Deprived, any word on if you are going to proceed with relisting?
It's my intention to relist, yes - but don't expect any immediate resolution of it. I've nearly completed a pretty long message which will be sent to Bitfunder and Havelock - explaining the benefits to them of us relisting there and asking various questions that will allow me to determine which best fits our needs (only really relevant if both actually want us - neither may) There are other options potentially available but those two possibilities are my focus for now. The actual process of migration to either would be very simple (maybe moreso with Bitfunder as they already have procedures/tools in place from taking in GLBSE refugees). Making sure we choose the best platform in terms of our needs (either in available functionality - or in scheduled future changes) is most important to me - but if it's close on those then the preference shown (so far) for Bitfunder would be the deciding factor. One - or both - of them may not have interest in accepting DMS. If both, then obviously closure comes back onto the table - but those two exchanges aren't QUITE the only options (Cryptostocks is NOT an option at all). |
|
|
|
Doog could show my chart, it has a nice graph to it until I busted.
Same for everyone else with a system - their graphs look good until they bust. There's a reason for that. Just the rest of them don't then try to beg other people to fund the next bet in return for SOME of the profit (when of course any investor could make the bet themself and get ALL the profit and none of the CP risk). |
|
|
|
The bonds have a face value for a reason, there should be no talk of discounting that.
BTCT/LTCG's closure does not affect their regular business operations (unless their business operations happen to require regular dilution of shares to stay afloat...)
+1 +2, all other bond/fund/stock operators are considering a move to either BF or Havelock, so there shouldn't be any discussion of closure or hostile buybacks, as this hasn't affected the underlying business whatsoever +3 i am wondering me why Kate is publishing news of procedere only on LTC-GLOBAL and not on BTC-TC where bonds are listed. Btw a listing on BitFunder (or Havelock) will be best way for all .... i believe in Ciphermine Well CIPHERMINE itself is only listed on LTC-Global. What happens with the bonds will logically follow on from whatever happens with CIPHERMINE itself. I'm one of the largest holders (either largest or 2nd largest) of these bonds (on behalf of DMS) so obviously I'm as concerned as everyone else with what will happen. What I DO know is that Kate IS actively looking at various alternatives - there's a private sub-forum for LTC-Global issuers where various discussions are ongoing. So whilst I can't give you any actual hard news (as, to the best of my knowledge there isn't any) I can, hopefully, reassure you that at least Kate and her team ARE actively looking into and discussing various options. |
|
|
|
So, does this mean that decreasing the max bet below the optimal value increases our aggregate exposure to a counter-party failure but does nothing to improve total profits?
affirmative Correct. Yes - with a minor caveat. Whether it ACTUALLY improves or reduces profits depends on what specific bets everyone makes that are different to what would have happened had the max bet not changed. But it reduces expected profits (unless someone has a reason why they think betting volume would INCREASE). |
|
|
|
Difficulty just jumped by 32%. Tomorrows SELLING dividend will be 1.189 mBTC, the new MINING dividend will be 1690 satoshi per day.
