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RE: It is Time to Stop the Overprinting of SBD to Decrease STEEM Inflation
The STEEM inflation is not increasing. I can understand why you would think otherwise however, keep in mind that SBD is nothing more than STEEM wraped in a smart contract.
When SBD is being printed the rate of STEEM creation is lower than the scheduled inflation rate.
When SBD are converted the amount of STEEM in circulation reverts back to what it would be if SBD did not exist.
This isn't true. Not sure where you're getting this idea.
The amount of Steem created in SBD conversion is entirely related to the price feed at that time and has no connection to the price at time of SBD creation.
It's not Steem wrapped in a smart contract, its' Virtual Steem in a smart contract. 1 Virtual Steem at payout (where it's locked behind SBD) can potentially become 2 Real Steem at conversion, or 10, 20 or 100. It entirely depends on the price feed.
Prove this. Everywhere i've researched this, the SBD is printed based on the rate of posting/voting along with the user option to receive rewards 50/50 and is not obtained from the voting pool.
I guarantee that this is not true. Currently, STEEM is created at roughly 2:1 ratio of STEEM for each SBD.
The rate of SBD or STEEM creation is not based on the amount of posts/votes. Per the blockchain rules there is a fixed amount of STEEM created (currently 8.6% of the total supply per year). That amount is then distributed between SP holders (15%), witnesses (10%) and the reward pool (75%).
The amount of SBD that can be converted cannot exceed 10% of the total STEEM supply (based on the witness median price feed of the last 3.5 days). At the moment the SBD supply equals about 30 million steem.
[Edit]: When the printing of SBD is stoped then the blockchain starts paying out steem instead of SBD (which has the same effect as converting SBD to STEEM).
It's important to note that the conversion and the printing of SBD uses the median price feed of the last 3.5 days which always lags the market if there is a trend (up or down). That is bad to SP holders if the price of STEEM tanks and viceversa.
With the current market conditions I can concede that it is not good if a significant amount of the SBD supply is converted and the additional STEEM in circulation is sold on the open market (that is obvious). To be honest I am not sold on the print rate rules change from HF20. To be specific, the slowing down of the print rate starting at 9% is too close for my comfort.
That's not exactly how it works. When the supply of SBD hits 10% of the internal Market Cap (MC), the amount of Steem converted per 1 SBD gets capped at the rate where the total SBD = 10% MC and no more. However, every new conversion as well as all newly created Steem continues to alter what that amount is. This is why we saw the price feed initially get 'stuck' at 0.42 when SBD went above 10% last time, but then slowly tick down all the way to 0.33 during that time period. The lower that price feed value, the more Steem the remaining SBD will convert for.
Thank you for commenting. I would have to say that this statement is not true. Let's say that everyone selected the 100% power up reward option, then there would be no SBD printed. In fact the SBD creation is based on the amount of posts and votes.
The number of posts does not influence the amount of rewards that are distributed. If the equivalent of 100 steem is allocated from the rewards pool per day then:
In either case the amount of SBD or the equivalent liquid steem would be the same (assuming each author selects 50/50 between liquid and SP).
What you are saying is correct, if nobody selected the 50/50 option then no liquid steem or SBD would be created but instead the equivalent amount of vested steem would take it's place in the form of SP.
I know I am over-simplifying in the example above, in reallity the rewards distribution takes the 30 day average from the reward pool (I am might be wrong it could be some other metric and not an average but I can't find the post where that is explained).
I am an engineer. I recall working with a very good engineer and his tag line was "show me the data". It is funny in the sense that everyone always knew he was going to say it. It was very effective though. People would always try to pitch their opinion and in the end, the data rules. I'm am willing to change my mind on the SBD reward, but in order to do that, you will need to "show me the data". With that said, I'll be eagerly waiting for proof that SBD is created from the reward pool and not just some post about it because I've seen many posts with incorrect information.
In lieu of actually looking at the code of the blockchain I am going to make the conjecture that the oficial Steem White Paper is an accurate description of it.
From page 26 of the Steem White Paper
From page 17:
If 75% of the inflation goes to the reward pool and 75% of the reward pool goes to author rewards it follows that the liquid portion of the post payouts comes from that same reward pool.
Now, over time that distribution may not be equal to the intended percentages due to the fluctuations of both the price of the Steem token and the 10% ceiling of debt ratio of Steem/SBD.
I understand that the above reasoning is not the same as showing empirical evidence. We could take two posts as samples. One with an SBD print rate of 100% and one with 0% to see if those percentages hold true. The tricky part is knowing what was the median price feed at the time of payout. But it's late and I need to go to sleep.
Too bad that https://steemdb.com/ is down (maybe it's being decomisioned?). On the front page it had stats showing the actual distribution of the tokens for the last 30 days.
That is correct. However it does not say anywhere that SBD is taken from the reward pool.
Still waiting for that data that proves that SBD is taken from that reward pool.
Interesting to see how perspectives can differ so much regarding the currencies here on steemit. How is a noob supposed to understand the details when the OGs can't even make sense of it or see it accurately. What the heavens is really going on here KISS.