[Voting] No Nu Liquidity Without a Revenue Model

NuShares Motions
#1

OK Nu, this is my last attempt at sanity. A number of us have asked and asked. Instead of getting compromise or discussion we get motions that push us towards the same cliff.

Motion Hash: 8688c842023109881ad6a77bc8bdfe8f5c1704dc

–Begin Motion–

Nu will not utilize nu funds to perform liquidity operations - try to maintain a peg - without establishing an agreed upon (through motion) revenue model.

–End Motion–

https://daology.org/proposals/c12868855eca0d201dfb744937255d42c75ad95b

We are not the Fed. We are a small (very small) business. We need to operate like one: revenue lines, accounting, etc. Once the books are black, then we can strike on new ventures.

Please Nu! Vote for this motion!

14 Likes
Thoughts about @Phoenix
About who is controlling the network right now
Nu Voting Cold List
Nu Voting Cold List
Possibility and implications of a majority shareholder
[Discontinued] Cybnate's Nu datafeed - BETA
Let the Peg Fail
Let the Peg Fail
[suspended] Cryptog's Nu data feeds - BETA
[Discontinued] Cybnate's Nu datafeed - BETA
[Passed] Elect Phoenix as Chief of Liquidity Operations (compromise version)
Nu Voting Hot List – Mar, 09 2018
#2

Through the machinations of a variety of members on this message board they have acquired a majority stake and it’s even pointless to try and go against any motion they initiate.

#3

Not sure if this is the correct thread for this but here my thoughts on revenue streams: As an issuer of a token which value will persist under a promised quality, you can monetize the following token actions:

  1. Exchanging the token (to some extend)
  2. Transferring the token
  3. Storing the token

(1) would be the spread, and it is only possible to some extend because it has a very observable reduction of the quality.

(2) would be the regular TX fee, and I think it was already decided that this should be a shareholder defined quantity. The problem in my opinion is, that the number of transfers (or better the size of the used outputs) does not really relate to the risk that you take by providing a token with stable value.

(3) would in its simplest form be lending and is probably the most commonly used option in traditional systems, because they have laws and courts and police to reduce the risk of someone running with their money.
An alternative form would be the coinage dependent tx fee I mentioned, and I would like to shortly explain the consequences for NBT as I see them:

Every non-parked NBT is a borrowed NBT. Therefore there are only two possible states for NBT: either they are borrowed to Nu or they are borrowed to the customer. In the first case (parking) the customer gets an interest rate in the other case Nu gets a (different) interest rate, both specified by shareholders.

Besides the revenue stream this will allow Nu to much better control the amount of NBT in circulation, because you encourage users to lock their NBT up until they need them. This will also increase confidence for people that consider buying NBT because they have a better understanding of the current amount of NBT in circulation. Note that the “retirement” guy is not affected, because he can park the NBT and avoid the fee. In my view it would mostly be short and mid-term speculators who would have to pay the bill because they are required to keep their funds liquid. Those are also the people who induce the greatest risk for Nu, because they dump large quantities out of nothing.

OK, you noticed that I am personally very much in favor of (3) but of course there might also be good proposals for exchanging and transferring NBT, or maybe I missed some action completely.

3 Likes
#4

Someone understood what’s the top priority.
I’m glad about that.
And no, it’s not pretending to keep any peg. No revenue, no peg.

3 Likes
#5

On your first point I have argued a long time ago that there is something inherently illogical to lending funds while we have funds ourselves. I feel an important part is cutting some of the expenses (less expenses means less revenue is needed to break even) we should do so by using Nu’s own funds for liquidity provision instead off borrowing at high interest rates from liquidity providers.

On your third point, I like the thought of that also I have argued in favor of a Nu collateral based lending business to generate net revenue for Nu.

4 Likes
#6

It would be difficult to craft a motion that would be more destructive to our enterprise than this.

Right now market observers are watching closely to determine what the quality of our liquidity and peg support will be in the future. Shareholders have just been beaten to a bloody pulp because peg support and liquidity were removed.

You would like to make it the formal policy of our enterprise to completely cease operations while you craft a plan to improve revenue? What could have a more adverse effect on potential revenues than shutting down our primary business operations?

If you were an airline CEO, and your revenues were not what you would like, would you stop all flights until you could agree on a plan to improve revenue? That is what you are proposing.

Right now, we are like an airline that keeps cancelling every flight. I’m saying we have to make resumption of flights our top priority. People booked their flights with us and trusted us with their travel plans. We have to come through for them. The more flights we cancel, the worse our reputation. So let’s focus on getting the very next flight off the ground!

3 Likes
#7

If we were supporting multiple currencies, there is the possibility of providing a currency exchange at a spread. Global FX volume was $5.3 Trillion daily in 2013. COMEX moves about $5.2 Billion in “paper gold” per day.

With all that is going on in China, the Yuan devaluation and the flee into Bitcoin, the space is not for the faint of heart. But there could be some good volume.

#8

Yes.

This is true and I agree that money can be made even by the token issuer in short term here. The dilemma I see is that at some point you are competing with your own customers. If Nu builds up a lot of confidence, then people will be willing to invest large sums and to provide liquidity at a smaller spread than Nu as long as this is profitable. So some customers become Nu’s enemy (profit wise).

#9

The CEO made the decision to take all the fuel and sell it to buy stock in the airline company.

#10

Awesome. We need a re-evaluation of our enterprise. The power of motions and shareholders!

