RE: Should SBD Be a Pegged Asset? If So, When Should We Peg It?
@aggroed For those triggers to happen you need to fix the SBD peg first! Doh!
I'm not gonna use SBD as a Teher alternative if it is not dependable with its peg.
Same goes for Commerce. It cannot seriously get off the ground without a proven stable SBD.
If you're an ebay seller and want to sell a product for 300$ on SteemBay, with the current SBD it is a nightmare: you need to rely on a real time conversion system (ala BitPay/Coinbase), which still means converting to BTC (fees) then converting to FIAT (more fees) and all in a fluctuating market. Good luck with that.
Instead with a stable SBD I can set the price at 300 SBD (and not 50 SBD as it is now), and when I sell the product I can keep the 300 SBD in my account knowing my earnings will be unaffected by crypto market swings. And then the 300 SBD can be used at any time to buy products on SteemBay, without needing to return to the FIAT market! (no need to sell the SBD for FIAT= Steem Moon). This will be a game changer especially in heavily taxed countries.
The SBD has never been stable since it's conception, it has some stable periods...but that's not sufficient for a online shop to move it's operation to Steem unless the SBD peg is proven dependable . It needs to be within the narrow range as envisioned in the whitepaper.
Imagine a shop selling 300$ products for 50 SBD today, and then seeing the SBD tank shortly after. That would be immediate bankrupcy.
Btw posts are already receiving high payouts, the problem is that payouts are not distributed widely and always end up in the pockets of the few circle-jerkers. Overly greedy and shortsighted people are making us miss these big opportunities.
If the pegging had been done 7 months ago by now Steem would be among the top 5 cryptos and SBD would have been used as Tether alternative and we'd have a thriving market-place.
If SBD was stable right now I'd be using it rather than Tether which is untrustworthy, who wouldn't? This opportunity is probably lost though as new ETH based stable coins are soon to be introduced on exchanges.
I hope you enjoyed the SBD earnings, but you've done tremendous damage to Steem with your front page posts defending the broken SBD and you held us back. It's time to realize it.
Upvoted as a well-written and powerful expression of the "Pro Peg" case. I'm personally quite open minded about this and willing to consider both sides of the issue, but your comment has indeed swayed my views a bit in making clear in stark terms how ignoring the peg and savoring the increased rewards has come at a real cost, perhaps a catastrophic one in terms of lost opportunities now that we've squandered our early lead and competitors are arriving.
thanks. it was more of a disjointed frustrated rant, I'm glad I managed to somehow put some points across.
But I apologize to @aggroed for the tone of my post, I'm sure his posts defending the high SBD are NOT done with malice or nefarious intentions.
It doesn't have to involve malice to still do tremendous damage (and I don't think you suggested any). Often that happens with the best of intentions.
I kind of implied blind greed and author short term self interest as the reasons why he supported the high SBD, and I might be wrong on that.
That's a good point. But I still think there is a strong case that defending the broken peg with whatever motive has done a lot of damage, and your comment was unusually clear and effective in making that case.
To be clear though, I don't view it as primarily a personalized issue, if at all. @aggroed is not at all the only one making that argument and certainly is not personally solely responsible for where things stand today.
Let's try not to make unsupported claims about what would have happened in a could of, should of, would of way. We can't possibly know what would make STEEM a top 5 given decisions made 7 months ago. We also don't get very far as a community making direct, personal accusations unless we have direct evidence of malice involved.
Instead, let's try socratic questioning and let people make up their own minds. Is it possible @aggroed's passionate love for this ecosystem and community caused him to miss some important parts of this discussion? Maybe. Is he solely to blame for the price of STEEM (either up or down)? Clearly not.
Let's be nice. We can disagree, even passionately so, but when we throw out unsubstantiated claims as accusations, it just makes people defensive and angry.
I'd say it should go without saying the @aggroed has the ecosystem's best interest at heart and so do you, that should be obvious to everybody!
But in this particular case, I think he is the one making the more sober and realistic analysis.
You should always rely on a real-time price feed. Depending on the peg is suicide. Even running a shop that hypothetically accepts Tether without actually checking a live price feed would be idiotic. It would be just as idiotic to do that with SBD, even if it had a hard peg.
Shop owners who accept any crypto should have live prices to guard against people who take advantage of shocks in the market.
quote out of context.
I was not referring to live price feed conversion (this can easily be implemented into Steem or any wallet), but to services like Bitpay which convert (exchange) the paid crypto instantly into FIAT and which merchants rely on in the bitcoin world. This is clear in the part you omitted from my quote. ;) ("ala BitPay", "fees", etc)
Of course it is wise to always keep an eye on the real live SBD price, that's common sense. In any case merchants wouldn't start adopting SBD until it's peg was fully proven and battle tested. So even if the proposed changes were to be implemented tomorrow and worked in controlling the SBD price, it would be months before online shops would even consider using it.
Market swings of around 1% are probably unavoidable but they would not be that much of an issue, especially considering all the savings in fees and possibly taxes compared to the FIAT system.
If the SBD had taken tether's place then it would also take its place when authorities choose to take action against Tether for the creation of money and various other schemes they've been up to. You do not want to be in that position. None of us should want to be in that position.
And as far as pegs go, you must not be a very good student of economic history to not know that pegs go terribly, terribly wrong all the time, and are very exploitable and ripe targets for manipulation. If you know there is an infinite buyer or seller on the other side, and you outweigh them or even just whittle away at them over time, you can destroy them. It leaves us at great risk to attempt any sort of peg, and the consequences would be far worse than letting the speculators get burned.
For instance do you think China's peg worked at all? What good has that brought the world. Deflated wages for Chinese workers, their country's soil, water and air is in ruins, and they've burned up all their capital reserves. Add to that the amount of new debt creation they had to endure just to stay afloat and it's just a total mess right now, even if they can claim to have the largest economy.
Pegs always fail. Do not think otherwise.
You make some valid points. But the current SBD already has a peg mechanism when it falls below 1$ (Steem needs to be printed to keep it afloat). So the current SBD has all the disadvantages of a pegged asset without any of the benefits. If we are to keep SBD lets peg it properly, if not lets get rid of it altogether.
Regarding the risk of authorities getting involved ....Steem is a decentralized blockchain what can they do about it? The Steemit website may face a shut down, but decentralized apps like Vessel would still operate and Steem based websites will still operate outside US jurisdiction. Frankly I wouldn't be surprised to see Steemit relocate HQ to some cryptohaven like Zug, Malta or Isle of Mann. The regulatory framework in the US has become way too oppressive for innovation
Do you think the bitUSD peg is being manipulated or has failed or will fail terribly?
I am very, very uncertain about bitUSD's future, I mean I asked Stan right here on steemit about what Arise Bank's association with it is and he just vaguely said "on and off-ramps". That combined with what I've read about Arise Bank does not give me great confidence. And sadly for new users like me it's one of the few trading pairs we have access to off of the steemit website, so it's very troubling to me.