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RE: Go home SBD, you're drunk! How to maximize your author rewards
The trouble is that there was never a dollar peg. There was a dollar floor.
If SBD was trading at 50¢ on the exchange, you could use steem to convert the SBD to steem at $1.
Yep.
Well, I'll say this -- there probably was a weak ceiling enforced informally by market makers. I, for one, had a personal policy of always selling when the SBD price went over $1.10.
I'm guessing any pegged currency has layers of support; market-makers keep the price steady in the short term, but you need fundamental mechanisms to have stability in the long run.
What actually happened is some trading pool or pools in Korea juiced SBD bc it was juicable (light trading, hard to sell by those who own a lot of it). Really nothing to do with the $1.00 mechanism or steemit accounts. We can see this by the trading volumes on exchanges which allow SBD trading, look for the volume and you can see who's doing the "juicing".
Everything to do with the mechanism. If the mechanism had a means of rapidly printing SBD to suppress the price, SBD wouldn't be "juiceable."