I love that input. It is very thoughtful and you really know you stuff.
If you don't mind, I would like to change your mind on the "no need" for SBD. Remember when Tether was a serious issue and could potentially pull the rug out from under cryptocurrency? SBD could potentially be a competitor for Tether. A single pegged currency is a single point of failure. This is cryptocurrency's Achilles heel. We cannot have a failure of a single currency that could send crypto back 5 years. SBD absolutely cannot be a competitor to Tether right now, but when the Steemit user base gets to a size of hundreds of millions, and the quantity of SBD gets large enough, it can be a huge asset. It wouldn't just work for buying things on Steemit, but it could be used as a stable currency everywhere (once it becomes massive enough).
For now SBD is a major benefit for those who are working hard on this platform. The peg doesn't work because the supply is too small. The only way to create supply is to earn it from content. Investors know this and buy it up or Steemians hold onto it with the expectation that the demand and price will go up. This happens to be a major benefit for those who work hard creating content on the various STEEM aps. We get paid in the quantity of SBD not the US dollar equivalent value. This means that right now it is a really good deal for us creators. So there is really no need to attempt to get rid of this cash cow called SBD.
Here is how the economics works on SBD. Getting paid in the quantity of SBD actually floods the market with the currency. This increases supply and price falls. Once the price of SBD drops below a US dollar, Steemians switch to the 100% SP reward system and supply of new SBD drops causing a shortage and price goes up. This is the just one mechanism that fixes the price to the US Dollar. It is really amazing how popular SBD remains as the evidence of price continues to stay well above the peg.
Long story short: Don't bite the hand that feeds you, and SBD will only get better over time.
Thank you for leaving such a detailed comment. It is not that often I get some real effort in comments.
Hi thank you! Oh I'm not averse to changing my mind, and tbh I don't know too much about SBD itself. For it to be worthwhile there needs to be a lot more functionality for it that makes it special. Know what I mean, like right now about the only real difference I see in how you would use SBD is that you can't use it to power up Steem Power. It doesn't transfer faster or allow you to do more fancy money stuff like perhaps smart contracts and the like (not yet anyway, that's something good to add isn't it?).
Yeah the peg is all over the place exactly because of this complete lack of functionality right now. So SBD behaves like your typical manipulated to all hell speculative altcoin, because Steem is the one you want for actually doing things with your account. About the only thing people use SBD for is to buy upvotes from bots.
I would rather like to see an actual 50/50 split of SP and SBD in payouts. The payout system is REALLY confusing, and it keeps on changing all the time. It seems that when the price of Steem is low (at around 1 USD) then it's something closer to 50/50 but even then not really. It's more something like 78% of the payout gets split like 60/40 or something like that. And when it's high it's worse, it's 62% of the payout gets split into 75/25 (all figures SBD/SP). It took me ages to get my head around it and really as it is not it's far too misleading to encourage goodwill among regular people. They see yay my post made a dollar, then it pays out and wtf is this why do I get something like 0.47 SBD and 0.102 SP or something, what gives man where is my dollar? Now have that happen millions of times a day and you see the completely unnecessary headache the devs created, for no reason at all. For that the payout should simply be computed to show the exact payout at this given time. If someone else upvotes and changes the payout and curation, well then re-compute it. It's the same work either way, you might as well make it calculate the way that returns an actual accurate result. I mean the payout formula tallies it up in the end anyway right? So just let that one compute the result in the meantime as well. That plus getting denied a one cent payout for a new user is also a kick in the balls. Like wow you're teasing me with this tiny little payout that I earned, and don't even give me that? Wtf?
But I'd argue that the broken status of the 50/50 vs powered up 100% is what makes SBD "popular", not that people like SBD in particular. When you're powered up, you simply do not get 100% of the earnings in SP, you get a far lower fraction than you should. I've tried it, it was horrible. You're better off getting 50/50 and then selling the SBD and powering up the Steem you get from it.
See what I mean lol, there has to be a better approach than "read the whitepaper lol it's all explained there and in this convoluted maths/programming post this one guy wrote". That's like if the Reddit or Facebook devs pointed you to their github repo to have a look over the source code and shut your fucking mouth too bad if you don't understand it.
Rule number one in any type of business: bend over backwards three times to make it as easy and frictionless as possible for your customers to want to see their money fly out of their hands. Not include lots of little annoyances and make it so convoluted that everyone needs to spend some weeks observing the system to get it.
The argument for new user payout not amounting to much doesn't wash with me.
There is really two ways all users need to approach Steemit.
OR
Everyone here can easily make 25% or more Return On Investment. The problem is that people can't seem to understand that if they don't invest any money, then they won't get great returns. It would be like me wanting to make a killing in the stock market, but I refuse to invest any money. 25% returns of $0 invested is still $0.
The returns are really amazing here. Let's compare to the stock market. If you make 10% on the stock market, you are doing really good. Most people don't do that well and some years they will be negative. Let's compare to a physical business. 10%-20% returns are also good, but think about the massive up-front capital investment, payroll, insurance, massive overhead, and other expenses. It is tough to run a business, and at the end of the year you may have squeaked out 10%-20%.
Let's compare that to Steemit. You can easily make 25% or more with almost no overhead. All you need is a laptop and an internet connection. There is no payroll, no building to buy or rent, no materials to buy, no insurance, no utilities, no employees to hire and manage, and no sales to deal with. Even if you decide not to do any work, you can get great returns just by delegating your voting power and not do any work at all. The other benefit to Steemit is that it is scalable. Your investment can be as small or as big as you want. Imagine trying to scale a restaurant. You really are stuck with the size of the building and the building seating capacity.
Now the new user doesn't even have to want to be an investor. They can do it purely for entertainment purposes and there is no advertisements and the account is free.
I'm going to help you with understanding the reward system. I have to admit that I was confused for quite a while and did a bunch of research and still was confused. Once I understood it, it was an Ah-Ha moment for me. It is actually quite beautiful and ingenious system once you understand it. I felt compelled to make an explanation to use as an aid for helping people understand STEEM. Click this link. It explains the reward system.
https://steemit.com/steemit/@socky/steemit-rewards-breakdown-a-simplified-explanation-with-illustrations