No-Brainer SBD Potato Top Up Proposal

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By now you are likely familiar with the @sbdpotato project, if not please check out the intro post. In summary, the @sbdpotato project name was inspired by this image where a potato brings balance to a stack of coins.

The essence of the project is to create a sustainable cycle of purchasing SBD on the internal market using post rewards and then placing the SBD into the conversion process, converting it back to STEEM over a 3.5 day period and then repeating the process to continually remove SBD from the market and lower the debt ratio to below 10% so the rest of the community can start helping to convert without fear of loss due to the haircut rule being in effect.

Currently, there has been positive support for the project and there are regular supporters of the daily post, yielding over $90 per day towards the conversion cycle. There is circa 1,500 SBD in conversion and 7,200 SBD converted since inception.

While these figures are encouraging; they are not enough to make a dent in the debt ratio; at the time of writing BTC has dropped below 7000 USD and SBD is sitting at 0.59 USD while the STEEM price has dropped to 0.12 USD according to https://coinmarketcap.com. The current @sbdpotato funding model is going to take some time to accumulate enough funds to make a meaningful impact which is why I am proposing this proposal gets funded.

The Proposal

Daily rate: 250 SBD per day Period: 100 days Total: 25 000 SBD Recipient: @sbdpotato Purpose of Funds: To be used to support the SBD peg via a cyclical market-buy-conversion process as detailed above and in the @sbdpotato posts.

Funds Return Mandate: Once the funds are no longer required to stabilise the SBD peg to 1:1 to the USD, the funds will be returned in full to @steem.dao which makes it a "No-brainer" vote as it will, in the end, be like a return proposal.

The DAO will also benefit from the spin-off effects of a stronger SBD which means less SBD is required to fund proposals with USD costs that need to be settled.

Further Compartmentalised Funding

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Should the this proposal funding be insufficient to correct the peg in a reasonable timeframe, it is recommended that additional trusted parties, witnesses, whales, project owners etc also submit proposals for a similar value and run the open source code on a personal Heroku instance.

For example, 250K SBD in custody of a single person is significant counterparty risk; however, 25K SBD across 10 different custodians achieves the same economic effect with decentralised risk.

(Credit to @smooth for the discussion that led to the formulation of the above.)

Conclusion

It is my sincere hope this proposal will be funded and thereafter, others might make similar proposals to catalyse the repair of the SBD peg through the power of unifed community.

Sincerely,

@thecryptodrive [Witness]

Proposal Voting platforms:

https://steemitwallet.com/proposals https://steempeak.com/proposals https://steemproposals.com/proposal/66

Beneficiary Disclaimer: This is a 100% @sbdpotato beneficiary post.


Comments
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  • @lanzjoseg

    Dear @thecryptodrive

    It is a great proposal my good friend.

    But I have a question, it will be that individually each of us can start buying SBD, I think that can also help true .. ??

  • @gniksivart

    It would be nice to have SBD close to or at $1 again as I'd much rather pay for Steem Monster cards and packs with SBD then I would Steem as Steem has a much higher likelihood of increasing in value over a token who is supposed to be worth $1.

  • @oldtimer.leo

    Potato? Even the name itself is a joke.


    Posted via Steemleo | A Decentralized Community for Investors
  • @cardboard

    Voted :) But I would prefer you to keep the funds and:

    • continue conversion if SBD drops below 1 USD again
    • sell SBDs if SBD prices goes above 1 USD

    Then maybe in the future the process could be decentralized by building it into the blockchain like @steem.dao. The more systems the stablecoin has to keep the peg the better.

  • @ash

    I mean at this point SBD is just an ongoing problem. there is no real fix to it, so instead of pumping in money/time maybe we all should think long and hard about whether steem really needs it, and if not, global settle and disable it...

  • @yabapmatt

    Maybe I'm missing something, but by converting the SBD to STEEM aren't you just inflating the STEEM supply which should (in theory) decrease the price to counteract the decrease in SBD supply?

    Wouldn't it be better to burn the SBD instead?

  • @oppongk

    That is great news to sbd potato. Thanks for this updates

  • @epic-fail

    Please just build and required % burn into the rewards payout. So if someone chooses the 100% STEEMPOWER option the payout would actualy be 95% STEEMPOWER and 5% (if 5% is the decided amount) goes to Null. If someone chooses the 50/50 Option, then the payout would look like 45% SBD and 45% SP with 5% SBD going to SBD Potato or other SBD Entity and 5%SP to Null.

