Custodial Grant Address: SiyWZ1WCedKRXLg7u8fmVkUtF3JRC9QATv
Custodial Grant Amount: 500000000 (500 million NSR)
This grant is being managed at Daology and contains the standard terms, being exactly the same as most previous liquidity operations grants.
It will be used to defend the peg and reach reserve equilibrium if needed. I certainly hope it isn’t needed. We have scarcely over 200 million right now, and with the NSR price at 18 satoshis that may not be enough if a significant percentage of the 150,000 outstanding US NuBits are sold.
Allow me to clarify what will determine whether they will be sold and whether NuShare holders will experience additional dilution. If enough of the 150,000 or so US NuBits in circulation are sold so that the minimum reserve is breached (currently about $14,000) my department will immediately sell more NSR. Otherwise, we will only sell a little each day (currently a little over 3 million NSR) to get us back to equilibrium at 1% per day.
On the other hand, if 55,000 US NuBits (or the equivalent in Chinese NuBits) were sold today, all NSR sales by my department would halt immediately and remain halted so long as the reserve level is above the reserve equilibrium level. In fact, modest NSR buybacks would begin.
Therefore, to avoid further dilution, it is imperative that shareholders and this community do everything we can to prevent the currency supply from falling, while taking action to expand it, such as promoting our parking rates (currently over 18% for six months on US NuBits) and trying to get US NuBits and Chinese NuBits listed on new exchanges.
NuShare holders are naturally upset when the price declines. However, spouting ignorant and angry talk about fatal flaws in the system, advocating for abandonment of the peg and the like will only increase the chance of further dilution.
Constructive action can pay off for NuShare holders. Self-defeating behaviors will only increase losses. Let’s behave in a way such that this grant will never need to be used.