Well, for one thing the price of STEEM on the Steemit-Market is constantly suppressed...
Right now STEEM costs about $4.45 USD on Polo... but only $3.09 USD on Steemit-Market (30% discount).
This has very little to do with the internal market (the same prices prevail externally) and you are confusing units.
STEEM costs $4.45 USD on Polo, but only $3.09
SBD on Steemit-Market.
Now check the price of SBD on Polo and you will see that 1 USD != 1 SBD (in fact 1 SBD = about $1.40 USD). That's because the pegging method in use has not been very effective overall, but this is another issue. At various times SBD has been above, below and about at par with USD.
But when a n00b uses the Deposit Function to "Buy STEEM" with BTC...
Steemit Inc is charging $4.69 right now... then can just buy it back for $3.09.
No, see above. Also the "Buy STEEM" function doesn't use the internal market. It can't because the internal market doesn't trade BTC, USD or any other external currency.
Potential issues that I came across today
1) Someone pointed out the fact that steemit has no fees. My question was, ok, then how does it prevent spam?
I covered that upthread. They rate limit the transactions, which has some negative implications for certain potential applications. And there is a transaction fee, which is the cost of holding Steem while it is debased 9X more than SP (since SP can't be transacted).
A rate limit can only be effective along with
size limitations. Otherwise if you have, say, a rate limit of 1 post per second per account, but no size limitations, then
-with one account
-you can make 86400 txs per day
-let's assume 20kb size
=1.7gb spam. If the txs are ike 100kb, that's 8.6gb per day.
At a more restrictive 2 sec between txs / 2kb per tx, you have 43200 txs per day x 2kb = 86mb. For a single account. If someone buys 100 such accounts, it's 8.6gb per day.
I'm really curious on how no fees can work.
Blockchains are good, but not really efficient in dealing with spam.
There are two levels of limits. The first level is things like time per post. That doesn't consider size (other than limits on the size of a post) is somewhat circumventable by creating more accounts.
The second level is stake-limited bandwidth, is not circumventable, and is based on size.
The first limit is more intended to encourage reasonable behavior by people with a reputation, or perhaps more importantly by compromised accounts with a reputation. The second is the real anti-spam limit. You would run out of bandwidth and your network access would be suspended (until bandwidth recharges) long before spamming 8.6 GB/day.