Oh, it was us always choosing a 50/50 payout.  Now the sbd supply is getting cut yet it is still way over 1 USD each.

Where exactly do I find the formula? The bluepaper is a bit very vague, but whitepaper has a few more specifics where it states:

> The blockchain prevents the debt-to-ownership ratio from getting too high, by reducing the amount of STEEM awarded through SBD conversions if the debt level were to exceed 10%. **If the amount of SBD debt ever exceeds 10% of the total STEEM market cap**, the blockchain will automatically reduce the amount of STEEM generated through conversions to a maximum of 10% of the market cap. This ensures that the blockchain will never have higher than a 10% debt-to-ownership ratio.

~~Perhaps~~ Quite likely, I'm not getting it, but according to Coinmarketcap, the total market cap of SBD is currently ~22 Million US-$ while Steem has a market cap of ~505 Million US-$. The debt-to-ownership (dto) ratio (SBD/Steem) is therefore 22/505 = 4% and given the relatively narrow price ranges per token between SBD and Steem and the much higher amount of Steem on the market, the ratio probably never exceeded these 10%. At the current number of tokens on the market, SBD would have to be 2.5 times as expensive as Steem to get to these 10% and if you consider the SBD supply being even smaller before this massive (and lasting!) increase of the inflation, the dto ratio must have been even smaller than it is now. I remember only a few weeks where you got 3-4 Steem for 1 SBD.

Therefore technically, this automatic decrease of generated Steem could have never been activated and if the dto ratio exceeded these 10%, it would have been shut down after the ratio went down again, which happened fast. At least right now, from the side of the system, there shouldn't be this kind of SBD inflation.

Or maybe...
-  it is in fact the price per token that is targeted by the dto ratio instead of the market? In that case, the whitepaper is talking about the wrong figures.
- it is only tokens on the platform and not outside of it that are relevant and there it might look completely different? If this is the case, are the platform only figures publicly available?
-  this mechanism is not a built-in feature of the blockchain, but something somebody can pick and click by convenience. Which begs the question: Who, what and when?

I mean, the results look pretty neat when you consider the SBD chart since December. It's close to a straight line the way it is going down and if you set the parity to the US-$ as goal, this is how you do it.

But since the "literature" doesn't offer a justification for an automatic mechanism to trigger this as I explained above - and in case the three maybes don't apply - I see no other explanations for this development than the ones I propose in my first comment: Either it was whales or it was Steemit Inc. who did it in a concerted effort and everyone who knew about it could make/save a ton of money on the expense of the bulk of Steem/Steemit users who trust(ed) the system.

And don't worry, I am not a saint. All I want is to be in on this deal;-)