Bitcoin Forum

I'm starting a pirate pass through program where you would deposit bitcoins with me. I will then deposit those bitcoins into pirateat40's BTCST (https://bitcointalk.org/index.php?topic=50822.0) program. And every week, I will pay interest in LTC. I think this is a good way for someone to accumulate litecoins and it will help increase Litecoin prices.

There's some risk with this program. If pirate defaults, you will lose your bitcoins as I'm not in a position to guarantee that pirate's program is not a Ponzi scheme. Though I believe that he's not and I have backed that belief by putting a lot of coins of my own with him. Of course there's also risk of me running away with your coins. But I hope people trust me enough not to do that.

Some info about the program:

• Deposits should be made in multiples of 50 btc
• Interest rate will be 6.5%/week.
• All depositors will be listed in this anonymized payouts spreadsheet: http://ltcppt.com
• Interests payment will be made on Mondays after pirate pays his interest.
• I will buy the litecoins on an exchange throughout the week and will average out the exchange rate for everyone. I will be fair about it, but you kind of have to trust me there.
• The interest for the first week will be prorated (in granularity of days) based on when you deposited the coins.
• In the event interest payments are lost due to exchanges being hacked or running away with coins, I will absorb the lost and the depositors will still get their interest payments.
• If you need to withdraw, just let me know. It will take me some time depending on how fast I can withdraw from pirate. Should be <24 hrs.
• Your funds may be forced withdrawn if pirate forces a withdraw on me.
• If Pirate defaults, I would not be able to return your principle to you.
• Terms are subject to change if pirate changes his terms.

For now, I have a minimum deposit amount of 50 BTC. If you are interested, please PM me with a BTC withdrawal address and an LTC interest payment address. And I will send you a BTC address for deposits.

EDIT: On 8/13/2012, Pirate is switching to a new account system. With the new accounts, I am no longer able to get 7% a week. So in order to keep the 6.5% a week payout, I will be using another passthrough. There is now an added risk of the other passthrough stealing your coins. If that happens, I would not be able to return your principle.

You can also choose the option of accepting a lower weekly return (4.5%) but have no additional risk of another passthrough. If I decide to put your coins in a passthrough, I will take on the full risk of it. So your coin is only at risk of a Pirate default. If the passthrough I choose steals the coins, I will pay them back to you out of my pocket. If you want to take this option, please let me know.

EDIT2: I will be using payb.tc's BitcoinMax.

EDIT3: Looks like Pirate is lowing his rates on 8/20. With the new rates, LTCPPT would likely pay out 4.5%. Stay tuned.

EDIT4: All deposits and interests paid out.

What are the chances of losing my coins?

800k %

I'm in!

I trust you 120%

Is a minimum deposit of 100btc reasonable? Cause I would rather not deal with many small accounts.

If you have nothing to say, why post crap?

I think 50btc would allow a substantially higher number of people to participate.

Either way, I'm in.

Maybe you can bribe payb.tc for use of his system.

No, i meant 100 BTC and every week you will get litecoins equivalent of 4.5 BTC. I realize 100 BTC might be a lot for some people. So that's why I'm asking.

What's payb.tc's system?

chill bro...laugh =) ;D ;D

Coblee are you paying 4.5% in litecoins?

I like the idea, just a little out of my reach. Too bad GLBSE can't be used for things like this.

Yes.

And coblee, this: https://bitcointalk.org/index.php?topic=83904.0;topicseen

Let's get Nefario to make a GLLSE!

Why wouldn't someone just invest in a PPT that pays >6.5%/week, then turn the BTC dividends into LTC?

What might be useful is if you accepted deposits in LTC.

Pirate is significantly reducing his rates. Coblee will be taking at 0.5% fee.

Sorry, forgot about that. Could Coblee possibly have a Trust account with Pirate? I know 500 BTC is a lot of money, but it's just a thought.

And paid out in LTC as well...

That's just another passthrough, right? With the new rates, he will likely reduce his interest payments.

I would love to accept deposit in LTC. Problem with that is if LTC appreciates in value with respect to BTC, and then if you wanted to withdraw in LTC, I would have to take a loss to buyback those LTC.

I guess that's the risk you take making a service like this. That's how the game is played. You will need to give your users options like this otherwise it only benefits you.

Sorry, it's not in my best interest to have a situation where I would not want LTC to appreciate in value.

