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RE: Witness Run: My outline of the Economics of the system. What to do to keep the SBD peg at $1USD and why we should.
So, your answer is do nothing for the time being? How does that help new people that want to come in? How does that help merchants? I think it protects the current steem owners best in the short term, but won't open this up to more people.
What's your answer to the obvious problem I now explained in all detail?
Sorry for telling that you didn't think your idea through.
New people that want to come in don't need to buy overpriced SBD, why do you ask?
Merchants shouldn't build upon a non-existing peg obviously. Well, they can of course treat it like it's worth 1$, because that's the thing we can guarantee. But nobody will buy then.
SBD are debt to Steem owners. You seriously argue that creating more debt for them is in their best interest?
//edit:
no you didn't, misunderstood :D
protecting holders is the most important thing. we don't need new users if the price is breaking the whole system ;)
I think we agree on some points here. I'm certainly not looking for the price of steem to crash. I don't want the price to moon though. That makes the distribution worse.
If we agree to print more when the SBD is higher than $1USD then that can maintain the peg.
If we agree to print more when it's above say $1.1 or $1.25 that gives us some buffer too in order to prevent a crash.
Debt at 0% interest doesn't scare me. Having an easy to trade token is swell.
I'm trying to balance protecting holders with growing users.
I don't think either of us is wrong I think we just have slightly different objectives.
There are many other ways to grow the ecosystem without depending on SBD. When steem is big enough, it can support a higher debt and the peg will be more stable.
Arbitrary printing of new money without an option to reduce supply would make this worse than central banks.
Maybe changing the rate from 50/50 to more SBD would be a step to take without adding inflation, although the reward pool is just a drop into a big lake at current market volumes.