Greetings, community! I'm not the most knowledgeable person in the world about crypto finance or its internal mechanics, but I like to dig deeper, to argue about topics I believe deserve to be discussed, and to offer solutions, in my opinion, to problems like the one I'm commenting on today and which drives us all in one way or another: "Impossibility of converting liquid Hive to HBD."🤔
The HBD situation is a reflection that the system is doing its job: it is protecting itself from a slow death. The problem is not that something is broken, but that "debt" (the HBD in circulation) is too large for the current size of the Hive economy. For the conversion
of HIVE to HBD to be reactivated and for you to have that liquid money, the system needs its debt ratio to go down. And that can be achieved mainly through two paths.
1 - Hive's value goes up: by increasing the total value of the network, the same amount of HBD weighs less proportionally, and the debt ratio drops automatically. According to analyses, for the conversion to be reactivated, HIVE would need to recover to around $0.31 (from the current ~$0.057), a considerable jump.
2 - Burning HBD to reduce debt: reducing the amount of HBD in circulation. This is where the HBD Stabilizer comes in, a bot funded by Hive's community fund. Its job is precisely to buy and burn HBD from the market to reduce supply and help bring the debt ratio down. It is a sacrifice mechanism: community money is being spent to buy and destroy the debt itself, in the hope that, by reducing it, the system will return to normal and the conversion will be reactivated.
From my point of view, the most realistic short-term solution is not one alone, but a combination of both, with an important nuance: the community cannot force the price up, but it can manage the debt.