A NuShare, or more generically, a Peershare, is a novel entity. Nothing like it was seen prior to its appearance in 2014. While it has some characteristics of equity instruments and is a fungible financial asset, a Peershare network differentiates itself from other types of blockchain networks in that it is a simulation of democracy, or a virtual democracy. It is not a democracy of shareholders. It is a direct democracy of NuShares. It can be compared to national political democracies such as Germany or Sweden. A voting block of NuShares may be thought of a citizen, having certain rights and responsibilities. A NuShare might also be called a NuCitizen. Nu is a virtual nation composed of NuCitizens, which we also call NuShares. One important difference between the Nu democracy and those that we are more familiar with (such as those in Germany or Canada) is that Nu is a direct democracy. It has no president, prime minister, parliament, congress or senate. This is because it is a direct democracy. Representatives are not needed, with a caveat about custodians.
Nu’s direct democracy has custodians, not members of parliament
In the Peershare democratic structure, custodians are defined not by certain voting privileges like we see with senators or members of parliament, but rather by their control of a finite quantity of funds belonging to the Nu nation. In other democracies, members of parliament are elected to make decisions on behalf of citizens for a fixed period of time. Nu is a direct democracy, so delegations of this kind are not needed. Still, it would be impractical to have NuCitizens direct each and every transaction. Even if they don’t direct transactions by custodians, NuCitizens still have the authority to halt or block transactions by custodians. Recently, two NSR FLOT groups composed of multisig custodians that went authoritarian, refusing to follow motions passed by NuCitizens. Being a direct democracy, NuCitizens are not helpless in the face of these would be authoritarians. They can immediately dispose of authoritarian custodians by blocking transactions from addresses belonging to the rogue custodians. Exactly this was just done in the Nu democracy.
What is the value of a Peershare based democratic simulation?
A democratic simulation such as Nu can perform many of the same functions as democracies such as Canada or Australia. For instance, it can issue currency, which can be used outside the scope of the Nu nation, just as US dollars can be used outside the United States. Nu can provide citizens of authoritarian regimes with money that doesn’t support their own oppression. So Nu, being merely a virtual democracy, can provide real money to anyone in the world. To do so, it needs to have its democratic institutions and procedures nurtured and upheld. We nurture and care for the democracy that is Nu, because it a prerequisite to credibly providing a stable and reliable currency. The problems Nu has had with the stability of its currency have not been economic phenomena. More reserves can’t address the problem we had in late May and June. The problem with the peg was precisely due to imposition of authoritarians and authoritarian values being held by many of Nu’s custodians. They scorned NuLaw and decided they would become a law unto themselves. @woodstockmerkle didn’t like the way most NuCitizens voted, so he did what he felt was right by opposing the peg by refusing to move funds to support it which were under his control. Later, he led the authoritarian wing of Nu, the minority of NuCitizens who foolishly opposed law, contracts and fairness when they experienced fear. Anyone who didn’t vote the way he thought they should was excluded and cut off from his version of the Nu nation. Indeed, anyone who demanded Nu consider its contracts and promises sacred was excluded. It was Marshal law justified by a crisis consisting of nothing more substantial than a feeling of fear. That is a classic authoritarian tactic: to kill the citizens that don’t support you. That is what @woodstockmerkle did, in simulated fashion, of course, with his Augeas blockchain.
The market has spoken. Its verdict is that the Nu nation is not worth much in view of the authoritarian actions revealed by many of its custodians in May and June. Authoritarian regimes have a poor record of being able to issue currency in a manner that is in the interest of the currency user. Take a look at the Soviet Union, which experienced numerous hyperinflations. Take a look at 20th century China, which also experienced multiple hyperinflations. Nobody wants a currency from an authoritarian regime, because they don’t value equality. When fear rises, they betray and destroy others, indulging their own ego and narcissism. Our future success depends on our ability to nurture our democratic values and keep individuals with authoritarian tendencies, such as @masterOfDisaster and @woodstockmerkle, out of any position of trust.
