I think its actually quite stable at this point. Most of what you see now are small fluctuations due to limited liquidity and also some fake price fluctuations due to weird price reporting and suspicious (most likely fake) volume reporting by crypto exchanges.
The stabilizer has its own methods of calculating the price and what I see in the logs is mostly a percent or two of fluctuations and very short divergences of more than that when there are big market displacements (big Bitcoin crash, for example). The latter are often resolved within a few minutes.
There are pumps that take longer to resolve, but eventually that too will stop, because most who participate in them lose money.
It's certainly nothing like SBD. Even the pumps are vastly smaller: The recent pump was mostly at $1.20, while SBD pumped to $10 or so. The previous HBD pump (to $2-3) was before Hard Fork 25 in June that added collateralized conversions from HIVE to HBD. It's much harder (and costlier) to pump after that fork.
What if the US dollar flash crashed (which some say is very possible) how would that effect our HBD?
It would probably be overvalued at first and take a little while to decline. We'd destroy a lot of HIVE creating HBD to dump on to the market to push its value down to the new value of USD, which could be good for the price of HIVE (over and above that the price of HIVE would likely go up in USD terms just due to the USD flash crash itself).
If it seemed like USD had utterly failed as a currency, we'd probably switch the peg to something else such as a basket of commodities, after some time to debate what the new peg should be.
Ok, thanks for the explanation. This was my only concern before considering a larger position in HBD. Hopefully we could move fast enough to switch the peg if and when that crisis arrives.
Honestly if you don't have confidence in USD to survive your holding period, I wouldn't buy it. Right now it is intended to track USD. Yes that could change, but if you don't trust USD you shouldn't trust something that tracks USD either. The idea of switching peg would be to preserve utility going forward (hyperinflation makes a currency nearly useless), but you shouldn't infer from that a promise to protect HBD holders from taking a loss if USD collapsed.
Ok, thanks for your response. Maybe Hive is the better investment for my needs then.
Thanks for this. Additionally, what are the mechanics or triggers to adjust liquid payouts being made in HBD to Hive? I can't remember and am seeing the HBD/HIVE ratio get decimated on this recent pump here.
The HBD payouts switch to HIVE when the market cap ratio reaches 9% or 10%, I don't recall which. However, the increase in HIVE price reduces the ratio, now about 3%, so this isn't even close to happening, and HBD will continue to pay out.
HBD in @hive.fund doesn't count toward the ratio.