I am glad you are interested in the first place, but i am not a technical expert as you are so i’ll try to do my best.
The main purpose is to support the Nubits demand using the Nushares demand, may be enforcing the trading through Nubits is not practical or too complicated that it doesn’t worth it, but here is what i think:
In order to enforces the Nushares-Nubits trade -at least as an intermediate exchange- we have to prevent sellers from transacting Nushares for No Nubits, this as far as i can think can be achieved by:
1) Pairing Nushares and Nubits transactions :
Alice tries to purchase 10,000 Nushares from Bob, Bob opens the Send tab in his Nu client and input Alice’s address, 10,000 Nushares and the amount of Nubits he demands.
When this transaction from Bob to Alice reaches a minting client, it will not be included in the block unless there is another transaction from Alice to Bob with the same amount of Nubits demanded.
Still Bob can demand Zero Nubits from Alice so he can sell his Nushares for Alice’s Bitcoins directly, this is less granted deal, but If Bob really needs Bitcoins or he is a centralized exchange that wants users to be able to withdraw their Nushares, he will have the incentive to do this, so how to prevent him from doing so? :
2) Minimum Nushares price in Nubits :
If the Market price of the Nushares have been around 1NBT +or- 0.05 , then its safe to enforce a minimum price of 0.5 NBT for every Nushare, that any transaction with a price less than 0.5 NBT won’t be validated.
So Bob ( the trader or the exchange) can’t send Nushares without Alice paying at least 50% with Nubits, this will definitely incentivize Bob to demand a proper price.
The Minimum price can be determined either through Nushare holders actively voting every 60 blocks or so, Or obtaining the price information automatically from the Nu decentralized exchange using the last selling orders.
Both of the previous methods have their cons. and may be manipulated and needs further investigation.
I can’t discuss right now the impact of the existence of this minimum price on the market Psychology, but i am interested to hear what you think about it.
Ok now every direct transaction in Nushares has to be a legit trade, what about Exchanges?
As for Nu dex, it will act like in NXT or Bitshares and the transactions will be subjected to the same validation terms previously discussed(Paired transactions and minimum price).
On the centralized exchanges ; As Nushares can only be traded not simply transferred, Bob wouldn’t be able to deposit his Nushares nor could Alice withdraw her Nushares, Still the exchange can offer BTC/NSR or any other trading pair than NBT/NSR for their speculators, just by changing accounts balances and the credit over their own Nushares that they buy from the Nu dex and may distribure dividends according to users virtual Nushares balance, but i cannot find any profit for the exchanges so it probably won’t do it and that’s fine.
