Everything Is Fine (Part 2 of 2)

Fear not, hiveizens of the web3 digital finance commieunity. While the world outside crumbles like an undercooked cookie, your Hive Dollars remain perfectly safe, pristine, and untouchable backed by the temporary-permanent staked hive. At least according to the highest authorities in optimism.

My self-esteemed members of the commieunity, brace yourselves for another installment of my highly professional, excessively credentialed, and undeniably neutral observation. I, your fearless investigator (Mua) and winner of the Nobel peace prize from the observations society, return from the gallows of yesterday’s documentary spectacle to bring you further clarity on matters that might or might not require clarity.

Before we dive headfirst into today’s saga, allow me to offer a “brief” recap of yesterday’s unprecedented chaos, the highlights, the lows, and everything in between.

Naturally, those who prefer the complete context may follow this link to Part 1, though I cannot guarantee it will make any more sense the second time around.

Yesterday, we witnessed the marvel that is HBD in action. Hive funds were “temporarily but permanently” staked, stability was measured in intent rather than price, and questions were celebrated as proof of health.

Also my noodles may have tasted funny, but at least nothing exploded, yet.

Following witty’s presentation of @smooth’s original proposal, that mighty cornerstone of economic destiny, has begotten several daring descendants. Some brave souls, have cast their votes in devotion to these progeny, carefully weighing every digital fiber of their being.

However, here we observe a truly heroic act. @enginewitty, faced with the monumental responsibility of influencing the very fate of HBD, refrains from voting. A decision of such unparalleled moral fortitude, one might expect statues to be erected in every corner of the commieunity.

Why abstain, you ask? Because manipulating the price, no matter how tiny the ripple, is far beneath the dignity of such a conscientious soul. Never mind that, realistically, more votes would only pour additional funds into the system.

Wait… didn't I say we probably need to 10x the funding? I can't remember now. Must be the Ganja.

For reasons unknown to me and beyond my scope of understanding, sex toys got mixed in the scene of this discussions and has me mind boggled. Apparently something by how the pegging is handled is not satisfactory.

As an expert in tokenomics, not even I know why peg toys have to with stabilizing hbd, but something extraordinarily different has to occur here. I should know I smoke plenty of weed daily. This is the first I'm hearing about it.

But we are assured that we can rest with our asses in tact because our hero is here to “get into that further”. Whatever that means.

My dear under qualified readers, I must confess something. I am suffering existential crisis at this point, because now I have to re-examine myself for I may have been living a lie this entire time.

All this time I am told that we have to be ourselves but now, in order to understand the underlying problems of adulthood, I now have to be the HBD price. To truly examine it. Breathe in and out the prana price.

After a few hours of HBD price observations and having studied the arts of it with the monks, and reverently, religiously stared at the prices fluctuate up and down, I did everything you asked and still I learned nothing actionable. I still don't understand why pegging is involved nor what, precisely, any of this examination was meant to accomplish.

I need a tokenomic now…

Puff puff cough puff puff pass

At this point I am at more loss than ever. Apparently by the sages wisdom we must, should the price wander upward, respond swiftly and decisively by buying Hive with HBD and sending it… back to where it came from.

Should it wander downward, we wait, hold… precisely three and a half days (that's 84 hours to be precise, a sacred interval known only to wallet alchemists) convert, reconvert, rebuy, and once again return the funds to their natural habitat. Movement is action. Action is stability. Stability is achieved by never letting anything actually leave the room.

Now we are told the #1 problem is not that we don't have enough stability but that don't have big enough cajones.

It's also been made known to us that we need someone to stand at every market and hype for hbd as the loudest vendor in the room while doing nothing because nothing is supposed to leave anyways right?

Fortunately and at the same time, tragically, HBD is spared this burden because it exists on some lone island. Maybe this is where the pegging is done? Why else would you call the market upfit? Like what are you trying to fit up at here? I'm not liking where this is going at all. I like my biscuit unbuttered and intact thank you.

