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NOT CURRENT REPORT - ESTIMATE FOR TOMORROW
This is an estimate for tomorrow ignoring all investment profit and any growth from sales/redemptions.
BTC Balance (BTC-TC) 2165.504
9071 LTC-ATF.B1 90.71000000
Coinlenders CD 27/9 200.9078086
Coinlenders CD 12/9 101.452737
Coinlenders Cash 3.94376483
Just-Dice Balance 245.15000000
TOTAL ASSETS 2,807.66831046
Outstanding MINING 176908
Outstanding SELLING 176908
Outstanding PURCHASE 10371
Effective Units 187279
Block reward 25
Difficulty 86,933,018
Hashes per MINING 5000000
Daily Dividend 0.00002892
50 days (Min Liquid) 0.00144625
100 days (Forced Close) 0.00289249
365 days (Buyback) 0.01055760
405 days (IPO) 0.01171460
400 days (Post SELLING div) 0.01156998
410 days (Pre SELLING div) 0.01185923
NAV Post MINING Div 2,802.25127607
NAV/U Post MINING Div 0.01496298
Days Dividend Post Div 517.30
SELLING Dividend 0.00339300
NAV Post SELLING Div 2,166.81375786
NAV/U Post Selling Div 0.01156998
PURCHASE selling price 0.01215
PURCHASE buy-back price 0.01134
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Sold 1782
Swapped 0
Total 1782
Price 0.01578
Total 28.11996
Less Fee 28.06372008
Man Fee 0.841911602
BTC Balance (BTC-TC) 2172.666829
9071 LTC-ATF.B1 90.71000000
Coinlenders CD 27/9 200.9078086
Coinlenders CD 12/9 101.452737
Coinlenders Cash 3.94376483
Just-Dice Balance 245.15000000
TOTAL ASSETS 2,814.83113903
Outstanding MINING 176908
Outstanding SELLING 176908
Outstanding PURCHASE 10371
Effective Units 187279
Block reward 25
Difficulty 65,750,060
Hashes per MINING 5000000
Daily Dividend 0.00003824
50 days (Min Liquid) 0.00191219
100 days (Forced Close) 0.00382438
365 days (Buyback) 0.01395899
405 days (IPO) 0.01548874
400 days (Post SELLING div) 0.01529752
410 days (Pre SELLING div) 0.01567996
NAV Post MINING Div 2,807.66887716
NAV/U Post MINING Div 0.01499190
Days Dividend Post Div 392.01
SELLING Dividend -
NAV Post SELLING Div 2,807.66887716
NAV/U Post Selling Div 0.01499190
PURCHASE selling price 0.01574
PURCHASE buy-back price 0.01469
J-D House profit at report 5753
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My point 1 has been addressed - my point 2 (secured only against the assets actually purchased with raised capital) may just be a case of talking at cross-purposes.
You gave the example of hire purchase agreements and secured loans. My point was that your liability for the debt in those cases doesn't extend just to the value of whatever you borrowed the cash for. If you take out a loan on a car, you don't get to limit repayments only to the value of the car.
From your response it seems you agree - and accept that Ciphermines is liable for repaying the bonds regardless of what happens with specific hardware purchased with the capital raised. Which raises the question of what "secured against" means in the context used.
With personal loans the only way out of repayment (other than through negotiation) is bankruptcy. With a company loan the equivalent is insolvency - hence my point that in practical terms the bond is secured against ALL of ciphermine's assets: if it isn't then it's not the company issuing the paper. And in the event Ciphermine closed bonds would have to be repaid before shareholders received anything - debt is always paid before equity in liquidation.
So long as you agree with those principles I don't really care if you want to claim it's somehow specifically secured against unspecified assets that will depreciate without principal being paid down (which would be the case in genuinely secured loans - the capital gets repaid as fast or faster than the backing assets lose value).
