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RE: A Few Thoughts About The Decoupling Of SBD From STEEM
The more valuable SBD is against USD, the more STEEM debt it creates.
If I am understanding you correctly, you are saying that the price of SBD affects the SBD/STEEM debt ratio. If that is what you are saying here, it is incorrect. The debt ratio always assumes that SBD is worth $1 worth of STEEM, so regardless of what SBD is trading at - it will never count as more than $1 worth of 'debt'.
@timcliff
just want to know your opinion. Why don't we use another witness price-feed for SBD and calculate STEEM-SBD debt more precise from a market price of SBDs not the 1 USD assumption?
Because it is not 'debt' when the price is above $1. The blockchain is still only "on the hook" for $1 worth of STEEM if SBD holders redeem their SBD for STEEM by converting.
Can you please point me to the exact code / files where this is written in the STEEM blockchain? I genuinely want to see if this is exactly as you said, because I have a feeling it may not be entirely like that.
But even this will be as you point - which I'm not arguing against, I just want some proof in the code - an increasing SBD supply because of the increased supply by witnesses bias will generate more debt. Am I correct in assuming this? As in it will "flood" the markets with more SBD which in turn will create more STEEM debt?
These are the main pieces of code if you are looking to understand how it works.
This is the section of code where the 10% 'haircut' rule is applied, and it basically reduces the amount of STEEM returned from SBD->STEEM conversions if the debt is above 10%:
https://github.com/steemit/steem/blob/bb8ca476f33c08434274f2d76333fcb74cfa58b8/libraries/chain/database.cpp#L3111
This is the section of code that reduces the SBD print rate as the debt ratio goes from 2% to 5%:
https://github.com/steemit/steem/blob/bb8ca476f33c08434274f2d76333fcb74cfa58b8/libraries/chain/database.cpp#L3452
Here is the section of code that processes SBD conversions:
https://github.com/steemit/steem/blob/bb8ca476f33c08434274f2d76333fcb74cfa58b8/libraries/chain/database.cpp#L2228
You can probably skip digging through the code and just think about it logically though:
[Edit] I missed your other point.
If witnesses use a bias to artificially increase the STEEM price in their feeds, then it will print more SBD (which would increase the debt), but witnesses are not using a bias.
How will steemit ever become mainstream as long as it so complicate to grasp even for people like you guys.
People don't need to know how everything works under the hood in order to use the platform.
Lotta truth in that statement. Does anyone even understand where the internet comes from? Don't think so. As long as it works to DL porn and surf Amazon and FB no one cares about the details. ;)
ty ... i don't yet understand, but maybe someday i will review
Thank God for seeing this part of your comment. Content creating minnows need rewards - sbd is generated by content and the only way for poor people to get on here - the only way to get STEEM without investing.
SBD is the "rare coin" only generated by content. If that is not of value here - what is? Lots of minnows getting rewards and creating good content is what makes the platform appealing to bigger fish who buy their way in and grow the place.
Do we want lots of people posting here or not? It's complicated enough without trying to understand the money and how it is generated.
If I get another weight loss author to try to post here - I'm going to tell her she can reach her audience and needs to make $10 rewards on a post to get the "do follow" for Alexa. I'm not going to tell her to figure out the cash flow of the place.
Yeah how many people know how an engine works that drive cars