That is certainly a risk towards the date the peg can be established. This can only be mitigated to reduce the park rates with shorter duration to close to zero. Only the very long say 1 year might partially offset the coinage. No one can get out of this unscathed. An issue is that we can’t cap the amount of parking against certain rates. This would allow a better preparation towards establishing the peg and sustaining it in the months afterwards.[quote=“mhps, post:20, topic:4198”]
It would be a rude surprise that the fund got a hefty hair cut.
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I think we all had a rude surprise in the last few weeks. Not sure why we should exclude people not paying attention at all. The information will be available on the forums. Maybe we could add something on the website to warn NBT users, but that be it.
There is no benefit to Nu to include them unless excluding them add significant cost.
Paying attention isn’t enough. It’s having to run a live client and learn how to park. A NuDroid user who keeps nubits in his wallet will have trouble. It’s one thing Nu has internal trouble. It’s another level of trouble if users have to know and learn all these bizarre technical details not to lose fund. Exellent PR.
So basically the idea is to make nbt holders pay for the privilege of having unfrozen nubits via a burn rate.
Ok that sounds interesting but:
- is that acceptable from a holder perspective?
- to what kind of economic mechanism does it correspond to?
- what would be an acceptable rate?
Protocol enforced automatic burning of nbt via nsr issuance.
With a such plan
- how are nu market cap and total nsr expected to behave according to nbt market cap and total nbt
2)we dont need bcex any more as a host for liquidity - what does it bring for nu?
This plan is sounding promising, but unfortunately it will require a hard-fork and some software development. That could be a barrier to execution.
The software development can be managed as long as we can release BTC for this. It has been estimated at 1 week for the coding excluding testing.
The hardfork is more challenging especially now many NuShares are being traded and the difficulty slumps (0.00015137 @ block 927498).
Nu is broke. This is a I believe a reasonable fair way to liquidate and get rid of outstanding debt. Once the peg is established and stabel for a few months Shareholders can choose to increase park rates or have another hard fork to partly reverse the relatively high burn rate. Ideally I would see a burn rate we can have a ongoing vote for. But we cannot afford the development I believe.
Liquidation
Need to do more calculations on that. For the first 4-6 months it will have to be high, as above after that we could reduce it to make it cheaper to hold NuBits without parking. As in the proposal Shareholder will need to seek the equilibrium between profits and usability.[quote=“crypto_coiner, post:24, topic:4198”]
- how are nu market cap and total nsr expected to behave according to nbt market cap and total nbt
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Your guess is as good as mine’s. We need to start with burning more NSR just to keep the basic infrastructure up and running and pay for necessities to survive. Establishing the peg with a plan providing a funding model should bring some confidence back and I would expect the NSR value to rise with that eventually.
While the fiat gateways in place it would be adequate. Nu would exist and arbitrage and trading could take place.
I think it is still useful to have B&C exchange trading NBT in a few pairs The question is whether we leave that 100% to the market or whether we are going to spend money on it. As advocated earlier it may useful to spend some of the profits on it for marketing purposes and.or supporting a small market to grow. With a wide peg and with deep liquidity possibly some profits can be made. I think we should make those decisions when the time is there and B&C is operational and Nu is solidly pegged to $1 for multiple months. Think big, act small!
So ok the idea is to reduce our debts via this burning mechanism.
Then assuming we have recovered the peg, we remove the burning mechanism.
But what would guarantee that Nu would never reintroduce the same mechanism later on, guanrateeing holders that they would never experience another hair cut in the future?
In other words, won’t introducing this mechanism be the last blow to the peg?
I am fine with burning those nubits but it would be on condition that we can put in place a model for sustainable revenues to always guarantee a high level of reserves or liquidity or both.
No not remove, only reduce. We need the burning to become sustainable and have revenues from the burns. The high rate is to burn the debt initially, the lower rate are our revenues going forward. There shouldn’t be a need to change that going forward.
So basically burning is not only about liquiditation, it s about getting revenues.
Basically using a stable crypto should be a paid service.
This is only possible in crypto world and this is where we would depart really from the fiat world.
I feel this is the right direction.
I really like the idea of burn rate being derived from park rates table. This way we won’t have to release new clients every time we need to fiddle with coin age coefficient. It might be easier to develop too.
For example shortest park period rate will be equal to burn rate, ie you don’t lose money parking it but there won’t be any profit neither.
Indeed
Difficulty (PoS) 0.000152
https://en.bitcoin.it/wiki/Hardfork
A hardfork is a change to the bitcoin protocol that makes previously invalid blocks/transactions valid, and therefore requires all users to upgrade.
Any alteration to bitcoin which changes the block structure (including block hash), difficulty rules, or increases the set of valid transactions is a hardfork. However, some of these changes can be implemented by having the new transaction appear to older clients as a pay-to-anybody transaction (of a special form), and getting the miners to agree to reject blocks including the pay-to-anybody transaction unless the transaction validates under the new rules. This is known as a softfork, and how P2SH was added to Bitcoin.
Given sigmike earlier response to this, the change proposed might categorise as a soft fork. But I’m certainly not the expert in this and support is needed from sigmike, coingame and creon to get this plan executed.
Just to make sure. I think that, after losing so much money on liquidity provision and against hedger that used our peg for free, we should make from now on, NuBits holders pay for the privilege of using a stable crypto-currency, via some kind of burning mechanism or taxation.
Is that what you have in mind too via the “burns” ?
Yes, I do. I believe a stablecoin like NuBits does have value (and a cost) for traders and other holders. We just haven’t been able to monetize it properly due to off-blockchain trading at centralised exchanges. The burns provide a model to monetise this. Not saying it is perfect, it does come with some challenges and trial and error to get the parameters between burns and parking rates right in the context of the reserves and demands. But at least it provides a fair chance to make it work and be sustainable.
Where do the burns get collected?
I see some connection between this idea of burning/parking and the idea of NuCosts API.
Anybody knows why it enables focusing on fiat pairs?
How does the plan enable fiat pairs?
Why is BCEX useful or efficient in the plan？
Because it is expected that most centralized ex will delist nbt?
Fom the proposal:
The amount of burning relates to the coinage and therefore discourages use of NBT on centralized exchanges or holding them in off-line wallets for longer periods.
How is it different with bcex?
The peg will be established as soon as the ratio reserves/NBT circulating (not parked) hits 50%. It also assumes that B&C is working and that NBT can be listed. Nu will start providing liquidity walls on B&C on popular pairs.
why is bcex pivotal here?
At the same time walls can be established on NBT/fiat pairs only on centralised exchanges assuming these pairs still exist. Other pairs should be initially left for arbitragers until a profitable model of liquidity provision appreciating the risks of exchange failure has been established.
we may have a revenue model but if we are subject to btc vol then we might loose much money.
Isnt it crucial to have revenue and fiat pairs only?