Looks like I had a brain-fart when I typed the 81.  The original info was in a spreadsheet.  If you look at my final calc of the BTC per mh/s it's pretty obvious I used the correct value of 135 there.  My point in the post wasn't so much to try to give accurate values - as to show why Bitbond price dropping had a perfectly rational explanation as, on the values published by the asset owner, it was clearly significantly over-priced compared to GIGAMINING.  Plus also to point out that, trading a lower price, the big upgrade no longer makes any sense - working out more expensive per MH/s than the small upgrade.

UPDATE

By now you should all be aware that GLBSE is closing down.  As regards assets on GLBSE, the following is a summary of what is supposedly happening:

BTC deposits will be returned - this may involve the need to provide some ID.  I have no objection in theory to IDing myself - though am not too keen on doing so to an organisation which is closing down.  For now I am valuing the fund on the basis that our BTC on GLBSE will be returned.

Asset-issuers will be provided with a means by which they can get in contact with asset-holders.  It will undoubtedly be the case that some asset issuers will just run with funds (or prevaricate until people give up trying), whilst others will act proactively to ressetablish a relationship.

I will now disclose our holdings on GLBSE and explain why I was holding them and how I am currently valuing them.  Note that this is only my best estimate of value and investors are entirely free to value any bids/asks you place on units on any valuation you choose.  It is also possible that our actual holdings are different to listed below - we had lots of active bids and a few asks up.  Whilst the below list was accurate maybe 10 minutes before GLBSE shut-down, it could have changed in that last 10 minutes without me noticing.

ASICMINER 16.

We were holding 10 of these as a longer-term investment and also regularly traded these.  We happened to have 16 at the time of GLBSE shut-down.  The 7-day average for these was .108 and last I checked (shortly before GLBSE going down) bids were at around .106 and asks at around .110.  friedcat (the issuer of these) is already proactive in seeking to resstablish contact with share-holders and I am confident our ownership of these will be recognised.  These will continue to be valued at .108 each for our portfolio until/unless circumstances or new information indicates to do otherwise.

OBSI.HRPT 20.

This always looked like a scam/ponzi to me and I never invested in them (nor did the fund) until they totally crashed in price from .1 down to .005.  We bought about 100 of them at under .005 and since then had been trading them a lot.  The price recovered from the bottom and at the time GLBSE went down bids were at around .0058 and asks at just over .01.  We had both bids and asks active on these at the time.  The value of these 20 units on GLBSE at the time it shutdown would have fairly been in the range .12 - .18.  I have zero confidence we will receive any more funds in respect of these and so these are being written off to a value of 0 in my records.  Obviously if we DO receive funds for them then those would go to the fund - but I cannot in good conscience value them above 0.  We have still make a nice profit on trading this stock - would guess we've bought and sold 150-200 of them making a 70%-100%+ markup on every trade.

BITBOND 3

This mining bond had recently been in a plummet in price from 0.4 per unit down to around 0.2 (maybe slightly slower) at the time when GLBSE closed.  The reason for the slump in price was entirely rational - if you compared their upgrade offering (to ASIC-based mining) with that of competitors then they were severely over-priced in terms of MH/s per BTC.  My view was that the devaluation had probably gone too far - as bitbond was about to announce an upgrade in the MH/s for their ASIC-bonds, information not immediately obvious to anyone looking at just the OP of their thread or the contract on GLBSE.  I had bought a few for us, hoping to make a profit when they announced the detail of their upgrade - as from past experience the naive market would over-react and over-price the stock briefly.

As noted above, these were trading somewhere around 0.2ish at time of GLBSE shutdown.  As far as I know there has been no announcement yet from bitbond in terms of how they intend to proceed following GLBSE closure.  This isn't a big deal - no reason they should have announced yet - but obviously I can't value them at full price.  For now these are being marked down to 0.1 BTC each in my accounts.  This valuation will be revisited when the situation with them becomes clearer.

Taking into account the above devaluations, the current valuation for the fund is as follows:

Current Exchange-rate : 0.00436

NAV/U : 10.30795017

If that proves correct and we can navigate past GLBSE closure and still be in profit then I won't, honestly, be too disappointed.

For anyone who believes we won't see a dime from GLBSE, nor be put in contact with asset-issuers the NAV/U is 4.977159 if you only count assets/LTC on LTC-GLOBAL.  So noone should be selling units significantly below that.  I'll put up a buy (from the fund) at 4.8 so noone accidentally sells for a stupidly cheap price.  As that price is JUST for LTC-denominated assets I don't need to monitor it based on exchange-rate.