Nu’s young democracy has demonstrated a capacity to quickly stabilize and restore itself in the face of an authoritarian coup
Nu’s fledgling democracy has faltered due to its inability to prevent infiltration from authoritarians. The good news is, the infiltration of authoritarians and the failed authoritarian revolution that occurred in May and June was an extreme test of the immature and experimental democracy that is Nu. What the experience demonstrated was that it took a number of weeks to marginalize the authoritarian rebels and to appoint new custodians who honored democratic principles. During that time tremendous damage was done. However, what emerged was an intact democracy that continues to persist and gather strength. The authoritarians were able to throw the Nu democracy off balance for a short time, after which they were made irrelevant and new custodians that honored democracy were chosen by NuCitizens. In this sense, the Nu democracy has a resilience and flexibility that traditional democracies such as Canada or Sweden lack. To dethrone an authoritarian regime that may emerge in the Nu nation, NuCitizens are empowered by our direct democracy to lock and freeze the funds held by authoritarians on our blockchain and grant funds to others that uphold democracy and the rule of law.
Democracy is a culture to be nurtured
Democracies such as Canada and Sweden can only be maintained when its citizens safeguard certain foundations of democracy. If citizens fail to do this, lawlessness may take over and an authoritarian regime may come to destroy what remains of the democratic institutions. Nu, being a democratic simulation, does accurately mirror these political democracies we are familiar with. The Nu democracy has exactly the same dependencies for its prosperity as the Canadian or Swedish democracies. As such, Nu, like Canada and Sweden, must employ and successfully nurture a culture of democracy in order to remain prosperous. The foundations of democracy are worth looking at closely, because as a democratic simulation, Nu has precisely the same foundations.
While much could be said about authoritarianism, in our context, representing shareholders in an economic enterprise, what is most relevant is that it is economically inefficient, if not outright destructive economically. Essentially, authoritarians impose large losses on the masses to make gains themselves. In this way, authoritarianism is fundamentally anti-social. When people take authoritarian actions, they have as their motive either narcissism or fear. Essentially, the formula is to make the masses follow a narcissistic leader by means of fear. Fear has played an important role in Nu. Fear was a fundamental and critical factor in what happened to Nu in May and June. A wave of fear swept over many in the community due to the large NuBit sale on May 27th. This caused people with authoritarian tendencies, like @masterOfDisaster who comes from authoritarian culture, to say a crisis necessitated the suspension of our most important protective laws. Those who value democracy said, “no we have to follow due process, our regulations established by citizen vote. We have laws. Change the laws using democratic procedures if you want to change how we operate.” The authoritarians said: “This crisis was not foreseen. Therefore, the laws made before the crisis are of no use. We need to change the way we operate due to the crisis, suspending law. I will decide what the changes will be”. And what was the crisis? Nothing but a social mood of fear, it appears. At the time authoritarians chose to abandon the peg, Nu was capable of handling many, many times the number of NuBit redemptions that were likely to have occurred without the authoritarian coup. Nu was not even close to experiencing an inability to keep the peg in a financial sense. It was the authoritarian coup itself that caused the loss of the peg.
