[...]but it's nice to see ponzi scheme isn't being thrown around so loosely anymore.
I wouldn't hold single individuals responsible for a whole community!
Aren't you doing almost exactly what FED is doing?
Nooo! The difference is, they announced to the public they are accepting private bids for their own 'feds' chairs. The Fed on the other hand starts the process by sending private invitation for the corresponding private auction.
If you translate the 'feds' chairs to NuShares, then yes, I agree.
Everybody can have such a chair. They can be bought at exchanges.
Initially they haven't been distributed freely to everyone, but more like the fed approach: invitations to people.
It was argued that this was necessary to bootstrap the whole thing and I agree that giving the chairs to people who might be in for the long-run rather than a quick buck was helpful to get the ball rolling.
While one can find that segregating, a wide distribution was ensured to make sure the chairs are sufficiently decentralized.
Nu is not just a regular coin, but a corporation. While I might find it unfair how it started and that not everybody could be in from the start, I did not make the rules; rules which helped Nu get where it is today: having issued a stable crypto currency that has kept the peg closely for almost one year.
Regarding the mechanisms with that Nu controls NBT supply to keep the peg stable I might need to expand the scope.
Nu is run by the 'fed chairs', the NSR holders. Nu is using a PoS process.
NSR holders that mint can cast votes each time they successfully mint a block.
One type of vote is a custodial vote.
With such a custodial vote NBT can be granted. They appear
from thin air by protocol on the custodial grant address as soon as 5,001 blocks in the last 10,000 consecutive blocks carried such a vote.
They are sold by the custodian and the revenue is meant to be distributed to the NSR holders, spent for development, spent for paying liquidity providers, etc. (whatever the intention of the custodial grant was).
This way new NBT get into circulation.
To reduce the number of circulating NBT there are basically two ways.
One is reducing the number of NBT only temporarily and in the end creates even more NBT:
parking.
Parking removes NBT (as far as I understand they are destroyed and created again (including the parking rate interest) after the parking period has ended), but only temporarily. Parked NBT will come back to haunt the network with even more NBT, because they generate a parking interest (which is voted for by, guess whom: the NSR holders). Parking was the reason why Nu was accused of being a ponzi scheme.
Without mechanisms to reduce supply permanently this accusation would have been fair.
Which leads us to permanent removal of NBT:
burning.
NBT burning has been available right from the start of Nu. A convenient, reliable, decentralized mechanism to fuel the burning was missing, though.
The NSR holders understood that and made the developers create another type of grant: NSR grants. NSR holders can vote for NSR grants like they can vote for NBT grants.
The same rules that apply to NBT grants are in place: 5,001 of 10,000 blocks are required, issued NSR are created by protocol at the NSR grant address.
The NSR custodian sells the NSR, buys NBT and burns them. An
example has been given by @CoinGame
Tada!
Any more questions?