Bitcoin Forum

So your friends or family may not get this whole "Bitcoin" thing and just "don't trust it", so they will not put any money into it.

Fine, their choice. But if they must keep their money in dollars, at least tell them that on https://www.bitfinex.com/ they can be getting 244% interest on their dollars.

So anyone who knows about Bitcoin right now can either be making 2000%+ in Bitcoins or 244% value in dollars.

That is not a bad spot to be in.

Does anyone see any downside to the 244% interest? I was going to tell my family (who I told about Bitcoin when it was at $11/BTC) that at the very least if they are not investing in Bitcoin they should get 244% interest on their savings.

i had a buddy wanting to invest in the $50's  I told him to wait because I didnt want to feel responsible if it crashed.  Now he hates me   hahaha

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Bitfinex disappears, gets hacked, or gets "hacked" resulting in a 100.000000% loss?

Note I am not saying they are shady but that is the "downside".  Interest earned is meaningless if you never actually get it.

Just keep in mind, in order to get this 244% interest, you need to give your money to what is essentially a fly-by-night organization that came into being using the same codebase as another organization that was repeatedly hacked and eventually went under losing a lot its users a lot of $$ and BTC.

OK... so the above may be a bit over the top.. Bitfinex HAS done a lot to clean up their codebase, and I think they probably do not have any intentions of taking off with everyone's $$...   

The point remains.. this is not a risk free 244% return on investment..  you have to trust a very young company as a counterparty.

As always, don't risk any more than you can afford to lose.

Sigg

Correct me if I am wrong, but isn't Bitfinex one of the safest exchanges/lenders? You have to wait for a manual withdrawal which is done once daily. Also, on the USD side, I am pretty sure its more virtual than you would think. So the only downside I can think of is if they run with your money, a hack is unlikely.

As far as I know you are correct... However, as you state, the only downside is you have to trust them not to run off with your money..    I seem to remember this guy on the forums that went by the name "pirate" also was trusted by a lot of people not to run off with their money....

Would I trust them with $1k.. yeah.. I do..
Would I trust them with my life savings.. not bloody likely..

Would I trust the largest bank in Cyprus with my life savings..

Would I trust the largest bank in the US with my life savings...     

Anyways, you get the picture..

Sigg   

Putting aside the counterparty risk for the moment, there's the matter of funding your account and cashing out. Getting money into/out of Bitfinex is going to get a lot harder in about a week, when Mt. Gox USD codes become impossible to create. You'll have to either transfer bitcoins from a better-connected exchange and eat the spread, or use an international wire which costs like $30 each way.

I kind of had the other problem. I suppose everyone just has to put their big boy pants on though.

It was around $37 and I told a friend he should buy the $100,000 block. He balked though because it was at an all-time high so I sold the block to someone else. Then two more $100k blocks crossed my desk around $50 which I offered to the same friend and he balked again so I sold them elsewhere. Then $100k at $85 which he balked at so I sold to someone else. Then 2 $100k blocks that he balked at again. Every time I told him the price was only going higher and that bitcoins are getting increasingly scarce and because of network effects actually getting more undervalued despite the increase in price.

Well, finally closed a few deals today and he picked up a $100k block. About time. Guess it is time for a correction!

I remember lots of people saying that bitcoinica was one of the safest exchanges/bitcoin services, and I have 150 or so less bitcoin from that.