Well there's a few differences:

1.  In shorting the ultimate authority on who wins is the market.  In a binary market the asset operator can directly determine the outcome (and knows it in advance with near certainty).
2.  In shorting the benefit from shorting is restricted to a certain amount per security.  In a binary market it's based on the ratio between people on each side of the bet - which can be directly exploited by the asset operator.
3.  It's much harder for the asset operator to go long on their asset (sell shorts) without actually delivering something to satisfy the market.  In a binary market the asset operator makes most money betting ON their asset by giving the impression of doing badly whilst meeting their contractual obligations.

The real difference is that the operator can gain in the binary market irrespective of how they do - by manipulating market confidence in the OPPOSITE direction to where it should be going.  With shorts (on either side of the deal) at least that particular issue in no longer true.

I believe CPA and nyan should both be closed down - that's not JUST because usgai is running them.  Here's why:

CPA:  I don't believe the bitcoin market-place is developed enough (or regulated enough) to be place to run an insurance company.  With the majority of busineses being incompetent, scams or run by individuals unable to do their job properly there's just no way to run the type of insurance company CPA set out to be profitably.  The risks would be high - and there's pretty much nowhere that the funds can be invested safely enough (and with sufficient liquidity) to be able to make large payouts in a timely fashion AND offer reasonable rates.  Depositing the funds in a non-BTC deposit-taker (such as a bank, buying treasury bills or whatever) isn't an alternative due to exchange-rate issues.  Which leaves the only safe option as being to hold all (or nearly all) funds as liquid BTC.

There's also the issue of regulatory issues - insurance is one area that falls within the realm of "must be properly licensed/authorised regulated" to conduct in every developed country I can think of.  If GLBSE becomes regulated by the FSA then there's absolutely no way it could continue to list an insurance company that didn't comply with the relevant regulations.

Nyan: This was badly structured from the start.  Six things were wrong with it:

1.  The minor issue of having the pretence of 3 funds while it's in reality 1 fund.  This has caused confusion over valuations etc - which SHOULD be totally irrelevant (the only value that matters is what you get back when you sell at the end).
2.  No settlement date.  There should have been a date at which all nyans would be liquidated and paid out - then restarted (if desired).
3.  No fixed amounts of each nyan.  This meant that no informed investor could actually calculate the relative merits of each nyan choice - as that depends on the relative numbers of each type.
4.  The CPA guarantee.  This is no problem for nyan.a investors - but I can't see how it was ever in the interests of CPA shareholders to offer it.  I must be missing the bit where they get a hefty payment in return for their exposure to it.
5.  Although 4 isn't a problem for nyan.a investors it IS a problem for nyan.b - as every time a nyan.a unit is bought back it reduces their overflow from nyan.a without reducing the benefit they give to nyan.a (in fact it increases it on a per/unit basis - as their protection is spread over less units of nyan.a).
6.  Investing in non-liquid assets.  With the model used this was bad - as it couldn't withstand a spate of withdrawals.  With a proper model (fixed expiry date) then all investments should be such as to be realisable at the expiry date.

In short it should have been:

Defined in size (# of each type or ration of each type),
Fixed expiry date,
Zero buy-backs before expiry (meaing no need for the CPA guarantee).

If CPA underwrote the offer then they should have got a small cut of the pie in return for taking up the slack on whatever units didn't sell (the role nyan parent was supposed to do - but didn't).

Right now, if nyan.b closes down then nyan.a pretty much HAS to close down as well.  Without nyan.b (and with nyan.c essentially asset-less) there's zero reason why nyan.a investors should want any cut of their profits (if they make any) going to a nyan.c that contributes nothing in return (it has no assets to back them with any more).  This situation is a direct result of the 3 points I just listed not being followed.

The MPEx similar offering is much better structured - though it IS completely hilarious that they invested in nyan.a.  I nearly fell off my chair laughing when usagi pointed that out.

Incidentally, one of the biggest problems facing ANY offering on GLBSE is the completely irrational (to the pont of being delusional) expectations of investors here for a ridiculously high rate of return.  The only things offering high rates are ponzis/scams, loans (which often default) and minng operations that devalue - making the real ROI way lower than it appears.  There ARE ways to make high returns - but typically only on a tiny amount of capital.  The mistake, of course, is trying to run something 'real' AND pay the same sort of rates - you're pretty much certain to fail on one of the other of the two objectives (or both, as is the case here).

