I can understand that you may have a unique perspective, from NSR buyback, in seeing what would be coming when an extreme adverse event drives down NSR prices. The capital control idea is interesting and I suggest you bring it up whenever there is supporting evidence, so that shareholders can see what you see as Nu grows, paving the way of a consensus. As a motion it is way too early now I think.
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Based on feedback here I don’t expect it to pass anytime soon, but I do think there is value in signalling our willingness to consider new macroeconomic tools. Even if it only has 5% support for months, I’m okay with that. It’s a good thing that motions can be voted on forever!
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That’s park rates. We haven’t implemented % fees yet.
Erm… right. Confused me tried to get some rest…
Maybe I better delete my post before I confuse others as well 
Still having a hard time weighing up increased T4 against the value of NSR in T6. I think we need a few scenarios of those adverse events. One obvious one is BTC halving in value, would NSR also half in value? If so then you are right. When NSR can stand on its own it would make sense to keep NSR. I tend to believe the latter, but again the reason of the halving of BTC might affect this.
It is hard to assess these scenarios as we haven’t seen it happening, but would be keen to hear whether some might have seen some trends during extreme volatility of Bitcoin and the response of NSR. That might help this discussion. It might just be too early to tell however.
This motion has been hashed and put up for voting: abab44f623bb3c5b29ce0d2dc873798cf2bfb8ae
I spent a great deal of time thinking about my arguments in the original post above, and I am convinced this Tier is the missing piece to a crisis response. With this new Tier, our network will have a capital controls tool that every national government has for managing their own currencies. We ought to continue pioneering our macroeconomic toolkit as a global leader in cryptocurrency.
In short, I believe this motion enhances our network by using empirically-proven currency management techniques approved by the IMF. Our ideal liquidity operations structure for maximum stability might look like this:
Tier 4: Increase the USD-value of reserves to 30-50% (outside the scope of this motion) to prevent speculative attacks.
Tier 6 (Restricted Network Access): Place this safety valve on our network to restrict panic sell-offs in a severe crisis and give the FLOT team time to sell their NSR from the next tier.
Tier 7 (NSR Sales): Use this tool as a method of speeding up the return to equilibrium between buy-side and sell-side, and to symbolize NuShareholders’ commitment to sharing risk.
I did my best to answer questions that were raised, so thank you to everyone who contributed to the discussion. For those looking for more in-depth analysis of this issue, please have a read of my responses in the thread.
I am aware of at least one major shareholder who is against this motion, so I won’t be personally offended if shareholders disagree with this idea. However, I hope that with consideration of the arguments I’ve presented above a majority of shareholders will eventually vote to add Tier 6 (Restricted Network Access) to our macroeconomic policies.
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I’m not in favour as it is presented. Tier 6 and 7 can only be somewhat effective when activated at the same time. Restricting network access and with that further lowering the value of the shares and then selling shares makes no sense to me. It also looks bad from a PR perspective.
Therefore I’m not voting for the current proposal although I like the proposed Tier 6 (restricted network access) approach very much. It is just the order of activation.
I am studying the motion…
This motion is currently attracting about 25% of the vote in the past 100 blocks. Thank you to everyone who is voting for it so far.
All NuShareholders should be in favor of this motion if they agree with my logic presented in my above posts and summary here: [Withdrawn] Motion to create a new Tier 6 (Restricted Network Access) of liquidity . One common viewpoint I think is held by @Cybnate, so I’ll share my counterpoint.
I encourage you to write out a scenario explaining how you think this chain of events would unfold, because I still don’t agree with your view here. In the event of a critical emergency where we would expect 80% of demand to disappear overnight, the very first thing I would do as a shareholder would be to sell all my NSR, because I know the value will tank. I’m saying this as an actual shareholder, not a hypothetical shareholder. This sell-off will require NSR sale dilutions that inflate the NSR supply by many orders of magnitude, because NSR will have lost most of its value. Imagine the NSR supply inflating from 800M to 5B or 10B or more. We cannot reliably back the price of an asset (NBT) with a second asset (NSR) that derives most of its valuation from the success of the first asset (NBT); we can only use it as a marketing tool to assure NBT users that NSR holders share in the risk of the network.
My proposal gives shareholders the confidence that mass NSR dilutions won’t be required, so that shareholders hold their NSR during crisis periods. The increased NBT transaction fees will slowly reduce the excess circulating supply over time while limited NSR sales occur to help keep our public relations positive and speed the removal of Restricted Network Access status.