I would think what I'm offering benefits both me and depositors since they get more than pirate's regular account interest (which is 3.9%) and they get a constant stream of LTC every week without having to deal with mining or buying LTC at an exchange.

I created a poll. Please vote. And please don't pick the last option just because you think it's funny. :)

Of course he will. But the "system" I was referring to is his web site front end and his automatic payout and probably tracking system back end.

Depends on how much interest there is, I might create a web front end for this. But initially, I think a published Google doc showing anonymous accounts is probably good enough.

Let's do a test run. For those of you that want to deposit 100 BTC or more, send me a PM. I will get you into this week and I can pay 4.5% interest in LTC on Mondays. And if you need to get your coins back, just PM me.

For each week, I will buy LTC from the exchange and average out the exchange rate for all the interest payments.

By the way, until August when Pirate lowers his interest rate, depositors will get 6.5% a week. And your first week interest will be prorated based on which day of the week you deposit.

I updated first post with more info.

I would only consider this if the amount is small enough (somewhere around 50BC for me personally).

There is already risk involved because of pass through and the added fact that Litecoin is not really established yet only increases the risk. Don't gamble with what you can't lose and all that. Smaller amounts would work better.

A few people have asked me whether or not I can do a 50 btc deposit. I decided to do it. So PM me if interested.

So every week you get 4.5btc interest on your 100. That 4.5 is then converted to ltc at that days price and then given to the user. Is this correct?

Correct

I think its a great idea coblee. But I agree with the guy who said that deposits and interest need to be paid in litecoins

well I would like this too, but it cannot happen at this point unless someone sets up a pirate-style operation using ltc instead of btc. or a ponzi-scheme.

you cannot operate a pass through to pirates btc fund as the risks are just too huge for coblee, with minimal rewards. look at the recent ltc/btc price swings..

i just came up with this idea myself today but after a forum search i see that coblee beat me by 2 days :D

it would be good if deposit/withdrawal was in LTC, but you just have to manage the exchange risk somehow.

...and that would all be a lot easier if there was a litcoinica.com for shorting LTC.

Coblee, did you buy tons of Litecoins? All those huge buy orders took the price up on BTC-e.  It seems to be very profitable to get dirt cheap Litecoins, push the price up and pay interest in Litecoins.
Just wondering...

Same question here...

I've bought only enough to pay the interest payments next week. Not enough to push the price up. But I did buy them before the run-up, so depositors will likely get more litecoins next Monday compared to the current exchange rate.

I plan to buy litecoins through the week so as to get the best price and minimize a run-up on Mondays.

By the way, I'm not doing this for profit. The .5% fee is basically for my time and effort. Also as long as pirate does not default, then I'm guaranteeing your coins. So if my wallet gets hacked or if btc-e gets hacked, I will personally cover all the loses.

Nice and honest answer. I like that.
To pay the interest, how many coins do you have to buy every week?

same as steve jobs, then.

he didn't do it for profit, he only got paid for his time and effort.

how many licks does it take to get to the center of a ponzi scheme ponzi pop

Only two things are infinite, the universe and human stupidity, and I'm not sure about the former.
Albert Einstein

way to be different coblee!

I just buy however much I need to pay for interest. So if you deposited 100 btc, then every week I send 6.5 btc to btc-e and buy litecoins throughout the week. I can figure out the average exchange rate based on how many litecoins I get.

Good news for this week is that I got the coins for an exchange rate of 0.00164816.

Well think of it as a non-profit organizations. The employees still get paid, right? :)

To me the obvious solution to that problem is to just keep the user's balance in BTC.  The simplest (but not best, most likely) solution is to just take the most recent price for BTC/LTC and use it to convert a deposit into BTC.  This is susceptible to a user running up the price by buying a lot of LTC, then depositing it all before the price stabilizes, causing you to take a loss.  A better solution would be to use the same average exchange rate that you are finding when paying interest, such that deposits of LTC are pending until the end of the interest period, at which point they are converted and put into the balance.

I feel like accepting LTC would make your PPT really stand out among the ones available, and it would help reduce the number of LTC you have to buy on the open market.  Essentially what you would be doing is cutting out the share that the trading website takes, because instead of investors selling their LTC for BTC, then you converting BTC to LTC to pay interest, you just pay out some of the LTC sent to you. 

It would be good if you had a website you could just visit and make a deposit.  It would also be good to be able to deposit down to 1BTC.

Eventually, I might have that. For now, please PM me if you'd like to deposit 50 btc or more.