What becomes particularly fascinating is how the internal mechanisms operate with such confidence, as though external markets were merely optional footnotes rather than participants. Inside the Hive ecosystem, stability is carefully managed, watched, converted, reconverted, and ceremonially returned to the DHF with great seriousness. Outside the ecosystem, however, price discovery continues independently, unsupervised, and tragically uninformed of these internal rituals. This creates a curious situation where HBD is simultaneously stable by internal decree and unstable by external observation, a contradiction resolved only by agreeing not to look too closely at one of them.

But as observations go…it is said that the price will align again out out of respect of this culture's ceremonies.

What I find remarkable is not that decisions are made, but how consistently they arrive at familiar destinations and from the same places.

One might reasonably expect that a blockchain approaching its sixth-seventh year of maturity, operating a so-called stable asset, would have made at least a modest effort to exist where prices are actually discovered. Not everywhere, perhaps, but somewhere beyond its own walls aside from its lonely island of refugee camps. Large exchanges, small exchanges, even mildly sketchy ones, any place where buyers and sellers are allowed to disagree in public.

And yet, here we find ourselves, observing a system that speaks fluently about market dynamics while politely declining to participate in markets.

To reiterate well understood the reasoning. External markets introduce variables which introduces volatility. Volatility introduces attention, and attention, while often mistaken for growth, is historically known to invite scrutiny, disagreement, and people who ask questions without first learning the culture. And we know how that goes when people ask too many questions in hive.

So thus, here we have “restraint” becoming wisdom disguised as lack of visibility which is a “risk” and the remaining largely unlisted is reinterpreted as a deliberate act of sovereignty rather than an unresolved structural choice.

Problem #3: The 5 legs of the pink elephant in the room

1. Stability Without Adversity

A system that avoids external markets is never forced to prove stability. Internal mechanisms can only respond to internal signals, which means they optimize for internal comfort rather than external reality. Without exposure to disagreement, arbitrage, or loss, “stability” becomes a claim rather than a condition.

Stability that cannot fail has also never succeeded.

2. Closed-Loop Liquidity

When HBD is bought, sold, converted, reconverted, converted again and reconverted etc, and ultimately returned to the same treasury, liquidity is simulated instead of discovered.

Movements is thus mistaken for circulation and accounting replaces exchange. The loop completes, blind applause follows, and no external participant was ever required at any stage.

This is not only inherently malicious, but it is structurally insulated.

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3. Reward Distribution Without Market Discipline

Rewards, DHF funding, and governance outcomes continue regardless of whether HBD meaningfully exists in contested markets.

Those best positioned to benefit are not those who increase demand or adoption, but those already positioned within the loop. IE the plebs.

Therefore, incentives by these key players, drift toward maintenance of the loop rather than expand beyond it.

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4. Volatility as an Information Source (Not a Threat)

External markets introduce volatility, BUTT volatility is not the enemy of stability, it is the mechanism by which stability is tested. Price disagreement reveals where systems bend, break, or adapt. Avoiding that process does not eliminate risk but merely postpones its visibility.

A stable asset that never faces public disagreement is stable only by convention.

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5. The Cultural Resolution

What is often framed as prudence, restraint, or sovereignty may also be understood as a cultural preference for predictability over exposure. This preference is not irrational but it does has its consequences.

The greatest among them is a stable asset that is internally coherent, externally absent, and not to forget economically confident precisely where it is least challenged.

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Closing Observation

HBD does not fail because it lacks mechanisms. It does not fail because it lacks intelligence or good intentions. It struggles because it is asked to behave like a market instrument while being protected from markets themselves.

Whether this is a temporary phase, a deliberate design choice, or an unresolved contradiction is left to the reader’s observation.

After all, we are encouraged to examine the price closely.

Just not where it is discovered.

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This post was not funded by the DHF, whales, witnesses, or optimism. Voluntary support accepted in XMR below, because closed loops are boring.

XMR:

86fXjLUF7W9SwGSjTtsbqq4t1LKzzypEZa1t77S5c68WF3yK9SmEfzPTtRyjUhDSk9Zn7p1ahFJT4PcKW8MN4h3QRpjx2Q5

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