Here's my theory:
Assuming pirate's operation is not a ponzi and he's not doing anything illegal, then he obviously wants the price of BTC to go down.
"I'd Gladly Pay You Tuesday for a Hamburger Today" - J. Wellington Wimpy
This famous quote is referring to the idea that people taking loans and paying interest are betting on the value of whatever they are borrowing to go down. In pirate's case he's betting on the value of BTC to go down.
Have you ever seen him say anything bullish? I see him talking about "risk management" saying that he is prepared for BTC to have no value in the future by using them in an analogy that refers to BTC as "pet rocks" here:
https://bitcointalk.org/index.php?topic=82849.msg918162#msg918162Even if pirate wasn't betting on the price going down initially, if he gets enough loans in BTC, (which he already has) he will have enough volume to corner the market and have enough influence on the price to MAKE it go down.
This really isn't a risky move for him because if somehow the price of BTC rises out of his control, (which i find unlikely because he clearly stopped the rally today) then his business model either turns into a ponzi (when the only income comes from new investors) and he can just take all the BTC and run. or if he decides to do this legally, he already has enough influence on the price of BTC that i think he can make enough fiat through market manipulation to pay back his investors still with a lot of profit for him.
His investors are basically lending him BTC to sell for fiat to drive the price down.Assuming this is the case, if I were an investor I would withdrawal my coins before the price makes any movements up or down, because both scenarios are risky for you.
Don't get me wrong, there is still potential to earn money through investing in BS&T as long as you get out in time. But, i think its a bad bet and, in any case, i think it's a bad thing for Bitcoin to have people "Centralizing" where the Bitcoins are. This picture here:
https://bitcointalk.org/index.php?topic=85687.msg1015662#msg1015662 clearly shows that the market is already backed up into a corner.