[Passed] Single Sided NBT Gateway on HitBTC - Updated 18FEB16

[Nagalim]

Can you please point me to a liquidity operation that can clearly be stated to have ‘made money’ for Nu?

[masterOfDisaster]

It depends on how you define “made money for Nu”.

When I operated NuBots at Poloniex at minimum 1% offset, you could argue that they made 1% (minus fees) gain for Nu with the offset at each trade.
But that doesn’t include the losses from being used as hedge.
…that’s why it’s a bit more complicated than just that.

I guess the second last post is about a general misunderstanding of LP; they are in general not here for making Nu money, but costing money instead - that’s the price Nu pays for having liquidity at exchanges…

[crypto_coiner]

z[quote=“masterOfDisaster, post:29, topic:3456”]
I guess the second last post is about a general misunderstanding of LP; they are in general not here for making Nu money, but costing money instead - t
[/quote]

I am playing the devil advocate to be provocative and see how we can define PROFIT indeed in Nu.

It seems we are printing the profits that we are enjoying on our P/L then, since LPCs obtain a positive net roll over from their grant that we then use for dividend distribution or share buyback, right?

Edit: PoW-pool-based network such as bitcoin or litecoin operate the same, accounting wise – they print (mine) their profit by selling their tokens to users.
But there is a big difference within Nu – we first (get to) issue the tokens to the pools (first kind of users) which will re-sell them to the market.

[Nagalim]

Profit is complicated when we are building an economy. Every btc that enters t4 can be seen as profit and the inverse as loss. Therefore, balancing a pool is a P/L event. If a custodial proposal increases frequency and/or profit for balancing events, it can be seen as a boon for the system.

[nmei]

I will be re-hashing with the following > address:

BEfKNxhQRVGAozMGUNkk6Wg6bcke2SE5Dm 1 NBT

Daology has been updated:
https://daology.org/proposals/57d57a1ac3ee0b1f2bea22958fc126a385967383

[crypto_coiner]

How many NBTs do you expect to sell on hitbtc during these 60days? what’s your objective?

[crypto_coiner]

Hello community.

Since I already had a NuBot running on HitBTC when I provided liquidity I can easily continue to use it for Nu. Considering the move to have FLOT funds be used for BTC liquidity outside of Polo and Bittrex, I thought this would be a prime example of that effort.

It will be very much like the drafts and grants for the poloniex gateways. But it will only be one sided. I will operate the NuBot, the FLOT will deposit NBT and I will return the BTC. I plan on doing weekly transfers. Simple.

From dual side lpc nubot to single sided sell side gateway using FLOT –
100NBT could be expensive if it does not sell relatively NBTs

[zoro]

Hitbtc has no ALP operators and for some days now no MLP either! @henry?
Alix reports always a 0 buy and 0 sell sides. We cannot expect to have even a small volume there
under these circumstances. We need a nubot there asap!
50 NBT/month is the cheapest liquidity operation we can have ATM

[masterOfDisaster]

100NBT could be expensive

Current liquity provision cost around $10,000 - per month.

Single side (sell side) NuBot (or PyBot, although I prefer NuBot due to the parametric order book) can save a lot of that money!

With 50 NBT per month and operation there’s some buffer to compensate the risks Nu needs to face for that type of operation.

[Nagalim]

HitBTC has gone down in volume from 700 NBT/day to a dollar or so (using ALIX). This is almost certainly due to the lack of liquidity, though there are other factors. I certainly think <2 NBT/day is worth it.

[masterOfDisaster]

I certainly think <2 NBT/day is worth it.

That order of magnitude would be great for fostering small ALP operations - just in case somebody has an appetite for a dual side operation with a slightly tighter peg at a particular exchange.
The problem is that the ALP operator costs come on top.
I find the NuBot operations more and more attractive.
Just make the sell side NuBot a dual side NuBot and operate it at <2 NBT/day…

[zoro]

dual side NuBot and operate it at <2 NBT/day

a brave and rich person probably

[crypto_coiner]

I find the NuBot operations more and more attractive.Just make the sell side NuBot a dual side NuBot and operate it at <2 NBT/day…

That makes the operation less complex imho

[masterOfDisaster]

That makes the operation less complex imho

On the contrary!
Sustaining and supporting dual side operations makes Nu appear responsible for both sides.

Sell side only requires a refill of the sell side from time to time and already makes it clear that this is an exchange with reduced support.

Placing the message that the peg isn’t really ensured by Nu at those exchanges is easier this way imho.

Don’t just look at the NuBot operation. Try to draw a bigger picture.

…the NuBot operations alone would indeed be less complex in dual side mode as they require less interaction.

[crypto_coiner]

Sustaining and supporting dual side operations makes Nu appear responsible for both sides.

Right from the operator perspective –
I was focusing on the accounting –

[crypto_coiner]

Added to my voting data feed.

[masterOfDisaster]

I was focusing on the accounting

You can try to imagine something else:
if Nu supports dual side operations at a lot exchanges, it should require more funds per exchange to provide a good customer experience.
In this case Nu needs to risk even more funds to make customers happy who want to bet against Nu and use NBT to hedge BTC volatility.
While this is good advertisement, it’s expensive and the past showed that trade volume doesn’t just come because liquidity is available.
Trade volume is where customers trade. Full stop.
This is currently more or less Poloniex.

If there are plenty of single side operations, but only a few dual side operations, Nu has several benefits. I already lined out the administrative benefits and some of the economical benefits.
It provides a small, but valuable additional economical benefit to sustain only sell side liquidity operations at most of the exchanges:

• people who want to sell NBT, which they bought at a sell side only operated exchange, might need to send them to another exchange with a sufficient NBT buy wall -> tx fees need to be paid -> revenue for Nu!
• arbitragers who operate the buy side on their own (because there’s money for them to be made from the offset…), might need to withdraw NBT from time to time -> tx fees -> revenue for Nu
• this works better, if we allow sell side only operations to run dry from time to time; otherwise the arbitragers can just balance with the sell side NuBots
• even when arbitragers balance with sell side NuBots, it’s not bad for Nu, if the offset is big enough to make money for Nu from the offset

[crypto_coiner]

people who want to sell NBT, which they bought at a sell side only operated exchange, might need to send them to another exchange with a sufficient NBT buy wall -> tx fees need to be paid -> revenue for Nu!

I wish people would hold their NBT and use them as a medium of exchange for payment of products and services rendered–
Store of value and unit of account have been achieved, so far.

[masterOfDisaster]

I wish people would hold their NBT and

You can’t make people do what you wish.
But you don’t need to support activities you don’t really like (offering NBT to hedge BTC volatility at the expense of Nu is not what Nu loves best) without limit

[crypto_coiner]

You can’t make people do what you wish.

This is not what I stated – this is taken out of context and cut in the middle.
To be honest, I’m afraid this conversation is not really constructive. --let us stop here
I will refrain from elaborating further on, but I believe I was accustomed to more intelligent/mindful from MoD, I believe.