You are viewing a single comment's thread from:
RE: Witness SBD pegging policy update
This seems somewhat like a chicken and egg problem. We want people to convert to destroy debt. We also want people to hold SBD instead of dumping on the market, but if the incentive for that involves increased debt via increased interest, isn't that bad? 260 a day compared to nearly 2M seems small, so maybe it's not a concern compared to the value of strengthening the incentives for the peg. It's complicated stuff for sure.
The reason I went ahead and calculated the daily cost of the interest increase was to make sure that it wouldn't add too much to the debt and be counterproductive. Debt reduction was running about 5% ($100K) per week, though in the past 1-2 weeks it has slowed down somewhat. Still, $260/day is not a major problem relative to continuing to neglect properly pegging SBD and undermining what ultimately could be one of the most useful features of the platform.
It is for sure complicated as you said. Only after having spent a lot of time thinking about these issues over the past few weeks have I reached my current (certainly incomplete) level of understanding. I may write a bit more soon on the tools available to witnesses to maintain the peg and some of the ways those tools can and should be used.
It's easy for me to get frustrated with all of this complexity and while seeing my investment dwindle in value. I just have to remind myself we are early pioneers, exploring and testing new economic systems in real time. That's pretty exciting and hopefully worth a little sacrifice along the way.
Thank you for being a consistently beneficial actor for the network here. So many of us benefit from you understanding. Please keep it up.