NuBits is an experiment. NuBits are digital tokens that are designed to be worth $1.00 US (or equivalent) through various supply and trading adjustments. They could become worth less or more than $1.00 US in the event of a large demand decrease or increase, just like all digital currencies and assets that are not backed by real-world assets. When you purchase 1.00 NBT you are not purchasing a US dollar. You are purchasing a digital token that the Nu network will attempt to keep at $1.00 US as long as possible.
We won’t be certain that Nu works for some time. It is a bold experiment. As deficiencies of the system become apparent, shareholders and developers will iteratively adjust the system to make it stronger. I believe the pegging mechanisms are quite robust. The integrity of the decentralized ledger is of greater concern. However, the code base is a descendent of Bitcoin, which has been functioning effectively for several years. We have been careful during development to alter the fundamentals of the code base as little as possible so that we inherit the robustness and reliability of the Bitcoin network. I believe it will work, but Nu is a beta network without precedent in many ways, so the unknowns are considerable.
For now, no one should entrust the network with funds they can’t afford to lose.
— Jordan Lee, architect of NuBits