Many users will have seen the latest Steem Protocol Update 0.14.0, which is due to come into effect 9/13/2016 at 11 AM EST (3 PM GMT).
Icon made by Icon Works from www.flaticon.com
This is a quick post to get everyone’s attention to the section;
Steem Dollar Stability
Starting when Steem Dollars are 2% of the market cap, a portional of content rewards will be awarded as Steem instead of Steem Dollars. The rate at which Steem Dollars are printed is 50% of the reward at 2% or less market cap and 0% at 5% or more market cap, linearly extrapolated from 2%-5% market cap. So, at 3.5% market cap content rewards will be 25% Steem Dollars, 25% Steem, and 50% Steem Power.
When Steem Dollars reach 10% of the market cap, the price feed will jump off the peg to keep Steem Dollars at 10% of the market cap and will return to the peg when the reported price feed goes below 10%. Witnesses should still report the real dollar value of Steem for their price feed. The median price feed is automatically capped regardless of what witnesses report.
This change is designed to protect the blockchain from a theoretical, but highly unlikely, event where by the SBD debt would completely devalue Steem. Steem holders are now guaranteed that SBD holders will never be entitled to more than 10% of the market cap.
We are currently beyond the 2% threshold;
Steem in Circulation: 153,737,832.220 STEEM
Current Steem Price: $0.717792
Steem Market Cap: $110,351,478 [2]
Steem Dollars in Circulation: 2,444,596.234 SBD [1]
%SBD to Steem: [1]/[2]: 0.02215282, 2.2%
At Current Levels, How Much Author Rewards will be paid in Steem?
- From 2% to 5% (%SBD to Steem) we need to Linear Extrapolate From 0%-100% of Steem Dollar Author Rewards to be paid in Steem...
- @2.2%, we are 0.2% into the threshold.
- 0.2/3 = 0.0666666* or 6.6666*%
- So, we can expect 6.6666% of Steem Dollar Rewards to be paid in Steem
This will change depending on the Steem Market Cap, and the supply of SBD. Essentially, If the price of Steem Falls, the Debt (SBD) priced in $USD gets relatively bigger. We are currently at 2.2%, so that signifies that Steem needs a ~10% rally in prices to go back below the 2% threshold.
I am happy to take any questions or correction