mhhmmm... that heap of deliciousness was worth it. I'm glad I could clear it up for you!

And yes, this is in fact a protective mechanism in the steem design to prevent the debt rate from exceeding. As all these rules, it was designed under the idea of $1-SBDs, hence it does not have the intended effect.

Witnesses did see this coming and potential remedies had been discussed... the sudden drop in STEEM-USD prices accelerated the situation, though, so nothing had been done in time.

But don't take this as FUD, it's not like the world is going to end, there are plenty of good arguments why the markets should be able to self-regulate the situation, but in the long term these rules definitely need to be improved!