[ANN] Nu Lagoon Pool C and Pool D Now Begin Operation, NAV of Pool A and D Reach A Record High

NuShares Grants
#1

Dear Nu community,

The Nu Lagoon Pool C and Pool D now open for deposit. The annual interest rate of Pool C is 20%. The Pool C and Pool D will begin operation on 28th May as long as both pools’ total asset is greater than zero. Their initial NAV will be set to be same as the NAV of Pool A at 28th May, and their fund will be use to support NBT/BTC market of exchanges Poloniex.com and Bitcoin.co.id.

  • Pool C Deposit addresses:

BTC: 1CgLY4f29QP5veVrDUUfemRkgekgK4cDu6

NBT: BAFCWvEdNWrvMKf8JNA5SFYMR8Zvy7f6oH

  • Pool D Deposit addresses:

BTC: 19eGo6grxSqXSQqugw3N7NxKopggWzEyec

NBT: BBiHdUVB8Sndf1tCNfBNpRZx53pK7Go8JK

Since two months ago, we have successfully created and operated the first Nubits group liquidity pool, the Nu Lagoon pool A, and have proved it works as an effective way to allow really everyone who is able to use a wallet to participate the liquidity operation. When the pool A was created, we also pointed out that in future the Nu Lagoon will consist of multiple pools with different features in risks and returns. Diversified liquidity pools is good and necessary for the health of the Nu system. So we are glad to see the creation of TLLP and encourage others (including ourself) to explore ways to set up the multisig liquidity pools.

Currently, even though the pool’s expected return rate is considerable, we have to admit that there are still many difficulties preventing potential liquidity providers step out. Among those difficulties, we believe the risk exposure to BTC’s price is a significant one. Pool participants are passively exposed to the BTC, which is a highly volatile asset according to historical performance, resulting the custodian fee earned much less attractive. In order to attract more fund to the pool and eventually reduce the cost of liquidity operation, it is very important to design and to create the first liquidity pool without exposure to BTC volatility and to make liquidity provision a predictably profitable business. That is one of the main
goals we put our effort on recently.

Now we are excited to announce the creation of Nu Lagoon pool C and pool D:

Pool C: the first liquidity pool immune to BTC volatility;

Pool D: the first leveraged liquidity pool.

They work like this:

The pool C’s annual interest rate will be fixed before every accounting period. The pool C’s participants lend their fund to the pool D’s participants, and will receive a fixed amount of interest no matter how the BTC price moves in the period. The pool D participants pay the pool C’s interests, be paid with all the custodian fee earned(exclude manage fee), and receive the remaining profit or loss generated by the overall fund of pool C and pool D.

The pool C and pool D will be operated together, the terms of deposit, withdraw and management will exactly same as pool A. The only differences will be NAV calculation and Pool C interest rate adjustment.

NAV calculation of Pool C:

  • NAV of pool C = NAV of pool C in previous accounting day * ( 1 + annual interest rate)^(days count / 365)

NAV calculation of Pool D:

  • Overall total asset = Holding of NBT + Holding of BTC * BTC price

  • Total asset of pool C = NAV of pool C * outstanding shares of pool C

  • Total asset of pool D = Overall total asset - Total asset of pool C

  • Custodian Fee = Custodian Fee in previous accounting day + Overall total Asset in previous accounting day * custodian fee rate * days

  • Manage Fee = Manage Fee in previous accounting day + Overall total asset in previous accounting day * manage fee rate * days

  • NAV of pool D = (Total asset of pool D + custodian fee - Manage Fee) / outstanding shares of pool D

Pool C Interest Rate Adjustment:

  • The pool C’s annual interest rate will be 20% when it begin operation.

  • When the total asset of pool C is greater than 125% of the total asset of pool D, then pool C’s annual interest rate will decrease by 10%, new rate begin effective at the next accounting day. The minimum of the interest rate is 2%.

  • When the total asset of pool C is less than 80% of the total asset of pool D, then pool C’s annual interest rate will increase by 10%, new rate begin effective at the next accounting day. The maximum of the interest rate is 100%.

We are looking forward to hearing your questions, suggestions and comments. Thank you.

The Nu Lagoon manage team

4 Likes
[Draft] LiquidBits TLLP trust less liquidity pool - term 3
[Nu Lagoon] The Nu Lagoon is supportting Bitcoin.co.id now | NAV: 1.062 @ 14 May
[Passed] Motion to regulate spread values for liquidity operations
#2

Example of Pool A, Pool C and Pool D:

Assuming the BTC price moves as described in the following table, the fund of Pool C and Pool D is perfectly balanced during the operation (half on buy side and half on sell side), and the total asset of Pool C and Pool D are perfectly balanced (no interest rate adjustment), the chart shows different performance of the three pools.

