[Passed] Motion to provide seed funding for B&C Exchange - a decentralized exchange built on the Peershares platform

[Sentinelrv]

I feel similar toward this. When I said before that eventually Nu would need to make profit, I wasn’t talking about dividends coming from a completely separate blockchain. I meant that dividneds would come through holding NuShares. B&C will be owned directly by Nu shareholders in the beginning, but that doesn’t mean that will always be the case. It’s possible in the future that shareholders of B&C will change and Nu shareholders will lose majority control of the exchange. If Nu is benefiting from the profit coming from B&C (for example our contractors are paid from B&C’s profit as I mentioned above) as the share owners change over time, the future owners could possibly pass a motion which ends support of the Nu network. This can’t happen if Nu shareholders control B&C directly (because they use the same asset: NuShares).

[Joe]

I don’t think you quite understand what I am saying. B&C will initially be 100% owned by NuShare holders. Overtime, some Nushare holders will sell their blockshares, and some non-Nushare holders will buy blockshares. This means it is possible NuShare holders might eventually be a minority vote for B&C and therefore B&C can pass votes not in the interest of Nu. This is because Nu does not own B&C because they operate on different blockchains. Additionally, profits from B&C go to B&C shareholders not NuShare holders. While I agree B&C should be built, I am still not convinced it should be on a new blockchain yet.

[Sentinelrv]

Yes, Joe just said the same thing as me. This is my main concern. I’m all for the exchange being built, but I struggle to see the benefits of splitting the blockchains when there is the possibility that we could eventually lose majority control of B&C.

[creon]

This means it is possible NuShare holders might eventually be a minority vote for B&C and therefore B&C can pass votes not in the interest of Nu.

This summarizes it in one simple sentence, thanks. I’d even say its more than likely.

[GreatScott]

If people sell their blockshares, that will be a choice they made. Much like some of the early business partners for Nu that sold their shares on the open market made the choice to sell them to others instead of hold them and influence the network with them. All Blockshare holders have the opportunity to make the same choice. One shouldn’t feel entitled to anything if the individual shareholder sells their stake in the network.

[JordanLee]

There can be two separate blockchains, one BKC and one NBT, which are both secured using different staking processes but using the same NSR

It is not clear to me whether you are proposing that NSR reside on a third chain or with the NBT chain, but in either case a multitude of significant technical and security challenges are posed. For instance, how are share days recorded and calculated? How is an NSR block reward given for minting on a foreign chain? How are different block heights handled? There are plenty of other issues as well, far too many to be addressed effectively in my opinion.

Edit: Sorry, I guess this post wasn’t necessary:

Well i am still thinking about it and was about to delete my post,
because the stake of the NSR blockchain can be in conflict when sending
NSR, so I think what I proposed is not doable in this form. I let the
post there since you answered.

[JordanLee]

I still have to check with @sigmike because I am too lazy to read into the code, BUT actually I would say that if you are an NSR user right now, who doesn’t stake, then you can simply throw away the NBT part of the merkle tree, so there is no bloat.

NBT and NSR transactions are placed in the same merkle tree.

[mhps]

This means it is possible NuShare holders might eventually be a minority vote for B&C and therefore B&C can pass votes not in the interest of Nu.

It cuts both ways. It’s possible, I hate to think about it, that Nu fails due to competition or lack of revenue source or high exposure to BTC prices, whatever, while B&C with its intrinsic profit model would survive and prosper. If people are jumping boats from Nu to B&C, you’d ask why.

Due to double direction burning between NBT and NSR ties both together, NSR is critically exposed to the health of the peg. So separate Nu and B&C is good in risk containment point of view. However I am sure shareholders will recognize the synergy between a fiat-pegged coin and an distributed exchange so even Nu and B&C have two blockchains, the shareowners will try to maximize the synergy between the two.

[Joe]

You cannot gaurantee that mutual cooperation will always occur.

Additionally, arguing that having the two seperate is beneficial becuase one might fail is false as well. In theory, tying b&c to nushares will cause the price of Nushares to go up because the network has more/better services to offer compared to any conpetitors and the promise of dividends. If b&c fails as a service the price of nushares will fall to reflect that. The same is true of nubits.

[mhps]

You cannot gaurantee that mutual cooperation will always occur.

Because high overlap between shareholders of NSR and Blockshares mutual cooperation in the beginnig is guaranteed. What happens later is difficult to tell. Nu has a longer history, B&C has a natural revenue model.

[crypto_coiner]

I am still observing what others are stating, but already several individuals ( @GreatScott, @Joe, @NubitGuy, @Nagalim, @cryptog) have expressed their concerns over the protocol through which this project intends to be funded or the outcomes it can have for nushareholders.
I believe at this time that the missing link here and a proper way to fund NuFork projects like BCexchange with
nushares would be first to pass a motion to enable the funding of NuForks by NSR custodial grant.
I mean, we have to set constraints and agree on a conceptual framework here.

Some ideas for such a motion.
Basically, it puts constraints consensually agreed upon, on each of the following articles and others.

*Initial distribution:

• Ratio NSR:NFSR for current Nushareholders
• Ratio NFSR:NSR for new NuForkshareholders
  *Funding method:
• Auction: put constraints on the minimal price
• Fixed price: set conditioning

*Special NFSR allocation

*Grant of NFSR:
NuFork blockchain already created or not?
In the latter case, the risk is higher and investors should be rewarded accordingly.

[Joe]

Currently Nu has no revenue models. None. We are now talking about

1. Diluting NuShares by 12.5% to fund development of an exchange with a good revenue model.
2. Spitting the NuShare market cap to create the exchange
3. Giving away the revenue model to the owners of the exchange

My suggestion, regardless of difficulty, is skip steps 2 and 3 and go straight to Nu keeping the revenue of the exchange it is funding.

[Ben]

My suggestion, regardless of difficulty, is skip steps 2 and 3 and go straight to Nu keeping the revenue of the exchange it is funding.

Serious question:

Where do you propose the funds come from to support the development of the exchange while returning future revenues to Nu shareholders?

[Joe]

See step 1. above

[Ben]

Which (as I understand it) is the proposal that Jordan presented, so I’m confused. Are you arguing in favor of or against the proposed structure?

[GreatScott]

Just to be clear, I think that by coming to shareholders with a motion such as has been laid out, everything is being done properly. If shareholders were to pass a motion like this draft or a NSR custodial grant, it would accomplish the same ends. It would mostly just be ceremonial to go the NSR grant route, though, as Jordan already has the NSR to cover it.

[Joe]

I want to see the exchange built into the existing Nushares blockchain. This way, Nu keeps the revenue from the exchange and it can be directly distributed to Nu shareholders or used to strengthen the peg.

[crypto_coiner]

I’m proposing that nushareholders first take the time to think about the parameters and agree upon the correct quantitative coefficients.

[Joe]

Perhaps we can split this discussion into 2 threads?

[tomjoad]

I like that you are thinking ahead to conceptual frameworks for future funding of new blockchains @crypto_coiner. Rather than setting hard-values though (such as equity must be given 1-1, or reserve price must be 75% of market price, etc.), what do you think about simply specifying the aspects that a project like B&C needs to address? This way shareholders will retain the flexibility to choose new values in your ratios for different Peershare platforms that might have very different profit models, as long as they are quantified in a user’s proposal.

In this case, I think Jordan has made a compelling case and put protections on the offer, like a reserve price and a guaranteed BKS distribution to all NuShareholders. I would enjoy seeing your idea codified into a motion to ensure that all future proposals are required to go into the same level of detail as Jordan has.