Support another currency besides NuBits?

I am not sure what it means for a currency B pegged to currency A to be A-inflation-adjusted while the sizes of the economies of A and B are not comparable.
However, it is true that cryptocoin enthusiasts believe that NBT is unstable because of the dollar (example: pic below)
So I would be interested in tackling the inflation issue.

I have pasted a typical conversation of what I encounter often in facebook crypto related groups:

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It happens. On bter, my nbt often sells for cny. Then, I just use the cny to buy btc or other crypto, send to another exchange, and sell back for nbt eventually. On CCEDK this is difficult, as the EUR markets are so thin.

One big point here is that if the target and spread are big enough, Nu is effectively just paying to keep a big EUR buy side because the provider will just sit with their EUR. This isn’t terrible if we can keep the rates down.

I didn’t have time to read all the posts in this topic, so I’m just going to state my idea here.

What do you think of creating NuGold? A synthetic gold that is pegged to the price of gold? Could it be possible? Would it be useful?

On bitasset exchange (CMC data) bitGold does seem to have more volume than bitEuro. But since bitUSD/CNY/EUR aren’t user friendly to end users so the data may mainly reflect traders’ preferences.

bitUSD volume is 10 times all other bitXXX combined although bitCNY is on par with bitUSD in marketcap (bitEur is far behind).

PBOC let Chinese Yuan lose 2% against the USD today. 2% is peanut in crypto exchange rate changes but this is the biggest daily change of CNYUSD since the 1980s.

I would personally answer as follows:

1- We should support additional currencies for 2 possible reasons:

  • increasing Nu’s revenues
  • increasing Nu’s visibility

I do think we should first consider increasing the sales of NuBits before considering creating another FIAT peg. The USD is still the most recognized FIAT currency in the world.
Therefore, I would not favor creating a NuEuro or a NuYuan right now. Right now, we should be working on increasing the sales of NuBits.

However, I do think we can increase the visibility of Nu via the creation of a crypto-currency immune to the inflation of the USD.
The reason is that the biggest criticism of NuBit that I have seen so far is that NuBit is destroying the work of Bitcoin since it is pegged to a very inflationary USD. In essence, that criticism blames NuBit for being a mere digital USD…
I fully confirm what @crypto_coiner is witnessing.
Creating such an inflation-free crypto-currency would kill off that main criticism and would generate a huge marketing boost for NuBit, I believe.

2- Therefore, if we have to add one, I believe we should add first the inflation-free crypto-currency.

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Allowing inflation nonetheless has an appeal in mainstream economics, and a close peg to something the masses can understand is also very beneficial. It much overweighs the benefits of catering to the zealous devotion to the Bitcoin model.

NuShares, while not completely immune to inflation, is designed to connect to the `real’ value of all NuBits in circulation and the influence of the Nu network, much like what people expect from BTC or XRP. There’s no need to clone another Bitcoin or Peercoin within Nu. If NBT/NSR has a closer relationship and Nu is profitable there would be no problem for people to appreciate this.

We have to convey the message that in the long term, one can spend NuBits and keep NuShares, which would be (nearly) the best of both worlds of BTC(PPC) and USD. Either park NBT or buy NuShares if he believes NBT is inflationary.

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Why not NuBTC?

Fastest transactions with predictable time confirmation, possible high volume.

Basically, make NSR unspendable and use burn gateways (a modified seeded auction would work) to go from NBT to NSR and NSR to NuBTC. Then, liquidity provision on exchange is simple and an entire ecosystem outside of the exchanges is built. B&C and other low risk exchanges would still be useful for going from NuBTC to BTC.

I agree with this and shared similar thoughts a few months ago: Inflation-Protected Asset vs. Anti-Inflation Parking. I seem to be in the minority here that believes minor inflation is healthy for an economy.

  1. Yes eventually, although I agree with @CoinGame that our community size and liquidity operations should be more mature before attempting it. The US Dollar is arguably the healthiest currency in the world for 2015 in terms of value appreciation, so I don’t think we’re losing users yet who would prefer a Euro-NuBit or Yuan-NuBit. I would also support the creation of 1 unit of both of those currencies as a symbolic accomplishment for the Nu network prior to us formalizing full-scale operations, as my unfinalized motion suggested. Now that Nu 2.0.0 is very close, I can revisit this motion if there is interest. I would also like to see an experimental currency like iGDP created because it is only a matter of time before a group attempts it. Nu should be the first to pioneer these brand new concepts.

  2. Once we do, I would support creating the Euro-NuBit and Yuan-NuBit at the same time.

  3. I am not sure what amount of liquidity would be required, nor whether enough interest exists to provide it. A poll of this forum would need to take place to gather initial expressions of interest in providing liquidity for those new currencies.

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YES
CNY
20K - 50K (NuLagoon’s BTC Tier 3 Fund could be shared in supporting NBT and NUCNY )
NuLagoon will be more than happy to help in supporting a new currency.

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The world is casting away rapidly from the "USD = world reserve currency" credo. This is also getting implemented now by economies and banks. That’s a fact.
Shareholders should get ready to implement NuYuan, very soon.

Sources:

Putin says dump dollar [RT.com - Published time: 1 Sep, 2015]

China has already dumped $100 billion of its $1 trillion of U.S [geopolitics.co - AUGUST 31, 2015]

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As a payment currency the Yuan is currently #5, probably #4 soon but a long way from the Pound and the Euro according to a Sept 1 report from SWIFT

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Does the Swift Network reflect correctly the global transactions and/or international commercial settlements?
SWIFT = Society for Worldwide Interbank Financial Telecommunication

Bump this.
Focus on how to cut the cost is useful, especially for big and old companies. But as for Nu, why not put more of our effort to expand the business and make more profit?

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I realized today Nu is not making any profit. Yet. It is establishing a confidence in a peg so that we are able to sell NBT without having to buy back.
Pegging maintenance has costs - The LPCs

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Scenario: NuEur or NuCny get created and sold by custodians.
What do you think will happen with the money the custodians get for selling the NuEur and NuCny? :wink:
How would you book that?

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True, but as MoD and Henry mention also provides the opportunities to sell more.
No LPCs -> no peg -> no demand -> no profit

Edit: Like in any company you need to create opportunities, take risks to make money and reduce the costs where possible. Doing nothing is not a good option.

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Yes the idea is to establish confidence in the peg.
I see the whole thing as an iceberg that would represent all NuBits in circulation and parked NuBits.
The peak of the iceberg is the part of the nubits that can be buy back immediately (Tier1).
The deeper you go into the water, the harder the ice is, the more frozen the NuBits are (Tier2 -->Tier6 according to JL’s model). I would call it NuIceberg :slight_smile: .
The depth down to which you can get your NuBit bought back is determined by the market cap of NuShares since Tier6 is basically burning NuBits from NuShares’ sale.
The more confidence there is in the peg, the shorter the peak can be.
Ideally, if at the end of the day, users never exchange their NuBits for Dollars, and have a blind confidence in the peg, liquidity operations will become needless.
Which makes we wonder about how the USD has its value maintained. Before it used to have a peg with silver or gold. Then it becomes oil. And now it is mostly Japanese and Chinese governments buying US treasuries? Well the Chinese is started to dump them massively it seems.

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Great elaboration.