#3

Terms of Pool C and Pool D:

Participants:

  1. Pool C and Pool D will accept deposit in BTC and NBT. The BTC deposit address for Pool C is: aaaaa, and NBT deposit address for Pool C is: bbbbb. The BTC deposit address for Pool D is: ccccc, and NBT deposit address for Pool D is: ddddd. Deposit transactions is public for anyone on the blockchains…

  2. The send-from address of every deposit transaction will be the participant’s account address, which is also the address to receive fund withdraw in future. If multiple inputs are used to deposit funds, the address in the first input will be the participant’s account address.

  3. Deposit less than 1000NBT or 4BTC will be rejected and will be returned to the account address (the transaction fee will be subtracted).

  4. To submit a full-size fund withdraw order, participant send 0.0001BTC or 0.01NBT from the account address to the pool’s deposit address. To submit a half-size fund withdraw order, participant send 0.0002BTC or 0.02NBT from the account address to the pool’s deposit address.

  5. Every Thursday during the operation of pool A is the accounting day. 10:00AM GMT will be the COB (close of business) time every accounting day. Deposit transactions and withdraw orders sent before COB time every accounting day will be effective that day. Transactions and orders sent afterward will be effective next accounting day.

  6. The price of BTC used in the calculation will be the acquirable last trade price at COB time of the accounting day.

  7. The number of shares participant get will be: Amount of NBT deposit / NAV or Amount of BTC deposit * BTC price / NAV.

  8. The asset of participant holding will be: The number of shares * NAV.

  9. If participants withdraw full-size fund, they will get: The number of shares * NAV (in NBT) or The number of shares * NAV / BTC price (in BTC). If participants withdraw half-size fund, they will withdraw a half of fund and keep another half of fund in the pool. If the number of shares less than
    2000, participants can only withdraw full-size fund.

Manager:

  1. The manager will process deposit transactions and withdraw orders, and publish the accounting report of the pool after COB time every accounting day.

  2. The manager will place a portion of fund in tier1 and tier2 on up to 2 exchanges. The amount of fund placed on exchanges will be set according to how much is needed based on several factors, for example the total size of the fund, the trading volume on the exchange, how often the walls will be unbalanced. The manager run the nubot(s) to support Nubits pegging at $1.

  3. If buy side or sell side of fund in tier1 and tier2 has less than 25%, the manager will manually balance it by transfer fund between tier2 and tier 3 once every working day. If either NBT or BTC in tier3 is not enough for the need of balance or withdraw, the manager will convert fund from other
    LPC and exchange.

  4. The manager will submit a custodian fee grant request once a month. Nu shareholders has promised to pass the fee grant in 10 days. The custodian fee granted will be added into Holding of NBT and subtracted from Custodian Fee wait to be granted.

  5. The manager reserves the right to optimize the operation of the pool when situations changed, for example the Nubot upgraded.

Fee

  • Now the daily custodian fee rate is 0.34%. The daily custodian fee rate could be adjusted by new motions passed by Nu Shareholder. The dividing ratio of custodian fee between pool manager and pool participants is 10:24.

  • The custodian fee rate could be adjusted by the terms in motion of the Nu Lagoon or another motion passed by shareholders in future. A new fee rate will be announced as soon as possible after it is decided, and it will only begin effect at an accounting day in future.

NAV calculation of Pool C

  • NAV of pool C = NAV of pool C in previous accounting day * ( 1 +
    annual interest rate)^(days count / 365)

NAV calculation of Pool D

  • Overall total asset = Holding of NBT + Holding of BTC * BTC price

  • Total asset of pool C = NAV of pool C * outstanding shares of pool C

  • Total asset of pool D = Overall total asset - Total asset of pool C

  • Custodian Fee = Custodian Fee in previous accounting day + Overall total Asset in previous accounting day * custodian fee rate * days

  • Manage Fee = Manage Fee in previous accounting day + Overall total asset in previous accounting day * manage fee
    rate * days

  • NAV of pool D = (Total asset of pool D + custodian fee - Manage Fee) / outstanding shares of pool D

Pool C Interest Rate Adjustment:

  • The pool C’s annual interest rate will be 20% when it begin operation.

  • When the total asset of pool C is greater than 125% of the total asset of pool D, then pool C’s annual interest rate will decrease by 10%, new rate begin effective at the next accounting day. The minimum of the interest rate is 2%.

