Disclaimer: I have no idea what I'm talking about! https://steemit.com/steem/@themarkymark/sbd-haircut-rule-is-about-to-activate-do-not-convert
Six months ago I made the claim that SBD was never going back down to $1. The rationale? There is too much dumb money in the cryptosphere. I figured that because SBD has a history of spiking up as high as $14 per coin that traders would see it as a safe-haven asset; a stable-coin soft-pegged to the dollar at the low-end with the ability to go x10+.
This is what we get for wanting institutional investors to come in. This extra volatility is just a small taste of the future. The last few times the stock market has dipped, so has crypto. We'll have to dip to even lower prices to shake off all those vipers. However, the second crypto is perceived to start making consistent gains in the face of Wall Street making consistent losses they'll hop right back over again. The insanity loop will continue on, friends.
Ironically, the same dumb money that pumped SBD up to $14 a coin have now pushed it down to sub 60¢. The USD value of SBD has NEVER been this low. It's pretty crazy if you ask me. Who are these traders? They clearly have no idea how this platform works.
I can no longer avoid the value of SBD, and neither should you. I've started a power-down, not to cash out my Steem to Binance, but to buy SBD with my Steem and burn it for even more Steem.
I've read about this several times but I've never actually done it before so I looked it up. @timcliff has a nice tutorial. It boils down to this:
https://steemconnect.com/sign/convert?owner=edicted&requestid=1&amount=4.644%20SBD
I just now ran this steemconnect command after trading 11.036 STEEM for 4.481 SBD. Now my SBD is gone! However, in 3.5 days I should receive $4.644 dollars worth of Steem. The value of Steem is averaged over 3.5 days. Assuming the average stays at 25¢ per coin I should get 18.6 Steem out of this transaction. If the value of Steem goes up over the next few days I'll get less, but if it crashes I'll get even more. See what's going on here?
This is effectively a hedge for anyone wanting to hold Steem coins. With SBD at 60¢ it's practically a guaranteed way to end up with more coins than you would of had otherwise.
You know who is taking advantage of this right now? Whales like ned who are dumping coins on the market and further devaluing the Steem currency. We need to mitigate these damages by scooping these coins up for ourselves and powering them up.
If you believe in this platform and want to power up during these dark times, don't power up directly. Acquire SBD and burn them until we get back to the $1 soft-cap. I'll follow up on this test in four days. Within a week I'll have access to a couple hundred more dollars for a larger SBD recycling loop.
Return from So Much Dumb Money! (Burn SBD for Steem) to edicted's Web3 Blog
