How to profit from Nu's cycles

The Plaza
#1

In the last month, there was $469 million USD in USNBT trading volume, ranking #47 by volume. In contrast, NuShares only have $304,000 USD in trading volume over the last month, ranking #836 by volume. The ratio of USNBT liquidity to NSR liquidity is 1543, meaning there has been 1543 times as much liquidity in USNBT as NSR. This is an unexpected ratio.

The main cause of the huge difference in NuBit and NuShare liquidity is that Bittrex and Upbit, where the vast majority of USNBT trading takes place, do not list NuShares. Fundamentally then, the weakness in USNBT support is coming from a failure to market NuShares, particularly in the form of exchange listings. That is a responsibility outside the scope of the responsibilities of Liquidity Operations. Anyone who has been watching knows I have always confessed incompetence in matters of marketing and my desire to not get directly involved in those efforts, even as I strongly support providing funds so others can engage in the important work of marketing. It is the responsibility of Liquidity Operations to optimally manage the liquidity that does exist. We have done a good job of that, even though we recognize further development in Liquidity Operations could reduce inefficiencies in our approach to peg support.

While it is a speculative claim, I suspect the ratio of volume of all types of NuBits to NSR might be somewhere in the neighborhood of 10 with equal exchange listings. A NuBit to NSR volume ratio of 10 would provide 154.3 times as much peg support from tier 6 liquidity as a ratio of 1543 provides. The current model has great potential if we could only add NSR exchange listings.

What the low liquidity in NSR means is that NSR is exceptionally volatile. We have switched from cycles of NSR sales to NSR buybacks several times in Nu’s history. Additional cycles are certainly expected. Nu has two classes of participants: investors and users of stable currency. The goal of investors in Nu is two fold: the first is to buy NSR low, such as when there are intense NSR sales like right now, and sell NSR high when there are NSR buybacks, as there were just a couple of months ago. Investors can also purchase NuBits (either CNNBT or USNBT) and collect an annualized premium of 43% for up to six months. When USNBT is below $1, they can also make a speculative profit of buying NuBits below $1 and selling them for $1 after the peg is recovered. Of course, for the Nu investor to make money, Nu must build success into the future. That isn’t certain, but we have been growing for three and a half years, and we are determined to continue.

In the immediate future, I expect shareholders will continue to offer high incentives to purchase and park NuBits, which removes them from circulation for the parking period chosen by the user. We will also sell NSR according to a formula that requires about 15 million NSR be sold each day under the present circumstances. The proceeds of these NSR sales will mostly go to purchasing USNBT in the open market, constantly providing price support to USNBT until the $1 price is restored.

Some Nu participants are fearful right now. Nu is designed to reward investors who step in and counterbalance that fear with brave greed. NuShares were commanding 160 BTC satoshis just two months ago, but today are going for 5 BTC satoshis. Smart investors with a risk tolerance can buy them at 5 BTC satoshis, in the hope they can sell them for much more later. Given NuShare history of rapid, wide and repetitive price swings, I do think the risk to reward ratio is excellent. Not because the risks are low, but because the rewards could easily be a ten bagger within months. It has happened before with NuShares.

We are currently in negotiations with a number of exchanges to list NuShares. We hope to be able to announce multiple new NSR exchange listings soon.

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Liquidity Operations
#2

4 posts were merged into an existing topic: Otherwise removed

Unproductive negativity. Allowing venting in the statement thread, but longtime negative community members that only further attempt to undermine NuBits should not be given the free playing field we’ve previously permitted them.

#5

As the formula can be changed at will by the chief, this suggestion on “how to profit from Nu’s cycles” is mostly unuseable.

I really think that by intentionally silencing dissent and continuing down this path of inconsistent monetary policy, you are scaring away potential players in the market.

#6

Moving posts instead of outright deleting them enables people to still take in those views while not giving statements we find inaccurate the impact we believe they do not deserve. I think that is a reasonable balance. We want to have constructive conversations that encourage solutions instead promoting giving up.

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#7

My basic statement is that if you had continued with 0.7% every day instead of dropping to 0.6, then 0.2, then 0%, that you would have fared much better. Also, you made the 20% rule for a reason, but didn’t obey it a lick. Consistency in monetary policy is far more resonant than just the week’s rebalance. It is heard for months, even years if you do it right.

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#8

Fuck you guys, removing comments that tell the truth about your shit fucking coin, go to hell along with the value of your shit coin

#9

@donthavename: Removing (or moving as we do) posts is sensitive. I refrained from having us at all do it for a long time. Please understand that we’ve had a problem of members essentially attacking us and discouraging productive conversation. There will surely be mistakes made in moderation, but simply not moderating wasn’t viable anymore.