The only other point would be that at the time you issue the bonds you should disclose any debt held by Ciphermine which has seniority over the bonds and commit not to taking on new debt unless it is junior.
Thanks for clarifying and I see what you are getting at now. Yes, the bond would be secured against all the assets except that in a liquidation scenario our shareholder contract states that shareholders have the rights to funds released from the sale of CipherMine's hardware in a winding up. My intention is to clearly delineate the two; in that situation I see the following as the process (in order of seniority): - All available means are used to repay CIPHERMINE.B1 bond holders from operating revenues and cash reserves. Assuming this proves inadequate:
- The assets purchased with the bond funds are sold and proceeds distributed to the bondholders.
- The remaining assets (original ones I put in, ones bought with CIPHERMINE shareholder funds and the ones I've "donated") are sold and the proceeds distributed to the CIPHERMINE shareholders.
We could make it so that 2 and 3 require a successful motion of the respective parties, but exclude CIPHERMINE shareholders' ability to veto the bondholders in that scenario? The issue with giving the bondholders seniority over everything is that it would (I think) require a change to the shareholder contract, and to be honest I can't see that motion passing unless I forced it through myself (which would piss off a lot of people). I would sincerely value your thoughts on the above and thank you ever-so-much for your considered input thus far. It is very appreciated!  Kate. You may be surprised at what shareholders will pass - if the benefits of it are explained clearly. I faced a similar situation with LTC-ATF - I wanted to raise further capital by issuing bonds rather than selling more units. LTC-ATF is fund rather than a mining operation - so the assets are securities and crypto-currency rather than mining hardware and fiat currency. But otherwise the situation is very similar (the bonds LTC-ATF sold have a face value in BTC despite the fund operating in LTC). I raised a motion to allow sale of the bonds. I believe a motion has to be raised as significant debt/liability is being incurred when bonds are sold - and even without a specific clause in the contract saying so debts have to be paid before anything is paid to equity holders. I made it explicit in the motion that bondholders would be shielded from trading loss (though there is an exception if an exchange we operate on defaults) and the bond contracts are explicit in bondholders senior claim on assets. That seniority was also discussed before and after the motion. The motion passed with 84.3% Yes votes and no No votes/abstains (it was only up for a day - back then there was no 7 day minimum for contract changes as there is now). Whilst I was (and still am) the majority holder the Yes votes included a majority of all shares NOT owned by me - i.e. it would have passed if I'd abstained. So long as you can convince your investors that the capital raised will generate more profit than it costs to service the bonds (and that the risk of significant loss on that capital is low) you should have no problem obtaining approval from them - as they end up making more profit themselves if the bonds are allowed than if they aren't. The key is just explaining the benefits to them. The idea of a bond with a BTC face value but interest tied to USD is an interesting one (now you've sorted the issue with multiple batches). With no possible loss of face value from exchange-rate movement I can see it having uses for investors that a pure USD-denominated or pure BTC-denominated bond wouldn't - as it allows for hedging income whilst maintaining capital as being pure BTC-denominated. |
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Thanks twentyseventy, BitThink and Deprived.
Very interesting security.
So essentially its a game where I have to predict the correct difficulty increase and buy MINING is its undervalued or SELLING if I think MINING is overvalued.
Yes - for you to make a significant profit someone else has to make a loss (not necessarily the person you buy from - could be someone earlier in the chain or someone you later sell to). It's ALMOST a zero-sum game (it's not quite zero-sum because I take a 3% management fee out and also because profits are made from investment). |
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This isn't a Ponzi scheme, as the dividends for MINING are paid on schedule out of the SELLING reserves. SELLING is NOT guaranteed to make a profit or to necessarily pay anything out. SELLING is paid a dividend only if the Difficulty increases significantly.
