Some of the most distinguished blutarians also like to post on Hive. Hive has an interesting token called HBD which is tempting for speculative investments and I want to bring up a risk that is not commonly known to investors, and to warn blurtarians.
HBD is trying to be a stable coin not by backing up with USD funds but by a "contract" that lets HBD holders convert HBD to Hive with estimating the HBD as 1 USD. Sounds legit but there are risks well known to the knowledgable investors and these can fail the non-educated investors.
HBD conversion takes 3.5 days during which the Hive rate is calculated by its average according to CMC and Coingeko published rates. These 3rd party rate providers (a.k.a oracles) can be manipulated or buggy and affect the algorithm but that is not the major risk these days.
If you have HBD and converting to Hive you might suffer a sharp price change.
Lets say you have HBD and you can sell it for 0.80$ but you choose to convert it to Hive and get 1.00$ per HBD, if Hive drops more than 20% on average of the 3.5 days you are losing money.
An example - Hive price is 0.40$ and you have 1 HBD that you can sell for 0.80$. If you sell the HBD and buy Hive you get 2 Hive for HBD. And then you can sell in the market and get your 0.80$.
Lets say you choose to convert and during the 3.5 days the average price of Hive is 0.40$ but 0.30$ in the last day. So you get for your 1 HBD 2.5 Hive but you can sell them for 0.75$ in the market. If the last day of conversion is grinding you Hive worth you are loosing money and its very reasonable these days when you need liquidity.
That is why HBD is paying 20% annual interest for locking it. But then on top of the 3.5 day conversion you wait 3 days for unlocking saving and again these days its risky.
So know your risks, there is no free meals, even in crypto.