Agree with the new MINING dividend but getting a very different SELLING dividend. Yeah, I found an error in my calculation. I don't have access to my desktop machine with most of my Mathematica notebooks (including DMS calculations that do tend to give good results), so I hastily slapped something together. Calculation's easy if you know the previous day's NAV/U (in last report) and the new MINING divend. NAV/U - (401*MINNG DIV) = SELLING DIV i.e. how much of NAV/U is left to dividend out if we set aside 401 days of it (400 as that's the reserve target plus 1 for tomorrow's MINING DIV). That's not how I work it out - as I have to recalculate it based on actual new NAV/U, but now we have nothing generating income other than the last few days of the CL CD (plus CIPHERMINE.B1 dividends each weekend) it should be pretty exact. Checking it I get : 0.00859085 - (401*0.00001690) = 0.00181395 Which is, of course, slightly different to what I posted as well. Turns out mine was wrong too - as I'd not adjusted the cash in account on BTC-TC to the current figure (so it still had the one from yesterday's report without yesterday's MINING dividend removed). So here's a better version of the spreadsheet : BTC Balance (BTC-TC) 1127.676895 9071 LTC-ATF.B1 90.71000000 CIPHERMINE Bonds 360.61000000 Coinlenders CD 27/9 203.3303975 Coinlenders Cash 0 Just-Dice Balance 153.86146722 TOTAL ASSETS 1,936.18875994 Outstanding MINING 210981 Outstanding SELLING 210981 Outstanding PURCHASE 14397 Effective Units 225378 Block reward 25 Difficulty 148,819,200 Hashes per MINING 5000000 Daily Dividend 0.00001690 50 days (Min Liquid) 0.00084483 100 days (Forced Close) 0.00168966 365 days (Buyback) 0.00616724 405 days (IPO) 0.00684311 400 days (Post SELLING div) 0.00675862 410 days (Pre SELLING div) 0.00692759 NAV Post MINING Div 1,932.38064697 NAV/U Post MINING Div 0.00857395 Days Dividend Post Div 507.44 SELLING Dividend 0.00181533 NAV Post SELLING Div 1,523.24518627 NAV/U Post Selling Div 0.00675862 It still differs from the quick calculation - but only in last few decimal places which is down to the spreadsheet using internally longer precision for the MINING dividend (which when multipled by 225000 ends up altering results a tiny bit). |
|
|
|
Burnside, when I log in, I am getting "Access temporarily denied."
I won't press the panic button, but maybe you can phrase it clearly for others who do panic.
What is this about? I need to get into my account...
Should be in the FAQs. It usually means one of a few things: 1. Failed login attempts on your account, 2. Excessive connects/requests from your IP address/range (i.e. you triggered anti-DDOS protection). Give it half an hour and try again and it should be fine. |
|
|
|
If any investors wanted a max bet .25% of their roll they could have divested 3/4ths of their investment.
If all investors wanted this than the investors bankroll would be about 8,000 with 1% max bet , which is the same thing as 32,000 invested at .25%. Both give a max bet of 80 BTC.
Why couldn't Doog just divest all accounts by 75% if he was scared of whales placing too big of bets.
It would be less risky for investors to keep 8,000 with the site at 1% max bet than 32,000 at .25% max. Now we have to trust Doog with 4x the amount in cold storage.
Now with a .25% max bet as soon as the steady profits start new investors will come which will further dilute all the current investors making it harder to recoop loses.
Whales should be treated like VIP, regardless of how they act, as long as they continue betting. Each 300 btc bet was an expected gain of $360 to investors.
Perfectly valid points - and ones which were belaboured at length the first time nakowa had big wins. Unfortunately some invesotrs *cough* mechs) seem to have some reason to want as much capital as possible left with dooglus rather than manage their own bankrolls, risk and variance. It's not so much that THEY want low variance (but high CP-risk compared to likely profits) but that they want to insist on everyone else doing the same - despite 1% being optimal Kelly and thus giving investors the most ability to adjust. |
|
|
|
Some simple risk of ruin math introduced here.
Assumptions:
- The whales have enough capital to try and break the bank without going broke.
- JD is considered "ruined" when the bankroll drops from 30,000 BTC to 5,000 BTC. Considering the panic already seen among investors, this is a very conservative estimate.
With a 1% max bet the risk of ruin is surprisingly high: 18.2%
With a 0.5% max bet it drops drastically to: 3.3%
With a 0.25% max bet it is miniscule: 0.11%
Also, Kelly criterion does apply for the best long-term ROI, but with kelly betting you can never go broke. Just eventually the max bet would get into the satoshis and nobody would play.
Those figures are clearly wrong. Did you happen to forget to reduce max bet when the whale wins? |
|
|
|
Another Option
On another option that hasn't been explored much, perhaps we should have an option where investors can choose to be based on amount wagered instead of amount won - at say a substantial reduced amount - example would be at 40% house 'risk cut'.
This is best explained with an example e.g. for an investor owning 1% of the house invested with current house edge of 1% - 5000 BTC gambled a day that's 50 profit or 0.5 BTC a day with pure winnings (as JD is now). With pure-wagered the penalty would be, say, 40% cut so it would be 5000 BTC a day, 50 expected profit, 1% own of the house but 40% cut so 0.6 / 100 * 50 = only 0.3 but that value is guaranteed.