I encourage everyone to take 5-10 minutes to read the motion and vote. This is a critically important feature for our network in my opinion, as it will allow shareholders to strengthen their guarantee of a stable NBT price peg over long periods of time.
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That is partially true. When NBT holders know that NSR shareholders have barely any stake a NuBits sell-off will be even faster and with that encouraging a further decrease in NSR value.
You may try, but you won’t see much, if any, value of it back in such a situation especially not in a panicking market. No buyers. You and other Shareholders most likely end up as a bagholder in such a situation as it is already too late. Most of us know that. So most likely a large number of Shareholders will try to jump ship as soon as ‘Restricted Network Access’ (your T6) will be in place, basically diminishing NSR value for T7 at almost the same time. T7 is therefore useless by the time it is required.
With turning it around some NSR value could be used to buyback NBT before Restricted Network Access comes in place. This would likely slow down panic from NBT holders more than restricting Network Access basically implying that they may foot the bill.
As said before I can see a scenario where both measures would be activated at the same time. Dilution of shares and Restricting Network Access. Users and Shareholders would be both punished for panicking behaviour equally. It will be messy anyway.
We need to keep in mind that when Tier 6/7 needs to be activated, most likely there already will be panic. The real problem is how to get individuals (both NBT and NSR holders) behaving when the odds of losing are getting more favourable. I don’t have all the answers and literature is thin on this subject. It balances between rational and psychological responses which happen when certain triggers occur and one sheep crosses the dam. Usually thereafter the rational goes down the drain.
I’m still not convinced of the value of your proposal as currently worded. I would settle to have both Tier 6 and 7 combined in time. Still appreciate the concept of Restricted Network Access as an ultimate measure.
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I think we’re in agreement here, and my intent was for both Tier 6 (RNA) and Tier 7 (NSR sales) to be used simultaneously. Both can be activated at the same time, with Tier 7 only taking a little longer to complete due to the logistics of selling NSR. Here is the section of the OP where I discuss this, where I assume a future network state that has the ability to set transaction fees quickly:
My intent with the motion wording was to keep things very high-level, so that shareholders could have maximum flexibility in prescribing the tools during an emergency. I share your view that Tier 6 (RNA) and Tier 7 (NSR Sales) should activate at the same time.
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Unfortunately your motion is drenched in statements as the above quotes show that there is a strict order. Tier 6 should be the plasters while we are preparing for proper medical care representing Tier 7. During that we will still need more plasters (NSR sales). Your motion clearly suggest the opposite intention in my opinion which makes it hard to support it.
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Not having NSR sales before or at least simultaneously with RNA will undermine the trust in and the credibility of Nu.
Restricting access before shares get diluted to mitigate a crisis is skinning customers before owners taking on responsibility.
That is too close to what we already know from traditional banking/social misconceptions to hope for being able to resemble it.
Does Nu want to become something better than current central banks, something that limits the devastating power of central banks, something that might make the world a slightly better place?
Then it shouldn’t try to step in the shoes of central banks.
No skinning of customers!
I was for that reason I included sale of NSR in a draft I once created - way before the situation is absolutely dire:
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I think also we should show that Nu cares about NuBits holders and that Nu will do everything in its power to protect the holders even if dilution is needed.
In other words, Nu will protect the interests of customers before the interests of shareholders…
But that sounds anti-capitalistic …Well yes but Nu is a new form capitalism.
But protecting the peg could be regarded as the best way to protect the value of nushares on the long run so after all it is not that anti-capitalistic.
Nu holders already take a risk when they use nubits compared to FIAT so we should counterbalance that with a thick protection, I feel
So when could RNA be activated.
Maybe when a lot of nubits are help by bad actors for example?
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Nothing in the hashed motion text indicates that they cannot be executed simultaneously. What are you referring to? You’ve only linked comments of mine from various points of discussion, none of which suggest that only Tier 6 (RNA) could be applied while ignoring Tier 7 (NSR sales).
However, as this motion seems to be stalling between 20-25% I would like to ask both @Cybnate and @cryptog what proposed wording changes to the motion would increase their likelihood of adding it to their data feeds. As others such as @Nagalim have noticed, you two have significant voting power under your control and it appears I will need to work with you to arrive at a motion wording that has a chance of passing.
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Which as a side note - and not trying to side track the discussion - is another great integral part of Nu’s governance (so please, rather don’t comment that here; I just couldn’t forbear writing this).