What is our enterprise? I contend it is a 1:1 peg to USD. Not a $0.1 peg.

Our “flights” are not being bought by the public. And your plan is we’re going to go slash fares with the belief that the consumer will come and fly with us again using the same model that didn’t work last time.

But since we’re all into analogies here, more Nu funds in the market on a peg just to have a peg would be throwing more pearls before swine.

#11

I wouldn’t. LOL

#12

That’s why a credible attempt to restore the peg needs to be done.
Some key parameters have been identified:

  • have a reliable revenue scheme (thousands and thousands of tx in the future are NO reliable revenue scheme, for you will never get there without making revenue on the way to it)
  • focus on NBT/USD
  • when trading on BTC/NBT adjust the spread so that the revenue from the spread covers the expenses (= risk * funds at stake)

Shareholders have been beaten to a bloody pulp.
That’s right.
But the lack of accounting combined with at least one evil actor played the major role and not removing the last few thousand of USD from a tight spread.
If the (buy side) liquidity wouldn’t have been pulled or put at increased spreads, Nu would have nothing left.
With nothing I mean: no BTC, no assets but NSR.
Nu would of course have hundreds of thousands of USD debts - oh wait, they are here anyway.

In a time when action would have been appropriate, a time consuming thrashing of liquidity providers that were operating with Nu funds was made. That was another reason to get shareholders beaten so badly.
Selling NSR would have been more effective, if NBT wouldn’t have started to float freely - only because no BTC were left at an appropriate spread!

@Phoenix, go and burn yourself. You might come back as a more clever bird. Don’t burn more of Nu than already has been burned.

I think I understand what you mean. I’ve come to a similar conclusion. Let’s focus on restoring Nu and not on speculation about what brought Nu here.

Regarding speculation - or rather the end of it in certain areas:
it’s time for some data, cash flows, addresses, balances, bills, payments, etc.

I’ve been watching the forum closely, but didn’t find anything that helps undertstanding the financial situation of Nu’s existence until FLOT was created. After that it was slightly better, at least transparent.
The only transparent information are the grants.
But a lot was paid from the development fund.
Where are the bills? Where’s Angela?

Is that the reason for JordanLee to not come back?
Doesn’t he want to account for what happened?

#15

I dont see why. The analogy is noisy

#16

Will add this to my data feed

#17

Voting.

#18

This has only 3 votes in the last 100 blocks…although I have put it in my data feeds.

1 Like
#19

The thinking behind this motion brought us an 800 million NSR expense, for which we have gained nothing. This motion is trending at 44% right now. That is 44% of shareholders voting for the scamification of NuBits. If it were to pass, I expect we would lose the peg, then regain it again after further damaging our brand and spending hundreds of million additional NSR to compensate for an even lower demand for NuBits.

If someone wanted to launch an attack against NuBits, the best way would be to shut down liquidity operations. That would be the most damaging thing that could be done, as we found out a few months ago.

Why is the will to commit suicide so strong here? I really don’t understand. Can anyone voting for this please explain why? It is unfathomable to me.

It is really difficult to build confidence in our brand with 44% of shareholders voting to seize value from our paying customers.

#20

Emptying the reserves for an NSR buyback brought Nu the 800 million NSR expense.
Nu has gained nothing from it.
But those who dumped NSR in the buybacks, crashed the peg and bought NSR thereafter cheaply gained a lot!

Someone did launch an attack. The best way was to reduce the ratio of reserves. Liquidity operations can’t deal with providing counter value for tens of thousands of NBT that get dumped.
Whose idea was it to empty the reserves by using them for buybacks?

I know that it’s risky if you keep BTC assets, although you need to back USD value.
Remind me: who decided to focus on BTC trading?
Volatile BTC may be. Had Nu still the BTC that were wasted in the buybacks in its books, it would still look great for Nu.
But now it looks only great for those who played their game with Nu.

Are you afraid of losing your ponzi scheme?
The suicide attempt (it was rather murder in my opinion) was already made.
This motion tries to fix one of the major reasons that enabled it.
Unfortunately it’s too late to undo the NSR buybacks.

You get more money by seizing value from (future) shareholders and customers, because you can drain more, if you target both groups.
First get more money by selling NSR.
Then leave the customers out in the rain in the last round of your ponzi scheme.

#21

This is not about shutting down liquidity operations. We need both. No liquidity can exist sustainably without a proper revenue model or at least working towards that with a clear roadmap with investments. Endlessly selling shares is not a sustainable model in my eyes and not providing the confidence you are looking for. That is why I’m still supporting this motion. Once a proper revenue model is in place I will stop voting for this motion because confidence will then likely be restored.

What also doesn’t help to build confidence if changing the reserve ratios. Maybe it should be 100% to start building confidence, but with the message that after a while it will gradually reduce to something between 33% and 50% over time depending on the amount of NBT in circulation. Transparency, communication in advance and sticking to it is very important to sustain confidence.

5 Likes
#22

Today, we treat NSR buyers as milk cow, when we spoil our money via LP etc, then we absorb blood from NSR holders.

Are there so many fools in this market who like get diluted form time to to time while the NSR sellers earn money in NSR buyback?

NSR is not NBT, you cannot adjust the supply freely, NSR should be something like BTC, encouraged to hoard. Although you can issue more NSR, but the quantity should be strictly limited. Apparently, we underestimate the public’s IQ, then the fact is our IQ are low because we are always wishful thinking.

Learn some Psychology before you start to do business, this is human being’s world, not just source code world.

2 Likes