Here is my reply again:
I'll get straight to the points here, expand a little on them and hopefully that will help;
"the dysfunctional pegging of SBD to USD, and the lack of tax harmonization between countries."
Legalities are what make all the difference.
If SBD remains a Crypto currency, then it shall be treated as such by all the various jurisdictions out there.
If it is an rewards point for "loyalty" as is used by many a company out there in this world, then it is worthless until it is actually used for something.
i.e. a set discount on a merchants page. (again, as is the case with many companies out there)
I hope that this helps in what I am about to say.
In the Steem ecosystem we already have an internal exchange which is set at doing the exchange in 3.5 days, so as to prevent any manipulation.
So the code is there, call it a "smart contract" for arguments sake. Why?
Well, a Steemian with user loyalty points who one day changes their mind and wants Steem for them can easily use the option with a click of a button.
This option (button) was available in all our wallets up until earlier this year, it was removed as users were getting confused between "trading platform" and "internal exchange".
For "points" however it would have to be returned to the front end of the wallets, as this would actually be the only way to exchange points within the ecosystem.
The beauty of this internal exchange is that the points get burned when exchanged.
Likewise, when looking at things from a legal stand point, it is only at this point, when a person submits a request for internal exchange that there is an "internal debt" produced.
Remember, reward/loyalty points are not "crypto tokens" as per the law (and if defined as such in the legal documentation of the company, in this case it would be our "Whitepaper").
Further more, we can "peg" points to $1 US.
We are not pegging a "crypto currency" as such.
Hence, legally looking at it, the "markets" which do decide to sell their "points" that they own with direct 101 sales, can not influence the value of a "worthless reward point" that is only worth something when burned in the internal code of a platform and which is fixed to $1 US.
They would be literally crazy to do this, as they would be undermining their crypto trading platforms by trading something that isn't a crypto token.
Likewise, it would definitely put into question their licenses to trade crypto.
"Are they legally able to trade anything else apart from crypto tokens?"
I hope that this helps in clearing up the queries you have and if not, or if this leads to new questions, go 4 it, I'm all ears and will do my best to answer them one by one.
I felt that what I have written in this reply to you will help.
PS, Sorry, I was logged into our family account, working on a post, so here it is via my account.
It's @jackmiller here.
Alright—we are not there just yet, but we may be able to progress.
So how would this work in the following situations:
1- Once the SBD are totally removed, how would a user be able to associate a Steem account and the SBDP he owns? Would the ownership still be recorded on the blockchain?
2- What functionality would be left for SBDP?
(Clearly, it would no longer be a way to trade Steem and SBD back and forth. It would be a one-way conversion. It could not be awarded as a post / curation reward. Would it still be possible to transfer SBDP through memo?)
3- What about the SBDP supply? People owning them would either keep them, exchange them for Steem, or use them as loyalty/discount point (I'll come back to that), which means a available supply would steadily decline. Have you considered a way to issue new SBDP apart from those converted from SBD or would they be doomed to all slowly burn away?
4- Now the value of SBDP: let's say I am an online merchant. What would make me interested in accepting SBDP as a way of payment, or to give discount in exchange of it?
I mean, yeah, if I am assured to receive 1$ worth of Steem for each of them, why not. But there are two possibilities—either as you said, it's not a crypto anymore, so I need to trust a third party to exchange my SBDP and I prefer the actual sbd for that. OR it will still have the ability to be sent directly from the consumer to the merchant, to be managed by a Steem smart contract...in this case it's still basically a crypto.
1 - Yes, it would definitely be on the blockchain. The code in essence wouldn't change.
2 - SBDP would be everything that SBD was supposed to be as far as functionality on the real (fiat) market goes except for the crypto token side of things as it legally wouldn't be a token.
3 - refer to answer #1.
4 - It would be a "coupon" type of transaction, with one big difference:
The merchant would be able to get something for them, to the full value of the barter.
Secondly, there is nothing stopping non crypto token types of rewards being issued on a blockchain.
Just because the "trend" to date has been such to use blockchain technology to issue and track crypto tokens, there is nothing excluding the tracking of other information. (Already proven by various use cases of blockchain technology)
A smart contract is not needed, as the exchange of points (SBDP) is guaranteed in the existing code. (as described earlier in my previous answer/comment).
I'm lovin' this dialogue, guys. :-)
In a private discussion on the topic, I described it as follows:
Which literally sums it all up!
Those “morning issues” will getcha every time. 🤣
Coffee on crack.