Let us make a comparison between what happened at Nu in May and June and what happened recently in the United States when an authoritarian order to implement a travel ban of people from 7 countries was briefly implemented. Asserting the authoritarian action taken by the US was caused by an emergency risk of terrorism from normally regulated travel is comparable to the claim that Nu had to drop the peg because it was not in a financial position to keep the peg. Both claims are demonstrably false. Both authoritarian actions were justified by irrational fear. Both created a variety of lose-lose scenarios where a large quantity of economic value was destroyed. Not transferred. Not stolen. Destroyed. We need to do our utmost to ensure our custodians never exhibit authoritarian actions. The democratic blockchain protocol Nu uses firmly secures our democracy in most contexts. We can’t do everything by protocol on the blockchain based on direct NuCitizen input, however. We need custodians who have the discretion and freedom to take a wide variety of actions dealing with third parties that can’t be managed directly on the blockchain. So, when we talk about avoiding authoritarianism in Nu, our main vulnerability is in our custodians. That is where things can go wrong. Accordingly, NuCitizens must do their utmost to ensure no custodian has any authoritarian leanings. I’m not suggesting custodians such as @masterOfDisaster and @woodstockmerkle who exhibited authoritarian actions in the Nu nation are evil agents plotting destruction. More likely, they didn’t have the experience of democracy that would impress upon them the importance of rule of law and due process. They felt fear in themselves, perceived it others, and used the strong emotion as justification for extreme and disorderly acts not based on reason.
Democracy is a complex cultural phenomena
Nu requires custodians with the strongest commitment to democratic principles, such that they will adhere to democratic principles of equality even in the presence of fear and crisis. How can we get this? Well, democracy is like a language. It is complex and culturally transmitted. Social pressure is used to maintain it. If you are raised in an authoritarian culture, democracy is a language not native to you. Just like someone born in China may learn English, someone born in an authoritarian culture can learn democracy. However, such an effort will take tremendous effort and they may never speak as fluently as a native speaker. Native speakers of democracy have proven useful for Nu. There is the question of social pressure as well. @masterOfDisaster isn’t going to face disapproval from his authoritarian society and social network for his authoritarian actions. @jooize, on the other hand, being a Swede, would certainly face emotionally painful disapproval from family and friends if he chose the same authoritarian actions. The Nu democracy should employ social pressures to its advantage in this way.
While the tiny number of Nu custodians doesn’t allow us to come to statistically significant conclusions about the relationship between living in an authoritarian culture and implementing destructive authoritarian actions as a custodian for Nu, the anecdotal evidence suggests choosing custodians rooted in democratic cultures offers a great deal of protection to the Nu democracy. While talking about that may be uncomfortable and even divisive, it is an important fact that should not be ignored by those who wish to see the Nu democratic simulation succeed. @mhps, @masterOfDisaster and @henry were all Chinese custodians. I can’t think of any Chinese custodians who have not hurt the growth of Nu with authoritarian actions. America has a hybrid culture of democracy and authoritarianism. Americans employ democratic elections at the state and local level. However, in recent decades, Americans have rejected the rule of law by refusing nearly all accused criminals the right to a trial and due process. Similarly, in America, property is routinely seized by police without due process. And then there are the endless, illegal and purposeless wars. All of these are classic authoritarian actions. Not surprisingly, some of our authoritarian custodians (particularly @woodstockmerkle) were American. We have also had some American successes as custodians, demonstrating the bipolar nature of America in regard to this democratic/authoritarian divide. While the behavior of custodians from Canada, Sweden, the Netherlands and similar cultures truly rooted in democracy hasn’t been perfect, they seem to tend to be more reliable custodians for Nu.
Nu is a democratic simulation native to the blockchain and the internet. Nu is a simulation of a sovereign like Canada or Germany. It is composed of NuCitizens (aka NuShares) which are structured as a direct democracy on its blockchain. Nu, despite being merely a democratic simulation, can do many things traditional democracies can. In particular, it can issue currency. Stable democracies have a much better record of maintaining currencies than authoritarian regimes. Accordingly, Nu can only succeed in its mission of issuing stable currencies over the long term if it nurtures and upholds democratic values. We must understand what democracy is, what authoritarianism is, and expel the authoritarians from among us. We have succeeded in implementing a robust blockchain democracy that is resilient in the face of authoritarian assaults. Nu’s principle failure has been to appoint custodians that exhibited authoritarian values. Nu’s authoritarian custodians have exhibited a pattern of coming from cultures and nations with authoritarian tendencies, specifically China and the United States.