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RE: WTF Is Going On With Steemit's Reward System...???
I agree that much of steem and steemit is super frustrating.
The way I understand this though is that it's a protection mechanism within the blockchain protocol when the SBD debt limit has gone over 10% to keep from over-printing steem. For that reason the price feed is currently frozen at .21, and will remain that way until those conditions change in regards to debt ratio.
For that reason the dollar amounts shown on posts will not equal what is actually paid out until steem either rises above $.21 or the supply of SBD is reduced to the point it is no longer greater than 10% of steem's total market cap.
Even more complicated and confusing.
AGREED.
Surely there could be some sort of "protection mechanism" that doesn't entail manipulative perception of value that makes the average Steem user feel cheated out of 43% of their earnings because their "rewards value" is based on some complex internal mechanism rather than an actual clear figure of what they're really worth if/when trying to cash out on a real exchange...
Yea, I think having SBDs is what convolutes all of this. Though I think SBDs could be valuable if they could reliable maintain their peg. The current configuration doesn't do that.
Probably cuz that'd be even more confusing to the average user as most people don't have the math skills to calculate what those rewards would actually contribute to paying bills...
Psychological familiarity - it makes it simply if we can relate our rewards directly to what they'd buy in our daily lives. (That is, if 1SBD actually = $1USD).
And even that is a flawed, overoptimistic assessment - based on the assumption that SBD and Steem will rise in tandem, which is not guaranteed.
Considering the criticisms coming from the whole decentralized movement and crypto world of the traditional financial systems and how the conventional ways currency prices are manipulated to distort public perception, it's close-to-unbelievable that such an arrangement here would be overlooked as anything less than the same type of smoke and mirrors as these new types of economic systems are supposed to be an improvement upon...
It's not the blockchain's fault that steemit.com shows misleading figures. Use SteemPeak and you won't see any dollar signs. You'll see the rewards in Steem Token Units, which are not currently worth one USD, though. But at least fewer people mistake the STU symbol to mean the dollar.
I think the front ends should do a better job showing the correct dollar amounts.
If STEEM starts going up, let's say close to 1 USD, then SBD will go up too. I can guarantee that. That's because SBD will become convertible again once the SBD Debt Ratio goes under 10%. What that means is that you can convert each SBD into exactly one 1 USD worth of STEEM. When SBD is under 1 USD, the conversion makes perfect economic sense. That's what makes the peg work from the downside until the price of STEEM goes so low that it can no longer back SBD properly. The failure of the peg is a fail-safe to stop STEEM from going lower at an accelerated paced when it's already very low in a vain attempt at maintaining SBD at 1 USD.
This is not smoke and mirrors. It's just a failure on part of steemit.com and most other front ends to properly show the dollar values when the SBD Debt Ratio is above 10% or when speculation has caused SBD to spike far above 1 USD.
I guarantee ya 8 out of 10 of the average people who use this site would find everything you wrote way too complicated and lose attention before getting halfway through.
That's not meant to be a reflection on you or your writing - but feedback on the overcomplexity of this system itself and what a headache it is for your average person.
Not mass-adoption friendly at all.
Absolutely not mass-adoption friendly. I completely agree with that.