02/08/2020 - Steemit again began paying rewards with SBD.

By Juan Molina | Juan Molina | 9 Feb 2020

02/08/2020 - Steemit again began paying rewards with SBD.

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The SBD has been constantly above the price of STEEM for months, for this reason it has not been printed as if it were linked to $ 1. This means that market capitalization has grown more slowly than it should. Now recently Steem has been growing gradually, so the relationship between the two (SBD-STEEM) has been closing.

Do you know what the SBD refers to? Steem-Backed Dollars.

This means that for each SBD printed, a quantity of STEEM printed will also be necessary.

Steem-Backed Dollars, this token serves to support the value of STEEM by having a currency anchored to the price of the dollar, therefore, there must be a relationship between the SBDs and the printed STEEMs. This relationship is very important since existing SBDs should not exceed the amount of STEEM printed, so that debt is not generated.

If the amount of existing SBD exceeds the amount of STEEM then there will be debt.

So how does Steem blockchain avoid this debt?

Well, what it does is stop printing SBD and start printing more STEEM so that the amount of STEEM in circulation can be equitable with respect to SBDs. Simple.

Until now there were more SBDs than STEEM in circulation, for this reason they had stopped paying SBD so that the impression of STEEM would increase and be able to close the gap between STEEM / SBD. Since the relationship is currently settled, SBD began printing instead of STEEM to continue maintaining a close relationship and not having to generate debt.

For this reason we begin to receive rewards again with SBD.