I have an Idea
Would a slow puncture maybe do the trick?
Earlier today I posted on why the current peg is bad for STEEM. I believe that the current mechanics of the peg are bad for STEEM, but that a peg on SBD is needed to create a stable cryptocurrency which can be used as a method of payment by merchants who want to accept crypto as payment.
The Background
After reading many posts and comments, and having some robust conversation on the topic, I think I may have a solution of sorts. Whether it is a complete solution, or even a viable solution in terms of implementation, I don't know, but it's worth putting it out there even if it sparks an idea from one of the geniuses out there who know infinitely more than me about how it all works...
I'd like to put forward an idea to the Witnesses and Developers of STEEM, on how we can bring the peg back into force at $1 USD = 1 SBD, without "flicking a switch" and causing a shock crash of SBD, people making huge losses and possibly losing sentiment in the platform. This is a long-term approach, with a maximum of 94 days to reach the 1USD peg mark, or sooner if the market gets there naturally within that period. Perhaps something like this would help...
The Plan:
It's short and sweet.. here goes:
- Set the target peg. This could be be $5 USD if we wanted it to be, but let's keep it at $1 USD, which is the way the platform designed it.
- Introduce a SBD price feed into the platform.
- Use that feed to implement a two-way SBD<--->STEEM conversion.
- Keep the 1USD=1SBD peg value for rewards payouts.
- Set the peg a the current SBD price feed value. This becomes the new peg ceiling, and can only be moved in a downward direction until the peg target it reached.
- At 00:00 GMT each day update the SBD peg price downwards at the new 3-day moving average. That peg stays in place for 24 hours. If the price has gone up, reduce the Peg price by 1.7% to force downward pressure on the price.
- Once the target peg level is reached work off the 3-day moving price feed, with a cap set to $1.01.
The Anticipated Result
The peg is now back to $1 =1 SBD, and with 2-way conversion in place, it will be more difficult to exploit or manipulate the SBD price upwards, as it will just be converted at the cheaper peg rate on platform.
This will unlock STEEM from SBD, and it will be free to be traded on the market without SBD dragging it up and down (which is what appears to be happening at the moment, but it may just be coincidence). It will be a gradual process which should mitigate any major losses as people sell their SBD into STEEM or other cryptos while the price goes down, making SBD return to the peg target quicker. With the peg slowly moving down with a 3-day price, any gains made by "playing" the conversion rates against external markets should be minimized, and the markets will generally follow the pricing drop. The big thing here is that there is no "shock" by locking in the peg far below the current market price, and that we don't have to wait to see if the market corrects autonomously.
We should then see the true value of STEEM appear, and it will be unlocked to go as high as it can without being led by the SBD price movements.
On a side note:
One other thing I'd like to see is a rewards slider which we can set our rewards to any split between SBD and SP, at 5% intervals. We could choose to take 100% in SBD and gain no vests, or we could go 20%/80% if we like too. Just a thought.
Thanks for taking the time to read this. I hope it at least sparks some out-of-the-box thinking on how to fix the peg without it causing major disruptions or losses to hundreds and thousands of people.
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