  • When the total asset of pool C is less than 80% of the total asset of pool D, then pool C’s annual interest rate will increase by 10%, new rate begin effective at the next accounting day. The maximum of the interest rate is 100%.

2 Likes
Overview of progress and plans
#4

I’m very pleased to see this. It is a viable strategy to allow anyone to provide buy support for NuBits with no exposure to BTC volatility. Shifting that volatility to Pool D is a great idea. I hope it succeeds.

Why did you decide not to offer interest on Pool D? Won’t that discourage participation?

What has led you to no longer pursue multisig operations with the two of the four people in our community that volunteered to sign? I think that would increase the popularity of your pools quite a bit. Our community is quite sensitive to the risk of default by a single party after the exchange defaults in February.

#5

Pool D do earn interest, all the custodian fee earned(exclude manage fee) paid to Pool D. Currently, the expected return rate of Pool D will be as high as 13% monthly.

We will pursue multisig operations, we just need some time to sort everything out. Stay tuned. Thank you.

2 Likes
#6

So the idea is to separate volatile return (D) from a core constant return (pool C).
return = volatile component + fundamental component
That is very interesting.

#7

i like it!
my question: who will be the managers or multisig participants other than your self?
we have to ensure proper operation regardless if you will be able to manage things in the future
(don’t get me wrong, i hope nothing happens to you :slight_smile:

#8

This is similar to how a lot of structured funds offer products to people of different risk appetite, not totally unlike Nu itself. The questions are if there are always enough high risk appetite people to buy, and if there are too many high risk buyers, in a quickly moving market if the fund itself can stay above the water.

#9

The Nu Lagoon Pool C and Pool D now open for deposit. The annual interest rate of Pool C is 20%. The Pool C and Pool D will begin operation on 28th May as long as both pools’ total asset is greater than zero. Their initial NAV will be set to be same as the NAV of Pool A at 28th May, and their fund will be use to support NBT/BTC market of exchanges Poloniex.com and Bitcoin.co.id.

  • Pool C Deposit addresses:

BTC: 34FJToKhDrmpn4amrm52hi12ZMVmD2jc16

NBT: BAFCWvEdNWrvMKf8JNA5SFYMR8Zvy7f6oH

  • Pool D Deposit addresses:

BTC: 3CK8gCzNo8gNmAvbgv2gaT3vGfUT91fYne

NBT: BBiHdUVB8Sndf1tCNfBNpRZx53pK7Go8JK

1 Like
#10

Accounting report of Pool A, C and D at 28th May was published.

Good News: NAV of Pool A reach a record high: 1.0868.
Bad News: Not many people interested in the new pool C and D

https://github.com/henrynu/NuLagoon/tree/master/Reports/2015-05-28

1 Like
#11

Accounting report of Pool A, C and D @ 20150604 was published.

https://github.com/henrynu/NuLagoon/tree/master/Reports/2015-06-04

1 Like
#12

The BTC deposit addresses of Pool A, Pool C and Pool D updated. Take a look at nulagoon.com

#13

Accounting report of Pool A, C and D @ 20150611 was published.

https://github.com/henrynu/NuLagoon/tree/master/Reports/2015-06-11

1 Like
#14

Accounting report of Pool A, C and D @ 20150618 was published.

https://github.com/henrynu/NuLagoon/tree/master/Reports/2015-06-18

2 Likes
#15

great job as always!

#16

It would be great to see NuShareholders and NuLagooners provide informations or answer questions in the following bitcointalk thread.

https://bitcointalk.org/index.php?topic=1094498.new#new

The growth of pools size will benefit Nu, and will benefit all the NuLagooners because more fund will be placed on tier3 to reduce exchange default risk.

Thank you.

1 Like
#17

wow! great offer!
i have sent some NBT 18/6. can i participate too or i have to sent from today onwards?

edit1:ok, i got my answers by reading bitcointalk thread.
but i think your initial post is incomplete. you should have noted the minimum deposit amount and when
the bonus will be sent :slight_smile:

edit2: http://nulagoon.com/ needs also to be updated with minimum deposit amounts

2 Likes
#18

The liquidity info of tier1 and tier2 now has been reported by the address: BHQJN5NnDimvTC9Md6a3Lc8sNkHGiizTMo
Thank you.

#19

Accounting report of Pool A, C and D @ 20150625 was published.

https://github.com/henrynu/NuLagoon/tree/master/Reports/2015-06-25

The annual interest rate of Pool C rise to 22% because funds of Pool C and Pool D.are unbalanced.

1 Like
#20

fantastic!
i saw more people joining this week, good promotion

1 Like