There are a lot of new users on steem who might not know what SBD means in the steem blockchain

On the Steem blockchain, SBD stands for Steem Backed Dollars. It is a stablecoin designed to maintain a value roughly equivalent to 1 USD. SBD is part of the dual-token system on Steem, alongside the main token, STEEM.

website coinmarketcap

Key Features of SBD:

Stability:
SBD is meant to provide a stable medium of exchange within the Steem ecosystem, making it useful for transactions and payouts. However, its actual value can fluctuate depending on market conditions.

Interest Mechanism:
In the past, holding SBD in your wallet could generate interest, but this feature is currently inactive.

Utility in Payouts:
Steem content creators often receive a portion of their earnings in SBD, allowing them to access a relatively stable asset compared to STEEM.

Conversion to STEEM:
Users can convert SBD into STEEM at the blockchain's internal exchange rate, offering flexibility in how they manage their holdings.

SBD adds a layer of versatility to the Steem ecosystem by offering users an option for a stablecoin within a cryptocurrency-based platform.

Calculation from ChatGPT

For SBD (Steem Backed Dollars) to be printed on the Steem blockchain, the price of STEEM must be sufficiently high to maintain a debt-to-value ratio below the blockchain’s 10% debt ceiling. This mechanism ensures the stability and sustainability of the Steem ecosystem.

Calculation Details:

1. Debt Ratio Formula:
   The debt ratio is calculated as:
   [
   \text{Debt Ratio} = \frac{\text{Total SBD Supply} \times 1 USD}{\text{STEEM Market Cap}}
   ]

   • Market Cap of STEEM: Determined by the circulating supply of STEEM multiplied by its current market price.
   • SBD Supply: Total amount of SBD in circulation.

2. Threshold for SBD Printing:

   • If the debt ratio exceeds 10%, the blockchain stops printing SBD and shifts all rewards to STEEM.
   • For SBD to resume printing, STEEM’s market price must be high enough to lower the debt ratio below 10%.

3. Approximate Price Condition:
   To calculate the required price of STEEM, use:
   [
   \text{Price of STEEM} > \frac{\text{Total SBD Supply} \times 1}{\text{10% of Total STEEM Supply}}
   ]
   This varies depending on the total supply of STEEM and SBD in circulation.

Example:

If the total SBD supply is 10 million and the STEEM supply is 400 million, then:
[
\text{Price of STEEM} > \frac{10,000,000}{0.1 \times 400,000,000} = 0.25 USD
]
In this case, STEEM must be priced above $0.25 USD for SBD to continue printing.

These dynamics can shift depending on market fluctuations, making the relationship between STEEM price and SBD printing fluid.

What will it mean to you if SBD prints again?

At the time of writing, the price of STEEM is $0.2575. This means that if the price of STEEM remains above $0.25 USD for approximately 3.5 days, the blockchain will resume printing SBD.

If you set your rewards to 50% SBD / 50% SP, you will also receive SBD as part of your payout when SBD printing is active.

At the time of writing, the value of SBD is $3.94, and the price of STEEM is $0.2573. This means that for every 1 SBD you earn, if you exchange it for STEEM, you will receive approximately 15.25 STEEM.

And that means you can build your Steem Power (SP) faster by exchanging your SBD for STEEM.

So, don’t sell your STEEM at too low a price if you want to maximize the benefits that SBD provides.

Where do you exchange your SBD for STEEM?
You can do that on the internal market of the Steem blockchain.

Press on the market
Here you can trade your SBD