Destroy what? What is 'it'? I'll assume you mean HBD price valuation because that is the thing we are printing. Except wait... what is HBD priced in again? Oh, yeah... it's priced in USD... the thing that nobody wants because it just lost 50%. But wait, there's more. The price valuation CANT be destroyed because it is Hive itself that maintains the peg. So it's Hive that we'd be destroying? Again, no. The 50% APR bump only occurred because nobody wants to hold HBD because USD tanked. In that case our debt ratio is less than 1%. We need to increase the APR so that people actually want to hold HBD/debt. It's not destroying anything it's bringing balance to the system. You don't fully understand these mechanics but you think you do.
- USD loses 50% value.
- Hive goes x2 just from unit-of-account devaluation.
- Debt ratio gets cut in half just from devaluation.
- Debt ratio gets slashed again because no one want to hold HBD.
- The only solution in this scenario is to increase demand to hold the debt.
- There are many ways to do this; increasing yield is the easiest way.
Again, you're saying the system would be destroyed if we increase APR to 50%.
Wrong, the system is destroyed if we DONT increase APR to 50% in this situation.
The interest rate exists to provide elasticity to the supply and demand of the debt.
Hive is the central bank; HBD is our debt instrument.
When there is no demand for debt we have to stimulate demand for debt just like the FED would.
As in stimulus. As in drastically higher yields (in the FED's case lower rates because it's a debt-based system which is the opposite of crypto).
I couldn’t disagree more. That said it’s all respect ✊
But it’s clear to me we just disagree and we won’t agree.
Let’s bet! U down?
For sure I would say I'm in the minority here, so I can't run around disrespecting what the majority are saying. There's a reason why the majority view is the majority, even if I think it is misplaced.
As for the bet... yeah I'd make a bet, but I don't think there is any concrete thing to bet on. Wanna make a bet that Hive market cap would double if USD loses half value? I'll take that one :D.