEEM if you understand what I mean!
I believe most cryptos are being manipulated in some way at this point in time. It scares the hell out of me for the future of all cryptocurrencies .
Ditto.. things are so positive looking right now, I wonder what black swan event will come to tear it all down. There has to be one, right? But... maybe not.. just hodl it out I guess? and generate that GAS :P
NEO is doing awesome and chart looks great to do even better yay!
NEO is one of the few that I'm not worried about. 😎
There's gold in them thar hills, ain't there? And until we find the fairest way of mining it, people will take advantage of 'flaws' in the system (as anyone would, in their position? - well, maybe not, but you get the point).
It's like it's all still being beta-tested. :D Gawd, I hope my new strategy is better than my last one! ;)
Yes it does feel like we're in beta-testing!
Which is scary... beta testing with your money !!
Lol. Just my time and energy for now (though some day, I intend to boost things with an injection of real money).
Is there anything in these stats that might help further substantiate or disprove your theory? I mean, it sounds plausible to me, but I wouldn't know how to go about proving or disproving it.
Phew there's a lot of info there! takes a while to digest it all. But with general stats there's not going to be anything in the form of proof. I'm not sure if something like this is really provable without some kind of Chainalysis-like company doing thorough research. I fear we're mostly going to find out if it happened after the fact, unless somebody happens to get lucky and stumble on the missing clue.
I would prefer to be wrong though, and have these high prices be the success of Steem instead!
I know traders have separate communication tools that the public does not have access to... so I would doubt coordinated efforts would be that hard to organise... especially if there are potentially millions of dollars to be made... or lost.
Wouldn't have to be a somewhat coordinated effort to work?
I'm not sure.. on coinmarketcap it says a $5 million trade volume daily. That's not a huge amount for some crypto-whales I'm sure.
I have personally witnessed markets being moved by single people before, it's kind of scary to see it happen and it really does not take all that much to make the price rise. 10 BTC here and there will do it many times over.
But it's probably easier financially if it's coordinated yes. Of course there's a lot of rumors that the 'top dog' bitcoin whales are coordinating their efforts anyway..
without data you are just another person with an opinion.
It is not that I pretend to be pedantic, on the contrary, but when you title the post "theory" it requires some data and what I see are only opinions. Let's take some data and see if the opinion becomes theory hehe
You are right, that's why I called it a theory in the first place, but maybe I should have called it speculation instead. I was hoping somebody smarter than me would come along, with more knowledge, to shed some light on wether or not this is possible! Logically it seems like it should be, but I don't have the blockchain knowhow to delve into the nitty gritty details of data analysis, unfortunately.
I understand, it would be great to see if someone with more information or data can contribute, I personally have a tendency to not think about what I can not control, I do not believe in conspiracies or big figures that move the threads behind the curtain.. my opinion is that stuff just flow including those who seek the trap or the maximum benefit of the system, even those make everything flow, especially in beta mode
Yes, I agree, it would be great to know more!
I have the opposite tendency... I can't let go of thinking about things I can't understand (yet). I don't do conspiracies either, but I like to ponder about the potentials and possibilities.
your tendency it's more fun than mine haha
<3
This is very interesting and I was recently chatting about this with a friend at work. The big question.. Will this be the last hoorah for the blogging platform as we know it? I see Steem the blockchain as being solid and once enough Dapps are created though they are not called Dapps it is a similar concept. Then perhaps the blogging platform might not even be needed.
I have speculated that this being a beta proof of concept simply illustrating what could be built on the blockchain; that one day it will vanish at least in its current form. The real value in all of this is the Steem blockchain and those platforms that run on it in one way or another.
Go Steem and SBD Go! Higher and Higher and Higher!
I worry about the same things, but I hope that STEEM can survive even with new platforms coming out that can do the same (or possibly better). I have been wondering what will happen to STEEM and Bitshares when EOS gets released for example.
And yes, STEEM is a great proof of concept, for sure. It's just so great, especially right now, that I don't really even want to think about it ending ;)
Although the future versions of similar concepts may be 'better'... will they also give me the same earnings?? I don't know..
I was railing against them when they froze up my funds for months and it appeared were allowing major raping of the rewards pool. It really ticked me off but then SBD got so High I was able to trade it and actually earn some real cash from Steemit. I earned enough to cover my initial investment where I bought Steem for Steem Power at 1.50 to 2.00...I was really thinking I was just going to lose it all and it be for nothing. No matter what happens they made me whole in the end and many other people have gotten wealthy from Steem and SBD. Not talked about like Bitcoin but if you were gobling up that steem for 0.20 SBD on the market and set on it you have a 3x almost 4 right now in less than 30 Days.
That is solid no matter what else is going on. There is nothing else in the world that can make men and women this wealthy in such a short amount of time if they put the effort in to learn and grow etc. What a blessing really in my life...I'll try to watch my grumblings in the future maybe.
Haha, yes, there's a lot of people who possibly got even richer than those people who got rich out of Bitcoin. Not just from STEEM but think about how many other crypto's there are. Bitconnect is one where people got crazy rich too.
See the thing is.. I'm sure Bitcoin can't be printed like FIAT money can.. but what if you made an altcoin that works like a money printing machine, and just use that to buy Bitcoin and other stuff with? if you keep the market cap low, who will notice? And when everybody on the platform also wins, who will complain?
Not sure if this is happening to STEEM but it very well might happen to other alts.. There are some strange things going on in the crypto world for sure :)
I love it though.. so much excitement! Crypto is better than any HBO television show! Game of Thrones eat your heart out!
i hope you are wrong as well lol but I have no idea
I hope I'm wrong too :S
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