I was asking themarkymark the following on his post. If I may ask you as well since I also have a follow up question.
Could you help me understand this?
These HIVE transactions are immediately converted to HBD by the DHF.
For simplicity purposes let’s say market price for hive is $1, and hbd $2.
dhf issues 1000 hhd to stabilizer.
stabilizer buys 2000 hive with it and sends it back to dhf.
dhf converts that to 2000 hbd by destroying 2000 hive and creating new 2000 hbd
dhf made profit of 1000 hdb
Is this how it works?
If this is how it works, why not make this part of the blockchain code when dhf or designated internal account does what hbdstabilizer is doing but with larger amounts based on market conditions. Sort of an internal AI. It seems like this process works and it is only matter of amounts used for it to be successful in establishing upwards peg for HBD.
However, since it isn't always, and you need to know the actual price of HBD at the time to decide whether to trade it for HIVE or just send it back. There isn't any easy way to do that within the blockchain. A mechanism to do so could be built, but it doesn't exist and isn't trivial.
I think this DHF fix is just the temporary cludge which can be done without hard forking and the only real answer is the internal market for HBD that means all of us can attack a pump if we want to.
That's ok, we're going to try to teach it better. And the DHF is getting paid to do the tutoring.
I was asking themarkymark the following on his post. If I may ask you as well since I also have a follow up question.
Could you help me understand this?
For simplicity purposes let’s say market price for hive is $1, and hbd $2.
Is this how it works?
If this is how it works, why not make this part of the blockchain code when dhf or designated internal account does what hbdstabilizer is doing but with larger amounts based on market conditions. Sort of an internal AI. It seems like this process works and it is only matter of amounts used for it to be successful in establishing upwards peg for HBD.
Assuming HBD is above $1, this would work.
However, since it isn't always, and you need to know the actual price of HBD at the time to decide whether to trade it for HIVE or just send it back. There isn't any easy way to do that within the blockchain. A mechanism to do so could be built, but it doesn't exist and isn't trivial.
I think this DHF fix is just the temporary cludge which can be done without hard forking and the only real answer is the internal market for HBD that means all of us can attack a pump if we want to.