The Price of a Coin
The price of a coin is determined very simply through the following equation.
For this post we will consider the price, market capitalization and inflation of Steem and Steem Based Dollars (SBD) and for clarity I will calculate the current price for both using the above equation.
Steem
Based on the market capitalization and circulation supply given by Coin Market Cap (CMC) the price can be calculated as seen below.
SBD
Based on the market capitalization and circulation supply given by Coin Market Cap (CMC) the price can be calculated as seen below.
My Concern
For a comparison the annual inflation rate for Steem is determined first after which the inflation rate for SBD is calculated.
Steem Inflation Rate
If we consider the market data for Steem from Mid December 2017 and only look at the price for a market capitalization of US$800mil (follow the US$800mil line in the graphs below) we can determine the increase in circulation supply and the inflation on the coin per annum.
The points selected are as follows (Courtesy of Coin Market Cap):
Point 1
Point 2
Point 3
Point 4
Point 5
Summary of Steem From Mid December 2017 to Date.
The annual inflation rate for Steem can then be determined as seen in the below table which equates to 10.0%.
SBD Inflation Rate
In order to determine the inflation rate of SBD the same methodology as above is followed but here we consider the market capitalization of US$40mil (follow the US$40mil line in the graphs below) we can determine the increase in circulation supply and the inflation on the coin per annum.
The points selected are as follows (Courtesy of Coin Market Cap):
Point 1
Point 2
Point 3
Point 4
Point 5
Point 6
Summary of SBD From Mid December 2017 to Date.
The annual inflation on SBD can then be determined as seen in the below table which equates to 583.8%. This is a monthly inflation rate of 48.65%.
Conclusion
Never hold on to SBD as the inflation on your SBD's in your wallet is 4 times higher PER MONTH than steem for an entire year. If you are holding on to SBD's it is being devalued at an incredible rate!
Source
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