Your comprehension skills are saldy lacking for someone who claims to teach English.

I said a "tighter noose".  My view is that you deceived and lied to your investors and that at least some of them lost coins as a result.  You refuse to ackonwledge your various conflicts of interest - despite some of them (e.g. the insurance poicy between BMF/CPA) being pretty much textbook examples of what a conflict of interest is.

My quoted comment referred to aomeone's intent to report you in the scammer forum - not whether you were a scammer or not.  The criteria for getting a scammer tag are NOT directly related to whether someone IS a scammer - rather whether the mods can be convinced that it's proven beyond reasonable doubt that they are a scammer.

Being acquitted in a trial does NOT mean that someone is innocent (just that the jury concluded there wasn't enough proof to be CERTAIN that they were guilty).  Similarly, not having a scammer tag is no way proof that someone hasn't scammed (it just indicates that the mods aren't SURE that they scammed - or, for other reasons, don't want to give the tag).

I was in no way saying I believe you're innocent of scamming (I prefer to avoid the word scam as it is open to debate what it actually means).  What I WAS saying is that I think it's hard to build a case strong enough to persuade the mods to the give the tag - but that if we let you carry on a bit further I'm sure you'll make the case much easier to build (by continuing to lie, deceive and blatantly ignore conflicts of interest).

My assumption was that closing down some of the Pirate pass-throughs was part of his preparation for FSA approval.  Where the work is going to come is in meeting the due diligence requirements on every security on there: from what I can see the vast majority of stuff on there can't be handled by anyone who's FSA approved anyway.

And of course the KYC/AML type requirements could take a lot of effort to comply with.  I can just imagine the backlash here if it turns out anyone who just wants to withdraw from GLBSE will still have to prove their identity first (as GLBSE was running as a for-profit service AND was taking deposits the requirements are pretty tight).

The binary betting model does raise some interesting possibilities e.g :

For a low-dividend investment you could end up being better off betting on it paying than actually investing.

You could create an asset that appeared really terrible, buy up shares yourself (so that it had an obvious need to pay dividends), do absolutely nothing with it and just bet on the pay side.  As you'd have little liabilities (hardly anyone invested but yourself) you should make a decent profit off everyone betting against it.

Scammers could bet against their own assets on sock-puppets accounts to make even more profit.

And the last two are the real problem with it - the asset owner KNOWS what the outcome of the bet will be (if it's short-term) so can flood that side of the bet on a second account (or via a partner), meaning noone legitimately betting gets any sort of decent value.

There's no need for anyone to have brought GLBSE to the attention of the FSA - nefario was actually trying to get it registered with them.  One pretty reasonable theory on what's happening gos like this:

Nefario: Hi FSA, I'd like to register my company GLBSE as a financial services provider.
FSA: Do you provide services that are required to be registered with us?
Nefario: Yes
FSA: Then please submit your application.  Oh - and if you're already providing such services then you need to stop until we approve or decline your application to register.

The application/approval process typically takes a few months.

He can't register with the FSA unless he provides services that they register.  And if he DOES provide services that should be registered with them, then he shouldn't be providing such services without being registered.

Obviously if GLBSE ends up registered with the FSA then it would have to comply with AML/KYC requirements - so if the announcement on Saturday mentions FSA registration everyone should start getting their photo id, proof of address etc ready if they want to get back access to their assets.

Note: I'm in no way saying the GLBSE WILL end up FSA regulated.  Nor is the above the only credible scenario for what's happening - just the most likely in my view.

Problem is that if the transaction fee is tiny - so is the insurance pay-out.

If I invest 1000 LTC in something, it fails/vanishes and I get 1 LTC back I wouldn't get a warm and fuzzy feeling that it had been insured.  It would feel more like adding insult to injury.  You can't have a tiny insurance charge that provides significant cover if every asset has its own pool (and you can't pool the insurance premiums from all assets or it just ends up with the good businesses paying off people who invested in scammers - making HYIP's the best investment).

