RE: Symbiont{s} | ECOBURN | SBD Price Regulation Experiment
Update in favor of the loop approach after the end of the brun proposal.
Conclusion
The key lesson, to me, is that when STEEM is below the haircut price, reducing inflation probably matters less than reducing the haircut price. So, what are the key lessons from proposal #117 (to date)? Maybe one lesson is that Steem has its own version of Don't fight the fed.. We tried to adjust the blockchain's inflation rate by burning STEEM, instead of SBDs, but it turned out that market dynamics soaked up most of the inflation progress we could have made that way.
The key lesson, to me, is that when STEEM is below the haircut price, reducing inflation probably matters less than reducing the haircut price. This is because the gap between the current STEEM price and the haircut price drives the amount of rewards that are paid per post. With the "peg ratio" set at 0.465, posts are getting almost 50% of the rewards that they'd get above the haircut price (in terms of STEEM). If that ratio had been allowed to fall to 0.375, authors and curators would be getting about 20% less rewards for their blockchain activities.
Considering the last point, maybe the thing the witnesses should think about next is a proposal that takes SBDs from the SPS and cycles them in a loop doing: convert to STEEM (lowers haircut price) -> buy SBDs -> convert to STEEM -> and so on, until the haircut price drops below the price of STEEM. Then when the peg ratio eventually climbs above 1 (assuming it does), return the SBDs to the SPS.
Once upon a time, the community tried something like this with voluntary contributions and the @sbdpotato account but in the years after SF22.2, that didn't work out very well. Back then, we didn't make use of the multisig capability that the witnesses are using now, though.
Or, maybe we should all just shift our focus over to cultivating and supporting post promotion.