The problem with HBD is that it helps burn hive in good times, but then prints more hive in bad times. It burns hive at high prices (burns little amounts of Hive per HBD printed) and prints at low hive prices (prints lots of hive per HBD burned).

If the liquidity gets too bad in a bear market, hive can dump a lot on hbd conversions, causing even more conversions. Raising the debt ceiling for HBD only delays the problem and make it worse when it comes.

It is not guaranteed that HBD is good for the hive supply over the long term. It is definitely good for the people who arbitrage though, including the DAO.

I personally don't like it. When I stake Hive Power, I'd like to know what percentage of governance I will own forever. Unfortunately HBD can simply make that irrelevant and double the quantity of hive in a single bad year.

This makes hive governance worse, and holding hive is more risky because of it. Right now everyone is happy because it's burning hive. Everyone forgets in the end it's just debt and leverage, and it can blow you up simply because of bad timing, even if it is fundamentally good.