To make it more elaborate, make it so there is a sliding scale of 0 to 100 on how much risk you want to take. If you chose to go 'winnings based' (this is how JD is now) then you take the risk of win and loss as people win and lose. If you choose to go 'wagered based' then you take the risk of not profiting as much when people win, but a lower but more stable income. To make the math work, the excess profit from those people who are on 'wagered based' when the house is up goes into a pot, and that pot is used to pay these people out when the house loses. I will have to think about the math a bit more to make certain it all adds up.
Keen observers will notice that 'wagered based' is very much like the model for letsdice.com - but with a lower (1%) house edge.
Will
So if everyone chooses 0% risk and the house loses who covers the losses? For such a system to work requires that for anyone taking under 100% risk there is someone taking over 100% risk - that can't be achieved by allowing people to move their own risk around as they see fit : it needs someone committed to covering all losses. And if someone's doing that then they don't need investors at all. The letsdice model is "grab as much cash as we can, make some promises and hope we can then deliver on them - whilst not actually having any customer base to warrant the investment and with zero liquidity so investors can back out once they realise that". |
|
|
|
NAV Post MINING Div 1,937.41333771 NAV/U Post MINING Div 0.00859628 Days Dividend Post Div 508.76 SELLING Dividend 0.00183766 NAV Post SELLING Div 1,523.24518627 NAV/U Post Selling Div 0.00675862 Sorry first time I am reading one of these reports so forgive the ignorance. Selling will get 0.00675863 for the ten-day dividend and Purchase gets none because it is frozen? Thanks for your time, HowlingMad [/quote] PURCHASE gets the MINING dividend AND the SELLING dividend - as each PURCHASE is exactly same as 1 MINING + 1 SELLING. The .00675862 is the NAV/U (value) of each PURCHASE (or each pair of MINING+SELLING) after the dividends are paid. The SELLING dividend is : SELLING Dividend 0.00183766 Every PURCHASE will get that AND the MINING dividend tomorrow. |
|
|
|
Difficulty just jumped by 32%. Tomorrows SELLING dividend will be 1.189 mBTC, the new MINING dividend will be 1690 satoshi per day.
Agree with the new MINING dividend but getting a very different SELLING dividend. This is EXACTLY what tomorrow's report will look other than a minor adjustment up in the Coinlenders CD (which I actually didn't do in last report - but it has trivial impact): BTC Balance (BTC-TC) 1132.709586 9071 LTC-ATF.B1 90.71000000 CIPHERMINE Bonds 360.61000000 Coinlenders CD 27/9 203.3303975 Coinlenders Cash 0 Just-Dice Balance 153.86146722 TOTAL ASSETS 1,941.22145068 Outstanding MINING 210981 Outstanding SELLING 210981 Outstanding PURCHASE 14397 Effective Units 225378 Block reward 25 Difficulty 148,819,200 Hashes per MINING 5000000 Daily Dividend 0.00001690 50 days (Min Liquid) 0.00084483 100 days (Forced Close) 0.00168966 365 days (Buyback) 0.00616724 405 days (IPO) 0.00684311 400 days (Post SELLING div) 0.00675862 410 days (Pre SELLING div) 0.00692759 NAV Post MINING Div 1,937.41333771 NAV/U Post MINING Div 0.00859628 Days Dividend Post Div 508.76 SELLING Dividend 0.00183766 NAV Post SELLING Div 1,523.24518627 NAV/U Post Selling Div 0.00675862 |
|
|
|
Deprived, the offer of exchanging MINING+SELLING for some of NAV/U and then a certain amount of CIPHERMINE bonds that could be sold into the market represents a loss of 23% off of original NAV/U. This is made worse by the statements that Kate has given regarding her lack of interest in dealing with small owners of her securities. As you are a major holder, I and i'm sure many of the other individuals who want to exchange MINING+SELLING for NAV/U*.99 would like to see you continue to try and get the bonds redeemed at face value as quickly as possible.