So the flow is like this: funds from people buying SELLING become the MINING dividend which is paid out on schedule. If the difficulty goes up a lot and the dividend required by MINING is smaller, then that difference is profit for SELLING and becomes a SELLING dividend. Is this correct? How does the situation change when you buy a SELLING share from someone whos selling one? Obviously the proceeds of that sale go to the seller instead of MINING dividends. The situation doesn't change. If you buy a SELLING from someone else then the funds YOU pay go the person you buy from. But the funds THAT person paid are still held by me and available to pay dividends to the associated MINING share. I hold a fixed amount of cash for each pair of MINING+SELLING (the NAV/U of a PURCHASE). Mining gets paid dividends from that cash as though it held shares in a mining operation. SELLING gets dividends if/when difficulty rises sufficiently that a dividend can be paid and still keep 400 days of dividend for MINING in reserve. When you buy a SELLING from someone in effect what's happening is that by buying, indicating that you believe the likely future value of dividends makes holding the share at that price better than having the trading price. This (DMS) isn't a traditional investment fund where the manager makes profit for you (a small amount is made from investments but not enough to justify investment on its own). Your profit or loss is made based on the trades you make of MINING and SELLING with other investors. You can make profit (or loss) in broadly three ways: 1. By more accurately predicting future behaviour of difficulty then buying whichever of MINING/SELLING (if either) is currently underpriced. At times NEITHER will be underpriced (so worth buying) based on your predictions. 2. By predicting how the market will respond to difficulty changes and other news. typically the market over-reacts which provides opportunities for profit. 3. By arbitraging MINING/SELLING vs PURCHASE and/or trading the spreads on them. I won't make much profit for you - you have to make it yourself. My role in DMS is far more that of an escrow/administrator than an investment manager. |
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why did the price go to 0.0005?
Is the price of 0,0014-0,0016 too high ?
Ah, I think that 24hr low was due to an options trade. I think (may be wrong here) that Bitfunder (same on BTC-TC) reports the strike price on option trades not Strike+Premium. So when an option is sold with a high premium it ends up leaving a very low price in the history if exercised. |
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My point 1 has been addressed - my point 2 (secured only against the assets actually purchased with raised capital) may just be a case of talking at cross-purposes.
You gave the example of hire purchase agreements and secured loans. My point was that your liability for the debt in those cases doesn't extend just to the value of whatever you borrowed the cash for. If you take out a loan on a car, you don't get to limit repayments only to the value of the car.
From your response it seems you agree - and accept that Ciphermines is liable for repaying the bonds regardless of what happens with specific hardware purchased with the capital raised. Which raises the question of what "secured against" means in the context used.
With personal loans the only way out of repayment (other than through negotiation) is bankruptcy. With a company loan the equivalent is insolvency - hence my point that in practical terms the bond is secured against ALL of ciphermine's assets: if it isn't then it's not the company issuing the paper. And in the event Ciphermine closed bonds would have to be repaid before shareholders received anything - debt is always paid before equity in liquidation.
So long as you agree with those principles I don't really care if you want to claim it's somehow specifically secured against unspecified assets that will depreciate without principal being paid down (which would be the case in genuinely secured loans - the capital gets repaid as fast or faster than the backing assets lose value).
The only other point would be that at the time you issue the bonds you should disclose any debt held by Ciphermine which has seniority over the bonds and commit not to taking on new debt unless it is junior.
