If no sellers are available because demand outpaces supply, reserve ndau is released and sold at the target issuance price. This ensures new ndau are issued only when the market can accept it. There is a finite amount of ndau (1,000) at each price level on ndau’s target price curve. All net proceeds are held in an endowment, managed by a nonprofit foundation, for the purpose of managing ndau’s monetary policies and implementing open market operations, much like reserves used by a central bank.
Hold & Use
The holding of ndau is rewarded by steadily increasing EAI based on the number of months held, coupled with an additional incentive of up to 5% for holders who lock ndau in their wallets. Unlocked ndau can be transferred to and from other holders directly within the ndau wallet app.
ndau’s monetary policy includes price stability mechanisms that trigger during moments of negative market pressure. ndau is subject to Stabilization Incentive Burn (SIB), a dynamic fee that is activated whenever the market price is more than 5% below the most recent issued price, to dissuade further sell-off. If selling pressure escalates, the SIB becomes more costly.
If market price falls to a published floor price, the foundation is obligated to buy back and burn ndau from the open market using endowment funds to decrease supply, thus driving the floor price upwards, to stimulate demand and further stabilize ndau’s price.