No it doesn't represent a loss of 23% of NAV/U. It would represent a loss of 20% of 23% of NAV/U - so a bit over 4%. And that loss would only be for those who chose to sell out AND chose to then sell the CIPHERMINE.B1 into bids on the market. If you're aware of some option I'm missing to redeem the bonds at face value then let me know - the only option I know of is to give 3 months notice and surrender all right to dividends in the meantime. Which anyone who cashes out will be entirely entitled to do with their own bonds once they get them. For those who don't cash out, I obviously intend to try to liquidate CIPHERMINE.B1 down to under 25% of capital as soon as I can (assuming it gets above that after next difficulty change). My belief is that we risk more trying to request a cashout immediately (which would only occur in 3 months) than waiting a week or so to see what Kate proposes. In short, excessively chasing these up right now would be less likely to get us what we want (to continue to get our interest and be able to slowly sell them off at face value) than having a bit of patience. Once I have convincing assurances then, at worst, I'd offer to buy them back personally off investors at much nearer face value than the market gives. And once I have such assurancces then, at worst, those looking to cash before moving would get either bonds + 100% of remainder of NAV OR the 98% of NAV promised in the contract. Without the actual ability to sell at face value there'd always be a discount on cash withdrawals - as all risk associated with those bonds backing your share of NAV is being left for those not cashing out. |
|
|
|
I've been very happy with the operation of this asset until this time. Deprived, you stated that you had a good idea that the closure of BTCT was coming - why did you still continue to pursue an investment in CIPHERMINE if the liquidity of these bonds could have been such an issue, especially at such an early date?
SELLING did approve the investment, so a significant amount of responsibility lies there, but this investment is only 1-2 weeks old and there is already talk of liquidation value.
I only became confident that was the case within the last week - after the CIPHERMINE.B1 investment. I wouldn't have proposed it or done it if I'd believed at the time that there was a significant likelihood of BTC-TC's imminent demise. My belief changed from "he's having to pay lawyers to tidy up the TOS and/or get rid of US customers" to "This looks like closure is a real likelihood" at the point where signups and asset creation were disabled and he didn't respond to the initial queries about it whilst answering other questions. That belief is why, the evening before BTC-TC close, I sold back 1K CIPHERMINE.B1 at about .0103. Until then I'd only been trickling them out at .0105+. At that point, whilst I still rated closure as a fairly likely outcome. I DID expect there to be significantly more time until the shit hit the fan : so I didn't want to scare the market down. |
|
|
|
The number of people disagreeing with Dooglus outnumbers those agreeing by 2:1.
I hope he reconsiders what he's done. He listened to mechs instead of listening to 30,000BTC in investors who left their money in at 1%.
+1 Setting your own risk % is the solution to this madness. What would happen then if I always increased my risk % to something high like 2.5% when the fishes were playing, and then decreased back to 0.25% when a whale comes along? You will lose the big wins. Think of it as a less extreme version of divesting when the whale comes along. OK that makes sense. But what if I also increase to *over* 1% when the fishes are playing? Like Oleander pointed out, would I not be diluting all the other investors that don't actively manage their account? Easily fixed - only allow people to change their risk level once per day. Then people can't game it - and have to pick the risk level they'll take for ALL action. The house doesn't need backing for the small bets - so if you want a share of those you should also have to take a similar part of the big action. People could still divest/reinvest when whales were around - but there's no stopping that whilst giving people control of their money. And the people who routinely divested when he bet before at 1% risk will likely do the same at .25% risk if a whale starts winning again - so it's not a new problem. |
|
|
|
|
Either he was cheating or he wasn't.
If he was cheating (which I still believe VERY unlikely) then the solution is to fix whatever needs fixing to stop the cheating working - lowering max bet would be shuffling the deck chairs on the Titanic.
If he wasn't cheating then it's a pity to have changed J-D from being the site whose motto could have been "we welcome whales" to "we shit our pants if a whale swims anywhere near".
And mechs not wanting him to play there because he thinks the whale is an asshole is stupidity climbing to a new peak. If I offer -EV bets then I'd FAR prefer to have assholes betting against me than people I actually like. But I'd happily take action from either - that's what the business is for.
The problem I see here is predominantly one of fear from people who want to dump all/a large part of their investment in J-D and treat it like a bank. Rather than treating it as just one high-variance/high-expectation item in a diverse investment portfolio.
