True or False?: NuBits are backed by NuShares

That is one of the reasons why many prefer to be anonymous. We will need many operators with relatively low funds at stake to make it robust.

The 100% decentralised model has a lot of overhead. I think we and a few others with us are starting to understand that a 100% DAO might not be sustainable. The voting and blockchain maintenance can be decentralised, but leading a company with a bunch of good willing random shareholders is probably not possible.

A decent governance structure needs to be put in place with clear roles, responsibilities and leaders in departments/knowledge areas. Those leaders need to be held accountable to the Shareholders like most companies in this world and be transparent in their reporting. This is also expensive and time consuming to do properly and therefore requires a decent scale and a source of revenues to afford this necessary ‘overhead’. A DAO can be like a cooperative model, but still requires people to be appointed in positions to ensure the ‘engine’ keeps running. Also in a cooperative model key performance indicators exist for at least the leadership positions.

On-topic: One for the category lessons-learned.
NuBits were backed by NuShares by motion. Didn’t work out well. Going forward I believe the liquidity reserves should be held way more diversified. Buybacks by Nu should take place when the share price is low. Selling should happen when the share price is high. Shares are meant to raise money and provide people a say and/or a share in the profit. They are not meant as reserves for the company. This is a mistake as most of us have recognised by now. Having said that there are no great alternatives in the cryptospace without creating counterparty risks. Something we try not to be exposed to. Other types of reserves have other risks. It is not clear yet which risks are higher. Only time will tell eventually.

When investments are required and there is inadequate revenue shares can be issued to raise money. This will dilute shareholders if they don’t contribute in the investments. The alternative of just printing money won’t work. It only temporary works as we see now with the printing machines on in US and Europe. Fortunately temporary on a large scale means decades, on a small Nu scale it meant about 18 months unfortunately. Both ‘schemes’ are doomed to fail eventually. It is not a matter of if but when.

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Share price is a reflect of our business status, you cannot support yourself with your shadow.

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