If you offer 24% on 6 months it is logically consistent to also offer 12% at 1 year and 6% at 2 years and 3% at 4 years.
How can you get the money to pay for parking rates by selling new product? That new product will just get parked at those same parking rates and now you’re on the line for even more money.
Park rates are not to be used when we are expanding supply (i.e. buying back shares). They are for a short term recession. As such, we need to consider how short term we think the recession is, then vote for high rates on that time period and drop off with base-2 from there.
Mathematical logic may differ from marketing logic. I believe that is the case here. Offering rates beyond 6 months is taking a mortgage even further into an unknown future. Not something to take on lightly.
Selling product means we can can top up reserves, isn’t that obvious? I’m really intrigued and puzzled by the reasoning of your response. It goes against any of my logic. Are you trying some kind of experiment?
Agree, with determining the recession period and adjust the time periods of the rates. However any rates beyond that, base2 or not, are taking a mortgage into a future Nu we shouldn’t take unless absolutely necessary to survive. That’s why I don’t set rates beyond 3 months. So mathematically you might be right from an overall cost perspective ignoring certain aspects. From a marketing perspective and common sense I think you got it wrong. Just my opinion.
I think i understand what nagalim said as I was thinking the same. What i thougt was if we were offering park rates, that is when there are too many nbt floating around. You can’t expect to sell more products when there are already too many.
I think nagalim just used 1, 2, 4 yrs as examples to explain the math. He didn’t mean that rates for those periods should be offered.
Last year at about this time the wall got very imbalanced (buy side 18%). Jordan urged
This time things are much better. The FLOT is doing Jordan’s balancing job. Park rates are offered by the shareholders.
However a thing different is that there have been less than 3000 nbt parked. I am a little surprised.
Is that because people are speculating there will be a higher rate?
No one knows for sure.
or the rates are too low?
On bitfinex people are lending hundreds of BTC at 3% pa. So if Nu offers 5% it should be already very attractive. I suspect outside of the community not many know about high park rates and people in the community know about the 50-80% pa LP reward rates. Action recommended: advertize high, limited-offer, park rates outside the community.
or the non-zero durations are too long and people don’t like the opportunity cost?
We should offer non-zero rates to the shorter periods in volatile times. Since there are rates of 12.8%pa@3mo, there is no reason not to provide rates for all shorter periods at the same premium according to base-2. Action recommended: set attractive short term rates 32% @ 11 day 16% @ 23day 8% @ 1.5 mo 4% @ 3mo 0% @ 6mo provided that the shorter periods are adjusted often (like once a week).
Good to see a push for advertising. Let’s aim to park a decent amount. So investors can make a decision to set funds aside for a fixed amount of time. Not just for a few days, but like Bitfinex for longer and sustained periods.
On the other hand we don’t want to take a mortgage to far into the future so the rates are limited to 12% for 3 months right now. That is a good balance. Please ensure you vote for:
3% for 23 days 6% for 1.5 months 12% for 3 months
or just subscribe to my datafeed.
I recommend opening a thread on Bitcointalk to start with and then inviting the shareholders to post there to keep the thread actual with rates and terms. Open to other ideas.
Banks offer better rates for longer periods because banks use deposits to invest so longer deposits are more atttractive. Nu “uses” removed funds to control sell pressure. So it is advantageous for Nu to take shorter period parkings as when buyside is low the market is always in a vlatile state.
If you offer 20% on 6 months, and i park for 6 months then just hold the money in my wallet for 6 months, it’s the same as if i parked for 1 year at 10%. Whether someone is holding their nbt in their wallet or parking it, you cannot make a person sell their nbt. So if you pay a certain total sum of money through a particular time interval, it doesn’t matter if it was a lot for a short period and then nothing or a little for a long period if the total cost and time was the same.
I’m not doing an experiment, I’m stating economic facts about our network. If we were selling new products we wouldn’t need park rates. To me suggesting we sell nubits as a solution to increasing park rates is like telling an infirmed patient that the best way to feel better is to get well.
I’m trying to have people park their money and make it as easy as possible (long term rates). You are aiming for low cost solutions for Nu which potential parkers can only profit from is they are very active, checking every week or so. I think we only attract people by offering longer term high park rates. That is just marketing. I wouldn’t go to a bank to park money for 22 days on a regular bases, too much hassle. If I do I hire someone to save me the hassle. I would aim for some longer term rates to set aside money I don’t need for a while. It is not rocket science. I don’t think the Nu network has different rules. It actually start to become clear it hasn’t as we have still very low park rates.
As far as I understand, your response to the question of where Nu gets the money to pay for increasing park rates, with reference to share dilutions, was as follows:
I guess you mean that growth always follows recession.
When you go to the bank, they don’t say:
"You can invest for 3 months and we’ll give you 8 dollars, but if you invest for longer than that we’ll give you 4 dollars."
Cause that wouldn’t make sense. Instead, they say:
"If you invest for at least 3 months we’ll give you 8 dollars. Feel free to leave it in longer than that."
The base-2 thing is the latter case. It’s simpler and more marketable than the former case.
I’m referring to new coins we should introduce as discussed.
That sound like your base-2[quote=“Nagalim, post:413, topic:161”]
Cause that wouldn’t make sense.
No, it doesn’t.
I think you are contradicting yourself.
I’m proposing [quote=“Cybnate, post:407, topic:161”]
3% for 23 days
6% for 1.5 months
12% for 3 months
So the bank says, you get 6% for 1.5 months, feel free to leave it longer. I can give you a better deal if you leave it for 3 months you get 12%, but feel free to leave it longer. Your base-2 think does exactly the opposite and is illogical from an end-user perspective in my opinion. Looks good for Nu, but it isn’t as it doesn’t meet the market.
We have now ended up with almost similar rates for all terms offered, which is odd and not easy to sell and have Nu benefiting from this in the form of a good uptake.
Nubits is a cryptocurrency pegged to the USD. It’s done so successfully for 1.5 years. As part of its liquidity control operations, when BTC price rises, Nu uses “parking” to rein in extra Nubits on the market.
Now Nushareholders are offering ~12%APR for 3 month to 23 days and 8%APR for 11-23days.
Just buy Nubits, park them (do it in your wallet), and the “interest” will be paid by the blockchain at the end of the period. The park rates are often changed according to market conditions. Once you park, your rate is fixed.
You can buy Nubits here (most liquid exchanges are poloniex and the NuLagoon Tube).
That is right, that is where Nu park rates differ from a normal bank as we are not into the lending business.
And that doesn’t make sense. Why would you do that? The risk of parking for 6 months is higher so people would expect a higher rate before considering that. And luring people in for very short terms is hard with BTC rising.