First interest payments have gone out! Since I was able to get LTC pretty cheaply at 0.00164816, you guys got a great deal. Some of you got an effective 25% interest. :)
See ltcppt.com for details.

Interest payments have gone out at a rate of 0.00503020

I received the interes from Pirate. I will pay out interest shortly. The payout amount is already on ltcppt.com.

Sorry for the delay. Payments have been sent at an exchange rate of 0.00518578.

Cool idea :)

I would deposit if you lowered the minimum to 10 BTC.

Sorry, only doing multiples of 50 btc for now. It's really too much work do anything smaller as I don't have something automated set up.

By the way, Pirate has not paid out interest today. I will send payments as soon as he does.

No problem, I understand. I'll just have to get some more BTC together :)

Btw, Bitcoinmax has applied interest so Pirate may be in the process of paying now.

no, those are only database entries... haven't received BST payout yet.

Ah, thanks for the correction.

What time does he normally pay by?

I would normally expect payments about 5 hours ago. So he's late today. But please don't panic yet. :)

I was just curious is all. No intent on causing panic like a person's name I won't mention.

But please do post once you have received the payment.

I got pirate's payment. And interest payments have been sent.

Luckily, I exchanged for the litecoins throughout the week and withdraw them Yesterday. I'm not sure what's going on with BTC-e. I may have to use a different exchange next week.

I think BTC-e got hacked, at least that's what I heard on IRC.

I might use Vircurex, but that seems to be down. I will post when I have more information. Thanks.

Apparently btc-e will have most everything sorted out in 1-2 days, all transactions during the period of hacking have been reversed, only ~4500BTC were stolen (still a lot, but most of their BTC was in offline cold storage). So you will likely still be able to use their service. :)

I will likely use the new Litecoin exchange: https://ltcexchange.bitparking.com/main

Perhaps not a bad idea. Nothing against btc-e. Good to know we have two exchanges now. Well 2.5 if you count vircurex.

I want to emphasize that even if I left the LTCPPT interest in btc-e and lost it due to the btc-e hack, I would absorb all the loss myself. I would make sure depositors of LTCPPT get their interest payments. Only in the event of a Pirate default, would there be a loss of principle. So the 0.5% fee I charge covers the work to exchange the interest payments into litecoins AND the insurance against any mishandling of the principle or interest payments by me or any exchanges I use.

sent you a pm coblee

Find someone who wants to write options and take a long straddle (http://en.wikipedia.org/wiki/Straddle), if you think it's too volatile. Worst that can happen is you lose the premium you paid for the options (if the price is stable).

Payments are going out right now. Thanks.

what is this Pirate Pass Through all about?

many of my friends is talking about it, but i can't seem to find some good info about.

can someone tell mere about?, i'll love to support, but i also won't to know what i'm doing :)

Essentially Pirateat40 runs a deposit system that pays up to 7% weekly on deposits (so if you put in 100BTC, in 1 week you could have 107, although you need large amounts to invest directly with him). People who do have accounts with him give passthroughs, where you deposit your 100BTC with them, they deposit it in pirate at 7%, and they pay you a certain amount (hashking gives 6.75%, Bitcoinmax.com 6.9%).

Coblee is providing a service to do a pirate passthrough with bitcoins, but pay out the weekly interest in litecoins, a very cool idea.

Do you guys think there is sufficient volume to open a LTC Exchange? Extending Cryptostocks to LTC would take a few days only, question is only whether there is sufficient LTC volume available on the various exchanges (Bitparking, BTC-e, Vircurex, any others out there?) to handle the potential load of LTC coins that are going to come.

It would be really nice if Cyptostocks would support LTC, including orderbooks for securities, and payment of dividends directly in LTC. It would help a lot having such a infrastructure to form more LTC and multicurrencies companies...

I also thought the developers of LTC believed in the immunity of Scrypt towards GPU acceleration. But that's another tangent.
Thanks but no thanks, my personal caveat emptor here! 

With the new Pirate accounts, I will only be able to get 5% a week instead of 7% per week. So instead of changing my passthrough to return 4.5% a week, I am thinking of using another passthrough to get 6.8% or 6.9%. And I can keep LTCPPT at 6.5% payout. The downside is that there's now another person you have to trust. I will likely go with Chaang Noi's passthrough. I have had many business dealings with Chaang and I trust him. Here's his profile: https://bitcointalk.org/index.php?action=profile;u=44233

I will be PM'ing the current depositors to make sure they are ok with this change. If you are not, I can return your deposit. This change will happen on Monday and will not affect this week's interest.