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Sold 1817
Swapped 0
Total 1817
Price 0.01582
Total 28.74494
Less Fee 28.68745012
Man Fee 0.860623504
BTC Balance (BTC-TC) 2152.554142
9071 LTC-ATF.B1 90.71000000
Coinlenders CD 27/9 200.7836427
Coinlenders CD 12/9 101.3865482
Coinlenders Cash 3.94154443
Just-Dice Balance 245.55000000
TOTAL ASSETS 2,794.92587756
Outstanding MINING 176028
Outstanding SELLING 176028
Outstanding PURCHASE 9469
Effective Units 185497
Block reward 25
Difficulty 65,750,060
Hashes per MINING 5000000
Daily Dividend 0.00003824
50 days (Min Liquid) 0.00191219
100 days (Forced Close) 0.00382438
365 days (Buyback) 0.01395899
405 days (IPO) 0.01548874
400 days (Post SELLING div) 0.01529752
410 days (Pre SELLING div) 0.01567996
NAV Post MINING Div 2,787.83176616
NAV/U Post MINING Div 0.01502899
Days Dividend Post Div 392.98
SELLING Dividend -
NAV Post SELLING Div 2,787.83176616
NAV/U Post Selling Div 0.01502899
PURCHASE selling price 0.01578
PURCHASE buy-back price 0.01473
J-D House profit at report 5850
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- An interest rate of ~22%/year (0.38%/week) based on EUR/BTC value at time of issue (eg. ~€0.0032 / bond / week).
- Bonds to be issued in tranches at discretion of CipherMine management; they shall only be issued if the management is satisfied that they can be repaid and that there is a useful way to spend them.
To clarify my point 2 above, the clash is between the two items quoted above. If you sell the bonds in tranches then there'll be a different exchange-rate when each tranche is sold. You then can't honour the contract in respect of all tranches as there's no way to pay different amounts of interest to different tranches of bonds. Unless you wanted to pay 22% of of face value at the most beneficial (to bondholders) exchange-rate at which you'd ever sold bonds. That pretty much negates the whole point (for you) if exchange-rate moves significantly in EITHER direction between the placement of tranches (as, depending on direction of the move, you'd either have to pay new bondholders a far higher rate than you wanted or upgrade heavily the rate paid to existing ones). |
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Two things immediately spring to mind:
1. If it's valued in euro then the face value has to be in euro. You can't sell all 100k at same BTC price as if they don't sell quickly and the exchange-rate moves it would be impossible for you to honour the contract to investors who bought at different exchange-rates.
2. You can't issue a bond which is only secured against the assets purchased with capital raised from the bonds:
a) That would necessitate you keeping seperate accounts in respect of the bonds - with all purchases recorded as being purchased with bond-capital or purchased with other capital.
b) It's grossly unfair to purchasers of the bonds. They take all losses associated with the bonds but have profits capped at 22% growth expressed in euros.
Bonds are issued by the company and secured against ALL its assets. Bond-holders have senior claim over equity holders.
EDIT: It occurs to me that when you say "based on EUR/BTC value at time of issue" you may mean at time dividend is paid rather than at time the bonds were issued. In that case my point 1 doesn't apply - though it then makes no sense as the interest would be based on BTC face value anyway (just with two currency conversions to get back to where you started from).
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Sold 1377
Swapped 0
Total 1377
Price 0.01585
Total 21.82545
Less Fee 21.7817991
Man Fee 0.653453973
BTC Balance (BTC-TC) 2131.735427
9071 LTC-ATF.B1 90.71000000
Coinlenders CD 27/9 200.6637398
Coinlenders CD 12/9 101.3226319
Coinlenders Cash 3.93932528
Just-Dice Balance 245.80000000
TOTAL ASSETS 2,774.17112401
Outstanding MINING 173706
Outstanding SELLING 173706
Outstanding PURCHASE 9974
Effective Units 183680
Block reward 25
Difficulty 65,750,060
Hashes per MINING 5000000
Daily Dividend 0.00003824
50 days (Min Liquid) 0.00191219
100 days (Forced Close) 0.00382438
365 days (Buyback) 0.01395899
405 days (IPO) 0.01548874
