So it's a semantics game and steem/SBDs are interchangeable from the SMT creation standpoint, except that the minimum amount will be set at the nominal value of whatever 1 SBD is.
Perhaps then some deep pocketed players have deemed it necessary to accumulate SBDs and drive their value higher to establish a cost barrier to entry in the SMT creation market whenever SMTs are ultimately launched. Who knows really.
Nonetheless, SBDs are plainly described as an experimental asset in the SMT white paper: "SBD (Steem Blockchain Dollars) are an experimental asset on Steem that relate to the US Dollar, originating with Steem’s launch in 2016."
And this experiment of being pegged in value to $1 USD has been disproved by the free market since November 2017. I don't understand why the inherent potential of SBDs continues to be misrepresented to the userbase and general public. Why impose a self-defined constraint on their value when the free market has no interest in doing so?
Some of those questions might be best answered by the creator of Steem or SteemIt.
However, I can clear up the fact that the 3.5 witness feed rate does not care about the market value of SBD. It cares about the value of STEEM and uses that to make the conversion between SBD->STEEM.
So if the traders keep pumping SBD, users will be able to sell SBD and buy STEEM and create more and more SMTs. This is the opposite of prohibitive.
Example from Steemd.com demonstrating SBD as the base independent of exchange value:
Thanks for the response. Trying to understand this all better myself and you're among the few Witnesses that has ever acknowledged the questions so I appreciate that.
Getting mixed messages though because I've seen other Witnesses say they are fine with the ongoing free market price discovery that is occurring with SBDs. Most recently @aggroed said in an interview with @jerrybanfield: "The other debate that I've been able to partake in a lot is, what should we do with the SBD? My response is, help it be as high as possible because this is good for the platform."