Yeah, it is now official. HBD now gives a 20% APR to keep the funds in Savings. The withdrawal period is also only 3 days. There were discussions going on back and forth in the last few days saying that HBD should give a better APR and probably a 20% APR would not harm the inflation or the chain. Many witnesses agreed and I also wrote an article yesterday saying that I'm going to be increasing my HBD interest APR to 20% on my witness node. We have 12 out of 20 witnesses that have set 20% APR to HBD in savings and it can be claimed once in 30 days.
Looks like many witnesses heard it and they also wanted to update the APR percentage to 20 now. Officially I think Hive is the only blockchain that provides 20% APR in a decentralized manner on-chain. Most of the other services that offer better APR is not stable coin and mostly they are also controlled by some individual account or wallet. They are not fully decentralized. In addition to that, only the centralized exchanges provide a better APR, and that too for normal coins and tokens and not for stable coins. Please correct me if my understanding is incorrect. I'm ready to learn if there is some other place that gives better APR for an on-chain decentralized stable coin investment and that too with just a 3-day locking period.
Now that the APR is good, we will start getting many investors. We have to agree that with just 12% itself HBD got good attention already. Now many people would be interested to grab that 20% by keeping their funds in the savings as HBD. Even I might power down a little bit when the next Hive pump happens and move the funds to savings as HBD. With Hive curation, we will be able to get a maximum of only 10% APR but with HBD we get 20% APR which can increase the demand for HBD and the internal market will already start flowing with orders. This can shatter Hive price a little bit initially but later the price will recover back.
HBD would need more liquidity
Liquidity can be the next problem. Now people will start entering into HBD and this will in turn lock lots of HBD inside savings. This can increase the need for more liquidity. We all know that there is already an HBD stabilizer that makes sure the price of HBD stays around 1$ all the time. When there is more pressure on HBD and supply keeps increasing, there are two possibilities. Initially, if people try to convert their Hive to HBD, then the price of Hive can drop further. Another possibility is for external investors who purchase Hive fresh. That is the way they can convert it to HBD. This will also increase the price of Hive.
In both cases, liquidity would be required. We will also need more exchanges listing HBD as a stable coin option. If that happens, we will be able to get more liquidity and see more people trading HBD. This will help in keeping the price of HBD around 1$ a little more precise. I don't know what other possible challenges we might get with this but yeah having more exchange listings is always good I guess.
I have not seen some of the popular witnesses change the interest APR to 20% yet for HBD. That includes block trades as well. Hope he has a different opinion on this subject and I would be curious to hear his thoughts. Most of the time he will come up with an X scenario that everyone else would miss.
blocktrades, good-karma, arrange, edit, stoodkev, emrebeyler, followbtcnews, someguy123 are the top 20 witnessess who have set the APR below 20%. I'm sure some of the witnesses did not get a chance to update the APR yet and other witnesses might have a different opinions on this subject.
If you like what I'm doing on Hive, you can vote me as a witness with the links below.
as a Hive Witness 
as a Hive Engine Witness
 |
 |
 |
 |
 |
 |