Post
Topic
Board Altcoin Discussion
Re: Steemit how can this thing be workable long term?
by
bones261
on 15/07/2016, 04:41:09 UTC
How do you know that the exchange rate will adjust accordingly ? It may not, markets don't always act rational, even more so when everyone are told that 9/10 of their wealth will be wiped out
The exchange rate of VESTs to SP is not determined by market forces. It is hard coded to change over time in order to dilute the supply of SP.

You can check the current rate at https://steemd.com/distribution

Currently it is
Code:
1M VESTS = 216.819 STEEM

Note that what is called SP is simply VEST balance denominated in STEEM equivalents.

There are mechanisms in that act as automatic stabilizers in the case of market volatility, by the way... We could eventually discuss those. They're very clever.

I think the mechanisms are absolutely convoluted.  I guess that you can spin that as "clever."  A 10 to 1 reverse split every three years to calibrate precision? WTF is that about? Also, the "mining" is convoluted. The "miners" are not actually adding to the blockchain with their hashing. All a correct hash does is put the miner in a queue, with the hopes of being selected among the other 20 witnesses, to create a DPOS block.