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RE: Why is SBD well below USD?

in #steemit6 years ago

I think the only things that help SBD to recover, are the inflation and burning. That's the only two processes that helps SBD (if we do not count with an increase in investing which may not happen) to go back to 1 USD.

But the first process - inflation - must be combined with investing, because when you create tokens out of thin air, it will (at least in the long-term) affect the whole ecosystem, as newly emitted tokens decrease their value. So basically, we can only count with burning that helps SBD.

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Conversion is the method. Since none (due to a bug, in fact a little, but it is probably not significant) is being created, as SBD is destroyed by conversions its supply declines and eventually it will get to the point it is repegged at $1.

You are correct that inflation doesn't assure anything. It might result in an increased, decreased, or unchanged total value, depending on market conditions.

Oh, I totally forget to that option, although a few days ago I even converted some SBDs. Thank you for your time and shared knowledge. :)

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