I should in fairness point out that the proposed insurance has a downside for me that it doesn't for most others.  I mainly day trade - so I'd be paying this 0.1% every trade (or every other trade) without receiving any real benefit of it.  The (majority of the) benefit of insurance gos to those who hold securities long-term, not those whose hands it briefly passes through.  It thus acts as a disincentive to actively trade - as it automatically reduces your margin.

In most cases it wouldn't deter me from trading/investing in a security.  The exception being where someone proudly trumpeted that their IPO/security was "Insured" (unless they'd be trading for ages).  Those I'd stay a mile away from - as they were either scammers, lying or didn't realise just how irrelavnt being insured for 0.1% of your capital is.

Do also bear in mind that the actual time-scale before a 0.1% insurance fee fully covers the IPO is  immense.  to get 100% coverage every share issued has to change hands 1000 times.  i.e. nearly 3 years if every single share is traded every single day.  In practice the insurance cover would never get there - the asset issuer would die of old age first.


Not convinced a hard cap on funds for new companies is good.  Consider ASICMINER - think their IPO was 10k+ BTC.  That's going to be above any meaningful cap you'd set.  A cap actually deters the very IPOs we want to see.  The market really doesnt need more people trying to take 10-20% or so of profits from mining whilst passing the risk on to investors.  Nor does it need more "Investment Managers" whose plan is to dump cash into fairly random securities, take a cut of the dividends themselves whilst ignoring any loss to investors as the value of those investments plummets.  We need companies that will actually produce something tangible (be it hardware, software, a service or whatever).  And those companies won't be able to start with a cap on funds that is low enough to deter scammers.

Rather, I'd suggest you consider tiers of companies.  With each tier having increasingly difficult requirements (in terms of contract clarity, business plan, revenue forecasts etc) and also significantly larger fees (to cover the time you'd need to invest to check they met the requirements).

So bottom tier could  be 250 LTC fee, requirements just that they cover the basic elements in their contract (purpose of investment, type of security, rules on issuing new paper, profit-split/fees mechanism, closing-down process etc).  Maximum market cap for these maybe 20,000 LTC.

Next tier maybe 1000 LTC fee, market cap 250k LTC, requirements added of a more comprehensive contract, some form of business plan including at least a theoretical demonstration of long-term profit for investors, and a sample weekly or monthly report containing all essential figures investors would need to see).

Third tier, 10,000 LTC fee, requirements to include proof of incorporation, details of company's lawyer, proof of a place of business etc.  No market cap.

All you're asking for in reality is that if the asset issuer wants a decent amount of funds they demonstrate that they at least have the potential to make investors a long-term profit.  Any good asset issuer will already have produced that before even considering raising funds.  It'll not just reduce scammers - but get rid of all the just out of school wannabe millionaires who think that, by some magic means, if they can just raise a big chunk of cash then profits will just naturally fly in their direction.  The latter are in many worse more damaging to the community than scammers imo.

And obviously once a company's established they could move up to next tier by providing the additional information and paying the extra fee.

Just an idea on a different approach to it.  Upgrading companies market cap based on profits would obviously be the absolute worst way - as that would prevent genuine start-ups with a medium to long-term plan from incubating and allow ponzis free rein.

First off, here's the current fund valuation:

Exchange-rate LTC/BTC : 0.0044

Adjusted NAV/U : 10.5696 LTC

With the exchange-rate finally stopping rising, profits were beginning to build up.  Then GLBSE pulled the plug.

I'll be reenabling trading of the units shortly - but won't be buying or selling them myself.  Here's a break-down of how funds are currently distributed:

BTC on GLBSE : 41.88%
Securities on GLBSE : 10.33%
LTC on LTC-GLOBAL : 5.57%
Securities on LTC-GLOBAL : 42.22%

This valuation is 100% accurate as of about 10 minutes before GLBSE went down - I was online at the time and had checked for new trades on GLBSE within the 10 minute period before it went down.

This means that just over half of our assets are currently inaccessible on GLBSE.  Usually we'd have a much larger portion of our assets on GLBSE - it just so happened that GLBSE went down at a time when we didn't.  I'll now explain why.

One of the trading opportunities I have been doing is buying LTC-MINING bonds on GLBSE then trading them with burnside (who runs the asset AND the exchange we're listed on).  Because of the current high(ish) LTC/BTC exchange-rate we make a 10%+ profit on each such trade (after paying the transfer fee on GLBSE and the costs of liquidating some of those bonds on LTC-GLOBAL then exchanging the proceeds back via BTC-E into BTC on GLBSE).  It's a profitable arbitrage opportunity for us (one of the types of thing our fund does) and also serves burnside's desire to get the bonds off of GLBSE and onto LTC-GLOBAL.

