Three roles that need to be filled by shareholders

mhps 2015-10-03 13:56:58 UTC #51

This doesn’t have to be defined before the group is formed. Actually it will take a very long time and iterations before the strategy can be worked out. I think the urgency is in getting a group of interested and committed community members together in case things happen and we don’t even have the mechanism ready.

dysconnect 2015-10-04 09:08:38 UTC #52

Reasonable. I guess for the time being tier 4 is going to be a piggy bank that’s just used when called upon, and has a somewhat lower threshold of approval than custodian grants.

mhps 2015-10-04 14:31:49 UTC #53

My feeling is that tier 4 hasn’t been used in the last year (right?) so Nu will likely have many months before it is used. We need to setup the nuts and bolts of the tier 4 fund movng mechanism (specify the group’s action manual, select the group, get them trained …) and dscuss the fund use strategy llike any of the topics.

Nagalim 2015-10-04 14:42:55 UTC #54

isnt tier 4 being used right now for buybacks?

mhps 2015-10-04 14:51:21 UTC #55

Yeah that is exactly because there hasn’t been any activity with tier 4 before.

masterOfDisaster 2015-10-04 17:01:13 UTC #56

…Nu really needs seeded auctions…
One of the very good use cases for tier 4 liquidity.

Nagalim 2015-10-04 17:17:05 UTC #57

That’s easy to say, but proper implementation will take a long time. We need to be on our feet without it, not put all our eggs in one economic basket. We have nsr grants, yet all we’ve passed has been nbt grants since Nu 2.0. That tells me that with seeded auctions Nu still would not pass nsr seeds, so we would effectively end up performing share buybacks.

masterOfDisaster 2015-10-04 19:51:37 UTC #58

I agree.
Because of that it’s better start sooner than later

It depends - if seeding NSR (to counter NBT oversupply created by the NBT grants) depletes tier 4 NSR funds, there’s only one way to refill them: NSR grants.

Nagalim 2015-10-04 20:02:23 UTC #59

So you would think it would go like:
Tier 4 > buy nsr on open market > NSR seed auctions to burn nbt
?

Interesting…

masterOfDisaster 2015-10-04 20:22:25 UTC #60

Exactly!

If continuous use of NBT grants brings more NBT on the market than is considered healthy (not everybody might want to receive NSR and prefer NBT instead - that’s a challenge Nu needs to deal with!), a way to remove them is seed NSR in seeded auctions and burn the retrieved NBT. Or just buffer them on tier 4 sell side, if there’s some space left - it depends on the agreed thresholds of tier 4 funds…
Those NSR for the seeded auctions need to be purchased before on the market for the BTC that is held in tier 4 buy side or granted on tier 6 (current situation).

Either way it won’t matter whether grants are NBT or NSR type - at least not if seeded auctions run with sufficient participation, because seeded auctions using tier 4 liquidity can even it out. If tier 4 gets depleted below a threshold, tier 6 needs to be used to refill it.

I think it might be good to have some NSR (in addition to BTC) in tier 4, because it would make dealing with seeded auctions easier and not dependent on tier 6 grants and NSR liquidity in NSR/BTC trading pairs (possible future situation).

Nagalim 2015-10-04 20:23:51 UTC #61

I guess my question is why not just buy nbt from the ALPs with tier 4 and burn, skip the auctions and nsr market all together?

masterOfDisaster 2015-10-04 20:33:25 UTC #62

That’s another option.
And I wouldn’t want to limit it to just the ALPs

As the future tier 4 custodians will be dealing with multi signature addresses which I hope to be well-known, the fund activity can be tracked in the blockchains (Nu, BTC) as well as with the seeded auctions.

The benefit I see with seeded auctions is that Nu provides the market with an offer to remove NBT from the market or inject some to the market and the market participants need to accept it.
Having tier 4 custodians actively buy or sell NBT is something different, which can easier lead to wrong decisions.
I rather have the market decide than tier 4 custodians whether it’s time to buy or sell NBT.

Nagalim 2015-10-04 20:40:38 UTC #63

but the LPs are the market just as much as the auction participants are. The fundamental aspect here is that tier 4 cannot be a network reserve, it must exist outside the system in BTC or USD or whatever. Then, if we wish to shrink that reserve, we have to buy a network currency on the open market or via private escrow. For burning NBT with tier 4, it’s clearly simpler to just buy it from the LPs and burn it. For burning NSR with tier 4, however, the situation becomes interesting if seeded auctions are on the table. It can be seen how tedious it is to do a share buyback on the open market and simply buying NBT from custodians and trading that for NSR via the seeded auction starts to look not only economically efficient, but just plain easier.

I don’t think Nu should ever buy NSR on the open market to seed an auction, that seems like economic suicide to me.

dysconnect 2015-10-04 21:00:25 UTC #64

We need to move to nsr/nbt eventually. Given the low liquidity of NSR, there will be people who want to skip BTC/fiat and go straight into NSR, so that’s where we grow tier 6 operations from nil. So we can let tier 4 have multiple assets like BTC and NSR, and use them in their respective markets to offset excess NBT liquidity, and it will be more effective than just having either one. If tier 6 becomes mature enough then it could spin off as a stand-alone unit that doesn’t need full support from tier 4, fulfilling our decentralization ideals.

And I’ve always been a bit disgruntled with exchanges taking all the profits but giving us all the default risk, so I’d love to be able to save some exchange fees, even if it means we have to pay up to an equivalent amount to shareholders who’d be in charge. Buying NBT from ALPs is a good idea - it would probably save us from the “can of worms” you mentioned for reducing sell-side liquidity payout. But so is buying NBT using NSR, and I don’t see why these two can’t co-exist. That said I’m not in favor of using Tier 4 to buy from open markets as a regular occurrence.

Anyway, I admit I’m hung up on tier 4 because we need to cultivate a workforce within the community and among shareholders. There’s a steep ladder (I’d say it’s actually a rocket) from being a peasant shareholder to being a paid anything, and the result is we’re putting too much work in the hands of just a few people who have more important duties to attend to. So I just need any excuse to bring community-sourced ideas into tier 4.

tomjoad 2015-10-07 04:18:58 UTC #65

I’m finding myself with less and less time each day to handle extra roles. I’m removing myself from consideration. I hope others will continue to discuss ways on moving forward on this issue.

desrever 2015-10-07 10:41:47 UTC #66

I think this thread reached its consensus-finding limit, this is a very important and active role requested and requires more interaction .

I propose to candidates of group #1 to schedule an open meeting on gitter to have a synchronous and in depth discussion about it and come up with a model to propose to shareholders…

Does it make sense?

Anybody else?

If you agree - or better, if no-one voices concerns with this approach - I will send out an invitation to a doodle in 24 hours and then publish the result here so everybody can participate.

mhps 2015-10-07 11:48:21 UTC #67

I think discuss here is better because the community can participate and the discussion is documented. That said having a meeting is fine with me but I only have a lot of short pieces on-line times.

desrever 2015-10-07 14:07:10 UTC #68

same goes for gitter, you can have the history.

cryptog 2015-10-08 03:26:03 UTC #69

I am fine with having that meeting on gitter.

dysconnect 2015-10-08 04:31:02 UTC #70

I’ll join when it turns out you can’t get 7 people.