Sell side liquidity is currently low as described here. To correct the liquidity imbalance, FSRT will bring some of its NBT to market.
One way for FSRT to keep its funds under joint control as opposed to the control of a single FSRT member is to keep our funds off exchanges (where funds can be accessed with login credentials). Instead, we can arrange direct exchanges of BTC and NBT without the NBT ever leaving multisig addresses, until it is transferred to the purchaser.
This is a bit of an experiment and we are sure the results will be informative. We will start by offering NuBits for exactly $1.00. Payment must be made in Bitcoin. An exchange rate will be agreed using the current coinmarketcap.com rate, which is $326.17 right now. Generally, $1.002 or more must be paid on the open market for a NuBit, so it is possible selling for $1.00 exactly will provide enough discount to provide incentive to purchase. If that proves not to be the case, we will lower the price slightly to increase the arbitrage opportunity until enough offers are made to balance liquidity walls.
All BTC proceeds from NBT sales will go straight to tier 4 buy side funds, which are currently being used for share buybacks as well.
If you would like to purchase NBT at 1.00 to help us inject the market with the additional downward peg pressure that is currently needed, you have three ways you can negotiate the trade:
Right here in this thread.
By private messaging FSRT on this forum.
By contacting us on Bitmessage at BM-2cWWSMDmcUtMw4kU352wtDCe91xrEUmKfW
2000 NBT is the minimum order size that will be accepted, while 20,000 NBT is the maximum we will sell at this time.
To bid, specify how many NBT you would like and what address you would like them sent to. We will reply with a BTC address and BTC amount. Once you have sent BTC, your NBT will be sent from one of our multisig addresses.
I wanted to assure everyone of the legitimacy of the @FSRT account. I am certain it is controlled by individuals in possession of a key to the 4 million NBT currently held in a multisig address.
As Jordan mentioned, we are not quite ready to bring liquidity to the market, and Jordan filled in for us.
There are two reasons for this:
No one responded to this offer to sell NBT to bring liquidity. In the future we will try a slightly lower price such as 0.998 USD.
We will be constructing transactions manually using RPCs or the command line. This leaves open a possibility, however slight, that there will be a mistake. We can’t take any chance of the bulk of the 4 million NBT accidentally going to a buyer of NBT, if change and receiving addresses are mixed, for instance. Therefore, we decided that when the 4 million NBT output is used in a transaction, all addresses involved must be FSRT addresses. We will split out smaller amounts of 10,000 to 20,000 NBT into different outputs for use in transferring funds to NBT buyers. Considering the quantity of money involved, we believe this extra precaution is required.
The sale has been suspended because the liquidity walls are currently balanced. We will open it again when liquidity conditions indicate we should.
@henry, would it be possible for NuLagoon to buy some NBT from FSRT when the sell side of NuLagoon is dried up? There certainly are times that you need to balance NBT and BTC, and buying NBT from FSRT should be cheaper than on the market. Given that FSRT would rather sell NBT at a loss (not something I entirely agree with), you might be able to distribute the difference as extra interest and take a part of it as a handling fee.
In the coming days I will try to build a crude workflow for multisig-based shareholder operations. If the FSRT is using some scripts already please let me know (or upload something to git hub), to avoid a duplication of effort. Also, if there’s anything that I can help please also tell me.
NuLagoon would be happy to do so if it is for the interests of NuShareholders and it accord with the rule that NuLagoon manage fund with.
Let us know how to do it when FSRT is ready.
I hope FSRT comes back to this thread soon, but the process would probably be like this:
NuLagoon reports an amount in NBT it wants buy using BTC based on balancing targets. I presume there’s BTC sitting off exchange now, so that should be used first. It should be a conservative estimate taking into account BTC volatility.
FSRT and NuLagoon decide upon an escrow for exchanging NBT for BTC. Ideally, the ultimate destination of NBT would be an exchange account controlled by NuLagoon; for BTC it can either be a BTC address designated for Tier 4 funds or a BTC address controlled by the FSRT, whichever is easier.
NuLagoon and FSRT negotiate an appropriate BTC price. The BTC price should follow the formula already used for NuLagoon accounting, and FSRT should sell NBT at no less than 0.998 USD per NBT based on this BTC price.
At a reasonable price, it is in the interest of shareholders for NuLagoon to purchase NBT from tier 4. I can sell 10,000 NBT. Shall we meet in a chat room like gitter.im and exchange for exactly 1.00?
I think I understand why this is weird, it’s about the price. On the one hand, NuLagoon is trying to keep a spread on all nbt purchases. On the other hand, these are shareholder operations. The rules here are ambiguous.
motion start
Any MLP may buy nbt from Tier 4 funds (any nbt held in reserve under the direct control and possession of shareholder motion) at a price of up to $1. This is in contrast to current and future spread regulation motions which pertain to open market actions.
In the the long term, the people who would do this kind of thing are going to be market makers. I don’t have a lot of NBT (or liquid crypto) but I guess I’ll try to set up some pair using NuBot.
We are happy to tell the community that the transaction between NuLagoon Tier3 and @JordanLee 's Tier4 was completed. NuLagoon has bought 10000 NBT and injected them into the network liquidity to mitigate the short of sell wall. Thank you.