This morning I transferred 10 of these bonds on GLBSE to burnside and sent him a PM to say I'd sent them (we'd agreed I'd just send them, PM him, then when he got online he'd transfer the bonds back to us on LTC-GLOBAL).  burnside didn't get online (or at least didn't see the PM) until AFTER GLBSE was down - and he could no longer verify that I'd sent them.  He STILL sent us the bonds on LTC-GLOBAL - my thanks for that trust (for anyone believing I could be trying to scam him, do bear in mind that the PM was sent some hours before GLBSE went down - had I known GLBSE was going down and intended to scam this is hardly the way I'd logically be doing it).

That's why we currently have a much larger proportion of our assets on LTC-GLOBAL than we normally would.  The bonds transferred from burnside are around 18% of our tiny fund.  Had GLBSE not gone down, most of those bonds would have been sold by now and the funds would be back on GLBSE to be recycled.

Those bonds will sit untouched in the fund's LTC-GLOBAL account at least until Saturday's announcement from GLBSE.  Before we can trade them we need to know that all transactions on GLBSE prior to its shutdown are intact and being honoured.  If they (for example) roll-back their database to before I transferred to burnside then I'd either need to re-send them on GLBSE (if the rollback wasn't far enough to cancel our purchase) or return the ones on LTC-GLOBAL (if the rollback was so far that we no longer had them at all on GLBSE).

The above information should be taken into account by anyone who wishes to trade our units prior to Saturday : there are circumstances in which that 18% of our assets could end up being on GLBSE not LTC-GLOBAL.

If GLBSE's next announcement does not make clear whether there's been a roll-back then the bonds will sit untouched in our account.  If their announcement indicates that there HAS been a rollback (without a precise time AFTER I sent to burnside) and we still cannot access our GLBSE accounts then the bonds will be returned to burnside (as it is then far more likely that the trade is reversed than that it occurred).  If GLBSE confirm that all trades are honoured up until their shut-down (which I believe to be be by FAR the most likely case) then the bonds are in burnside's GLBSE account and we can use the ones one LTC-GLOBAL as we see fit (though obviously, if this were the case and then somehow it turned out GLBSE were wrong we would need to reimburse burnside with 10 LTC-MINING bonds on one of the two platforms).

Although the majority of our assets on GLBSE are in BTC, those are nearly all committed to bids - I very rarely leave any significant amount of BTC on GLBSE idle (idle makes no profit).  My hope is that when GLBSE comes back up they'll either clear all bids/asks or give a decent amount of notice and then have a period in which no trading occurs but bids/asks can be cancelled.  It is near enough a certainty that when GLBSE returns there'll be a wave of panic selling.  So long as I can cancel our bids before trading starts we'll be in good shape - we can either withdraw the funds (if we no longer want to stay on GLBSE) or take advantage of the panic to buy into the better securities at bargain-basement prices.  It's unfortunate our fund is still so tiny - so even a good % profit is still a tiny amount of actual LTC.

Looking forward, I'll continue to trade on LTC-GLOBAL (though volume is still tiny) until Saturday - then reassess things when the GLBSE situation is hopefully a bit clearer.  All I expect to happen on Saturday is that GLBSE will issue a brief announcment explaining the reasons for the shutdown (which I'm very confident will be that they were instructed to by the FSA or LE) and maybe some sort of a time-scale for reopening.  I also expect them to confirm that all data is intact and that all trades up until the moment of shut-down will be honoured.  If we're lucky they COULD re-open the site read-only (no trades or withdrawals possible) so at least everyone can verify what they've got on there.  But I'm not too optimistic on that.

I won't be doing a weekly report/profit-split this week.  Under the contract I could possibly do so - and take some more units as my fee.  I will NOT be taking a fee for any funds tied up on GLBSE.

I'd recommend against trading the units before Saturday - but in case anyone wants to, I will shortly be re-enabling trading of the asset.  I will NOT be clearing trades/freezing trading on the assets again - anyone who wants to trade it now does so on the basis that they believe they can react to changes faster than those on the other side of the trade they're trying to make.  I will not be placing bids/sells until GLBSE is back up and I have proper access to our assets including the ability to withdraw funds and trade securities.  At that stage my Bid wall WILL eat any Asks below it.