400 days (Post SELLING div) 0.01529752
410 days (Pre SELLING div) 0.01567996
NAV Post MINING Div 2,767.14650160
NAV/U Post MINING Div 0.01506504
Days Dividend Post Div 393.92
SELLING Dividend -
NAV Post SELLING Div 2,767.14650160
NAV/U Post Selling Div 0.01506504
PURCHASE selling price 0.01582
PURCHASE buy-back price 0.01476
J-D House profit at report 5905
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Look at this: user: christina (56748) date: 2013-08-28 07:15:06 betid: 92815409 lucky: 90.6999 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:20:17 betid: 92823811 lucky: 98.7592 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:20:27 betid: 92824092 lucky: 96.9241 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:21:33 betid: 92825760 lucky: 04.4029 target: >04.9999 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:23:06 betid: 92828156 lucky: 98.1992 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:24:05 betid: 92829715 lucky: 03.6291 target: >04.9999 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:24:30 betid: 92830274 lucky: 02.7218 target: >04.9999 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:25:06 betid: 92831248 lucky: 95.6332 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:25:29 betid: 92831837 lucky: 02.7222 target: >04.9999 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:26:02 betid: 92832662 lucky: 99.9926 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:26:19 betid: 92833071 lucky: 96.4261 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:26:37 betid: 92833352 lucky: 99.0986 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:27:11 betid: 92833941 lucky: 92.3438 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:27:32 betid: 92834369 lucky: 95.0132 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:27:38 betid: 92834517 lucky: 96.3805 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:28:00 betid: 92834974 lucky: 04.5399 target: >09.9999 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:28:06 betid: 92835137 lucky: 01.3913 target: >09.9999 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:28:27 betid: 92835658 lucky: 09.3673 target: >09.9999 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:40:33 betid: 92856613 lucky: 99.9124 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:50:30 betid: 92873501 lucky: 99.7091 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:52:56 betid: 92877560 lucky: 98.3884 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:53:03 betid: 92877735 lucky: 00.2374 target: >04.9999 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:55:01 betid: 92881069 lucky: 01.7131 target: >04.9999 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:55:32 betid: 92881918 lucky: 98.3093 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:55:46 betid: 92882303 lucky: 95.1646 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 07:56:04 betid: 92882778 lucky: 97.5701 target: <95.0000 bet: 1.00000000 payout: 1.04210526x profit: -1.00000000
user: christina (56748) date: 2013-08-28 08:12:01 betid: 92906333 lucky: 08.8284 target: >09.9999 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 08:12:32 betid: 92906474 lucky: 99.2856 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 08:12:40 betid: 92906550 lucky: 93.4175 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 08:13:19 betid: 92906972 lucky: 04.8850 target: >09.9999 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 08:13:33 betid: 92907114 lucky: 01.3203 target: >09.9999 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 08:14:02 betid: 92907462 lucky: 96.1347 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: christina (56748) date: 2013-08-28 08:14:10 betid: 92907563 lucky: 91.8527 target: <90.0000 bet: 1.00000000 payout: 1.1x profit: -1.00000000
user: octocoin (2421) date: 2013-08-28 08:38:03 betid: 92930408 lucky: 01.3481 target: <03.0000 bet: 0.00806720 payout: 33x profit: +0.25815040
user: octocoin (2421) date: 2013-08-28 08:38:21 betid: 92930852 lucky: 00.7883 target: <03.0000 bet: 0.01613440 payout: 33x profit: +0.51630080
