Uncoupled ordering and payments systems are definitely a sign of a scam. Taking payment for pre-orders is also a sign of a scam. However, a company history of delivering actual innovative products is a big sign of a non-scam.

Say you show me the public key to an account to prove to me it's yours. Now I can show that public key to anyone to prove it's mine. But it's not mine. So this can't be right.

Does anyone you know IRL know who he is IRL?

Within two weeks, either Pirate will have paid everyone back, he'll have disappeared, or he'll still be stalling for time. At that point, it should be obvious even to those who are willfully blind.

So what's happening with Pirate pass throughs? For those who think Pirate will pay everyone back, they should be worth close to face value. For those who think Pirate is a Ponzi, they are worthless. So what does the market think?

Some things turn out after the fact to have been high yield investments (for example, Microsoft, Apple and Google over the right time frames). That's not the same as something being offered as a high yield investment (with a predictable future high yield). Bitcoin should not be offered as a high yield investment. The risk and variability is way too high.

What makes HYIPs invariably scams is that there is no way to guarantee future high yields. It is just a fact of life that low risk means low yield and high yield, where even possible, involves high risk.

Only an idiot thinks outside the box when there's a 100% perfect solution that doesn't require it.

If he's buying coins, that must mean he's holding USD. But all his deposits are in Bitcoins. So either he got the USD from magic or his Bitcoin deposits are fractionally reserved.

There is no reason this should be controversial. It is basically common sense that if you have deposits in a particular unit and you pay interest in that same unit, you cannot also have 100% reserves. The exception might be things that reproduce, like animals.

If you lend me $100 and I'm to pay you interest on that $100, I have to do something with that $100 other than store it.

Investment and a 100% reserve are mutually exclusive.

You can't make much money that way when there are functioning exchanges and you're not producing a product. In fact, you are much more likely to lose money.

There are a large number of complex reasons why this doesn't work, but here's the short version: Say Bitcoins are trading at roughly $10 and are relatively stable. If not for any manipulations, they'd stay basically there. You have a huge supply of both Bitcoins and USD at several major exchanges. You have no inside knowledge others don't have except what you yourself are going to do. (These assumptions are not necessary, but they make things easier to understand to get the basics.)

So you hatch a plan, you'll sell the price down to $8.50 and then buy a bunch of Bitcoins at the reduced price. Now this only works if you understand that the "natural price" of Bitcoins is more than $8.50. Otherwise, buying at $8.50 is no benefit. And if you know this, so does everyone else.

So as soon as you push the price significantly below $10, you are selling to get down to $8.50 at a loss. And everyone else can buy all your coins for less than their natural price. When you succeed and get the price down to $8.50, you will not be the only one buying. And because people know the price is below the natural price, the price will shoot up very quickly. (Many buyers will be induced by the low price and very few new sellers will appear. If idiots panic sell, you won't be only one person on line with USD to buy them out.)

So the further you push the price from the natural price, the harder it gets to move the price. You take more and more losses. And the further you push the price, the easier it is for it to jump back to the natural price, the easier it gets for others to move the price back.

So manipulations have to be much more subtle to have even a chance of working. You have to gradually push the market to convince a large number of other people that the "natural price" is something other than what it would be if not for your manipulations. And the reason this won't work is because there are a number of well-financed people who are too smart to fall for this. It only takes one to make you lose more and more as you try to move the price at a loss and split the gain more and more as you try to take profit as it goes back. Since there are several, this is just not going to work.

He already has. What do you think demand deposits bearing interest are? If he didn't do a fractional reserve, how could he pay you interest?

I am convinced that pirate holds enough BTC and USD to move the market significantly. I am not convinced that this can be a source of any more than a marginal amount of revenue. You take losses when you move the market, and even if the gains could exceed the losses (which they almost never do), you have to share them with everyone else trading.

Actually, I understand that. Vanilla, citrus oil, cinnamon extract, phosphoric acid, and tons of sugar. But if I didn't know that, ...
http://en.wikipedia.org/wiki/United_States_v._Forty_Barrels_and_Twenty_Kegs_of_Coca-Cola

I explained that in the very post that you are responding to. If I don't know how something could be possible, I can't consider that possibility. I wouldn't know what I'm considering. So if you think I need to consider some possibility, then you should also agree that I need to know how it could be possible.

No, I grasp that concept. Did you read the post you're responding to? It was explaining the consequences of the very thing that you claim I don't grasp.

No, that's not what I said, please try reading it again. It's not that I don't know how it makes money, it's that I don't know how it could be possible that it makes money. So if I try to consider the possibility that it's making money, I literally have no idea what I'm considering.

That's not what I'm saying. I'm saying that if I don't know how something could be possible, I cannot consider the possibility of it. I literally don't know what it is I would be considering. My very first step in reasoning would be blocked as I tried to consider the consequences of an unknown thing.

Well, exactly. If you want us to consider something, you have to convince us that it's possible. Until you do that, we *can't* consider it. He is asking us to do something that is impossible for us to do. If you consider that our fault, so be it. But it's just how the world works.

We can't consider a possibility until we are convinced it is possible. We are not convinced it is possible, so asking us to consider it will not work. Convincing us it is possible is logically prior.

It's not that I'm unwilling to do this, I simply do not know how to.

Sure. Just explain how that's possible. I've offered to do this several times, but I can't consider something if I can't imagine how it could be possible.

You can't consider a "green idea" until someone explains to you how an idea can be green. It's not possible.

I think you didn't understand what I was saying. I didn't say every claim violated every item. In fact, I specifically listed some claims that are fine by item 1 but busted by the others.

Pattern similarities are extremely strong evidence. If someone behaves just like Madoff or Stock Generation, that very strongly suggests that they're doing the same thing, right? This is especially strong, almost conclusive, when no alternative has been suggested or can even be imagined.  As for "emotional fervor", I think it's not coming across clearly that this is intellectual fervor, not emotional.

It's an intangible thing of value. No complex considerations are really involved. They'd be treated as something of value, with a fair market value established as of the time they were transferred. I guess we'll find out for sure if any of the current cases involving theft of Bitcoins proceeds.

Yes, it's possible courts might do something really strange. But it's very, very likely they'll treat this the same as stocks or any other thing whose value can be established at the time it was transferred.

I should point out that greed for ill gotten gains is one of the things scammers have been exploiting for centuries. To some extent, if you want to be the beneficiary of fraudulent transfers of other people's money, you deserve to be scammed.

It's in fact true, ignoring your silly "what they claim" nonsense. Efficient breach is not only permitted but *encouraged*.
http://en.wikipedia.org/wiki/Efficient_breach

I don't know if you're playing dumb or you are dumb, but either way, it's not going to inspire much confidence.

You can only infer future performance from past results if you understand how the past results were accomplished. If you send 1,000 people into a casino to play slots, one of them probably will do so well that the odds of him achieving those results by chance are 1 in 1,000. Does that mean you should back that guy's next day of slots?

Hey, can I borrow $500 to play the slot machines? It's very risky, but if I turn it into $2,000, I'll give you back $1,000. It's high risk, but you could double your money in just a day.

Oh, and if I lose all your money, I won't even provide you any proof that I lost them on the slot machines. You'll just have to take my word for it.

Honestly, it's stunning to me that you've found people stupid enough to fall for this. My hat is off to you sir.