I tend towards believing that sort of system is pretty pointless.  The funds that go into the insurance in effect come from investors (other than the token initial payment) - but are assigned to whoever currently owns the shares.  If we consider the two extreme cases first, it may make clear while the fund doesn't do much worthwhile:

1.  Right after IPO when all initial shares have been sold.  At this stage the insurance fund will hold 250 LTC +0.1-0.2% of share purchase price.  This is the point at which a quick scam is going to run off.  The 0.1-0.2% comes from the current investors - so if the fund defaults all they're getting back is 0.1-0.2% of what they originally paid + 250 LTC/number of shares.  Contributing the original 0.1-0.2% has gained them no benefit over just buying the shares at 0.1-0.2% less and keeping the other 0.1-0.2% themselves in tehir own wallet with the ability to use it at any time they choose.

2.  Now consider many years down the road - where the insurance pool covers the entire IPO price.  That money is not producing any revenue - but is assigned to the current share-holders.  That means that (if we take a share which dividends out all profits for simplicity) the price of those shares has to have doubled (as each share is now backed by twice the IPO price - half as working capital, half as insurance).  But income is only being generated from the half of that revenue which is in the hands of the company - AND there's no way shareholders can ever get hold of that half other than through the company defaulting.

COntinuing with case 2 - now consider this from the perspective of a new investor.  He has the option of investing in this insured company or in another company which has been running as long but doesn't have the insurance fund.

Company 1 (insured) - has shares costing 1 LTC and 1 LTC of insurance backing each share.  It trades at 2 LTC.
Company 2 (uninsured) - has shares costing 1 LTC and 0 LTC of insurance backing.  It trades at 1 LTC.

Both have the same apparent level of risk of default.

So he can buy the insured share - or instead but an insured 1 and keep the equivalent of the insurance money himself in his own wallet, accessible at any time (and able to be able to be used to produce more profits).

Obviously the share prices would NOT be double for company 1 than company 2 - but if it is NOT double then that just makes company 1 an even worse investment - as it means cash being spent on the purchase/transfer of company 1 shares is not ending up being reflected in the company's share-price.

A more likely scenario long-term is that company 1 ends up with shares only valued slightly higher than company 2.  I believe this would be the case - given they both have same assets and generate same revenue and the only premium on value for company 1 is in the insurance which MUST be valued at below 100% of value unless you KNOW an immediate default is going to occur - at which stage the REST of company's value becomes worthless.  What that means is that the vast majority of the insurance payments going into the fund have added no value to the stock - making company 2 the better investment all along UNLESS you believe the risk of default is high.  And if you believe the risk of default is high the NEITHER is worth investing in early.

In short : Company 1 only becomes a good investment when the insurance fund is maxed but has no great impact on the share price due to default being seen as highly unlikely.  Company 1 is a significantly worse investment in early stages because you get nothing of note back if it defaults - and the insurance premium (which can't have its full value rationally reflected in the share price) means you make a loss when you sell the share on (compared to company 2).

Looking at it from an entirely perspective, consider the following.

Investor one invests 1000 LTC every day in new shares - always in insured ones on which 0.1% (1 LTC) is taken for insurance.
Investor two always invests 999 LTC every day in new uninsured shares and puts 1 LTC into a cold-wallet every day.

Which of them is better off?  I'd say invest two is better off.  He has immediate access to LTC every day and doesn't have the (no matter how small, non-zero) risk of the exchange failing and keeping his insurance funds.  Investor 2 has actually "insured" himself not just against the share defaulting but also against the exchange defaulting. 

Personally I'd be investor 3 - who invested 1000 LTC in uninsured shares.  If I believe my investments will make a non-zero profit then it makes more sense than leaving any in an insurance fund (whether my own cold-wallet or an exchange-run one).

Any insurance plan which involves LTC sitting around generating no income is automatically bad value in my book.  There's actually a danger that such plans would HELP scammers - as it's a really cheap and easy way for a scammer to ptove (to those who don't think it through) that they're real.  Whilst the actual genuine businesses would reject it - as it's simply a bad way for their investors' funds to be used and devalues their shares in relation to the capital invested them compared to uninsured companies.

For similar reasons to the above paragraph I'm not a big fan of "ID verification" as a means to determining whether a company is legitimate.  It detracts from what I see as the two real things potential investors should be looking at:

Does the business have a plan which will actually make a profit?
Is the business verifiably able to do what it claims it would be doing?

