Apon reading how the hbdstablizer actually has been earning money rather than losing it, I wonder why it keeps getting funding. It is like it should fund itself. The DHF sends money to it and it sends money back after making profits from it's activity.

Dollar Cycling

The basic instructions that this bot follows are:

1. If the value of the Hive Backed Dollar, HBD, is less than that of the USD, use the blockchain operation convert to change the money into Hive without trading. Hereafter, I will refer to this as burning dollars. Once you issue the transaction to the blockchain, these dollars are destroyed. Nobody gets them. They cease to exist.
2. After 3½ days, the process actually results like bread to toast in a toaster. The blockchain issues you newly minted Hive. The blockchain destroys your dollars and gives you Hive back.
3. Since the Hive Dollar has a lower value than the US dollar, you should be able to trade the Hive you obtained through the burning process for Hive Dollars at a profit.

In practice, Hive can be quite volatile. In spite of this mechanism, the HBD doesn't get within 0.1% of the value of the USD. Thanks to this mechanism and the other one that goes the other direction it does get and stay within 2% of the USD value.

Looking around the Internet apart from Hive users, I found an article with price predictions for HBD that seem to follow an exponential curve. There are many that don't seem to understand the motivation that the HBD is supposed to be a pegged currency. I think it is probably good enough but for some reason it stays at 99¢ rather than exactly $1.00.

Problems With Burning

The process doesn't work perfectly because there can be a spread between the best buy price and the best sell price. Thanks to lack of liquidity. Hive is somewhat volatile to the USD price. When Hive is losing value, burning dollars can leave you burnt. If the Hive price drops by more than 1%, and your profit margin is 1%; you end up with losing money in the end or being stuck with Hive in sell orders while it loses value.

I think it is up to burning small amounts frequently. This should @smooth out the flash crashes in the market. I think I should avoid burning it when Hive gets above some price point. The Hive price has risen rather quickly. It seems likely that it will correct downwards back down to $1.05. I hope it doesn't but I have stopped burning my dollars.

I understand the reasons for the 3½ day delay and I am not looking for changes in the blockchain on the part of devs. However, I am sharing my perspective as a extremely small-cap retail investor. And I of course can learn from comments from others in the community.

Rather than selling for the best order on the books. I am selling the Hive for the price the blockchain gave me or I will end up with open orders and holding Hive. I suppose I can lose in that the value of what I hold will drop but I am using dollars here. So I have already accepted that risk.