    Yes, I know these can be set manually however this just needs to be built into the rewards pool directly as default and if someone wants to increase the amount they can.

    As of right now the Mr. Potato Head posts do actually look like "no brainers", are recycled content with no Proof of Brain , set a very bad example for new and veteran users alike (especially with voting the "additional comments") and look terrible cluttering the trending page.

    With a built in burn on all rewards, these types of posts would not be necessary and then the votes on these posts could go to minnows and actually keep some retention and will fix STEEM organically.

  • @phgnomo

    Come on man... Here is my proposal for you:

    Get the witness together, convince them to donate 65k steem total from all of them (and maybe other whales too), trade it for btc, buy the sbd ask book on Bittrex.

    There. You have sbd price at 1 USD.

    Then do whatever with the collected and (burn, donate, I don't care)

    Isn't this way easier than pledging for funds that could go to another more attractive project?

    Also, it would stop the potatoe nonsense on the trending ( also a front page for steemit)

  • @freddio

    I think longterm it brings nothing, because the market doesnt see SBD at 1$ otherwise it would be 1$.

    And what is if Steem Pumps to XX$, then we print a lot of SBD again.

    So what is the benefit of it?

    I think SBD cant be abuse save so it should fixed or removed.

  • @onthewayout

    I think that the intention of this initiative is commendable however it is a drop in an ocean and it will not even make a scratch. At the current prices we need to burn 2.5 million SBD so it would take this proposal 10 thousand days to achive it's goal...that is 27.4 years. Assuming we multiply this effort by 10 it would still take almost 3 years to do it.

    With the current inflation rate the blockchain is producing about 30 million steem per year. That has a value of 3.9 million USD or 6 million SBD (at a price of 0.13 for steem and 0.65 for sbd). So burning 2.5 million SBD means that we would need to re-route 42% of the inflation to this. That equals to 100% of the author rewards for 1.2 years.

    That is not even considering that with the last HF there is nothing stopping the printing of SBD. The whole SBD pegging mechanism is FUBAR.

    The only realistic way that SBD will be worth ~1 USD is if Steem is at least 0.20 USD again. Doing conversions is not good because the market sees that the inflation rate skyrockets and the price will reflect that.

    Going forward we need to make sure that the code does not issue SBD via author rewards since the SPS already takes up 10% of the inflation and that triggers the haircut rule faster than normal...In addition we should make sure that there is a mechanism in place that stops printing SBD via the SPS. Maybe have a hardcoded rule that buys SBD from the internal market instead of printing more SBD...or we just live with the fact that SBD will no longer be worth about 1 USD.

  • @witnessnews

    This post has been resteemed by @witnessnews.

    Follow @witnessnews to keep up with active witness updates.

  • @freddio

    @thecryptodrive i think you should make a proposal to rewrite code of SBD and make it like a copy of DAI.

    Remove the SBD in payouts and add them as real 1$ value.

    It is also way more scalable and it add more internal trading Volume to the market.

    The point is if SBD comes only from Rewards, it cant scale. If you can look up Steem for real 1$SBD it is way better and stabilize the price too.

    It also would be awesome to trade a real 1$ SBD with SMTs and Steem Engine Tokens.

    If more 1$SBD needed there can be fast "prited" via look up.

    So we should stop wasting Time and make SBD usefull.

    Edit:

    It is also more abuse save because if it use the same mechanic the inflation cant go higher and SBD has no impact on it.

  • @zedikaredirect

    I had only skimmed on this one, wasn't going to support it as i think it might not work, but since you mentioned a refund policy and the numbers are large enough to at least try (and you mentioned splitting in pieces to decentralize), in the near future the strength would be to keep it down, i doubt that you can but it might work, or else only a change in the code / inflation probably. Speaking without much technical or economical knowledge.

  • @jarvie

    So what's the plan for this?

    Funds Return Mandate: Once the funds are no longer required to stabilise the SBD peg to 1:1 to the USD, the funds will be returned in full to @steem.dao which makes it a "No-brainer" vote as it will, in the end, be like a return proposal.

    Personally i don't see the benefit of SBD shooting way above $1 either and with such low supply SBD could be easily manipulated now perhaps?

    In any case it's not like you have to return the funds right now but does the proposal need to still be voted in your opinion?

  • @maxsieg

    approved, but this is a rather resource intensive way to do it... why not an exchange that exchanges 1:1 sbd with the stellar USD tether, and create and anchor for the steem as well... then people who do triangular trading would raise the value of sbd while making money of it... plus it would make the steem fiat conversion cheaper if a stellar steem link existed...