RE: SBD Burn Proposal – Let’s Get Rid of What We Don’t Need -- Burn of 1.05 Million SBD to Strengthen Steem’s Economic Foundation

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RE: SBD Burn Proposal – Let’s Get Rid of What We Don’t Need -- Burn of 1.05 Million SBD to Strengthen Steem’s Economic Foundation

moecki (73)in #proposal • 2 months ago (edited)

Yes and no.

It has something to do with the STEEM price. If the price is higher than the "Internal Median Price", SBD will be printed. You can find the price on Steemworld:

But the internal median price is variable and is no longer $0.25.
It is calculated as follows: 9 * current_sbd_supply / current_supply. The price therefore depends on the amount of SBD and STEEM. Since proposal #116 reduces the supply of SBD but leaves the supply of STEEM unchanged, the median price falls.

BTW: The screenshot clearly shows that my calculated debt ratio (9.9985%) actually came true.

2 months ago in #proposal by moecki (73)

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lifetrail (73) last month

Thanks so much! Finally I am starting to understand it, lolz.
Now, a follow up question - why 9? Is this a constant value or it could change under some conditions?

80k STEEM minted for 23 hours, wow (on a separate note)

$0.43

4 votes

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moecki (73) last month

The 9 is constant (at the moment – this could only be changed by a hard fork).

I quote from the code comment:

This block limits the effective median price to force SBD to remain at or below 10% of the combined market cap of STEEM and SBD.

For example, if we have 500 STEEM and 100 SBD, the price is limited to 900 SBD / 500 STEEM which works out to be $1.80. At this price, 500 Steem would be valued at 500 * $1.80 = $900. 100 SBD is by definition always $100, so the combined market cap is $900 + $100 = $1000.

80k STEEM minted for 23 hours, wow (on a separate note)

Yes, we are currently experiencing very high inflation, even though inflation from the block protocol has been decreasing. This is because the virtual supply is currently very high. However, less STEEM will be printed in the near future, as can be read here.

$0.27

4 votes

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lifetrail (73) last month

Thanks for that extra piece of info, it makes sense, I suppose.
You're right, inflation seems too high to me and I saved that read for a second go.

$0.23

3 votes