One additional line I would add is that “TomJoad or the elected representative will abstain from purchasing or selling personal NSR during periods of share buybacks”. It occurs to me that I would be in a privileged position to purchase NSR if heavily discounted offers arrive through BitMessage, and a privileged position to sell NSR into a shareholder-funded buy wall prior to posting a purchase order on the exchange. As long as I’m not engaged in any transactions the process remains fair.
It’s interesting that share buybacks happen on exchange and share sales happen in auction. I would rather they happen this way when compared with auction, so I like to favor this motion. I’m worried, however, about the situation where the peg undergoes a good deal of sell pressure and we do not have tier 4 funds to support. In this case, we will implement park rates and an automatic share sale will be triggered. Could this motion lead to a situation where we are selling and buying nsr at the same time?
I guess my question comes down to what the threshold is for using tier 4 funds to support the peg.
I can basically follow the reasoning to have 80,000 NBT value in tier 4 buy side liquidity.
I just don’t understand how 250,000 NBT in the wild minus 50,000 buy side volume (tier 1?) from pools leads to NBT 80,000 buy side liquidity required in tier 4. Is it because the 50,000 NBT are tier 1 buy side and there are 120,000 NBT more in tier 2 -3?
It would be helpful to have a kind of formula that includes tier 1 - 3 buy (and sell?) sides.
The currently 300,000 NBT in wallets that are more or less in control of Nu are a special circumstance that needs to be taken into consideration - and you did that.
Maybe be after BCE there will be other projects causing big amounts of NBT under control of Nu? Nu development funded with NBT grants in my opinion fit that category.
So this should be included in the formula as well.
If I try to put your reasoning into a formula it looks like this:
NBT value in tier 4 = (total NBT) - (NBT controlled by Nu) - (buy side liquidity tier 1, 2, 3)
I’d like to differentiate between buy side liquidity of ALP and NuLagoon, because the buy side liquidity from ALP pools can evaporate in seconds, whereas the buy side liquidity of NuLagoon can only be removed twice a week.
That should be considered with a factor between 0 and 1 (that needs to be determined (based on historic tier 1 fluctuation?)) for each type of liquidity operation.
What about this:
NBT value in tier 4 = (total NBT in the wild) - (NBT controlled by Nu) - n * (buy side liquidity tier 1)ALP - m * (buy side liquidity tier 1, 2, 3)NuLagoon
I have no tier 2 and 3 liquidity of ALPs included because we don’t know about them.
These formulas are just an attempt to give the calculation of the tier 4 liquidity a start.
In reality it will be much more complex.
The value in tier 4 won’t be adjusted daily.
But the calculation of the recommended value in tier 4 should be calculated frequently to be able to follow a trend the next time the value of tier 4 liquidity gets adjusted.
A snapshot of the liquidity in tier 1 to 3 at the point of time when tier 4 gets calculated won’t do.
It would be nice to have the (un)seeded auction back and finally have it converted to a seeded auction to balance tier 4 liquidity!
Nu could encourage liquidity provision when liquidity is low by setting the interest rate higher when liquidity is low. For example it seems easy to implement for ALP – just fix the total payout every minute so that less total liquidity gets to earn more interest for the remaining liquidity providers. This fixed perminut pay out also allows removal of fixed target, simplifying operation, and feels fairer to the liquidity exceeding the target (they can earn interest as everyone else)
This is a very cool idea. Can you or I make a post about it? Possibly turn it into a motion eventually? There’s a lot to talk about there, as it changes the dynamics such that shareholders directly control things a lot more. Removal of fixed targets would be immense but it also necessarily increases amount of money paid out per month (no more rollover dollars) assuming fixed pool rates (i.e. rates would need to go down). Though you’re very right about it simplifying a lot of the economics.
I think it would be a nice way to further reduce the counter-party risk of Tier 4 while at the same time increasing the wealth of shareholders.
By the way, who would manage the remaining 80k in Tier 4? It also needs to get decentralized and counter-party-risk-free.
Does it suggest that this buy back draft intend to elevate the NSR price in preparation of shares sales if case we need to put some pressure on the buy side of the peg?
I hope it will elevate the NSR price in preparation for larger, additional share buybacks resulting from continued increases in demand for NuBits. But no one knows what will happen with NuBit demand. We will let ongoing liquidity and park rate data guide us in choosing between NSR buybacks and NSR sales.
This has been hashed for voting:
The Verify link doesn’t work because @assistant is unavailable right now.
Supporting this interim solution awaiting further tier 4 management improvements as result of management changes. Added to my datafeed.
After several review, the motion seems reasonable and that does not hurt NSR value. Voted
I think this proposal is reasonable and needed: a relatively substantial amount of funds remain in Tier 4 to protect the peg if needed (this plays the role of an insurance) while at the same time the network starts doing a buy back of NSRs since it has enough buy side liquidity (to give some returns to shareholders as a reward for expanding the network)
Share buybacks currently have 38.66% support, and the number is still rapidly rising. If this motion passes before the end of Friday UTC, we will begin conducting share buybacks this weekend.
This has passed. The first buyback cycle will begin this Saturday. The total tier 4 buy side funds as of end of Friday UTC will be announced, which will determine the size of the buyback for this week. It is on track to be between $2000 and $3000.
I’ll begin working with @JordanLee this weekend to coordinate the buyback next week. In the meantime, if you are interested in selling NSR for less than 70% of the current market price please send a BitMessage to BM-2cVFzzfWwKkdxLmgZwhSFfGmKwqDrddDfv. Otherwise the buy wall will be set according to the motion at a random time each day next week.