user: octocoin (2421) date: 2013-08-28 08:41:09 betid: 92934638 lucky: 94.6695 target: >89.9999 bet: 0.01613440 payout: 9.9x profit: +0.14359616
user: octocoin (2421) date: 2013-08-28 08:41:10 betid: 92934665 lucky: 97.2002 target: >89.9999 bet: 0.01613440 payout: 9.9x profit: +0.14359616
user: octocoin (2421) date: 2013-08-28 08:41:15 betid: 92934785 lucky: 99.2084 target: >89.9999 bet: 0.01613440 payout: 9.9x profit: +0.14359616
user: octocoin (2421) date: 2013-08-28 08:41:20 betid: 92934898 lucky: 94.2368 target: >89.9999 bet: 0.01613440 payout: 9.9x profit: +0.14359616
user: octocoin (2421) date: 2013-08-28 08:41:20 betid: 92934910 lucky: 06.0043 target: <10.0000 bet: 0.01613440 payout: 9.9x profit: +0.14359616
user: octocoin (2421) date: 2013-08-28 08:41:21 betid: 92934915 lucky: 98.8157 target: >89.9999 bet: 0.01613440 payout: 9.9x profit: +0.14359616
user: octocoin (2421) date: 2013-08-28 08:41:24 betid: 92934994 lucky: 04.3757 target: <10.0000 bet: 0.01613440 payout: 9.9x profit: +0.14359616
How it can be so much rolls outside of 10-90 range and with same luck per user? Secret is not published, so can't check fairness. Answer is almost certinly that you had a filter on - something like only showing profit/loss greater than 0.2 BTC. When the user wins they only profit by 0.1 BTC or less so it doesn't show up - but when they lose they lose 1 BTC and yo usee it. Same for the other guy below - except there he was betting at high odds so only his winning bets showed up not his losing ones. Nothing strange is happening - just you're seeing only a small part of the results (due to a filter you set) and then mistakenly believing it's all the results. |
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So who's the highly trusted escrow? Not seeing that mentioned anywhere.
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It's baffling how some issuers seem to think unilaterally changing their contract after shares have been sold is acceptable. This defeats the entire purpose of having a contract.
Also baffling is the exchange operator's indulgence of such anarchy. Ukyo would never stand for that nonsense! Bitfunder allows issuers to just edit their contracts - so they can just skip the stage of talking about it on the forum. Not sure why you think that's better - or weren't you aware that was the case? That's how, when Bakewell vanished, he was able to delete his whole contract on Bitfunder (Ukyo subsequently restored it). That's how Icedrill were able to amend their contract mid-IPO without any shareholder vote (the changes WERE all beneficial to investors). That's how TF's fund there changed from a bond with a guaranteed value to a fund with no guarantee without any vote, advance warning or recall of outstanding units (it was done for a sensible reason and is well above the old guaranteed level anyway - but still should not have been possible to do unilaterally). etc Sometimes knowing the relevant facts is advisable before posting an opinion. Changes to contracts on BTC-TC need burnside's approval once any shares have been sold. For many (not all) securities on Bitfunder changes to contracts can be made by the issuer without any input or agreement from Ukyo. You can tell which are which on Bitfinder by looking at the profile for the Security. E.g. go to ActiveMining secuirty profile and you''ll see: Issuer may Modify Description: Yes, without vote. That means Ken can change the Description (which is where what passes for a contract is) at any time however he likes. In short : you are totally wrong. The BTC-TC situation isn't ideal but the Bitfunder one is even worse. |
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Forgive me if this is a really dumb oversight on my part, but I am confused about one thing,
If the house edge is 1%, then in the long run that is the "profit" that should be produced.
JD has had almost 1 million BTC wagered currently (through over 100 million bets), enough in my opinion to smooth out and lucky/unlucky streaks that may have occurred.
Based on this, why is the site profit about 0.6%, a large variance from the 1% I would expect.
I know I have missed something, so who can enlighten me?
