SBD was created to be a crypto pegged to the USD dollar. Used as a currency in steemit, users can exchange SBD for Steems directly through the steemit. SBD is currently ranked ~343th in market cap with ~ 3.3mil in circulation.
There will be experts on this coin and I sincerely admit I am not one of them so what I am about to explain may not be fully correct however it is my interpretation of what I have read from others regarding this coin. Therefore forgive me for any misinterpretations I may have and for those who believe I am wrong in some way or another regarding SBD please fill free to post and correct me. Thanks!
Quick definition when I mention Steemit it means the platform and blockchain in which SBD and Steem is used.
Basically SBD is debt. When Steemit takes out a loan it creates SBDs. The loan of 1 USD at current value would equate to 1 SBD. This is why SBD is pegged to the USD. Steemit then has the USDs to create Steem and Steem Power. That way rewards to users can be given out. The loans or aka SBDs in turn has actual value to them backed by steemit. Steemit is backed by the $ evalluation of the whole platform and blockchain. That $ amount will grow as more participants uses steemit. So to summarize, steemit takes out a loan by giving out SBDs and uses the loans to create Steem & Steem power. Which in turn are rewarded to participants like you and me who post and curate. The collateral for SBD is the Steemit platform and blockchain.
Every blockchain from bitcoin, ETH, to Steem has a price that is broken up into coins and distributed to all participants. This may all sound complicated but it is everything is done through the programming of the Steemit's blockchain. From when to taking out a loan to how much rewards can be distributed. The blockchain performs all these tasks. Leaving its users to focus on primarily creating content on the blockchain. Pretty cool, no?