My understanding is that this is neither revenue nor profit as it creates a liability - a liability to keep the peg and therefore the need to buy each of the sold NBT back if the NBT owner desires to get back USD, BTC or whatever currency or asset is offered by Nu.
At the moment only the transaction fees can be counted as profit.
Sell-side custodians will be elected when there’s more demand for Nu than the liquidity operations can handle.
Soon there might be buy-side custodians (after protocol 2.0 is productive and NSR grants are available) to handle oversupply of NBT as well.
But a revenue model beyond transaction fees is not yet established.
Still this might be enough to build a sound business on it.
With the NuDroid wallet and use of NBT beyond hedging BTC volatility there might be lots of transactions.
Nu is still young and needs to evolve.
Selling NBT is not generating profit.
Yet I think dividiends is a matter that can be discussed. It’s a viable way of distributing money to the NSR holders who collecively keep the peg with the value of the NSR they hold.
In times of NBT oversupply they suffer from a dilution of their property and pushed down NSR exchange rates by NSR being sold for NBT.
So it might be considered to distribute dividends in times of NBT shortage (sell NBT, buy PPC, distribute them).
This might sound like I ultimately consider sale of NBT profit. On the contrary I consider sale of NBT the creation of a liability and want to compensate the NSR holders for that by distributing dividends.
The only other option I see to compensate the NSR holders would be a share buyback; this would keep the money in the Nu network.
The decision whether to distribute divideneds or to buyback NSR is up to the NSR holders as they are the owners of the Nu network.
With the thin NSR market liquidity I doubt that a NSR buyback is the better choice compared to dividend distribution.
A buyback might push the NSR price far up - far enough to let those who are willing to dump to make some money. And once Nu needs to buyback NBT by selling NSR the NSR price plummets and former sellers can buyback cheaply.
That is only one of the possible scenarios, but a not totally unlikely one.
So I think two questions needs to be answered by NSR holders:
- under what circumstances / at what thresholds shall wealth be distributed to NSR holders
- what’s the appropriate way of doing that (NSR buyback or dividend distribution)
If the thresholds are not chosen wisely, sell-side and buy-side custodians would be continually coming and going - I think that’s where @Ben tries to point at.
With the coming months and expecting B&C Exchange to sell NBT to fund the exchange development I rather see buy-side custodians coming and agree that now is not the perfect time to talk about distributing dividends AND share buybacks.