Following @smooth's lead, I have updated the HBD APR for my witness to 3%. A brief explanation as to why is below. I encourage all other witnesses to do the same.
HBD Stabilization Plan
If you have not yet read @smooth's HBD stabilization plan, there is a link to it here.
The TLDR of @smooth's proposal is that when there is excess demand for HBD causing the price of HBD to go above $1.00 USD, the @hbdstabilizer account (which is funded by the Hive DAO) uses HBD from the DAO to purchase HIVE on the internal market and then send the HIVE back to the DAO to be converted into HBD.
If that seems confusing, don't worry. The important part is demand for HBD turns into buy pressure for HIVE - which is a good thing :)
HBD Interest
With the HBD stabilization mechanism in place, witnesses can use HBD APR to generate additional demand for HBD. The idea is that people will be encouraged to buy and hold HBD when looking for a "stable coin" to park their money, and the interest helps to make HBD more attractive than some of the other stable coins available on the market.
With the additional demand for HBD, this will hopefully translate into additional buy pressure for HIVE.
What Percent?
I don't think there is a perfect answer to this, although the idea is to create enough additional demand for HBD to keep continued buy pressure on HIVE. Whatever percent achieves that is what we want to aim for.
Personally I think we may eventually need to increase the percent to around 10% to compete with other DeFi coins that are offering something similar, but I am following @smooth's recommendation to start with 3% for now.
Technical Details
The blockchain sets the actual HBD interest parameter for the chain based on the median value across the 21 witnesses participating in the current block producing round. (There are 20 top witnesses + one backup witness producing blocks each round.) This means that a majority of top witnesses will need to set their HBD APR witness to 3% in order for it to take effect.
Post Rewards
The rewards for this post are set to 100% beneficiary going to the @hbdstabilizer account.
Witness Voting
I strongly encourage all HP holders to participate in our Proof-of-Stake governance model. This means either taking an active role in voting for the witnesses you think are doing the best job or delegating your witness voting power to someone you trust by setting them as your voting proxy.
If having HBD interest is important to you, I encourage you to talk to the witnesses you are voting for and suggest they update their witness parameter. You can also support the witnesses who are setting a favorable HBD interest rate by voting for them as witness.
You can vote on witnesses here:
https://peakd.com/me/witnesses