Time to bring more NuBits to market because the 40% threshold for balancing liquidity has been exceeded.
I am increasingly worried about the peg breaking to the upside in the coming days. We have mostly focused on buy side support in the past, but the situation has changed so that sell side is our weak spot now. Volume is very high and crypto is very volatile right now, which means the level of demand could change a great deal very quickly. FSRT is still working out the issues that remain for it to actually become operational for the first time.
It has been mentioned that relying on non-multisig funds like what I am asking for in my latest custodial grant is a step backwards. It certainly isn’t a step forward in the sophistication of our liquidity operations, but it is actually status quo because multisig has still never been used. Let’s remember that our customers are probably not as interested in fancy sell side liquidity operations as they are in simply finding correctly priced liquidity when they want to buy or sell NuBits. They don’t care how it gets there.
I am just about out of NuBits that I can bring to market. This may be the last liquidity injection I can fund. Hopefully FSRT can become active soon, but we need to have multiple backups for something as important as keeping the peg. Therefore, I urge shareholders to pass my requested grant of 100,000 NBT. There is a real chance that sell side liquidity will become disorderly in the coming days. We have a number of extreme measures available, but they are not cheap and graceful like passing my grant. For instance, it comes to mind that B&C Exchange is a very large holder of NuBits, which might be used to suppress the price in a desperate situation. If I refused to use them to keep the peg and it was lost, I would surely be criticised. If I did use them I would have to dictate terms of a loan from B&C to Nu or some ad hoc financial arrangement. Surely some Nu or B&C shareholders would find something objectionable about the action and complain I wasn’t authorised to do that. But there won’t be time to pass a motion about it. I am quite aware I don’t want to be in that situation and that it is sure to bring controversy whichever course of action I chose. I am hoping to avoid the entire situation by having my grant passed.
So, I am issuing a warning to shareholders that there is a clear and imminent chance of our sell side liquidity becoming disorderly that ought to be addressed immediately.