I personally divested yesterday for the first time - but only because I needed more liquid BTC immediately after BTC-TC announced closure (to try to grab some bargains - the few hundred BTC I keep as cash having been used to buy my own investors on BTC-TC/LTC-Global out immediately at full value). Those funds would have been returning to J-D within weeks - they still might, but if the site loses its big action then EV is going to fall a lot (I don't care about variance - my own bankroll management handles that).
EDIT: I have no problem with the idea of investors setting their own risk level. I wasn't keen on it - but it's far preferable to the house using a non-optimal kelly that we can't compensate for.
|
|
|
|
|
BTC Balance (BTC-TC) 1132.709586
9071 LTC-ATF.B1 90.71000000
CIPHERMINE Bonds 360.61000000
Coinlenders CD 27/9 203.3303975
Coinlenders Cash 0
Just-Dice Balance 153.86146722
TOTAL ASSETS 1,941.22145068
Outstanding MINING 210981
Outstanding SELLING 210981
Outstanding PURCHASE 14397
Effective Units 225378
Block reward 25
Difficulty 112,628,549
Hashes per MINING 5000000
Daily Dividend 0.00002233
50 days (Min Liquid) 0.00111629
100 days (Forced Close) 0.00223259
365 days (Buyback) 0.00814895
405 days (IPO) 0.00904199
400 days (Post SELLING div) 0.00893036
410 days (Pre SELLING div) 0.00915361
NAV Post MINING Div 1,936.18968626
NAV/U Post MINING Div 0.00859085
Days Dividend Post Div 384.79
SELLING Dividend -
NAV Post SELLING Div 1,936.18968626
NAV/U Post Selling Div 0.00859085
Posting report slightly early as I have to go out later and may not be aorund at usual time. Dividends are set for usual time of course. As I don't have to update PURCHASE orders I can post the reports in advance now - other than when it's SELLING dividend day (which is tomorrow).
|
|
|
|
So 49.25% of small bets win, when we expect 49.5% to win. Is that significant? It's not as far below average as the big bets are above average.
Certainly not enough different to actually prove anything. You can check in even more depth by seperately analysing them for each of his big winning sessions - if it's ALWAYS below average then that starts to look suspicious. You should ignore losing sessions when doing that - just the half dozen (or however many it is) sessiosn where he won big. There's no selection bias in that as we're choosing samples based only on the results of the big bets. If it's genuinely random then you'd expect some sessions to have small bets winning more often than 49.5% and others losing more often - that overall it ends up slightly below isn't so important. Think of the overall result (quoted) as meaning he flipped more heads than tails in a series of coin tosses (which doesn't mean a lot). Now we're checking to see if they were ALL heads (which means a lot more). Similar analysis can't be applied to the big bets - as his strategy (win decently - or lose big) adds selection bias. But his ending points weren't chosen based on the performance of the small bets so they can be analysed in a manner that can't be done for the big ones. Reason I say to only look at big winning sessions is simple - if he IS cheating then he'd throw some losing sessions in intentionally where the small bets (and big ones) would likely be random. Incidentally, if he worked out a pattern then I don't personally regard it as cheating. Cheating would be if he somehow got hold of server seeds. |
|
|
|
Deprived, I really do not understand, why we should only get 99% of NAV/U? It's ok if people want to continue, but the ones who do not should be given the chance to get a fair deal.
The contract is quite explicit in terms of what will happen in unforseen circumstances.
Cease making new investments,
Liquidate investments where possible,
Cease selling new DMS.PURCHASE
Offer redemption at 100% (less any exchange fees) of NAV/U for DMS.PURCHASE and bundles of equal numbers of DMS.MINING and DMS.SELLING where it is possible to do so whilst retaining at least 50 days dividend cover in liquid BTC for the remaining DMS.MINING.
Either way, the fund is closing down. It may reopen on a different exchange, with very similar contract (but not quite the same), it may offer the redemption of Mining and Selling for Mining and Selling on the new exchange. That is all fine with me. You have proceeded with the first three steps, I believe you should with the last one as well. (I have read everything up until now and agree that we wait for the CL coins.)
Disclaimer: I own slightly above 6% of Mining and Selling. I bought the overpriced Mining only after the BTCT announcment of its closure, exactly because of this part of the contract.)