@Nagalim: That’s again because of the low-liquidity NuShare market. Instead of consuming the entire thin market support immediately, choice was made to use some grace. I don’t think those policy adjustments caused a meaningful weak point when the NuShare was so weak anyway. We did sell extra toward Minimum Asset Reserve (20%), but did limit lowest price and gradually lowered it.

What I’m objecting to is that the tone in your first moved comment was easily read as suggesting we’re adjusting policy to profit from insider trading. Without additional information as to how and why you believe that’s the case it simply spreads fear. Even if you would, arguments about our credibility cannot become a topic in every thread as that would derail the efforts intended on this forum.

I’m interested in discussing what to allow and how to handle these issues in general not only for this forum, but this is the state of my opinion on moderation. There are more important tasks to handle.

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#10

Just so we’re clear on the narrative, last time when the custodians didnt aggressively sell nsr to prevent an nbt collapse it was delinquency, but this time it was grace. Have I got that right?

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#11

Lets get some productive conversation out of the way Joozie:

How much money did you get paid by Nu over the last year???

#14

Why didn’t bittrex list NSR? I remember that both NBT and NSR were listed on bter.com, and the result? If NSR trade volume is high, why don’t other exchanges list it at all?

Free market cares little about NSR–> NSR volume is low–> existing exchanges delist it–> potential exchanges won’t list it. YOU MESS UP CAUSE & EFFECT. I bet even you let the TOP3 exchanges list NSR, the trade volume will also be lower than your expect. The design of Nu’s liquidity engine has flaws as I predicted before, believe it or not.

One year ago, I prepared a “B Plan” for Nu because I believed the pegging would be broken sooner or later, and my suggestion is constructive, isn’t it? From Sep. 2014 to 2018, for 3-4 years, haven’t you found that NSR liquidity is the Achilles’s heel?

#15

I’d like to propose a Bancor relay token so Ethereum users can easily buy Nushares, as well as getting some funds for a legal opinion on how to issue a Reg D/C/whatever US-based equity crowdfunding offering for Nushares.

I’d also suggest that any Nushares that are not associated with a KYC/AML’ed identity should be charged a 5% per month demurrage charge

Sound interesting? I think Nubits has a great deal of promise if more of the workings and management are made public on who the large players are.

If nothing else, put out an RFP for allowing direct trading of Nubits/Nushares from the wallet with no exchange required.

Finally, there is always the fork option… Start over with a NuNubits with a new management team and a new name, and pretty much the same code, or maybe better yet, throw away the old blockchain history and start over with a new genesis block. There seems to be clear market demand for stablecoins, and forks of bitcoin have only tended to make bitcoin more resilient.

#16

Sounds like a good idea to enable some liquidity to get into NSR. Not sure how easy it would be to do it, but given the tiny exchange exposure, it’s worth pursuing.

I can’t imagine many people would want to agree to this, given the desire to create as decentralised a system as possible. I agree that the anonymous nature of big players is a problem for Nu (especially the leadership), but can’t imagine they’d want to change this, and don’t think big holders who aren’t leading the project should be subject to AML etc.

That’s an option if there’s a new management team. Augeas was an attempt at this, but it had no leadership, so predictably went nowhere.

I don’t see Nu succeeding long term unless it can radically reform its business model so that it’s able to keep a secure peg in bad times as well as good times. So far the current leadership don’t have any ideas on this one, and the community doesn’t seem forthcoming (except for @Sabreiib’s ‘Hayek money’ proposal, and my lending based NBT issuance suggestion) so it’s hard to see a way forward where there’s actually anyone to drive it.

I hope a direction can be found that the community likes, some resources can be put in to get it up & running and see Nu succeed, even if in a different form, with largely new leadership, a significant dilution of existing shareholders + new ICO.

#17

Nubits turned out to be a scam in a way that it deviated strongly from its initial whitepaper. In its initial paper it was written that the peg shall be kept using USD/NBT trading pair. In reality this promise was broken and everything went to shit when NBT/BTC was used instead of USD/NBT. The initial funds were deceived out from investors by making promises that were later not kept. I wouldn’t have invested in Nubits if JordanLee/Phoenix would have said in the very beginning that NBT/BTC pair is going to be used for keeping the peg. I only fell for the scam because of the promise of USD/NBT. According to the law, JL should be in prison right now. Lesson learned: never invest in any scheme where the author wishes to remain anonymous.

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