Don't you have enought volume to get 7%? I was going to invest 100 Bitcoins but I am not confident with another person in the chain.

Unfortunately, with the new interest rates, not even close:

It's quite a risky idea if you don't know whether it's a Ponzi or not. I have lost 50 Bitcoins to Bitcoinica, and I'm not sure that as lead developer of ltc you should take on a high risk like that. People trust you and if you mess this one up, or if Pirate does, people will be mad at you anyway. It won't help you then that you told them "at your own risk only" when you ask people to trust you because you are convinced Pirate is not a Ponzi. It's a crazy, greedy idea and you could significantly hurt the entire Ltc project because of the connection between Ltc and your name and reputation. Personally, I want Ltc to be a success. Not sure what you're doing is the way to achieve that.

As well, coblee can't just make the litecoins out of thin air, he is buying them on the exchanges, meaning that, in the end, every week the interest in BTC is used to buy LTC, increasing the price of LTC, perhaps quite significantly if this service really catches on. I'd invest in something like this, but I only have like 25 BTC. :(

I'm doing this because I think this is a good way for people to accumulate Litecoins. And this will help the price. Of course there is a risk with Pirate. I think I'm pretty clear about that. If Pirate does default and LTCPPT does blow up, people might be mad at me. But it's not going to hurt the Litecoin project.

Reinvest the litecoin interest in what? Are you saying you don't want me to pay you the Litecoin interest and instead compound the btc deposit? In that case, you wouldn't get any litecoins. So mind as well invest with bitcoinmax.

I think coblee already doing what you are saying.
You send investment in bitcoins to coblee, he send it to pirate , he gets interest from pirate as bitcoin, he then buys litecoins from market & give you litecoins as interest to you.
If you want to withdraw then you get your deposit in bitcoin

Correct, I am using Pirate to turn bitcoins into more bitcoins. I currently have no way to turn litecoins into more litecoins. So reinvesting litecoins with me does not work. You can have the bitcoins compounded and then when you want to withdraw, you can exchange them all for litecoins. But then you don't need LTCPPT for that. If you want, I can hold the litecoins interest for you until you want them. But of course, those litecoins won't be generating anything every week.

Another passthrough that I'm considering using is payb.tc's bitcoinmax.com.

An option I'd like to open up to depositors is the option to be insured against the passthrough stealing your money. If you like to take that option, you will only get 4.5% interest a week, and you will only be at risk of a Pirate default. If I decide to put your money in a passthrough instead of directly with Pirate, then I take on full responsibility of the passthrough. In other words, if the passthrough steals the coins, I will still pay you back your deposit. If you'd like that option, please let me know.

Could you be clearer on exactly what you are insuring against?

Is it against the fact that you don't get payouts from say payb.tc's passthrough that is obviously connected to pirate's passthrough? Meaning if pirate ran with the money (while using paybt.c's passthrough) you WOULD or WOULDN'T insure it?

The insurance is only against payb.tc running away with the money and pirate not defaulting. If pirate ran away with the money, you will lose the coins.

By the way, it doesn't make sense for anyone to provide a fully insured passthrough. Because they would take on the full risk of a default and only the partial gains of the investment. So they mind as well just invest the money themselves.

i wrote similar reasoning in my thread, however i did later think of one reason where it might make sense:

where the passthrough operator doesn't personally own many coins, but can back up 'insurance' with other assets.

eg. if they own 100 btc, they could invest that in BST directly and get ALL the interest.

or, if they wanted to take the gamble, they could offer a 'fully-insured' passthrough and get maybe half the interest on 10,000's of BTC. *in this case the operator would be gambling their house and car and other assets because upon default they wouldn't have enough coins to cover it.

That's true. But if that's the case, there's a very good chance the insurer would just default when Pirate defaults.  They are basically borrowing money to gamble with. That's not someone I would deposit money with.

yes, it would be a very risky bet for both the passthrough operator and his lenders. not something i'd do.

Hmm all of this borrowing and lending and "passthroughs" makes me just doubtful that the end result (whether sooner or later) will be a happy ending.

I just don't see this entire "pyramid" unwinding with no one losing money.

Just my take.

Insurance is something I would consider if it fully existed and not partially covering one entity running with the money.