In theory I agree with you - and if ALL investments were 100% BTC then I'd do that. Problem is that it's highly unlikely we'll have the option to convert CIPHERMINE.B1 into BTC by then. Even if we're promised it'll later become liquid it still can't truly be valued at full face value whlst it isn't tradable. So some discount to its value has to be applied. Easiest way around it to be totally fair would be to do all redemptions by sending cash plus a portion of CIPHERMINE.B1 - but we still have the problem of very small holdings too low to give even 1 CIPHERMINE.B1. If I have the option of liquidiating it then yes - I'd give 100% NAV/U. If I don't have that option then I'd probably have to give cash + some of them and then slightly under NAV/U for tiny holdings. As you correctly point out - if the contract changes then it MUST be considered as being an effective closure/reopening, so the general rule is that anyone choosing to sell out should get precisely their fair share of NAV/U. The 99% NAV/U was intended as a means to pay in all cash whilst reflecting the fact that a significant portion of assets weren't actually liquid (assuming I was satisifed there was every intent to honour the bond commitments). Any time risk is passed to someone else there MUST be a cost associated with it. EDIT: Just realised in a previous post I'd referred to paying 99% of NAV/U + some bonds. That is incorrect - if everything bar the bonds is in cash then one-time redemptions before moving would be at 100% NAV/U (excluding bonds) + bonds. That much is definite. |
|
|
|
Yes, it doesn't make sense to announce what a split would be before the final decission to close the fund has been made and trading has been locked.
Yeah, at this stage if it becomes apparent we won't be able to relist then I'd wipe the order books, announce the split (and explain how I got the numbers), make MINING their full payment and SELLING a partial payment. If it reaches a stage where relisting looks unlikely then I MAY: 1. WIpe order books, 2. Explain how I'd split if the fund closes, 3. Reopen order books Then people can make their own call on whether they want to trade based on what they believe the shares are worth if we continue or on what they believe they'll get if we close. Right now I rate closure as unlikely - so it would do more harm than good for me to give numbers that most likely have no meaning. But if closure becomes likely I'll definitely reconsider. Comments on that general approach are definitely welcome - I don't want to distort the market, but nor would I want people buying one or the other of MINING/SELLING if I knew there was a high chance they'd get a lot less back from an imminent closure. Right now I rate closure as low enough probability that the harm from disclosure outweighs the benefits. |
|
|
|
If we haven't managed to move by the end of October when BTC-TC closes then we'd shut down. At that stage mining would be paid thier amount in full immediately, SELLING would get whatever was left. If there was still CIPHERMINE.B1 not sold then I'd have to do a final dividend manually when we sold them.
But Deprived has clearly said mining would be paid their amount in full immediately. Right - but you seem confused over what "their amount" is. As Rannasha pointed out, any closure would be because DMS can't continue - not because of a vote by SELLING. Under the contract the option I have (ignoring finding a new manager which obviously isn't practical) is to put up a vote with a proposed split and try to get both MINING and SELLING to agree it. But if I do that, then I also have to stop paying dividends - as I can't have a 7 day long vote up with proposals that may not even be relevant a week later (if difficulty rises or falls by a lot). And I can't even propose a split until I know what's happening with CL and CIPHERMINE.B1 - as I don't know how much there is to be split (though in theory I could get around that one by proposing an amount for MINING with SELLING getting the rest). So at present we end up falling back on the final clause - that I have to decide the split myself. Because the problem is that if I put up a proposal and it fails there won't be time to do a second one anyway. So I'd end up having to decide myself - at which point I'd likely go with what I proposed (but was voted down on) anyway. Which makes the vote pointless - as there's no way to act on (and get approval for) any revision to it. IF the vote had indiciated most wanted to close then I MAY have considered halting all dividends and putting up a proposal for vote. But as a clear majority wants to relist it seems rather silly to screw the market up and cause confusion when most likely we'll just be moving anyway. EDIT: Just to be asolutely clear, no split I proposed or unilaterally imposed would be giving MINING anywhere NEAR 365 days of dividends. And it won't be susceptible to market manipulation (by someone trying to move the price on low volume) either. Once we've relisted (if we do) someone feel free to ask me how I was going to do it - and I'll explain it in detail. |
|
|
|
|
Show Posts