I’m so overly happy that @Coingame stated what’s obvious for most of us, but hidden for so many.
And until recenty I wasn’t aware of the importance for Nu - the inner workings and as a means to attract active contributors, who favour agile endeavours, which have a solid consensus mechanism.
Data feeds belong to that.
With them you can delegate your vote, but need to keep that delegation up only as long as the delegate acts and decides more or less according to your interest.
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I think that is overestimated. I’ve seen on numerous occasions that at times people choose to not join a datafeed and vote in their own way. I’m not sure whether either cryptgo or me is able to help you to 50% rewording this motion as the current 25% might not like the rewording and you still won’t have a majority.
I think my point is clear, the gist of this motion and the tier numbering is that we first put RNA (tier 6) in place and then start selling NSR (Tier 7). That is the part I don’t appreciate. Most simple solution is to turn the tiers around.
More sophisticated is to add another paragraph detailing e.g. the amount of NSR to sell (e.g. 50%) as soon as tier 6 is activated. This will create a barrier for shareholders to ensure they have done everything before putting RNA in place and with that protects the NBT holders. The other 50% if still valuable can be used to sell when RNA is in place to mop up some spills likely to occur when RNA is gearing up.
Hope that helps and like to see others chipping in @cryptog. I think RNA is a great last resort mechanism to have in place. We just have to make sure we apply it properly.
Im still unclear what this motion does other than force us to change the language we use.
The only actual compelling number in there is 10%, which is lower than the number which triggers nsr buybacks, making this a higher tier than nsr buybacks. So is this entire motion just trying to get consensus on that 10% number? Why not 15%? Why not any number and just say ‘set high fees when we’re in economic trouble’? Why not just let shareholders do that themselves without trying to do some weird kind of semi-marketing using a motion?
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I think I would be comfortable with RNA being named T7.
T6 being new NSR issuance.
And I think we need concrete numbers.
Like: we start to create new NSRs to protect the peg while at the same time we do not increase the fees.
We continue to do that as needed.
If we reach a point in which we have increased by x% (Ex: 50%) the number of NSRs in circulation, then we can start increasing the tx fees (freezing the accounts) while at the same time we stop the new issuance of NSRs.
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Why do you think buybacks are unacceptable without NuShares backing NuBits? Because we’re “manipulating” our share value? If we distribute dividends and then all buy NuShares for the money, wouldn’t it end up the same but less efficient?
Why is it necessary to display good will by selling NuShares? Our share value will be in danger anyway in such a situation. Isn’t that enough as incentive for Nu to avoid ever getting there?
As I see it, Nu promises to provide NuBits at $1.00 and at reasonable velocity. Does it matter how Nu does that?
I still question how much selling NuShares to pay for exiting NuBits will help, regardless of whether it’s before or during Restricted Network Access is in effect. If selling NuShares is necessary, go ahead, but I don’t understand the rationale for doing that just to show Nu is serious.
Regarding the concerns for Nu’s reputation. Surely, it’s irresponsible to care more about perception than actual stability? It sounds good that NuShares back NuBits, but will they really in practice to a justifiable degree? It may be risky to sell away network power as well.
I imagine selling NuShares while Nu is not in Restricted Network Access will be ineffective because too many NuBits will flow for Nu to keep up (we’d be in that situation for this reason). Even when RNA is active (assuming NuBits only) shareholders may want to exit themselves and push the value of NuShares down even further. Including NuShare transactions in RNA seems interesting to reduce panic selling effect in NuShare value, but I guess would need some exception for Nu’s sell transactions to go through?
I guess we don’t have much choice as last resort to sell NuShares, and I believe I support that. I think if NuShare sales are necessary they should occur when RNA is active. RNA is not a pleasant situation, but seems a lot better than letting a panicking market run Nu into the ground.
Moreover, what does Nu do if one of its currencies is failing and keeping a peg is deemed infeasible? When Nu needs to abandon a currency, we can’t keep throwing shares at it and risk the remaining currencies in the network.
Edit: How does Nu’s buy side work? 
Is selling NuShares for peg support integral to the design of Nu? Perhaps in this post I’ve neglected how Nu stores value in NuShares for use toward pegs. While the network is in good condition, that should work well, but in emergencies I see RNA as the action before an emergency sell-off of NuShares. Differentiating a normal NuShare sell and the sort during RNA.
Hope I’m making some sense.
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