I’m on the fence regarding the transfer to NuLagoon Tube.
On the one hand I think it’s important to offer BTC at a tight spread for LP who ran out of BTC.
On the other hand these BTC might have a better place in a gateway at an increased buy side offset.
I think I’ll withhold my signature until I’ve made up my mind.
The situation is dire enough to keep T1.1 low or even empty.
It’s likely that I don’t sign the tx until the BTC price dropped and we got additional BTC on reserve or NSR got sold and provided us with BTC.
It just feels painful to fuel daytraders with cheap BTC - what would be a likely resultof sending them to NLT; either the traders grab them directly from NLT or through ALP once the LP refilled their BTC at NLT.
That does not make any sense, if BTC price drops we will have to pay a lot more BTC for the same amount of NBT liquidity. If you consider BTC price is at peak, I don’t see a better time to empty our BTC reserves.
Don’t you sense the tragedy in it?
If the price drops, we should have sold all BTC, but won’t be in the position to do so. On the contrary - we will receive even more BTC that are worth less the more BTC drops.
If the price rises more, NuLagoon Tube funds will be emptied in the blink of an eye, leaving us empty-handed.
We are always in a bad position.
The BTC might be better used for keeping gateways funded until there’s a little less volatility at BTC.
When?
This is pretty much all that stands between the traders at Poloniex and the total loss of the peg there:
Sat May 28 22:10:41 UTC 2016
status of zoro dual side NuBot at Poloniex:
nud getliquidityinfo B | grep BJs4YbtaqCmxeHLiR6zzjnZEotYVFAPfMo -A 2
"BJs4YbtaqCmxeHLiR6zzjnZEotYVFAPfMo" : {
"buy" : 3861.05,
"sell" : 18331.5422
status of mOD dual side NuBot at Poloniex:
nud getliquidityinfo B | grep B9gXptkoqAApF3AFrQyhUbhSzvuEudxupt -A 2
"B9gXptkoqAApF3AFrQyhUbhSzvuEudxupt" : {
"buy" : 1215.01,
"sell" : 3000.9037
Reasoning:
BTC price continues to climb for now.
The 50 BTC on reserve is the last money Nu has.
None of the NSR, that are on order at Poloniex, have been sold so far.
Sending BTC to NuLagoon Tube will make them disappear get traded to NBT in the blink of an eye.
We need them to support the gateways.
My gateway has a buyside offset of 5% and still traded $3,000 to NBT.
NuBot might react too slow on price surges. I don’t know.
All I know is that we need th BTC there and not at NuLagoon Tube.
@cryptog, @Dhume, @dysconnect, @jooize, @mhps, @ttutdxh, @woodstockmerkle would you rather have some peg support for hours at Poloniex, or make daytraders happy for a few seconds with 0.1% spread at NuLagoon Tube?
Remark: once NuLagoon Tube has no BTC, there’s no trade and no bad peg support reported by Coinmarketcap…
Don’t sign the deposit to NLT, sign the one to the gateways!
This might look differently once the gateways at Poloniex are out of BTC:
I am ok with signing your tx to refill the gateways now but i think 15btc is too much.
Maybe 10btc, one third of what we are trying to put into the Tube is more appropriate.
If we do not show that we can provide liquidity when there is demand for getting out of nubits, as it is the case now, we are failing the purpose of NuBits, which is to provide liquidity to hedgers, right now.
I agree though that we need to be careful not to lose too much money in the short term but the bet is that it will increase confidence in the peg in the mid term which would create demand for getting in Nubits when there is bitcoin volatility in the opposite direction.
It s painful to refill the Tube but as a startup we need to take that bet.
That is why we need to refill the Tube as a first priority right now, i believe.
There’s in total only 10 BTC left in the gateway accounts at the moment.
Face it: we can’t at the moment. NLT will have the BTC traded in less than 30 minutes. Wanna make a bet?
The gateways can keep a kind of peg for hours with it.
Maybe we should just provide all liquidity with a spread of 1% or below.
If you send BTC to NLT at the moment you will completely fail to provide liquidity soon after.
With the gateways there will be liquidity, but at a not so good spread.
What’s better:
no liquidity at all?
some liquidity at a not so perfect spread?
Wanna take the bet? NLT BTC will be gone within 30 minutes after deposit.
I bet 5 NBT.
After careful consideration I’m inclined to agree with MoD, right now BTC is going nuts (which absolutely baffles me) and we dont have the funds to keep this up much longer.
It’s seems we are now faced with the choice of a complete peg breakdown after out last BTC get scooped or a weak peg with larger spreads which will buy us more time. If we have to choose between no peg or a weak peg I prefer the latter. I will sleep on this dilemma and probally sign MoD’s tx tommorow.
Another good choice. We still have 10 BTC in total at the Poloniex gateways.
They might last some time, because I’ve investigated an issue:
There’s such an immense spread across exchanges!
Sadly the default exchange, which is chosen by NuBot, has a BTC/USD rate, that is below the one at Poloniex.
I’ve had a look at the other available price feed providers and found some that are on level or above Poloniex BTC/USD rate:
This is indeed the role of gateways. To protect the peg and buy time but it should not be used to provide liquidity although it seems that some traders buy even at high spread!
Edit: btw anyone good at technical analysis? When will the surge in bitcoin price stop? Any dump after?
That was not a great timing. The BTC arrived, automatically placed and were consumed at a 1.4% spread within 3 hours. The appetite for BTC is insatiable at anything below 2% spread on the average NBT price, that is clear by now.
BTW I’m bound by the 1.4% spread as part of my contract, not keen to breach that. If FLOT doesn’t like it than please don’t transfer any further BTC and request all NBT back.
Anyway, I will transfer 7.83 BTC * 510 (BTC/NBT) ~ 4000 NBT minus 2000 NBT transferred earlier = 2000 NBT to FLOT NBT reserve. Will add the transaction to this post as soon as it is confirmed.
2115 NBT = 4.23 BTC received by FLOT (20h ago) * against NBT/BTC rate yesterday of 500 NBT/Bitcoin.
There is no buy side liquidity remaining on Bittrex. Total balance of my gateway on Bittrex is now reduced to 4256 NBT of which 1000 NBT is on T1.
Not sure what is still underway, but the BTC/NBT peg is really gone by now.
There is still just over 5000 USD buy side on USD/UNBT pair on CCEDK.
The operation on CCEDK will stop after next payout in about 7h time. That will leave <1000 buy side within 2.5% spread.
With heavy heart, I think we have to admit that the peg is failing We just can’t cope with continuing BTC rise.
Anyone’s guess? I wouldn’t have a clue, it can go to 600 easily. The Chinese are trading/buying like crazy. Check e.g. Huobi
But just sitting on it doesn’t mean the peg is protected. And once deployed it will likely be gone in hours if not minutes in the current market (unless at premium prices 2.5% over peg).
It is true that there is NOT a lot of NBT sell side pressure otherwise every NBT would have been gobbled up by now. It is just an insatiable demand for BTC which kills us. It proves that a NBT/BTC peg only is very tricky and unsustainable, we should really start spreading that, starting with ETH and LTC pegs. Especially now we are also losing our CCEDK fiat pegs.
All right. Seeing that we are not unable to sales nsr fast enough, we need to concede that we need to lower the quality of the peg under the current circumstances.
We just can’t cope with continuing BTC rise.