With new Hard Fork 25 there's serious commitment to making HBD into a competitive stablecoin. Earlier it used to be only a coin with price floor instead of real stable peg to USD.
Allowing 2 way conversion between Hive <=> HBD opened a way to more price stability. @ausbitbank developed a tool to keep track of all HBD stats you need to get a good hang of the market conditions. It's also a nice place to send new people to when you want to teach them about HBD.
Perfect For Competition
- Steem made no changes to SBD
- Blurt removed stablecoin (No BBD)
- Hive has 2 way conversion for HBD
We've got all 3 scenarios to test things out. Whatever happens best solution will win. Maybe the best solution is having all the options and using them for different investment types.
SBD Had Gains! HBD Has Stability!
HBD has 7% interest which is really cool. So you're not loosing much. In fact it might be the better way since there's already so many other crypto that can pump their price 😃
We've created the Hive Backed Dollars (HBD), a token that provides a stable utility value when transacting on the Hive platform or anywhere else where zero fee Hive Tx are accepted. I see few super powerful use cases to pick HBD over other options in the market.
- We've stood the test of time (5 years!)
- No trust in central system (like USDT)
- 100% transparent with no sketchy stuff in code
- Strong price floor
- More arbitrage opportunity
Let's Talk About Last 2 Points
We've seen tons of stablecoins crash their prices. We've seen them fail miserably because of tough market conditions or problems in code. HBD has been tested for 5 years & it's backed by Hive Blockchain marketcap.
This is super capital efficient. No collateral is locked. It's just the smart contract taking care of a promise in the DAO way 😃
Prices are pretty much guaranteed to not fall hard. Hive is the strongest social media blockchain in the crypto game with most Dapps & front ends. It's hard to fail there.
There are these Yield farming DeFi Dapps where folks are trading what's basically 2 crypto that's pegged to the exact same value. Why?
Cause there can be fluctuations in market prices. because of history of HBD and how it's stabilized, opportunities for trades like this could be far far far far far far far better compared USDC-USDT pools. That's a huge perk while having similar risk profile.
Speaking of Risk (& Flaws/Drawbacks)
- Stability of HBD price could be slow to achieve
- HBD may not always be $1
- Larger range of price movement
- Limited issuance based on Hive marketcap
- Hive goes down - debt haircut happens weakening peg
- Makes things complicated for Hive
That's a main reason why Blurt completely got out of stablecoin game never creating a BBD. @demotruck made this post Ned Scott was right about one thing & it says we'd see more volatility in Hive when we try to stabilize HBD. Makes sense to me when I try to think about it.........
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