From my perspective, looking at most of the scams, the red flag has nothing to do with whether they were verified or not.  The common thread to a lot of them is that they never provided any credible and verifiable means by which they would make money.  That includes pass-throughs to unidentified magic-money-making enterprises and the development of websites with no credible evidence that they could ever be monetarised sufficiently to generate the sort of revenue they'd need for the capital they were asking for.  If a company can make money doing what it says it'll be doing then that's a much better incentive for me to invest than whether they produced IF (fake or not) or have some sort of insurance policy that decreases my earnings whilst they don't default and doesn't give back much if they do.

What SHOULD be verified is when a company claims to be associated with a real world company -as one of the bonds on LTC-GLOBAL does.  Amazingly people are asking for proof of hardware - but not for the very basic prrof I'd want (before investing) that they actually ARE working in behalf of that company.  If something that is verifiable is claimed then no way am I investing until it's verified.  I'm not saying the exchange should do that - but it amazes me that investors will see someone say "I'm working for company X - here's their website" and not think "well OK - let's see something up on that website confirming what you say."

Surely it would be the FSA not the SEC - it's the FSA he was trying to get GLBSE regulated with.

It's not gonna be a hosting issue - if so they could just say so.  The refusal to give any indication of the reason is a pretty clear indication that they're having to get lawyered up before giving any information - meaning some regulatory body (e.g. the FSA) or LE is on their case.

Think I'd actually be more confident about getting funds back if they HAD been hacked.

GLBSE is down with a message saying:

"GLBSE is offline

We will update our users on Saturday."

Obviously majority of our fund's assets are stuck on there.  I've cancelled all outstanding orders on LTC-ATF (mainly so nooned sold to the other Bid that was up) and temporarily frozen trading on it.  Will be sending out a notification saying this as well.

I'll reenable trading later tonight - but won't be placing any buys or sells up myself (not on the asset account nor on my private one).  I've also done no trades on either account since GLBSE went down -

We'll then review the situation on Saturday and decide how to proceed.  My guess (ONLY a guess) is that they've been ordered to close by the FSA (UK equivalent of the SEC in the US) pending investigation of whether to license them.  I don't personally expect much news on Saturday if that's the case.

Will go post this on litecoin forum and in a notification for LTC-ATF then I'll make sure my spreadsheet is up to date and report back what the situation is with our holdings.

Well what's wrong with it right now is that it's totally down.  404s on every page.

Missed that little gem.

Trading 10 BTC NOW for 10 BTC NOW definitely doesn't make anyone more or less solvent.  Trading 500 BTC NOW for a promise to repay 500 BTC over 2 years definitely DOES make someone more solvent.

Further to that:

1.  If the time element is irrelevant what was the purpose of the insurance contract again?  Wouldn't that make it a loser for BMF whatever happened - as they were agreeing to pay 550 in return for 500.
2.  If trading bitcoins now for bitcoins in the future doesn't make anyone more or less solvent why did usagi make a thread specifically to borrow a few hundred bitcoins?
3.  What has "10 bitcoins when you have a market cap of 2500" have to do with a debt of 500 bitcoins?

Predictions on how long before usagi suddenly remembers/realises/is told by someone it listens to that getting 500 bitcoins now and only having to pay them back over 2 years is actually very useful.

At least we've progressed past the "it was a joke, it wasn't an actual contract silly" stage.  Now we're on the "well yeah it was a proper contract but that's not really a good reason to actually stick to it" stage.  Wonder what act 3 will be - maybe the "well CPA can't pay it so there's no point us making a fuss about it" stage with a brief intermission of "let's vote on it as I control most of the shares and can vote as many times as I want with them".

My predictions for any motion:

Option 1 : Let's claim our 500 BTC from CPA.
Option 2 : Let's just forget about it as noone's been hurt by anything.

With option 2 winning by Y votes to option 1's X votes where:

X is slightly smaller than the number of shares controlled by anyone other than usagi.
Y is larger than the total number of BMF shares in circulation (as in the last one).

LOL, why do I get the feeling usagi misread "staying out of your threads" as "staying out of all threads about you".

