RE: Witness Discussion – SBD price and reverse peg
As an active Korean community support, I personally experience high SBD price is very effective and helpful to authors more attention and engage to the community.
The implication of high (e.g. $6) SBD price is like, Steem pays $1 for authors and the investors(or speculators) pay the rest of $5. So it can be considered as outsourced support on behalf of authors.
Despite the high SBD price, its usage is growing in Korean community. I believe this is due to the fact that the adoption of currency is not only dependent to its stability, but also highly dependent to how many people are engaged in the ecosystem and how much they trust the economy.
Also, I am highly against the suggested conversion model, since it cause very high vulnerability to Steem economy. The nature of SBD is a derivative, being backed by at least x20 STEEM in order to deal with STEEM price fluctuation. Theoretically, if STEEM price goes down by 95%, SBD becomes broken.
But the suggested model requires only $1 value of STEEM to create 1 SBD. This will decrease the STEEM reserve ratio that backs SBD. In bullish market, this may be not a big deal. But in bearish market, it can be a huge weakness of our economic system.
In my opinion, SBD is mainly for contexts creators. Specifically, it is aimed to secure author's income in terms of USD value. Its high price obviously benefits the authors now, while does not harm any others except poor speculators. I also saw many authors who like Steem sell their SBD then buy STEEM, in that way high SBD price still contribute STEEM price. I really like this golden goose, and want to keep alive as long as possible.