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RE: Buying SBD with fiat a good idea?
Why do you think there is no risk of SBD going below $1? It has been as low as $0.60 in the past, and hard fork 20 is going to massively increase the potential supply.
Because I will be able to convert is to $1 STEEM. (unless SBD market cap reaches 10% STEEM marketcap).
Sure, but the conversion doesn't necessarily give you $1 worth of Steem. The conversion happens over a time period of 3.5 days, using the witness price feeds, and the actual amount can be less than $1 worth of Steem if the price has continued to drop during that time. It can also be more, but it's likely biased to the downside in a bear market.
The price of STEEM has to drop below 50 cents for that to happen. Can that happen in 3,5 days....I guess so when it's really volatile.....it can also fly up (but in that case, I'll be happy anyway).
Nothing is 100% certain but in general I don't think it's a bad buy.
I think on the markets SBD will trade for around $1 for now. If it goes to 60 cents....it be a steal.
You get less than $1 from a Steem Dollar conversion if the final price of Steem after the 3.5 days is below the median price of Steem during the 3.5 days. It doesn't have to drop below a specific amount.
I will be buying up SBD as they go below $1, but I don't think it's a risk-free trade.
which exchange or procedure to get the 1 SBD to 1 STEEM conversion? The internal market is not price guaranteed and blocktrades neither as far as i know? thanks
There is a transaction type which allows you to execute the Steem Dollar contract. It used to be available on the Steemit.com wallet page, but I believe you can only do it in the Command Line Client these days.
Ah... So we will need to test this first to see if it works as we speculate at this time. Thanks 👍😀
I've done the conversion probably 100 times. So I know that it works.
Yeah but I mean you say... It used to be.... but now it is only available I believe... so it means at this moment we have not used the available option for conversion and I don't know about a command line interface
I made an easy to use interface so you don't have to use command line interfaces :)
https://mwfiae.github.io/SbdConverter/
You can read more about it above ;)
I think the HF20 changes make a haircut on SBD conversion more likely.
The changes to the print limits will allow SBD to be printed all the way up to the 10% debt level cap. This makes it more likely that the 10% cap will be reached. It only needs SBD to be a little above $1 to make 50/50 rewards the better option and for SBD to keep being produced.
In market conditions similar to the ones we have just lived through we could find ourselves in a market where Steem is falling but the SBD conversion guarantee no longer holds. (Imagine if the debt cap was currently at the print limits of 5% for example).
Something I think people should be aware of if they are looking to hold or purchase SBD.