Bit premature for that in my opinion.  Let usagi build a tighter noose for itself by blatantly trying to get BMF investors to act against their own interest via a motion.  When usagi's properly ripe for the picking on this one I'll see if I can motivate myself to properly document one of the nyan conflict of interest scenarios that's happened - and make any scammer accusation rock-solid by demonstrating that this insurance mess isn't some one-off occurrence.

Thought I made it plain already.  I'm NOT interested in hearing any more of your crap anyway.  I don't WANT any more responses from you LOL.  You won't tell the truth and I've no interest in your lies.

I'm just gonna discuss stuff in here with others who are interested in it - some of them may share my views, others may not: all are welcome.  And if any of them happen to be share-holders and want to take it up with you then that's their business.

And no - you won't control this discussion (if you mean the discussion in here).  Noone will control it (unless a mod chooses to) - and definitely someone who isn't going to post again in this topic isn't going to.  If you mean some other discussion in one of your own threads then go ahead - control it.

And no - I'm not playing your silly little games of being sent from thread to thread and each time being told I'm a troll or "banned" etc.  I'm doing you the courtesy of now staying out of your threads (unless you make an inaccurate statement about me).  You can stay out of this thread, post in it, ignore it - do what you like about it.  I really don't care.  If you post in here I will likely respond - and help you dig your hole deeper.

usagi trying to shove it back under the carpet with a motion.  Of course usagi controls most of the shares and is unlikely to abstain due to its conflict of interest.  As usagi doesn't appear to even understand what a conflict of interest is, here's a simple explanation:

CPA owes BMF 500 BTC (make it 100 BTC for the purpsoe of discussion if anyone wants - but it's actually 500).

It's in CPA's interest (obviously) not to actually pay this.
It's in BMF's interest to get as much as it can (up to what it's due).

usagi speaks for both CPA and BMF - so has to bear in mind the interests of both CPA and BMF.  But there's a conflict between those interests - as they want opposing things.  That's why it's called a conflict of interest - as (in theory at least) usagi has reponsibilities to both and what benefits one is detrimental to the other.

The usual step in this situation is for the conflicted individual to step aside and let others resolve the issue - but that's not so easy here as there's no other management for either BMF or CPA.

There's no need for a motion at this stage - whatever usagi says.  If you take out an insurance policy and the situation arises where you can claim on it and there's no down-side to YOU in claiming then you claim.  It really IS that simple here.  The first stage is for BMF to claim on the policy.  That should be for the full 500 for two reasons:

1.  There's no specified period between successive claims.  So if BMF claims 100 it can then immediately claim the next 100.
2.  Even if you assume some reasonable period (like a week) between claims, all 5 claims should have been made by now.  The only reason they haven't is usagi's prevarication, lieing and deceit in an attempt to make life easy for CPA at the expense of BMF.

Where it becomes more messy is when the response to the claim is (as it would pretty much have to be) "Well we haven't actually got 500 BTC liquid.  Let's negotiate."

And the problem there is that there's absolutely no way usagi can be trusted to negotiate robustly and in the interests of BMF.  Because it has a conflict of interest, no moral fibre and has already shown a propensity to lie and deceive to protect CPA even when doing so hurts BMF's investors.

The silly thing is that there's actually a few ways it could be resolved without too much pain to CPA (if we forget about the losses caused to earlier investors who should have received more for selling their shares).  But the fair settlement for this will likely not be reached - as usagi won't properly look at each position on its own merit, assess what their bargaining chips are, what their objectives SHOULD be from negotiation and then negotiate.  You really CAN'T negotiate for both sides in a situation like that without letting down on side or the other: there's no way to bluff yourself, no way to hide your objectives from yourself and no way to get around any preconceived ideas you may have of how to resolve the situation.

If CPA acknowledge the debt and their inability to pay it in BTC right now it actually becomes EASIER to settle the issue - not harder.  As those involved can now focus on finding a solution, agreeing what the situation actually IS.  Instead we'll now have usagi trying to weasel-word its way out of it, trying to force through crappy inequitable solutions via motions and the like - ending in a total mess for all involved.

Exchange rate at 0.00446

For once it's having a steady spell - becalmed between 0.0044 and 0.0045. Will set a nice tight range for now so anyone who wants to buy in or out can do so without too much premium.  That range will, of course, widen significantly as soon as I spot the exchange-rate starting to significantly move.

Adjusted NAV/U : 10.4716 (yep, we're now in profit for the week despite LTC still being up over 10% on the week)

Bid : 10.35
Ask : 10.55