I can keep wishing I guess... ;)

It all depends, offering only 100% secure deposits isnt rational at all. But when u run multiple stuff you may use this as financial buffer. Like in my case, I`ve bought insured ones from goat, but currently i dont need them. And in his place he offered scheme where we share responsibility, it`ll take my 2.5 month to get back my overpayment, and he`ll need 4-5 months to start getting profit even if pirate fails. But if he dont Goat would have a whole bunch of coins, so why not?)

This is the type of talk that in hind sight will sound ridiculous should any of the pyramids in place fall apart.

For someone to borrow your bitcoins at interest they need to be able to make a profit (crazy amount) to pay you and to have left over to call their own without it being a ponzi scheme.

Asking for insurance is rational.

Once again this shows you my thinking in that I'm not willing to risk 100% of my principal investment capital to make 7% a week with zero insurance.

I won't tell you what to do with your money.

 ::) ::) ::)

Edit: Yes I saw goat's insured pass through...with pirate cutting rates soon the % won't be much given goat will be taking 1.5% of the x% pirate gives. x - 0.015

Is there smth i dont know about pirate, or rates are still going to be 7%/w for big accounts(with subs)? At least for 2 more months, and after you will have your bond amount fully insured, not so bad if u want to stay with btc for a long time...

It all  depends on what u want to get, because every 3 month u get 100% of your money, which would be 100% insurance after) It`s all depends on what u want to get.

It seems like you just want a free lunch :)

I changed the poll. Please vote.

Hehehehe...oh yes! :D

Someone told me that they already have money with payb.tc and they trust him so they will be happy for me to use him. Someone else told me that they also already have money with payb.tc, so they don't want me to use him because they want to be diversified. Go figure!

Here's what I'm planning on doing. payb.tc has a great website to keep track of deposits, so it will make my job easier to go with him. I will default all accounts to use payb.tc unless you tell me otherwise. So if you care, please let me know.

Ok, I've transferred all the coins to payb.tc (BitcoinMax) and Chaang Noi. By default, coins will be held at BitcoinMax. If you'd like me to hold your coins with Chaang Noi, please let me know. Also let me know if you like me to hold the coins directly with Pirate for 4.5% weekly interest. Please be aware that if your coins are with payb.tc or Chaang Noi and they default (i.e. steal your coins), then I will not be able to pay them back to you.

Thanks for working on the different solutions, I'm sure every depositor has a solution that will work for him/her.

Will there be dividends this week because of this change?

Yes dividends being sent out now.

What are the interest rates going to look like for LTCPPT with pirate's new adjustment?

Assuming payb.tc is paying 4.9% interest, LTCPPT will be paying out 4.5% interest. Thanks.

Also, I think I will stick with just using payb.tc's BitcoinMax for passthrough for now.

Well, all good things must come to an end. LTCPPT is closing due to Pirate closing. I will actually return your deposits before pirate returns them to me. And I will send out the litecoin interests on them today. If Pirate does default, it's my loss and not yours. Thanks for trusting in me.

Ok, all deposits returned and litecoin interests paid out. Thanks.

Here are some final stats:

Interest received from Pirate: 445.93 BTC
Total litecoins paid out: 103,376 LTC
Average exchange rate: 0.00431367

Wow coblee, that's a huge gesture you are making there. I think everybody knew the risks when they signed up so you did not have to do this at all. Much appreciated and keep us in the loop.

Told you it was a dumb idea. I hope Pirate will indeed refund your coins. Otherwise, no sympathy from me.

Oh please... ::)

come one man? the man is doing a good job here.

No need to be a prick, he has paid everyone back and taken the full financial risk of a hit on his own wallet. That's called integrity in the face of adversity.

Obviously perfect people like you who never make mistakes wouldn't understand this concept..

Good Job Coblee.

Thanks Coblee for setting this all up....definitely appreciated it. :)

Coblee, can you think of any other investing opportunities that can have a positive effect on Litecoin? 

Coblee, let us know when you get your coins back from pirate please.

Thanks!

Thanks Coblee,

great service.

I'm on the tail end of development for the core features of Litecoin Global. (https://www.litecoinglobal.com/)  You could accomplish something similar by setting up a fund.  Trade the shares in LTC, but have the fund invest in BTC assets.  The BTC assets would pay in BTC, which would then have to be converted to LTC to pay dividends.

Coblee, did you get your coins back from Pirate?

Not yet  :(

Turn that frown upside down! :D