If you looked at the 99.9 million small bets I've no doubt the profit would be near 1%. It's the tiny proportion of big bets that cause the difference - which there haven't been enough of to have any expectation of profit being near the theoretical edge. Here's how it happens - consider the following scenario 100 million bets of .00001 at 50/50 only amounts to 1k BTC bet - with an expected house profit of 10 BTC. Actual edge would be very near expectation for sure. A single 10 BTC bet at 50/50 on top of those would mean the house would either be at double expected edge or no profit at all - despite there being 100 million and one bets. That's basically what's happened - with the actual returns being dominated by a relatively small number of large (100 BTC+) bets drowning out the performance of all the much smaller bets. |
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Sold 2493
Swapped 0
Total 2493
Price 0.01588
Total 39.58884
Less Fee 39.50966232
Man Fee 1.18528987
BTC Balance (BTC-TC) 2117.578295
9071 LTC-ATF.B1 90.71000000
Coinlenders CD 27/9 200.5433378
Coinlenders CD 12/9 101.2584495
Coinlenders Cash 3.93710738
Just-Dice Balance 245.10000000
TOTAL ASSETS 2,759.12718926
Outstanding MINING 172712
Outstanding SELLING 172712
Outstanding PURCHASE 9591
Effective Units 182303
Block reward 25
Difficulty 65,750,060
Hashes per MINING 5000000
Daily Dividend 0.00003824
50 days (Min Liquid) 0.00191219
100 days (Forced Close) 0.00382438
365 days (Buyback) 0.01395899
405 days (IPO) 0.01548874
400 days (Post SELLING div) 0.01529752
410 days (Pre SELLING div) 0.01567996
NAV Post MINING Div 2,752.15522858
NAV/U Post MINING Div 0.01509660
Days Dividend Post Div 394.75
SELLING Dividend -
NAV Post SELLING Div 2,752.15522858
NAV/U Post Selling Div 0.01509660
PURCHASE selling price 0.01585
PURCHASE buy-back price 0.01479
J-D House profit at report 5780
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WEEKLY REPORT  Growth in NAV/U (pre-management fee) was 3.9% with an estimate that ~1.75% was trading profits and the rest resulting from the continued decline of LTC vs BTC. With BTC rising steadily vs USD it would be expected that LTC will continue to fall vs BTC due to arbitrage unless/until something happens to cause a rise in LTC's value. If this continues much longer it does pose a potential (minor) problem to LTC-ATF. Under the terms of the contracts for our bonds we are committed to ensuring that the value of our issued bonds does not exceed 150% of LTC-ATF's own NAV (Assets we manage less the value of our liabilities). As LTC falls vs BTC that ratio increases - and currently stands at 108.68%. That's not a problem at present - being barely above the 75-100% range that I consider to be the sweet-spot. But if LTC declines much further then we'll get near the 150% point. If that point is reached (and it would be reached if LTC fell to around .013 vs BTC - lower than that if we make more profit in the meantime) then the fund has to do one of two things: 1. Recall bonds. 2. Issue more LTC-ATF units. As there's no way to selectively recall part of an issue and, in any event, we can use all the capital we have I would go with option 2 - and sell more units into existing bids. Hopefully it won't come to that and if it does happen then it isn't as bad as it may seem. Whilst it would dilute existing investment that is balanced by two factors: 1. The new units would be selling at above NAV/U and so generate an increase in NAV/U. 2. When LTC falls vs BTC profits tend to rise (expressed in LTC). That's because most of our trading is done in BTC - and with a lower exchange-rate each 1 BTC of profit translates into more LTC profit and hence a larger percentage increase in NAV/U. The massive rise in LTC vs BTC is what caused us to be unable to generate the 5-10% profits we were making earlier on - if LTC does fall right back vs BTC then such profits would become possible again. Notwithstanding the above I'd still prefer not to need to issue more units - and will only do so if it becomes essential to do so and then would only do so to the extent that I had to. The commitment to maintain that ratio is a key one from the perspective of bondholders (it's what ensures they can't end up with LTC-ATF defaulting on them if some trades go wrong) and is not one that can be avoided. It's also a sensible one from the perpective of LTC-ATF investors - as it avoids the potential of massive percentage loss of NAV/U from a few bad trades. Given that I'm having to consider this possibility does this mean I was wrong to pay a dividend in July? I don't think so. When the last dividend was paid the exchange-rate was at .0032 and appeared to have stablised in that area. I don't think I could reasonably be expected to predict a fall in the rate to .0013 within 2 months (which is what would need to happen for more units to be issued). Whilst it was always a possibility (everything's always a possibility) retaining unused capital solely to protect against a drop of that magnitude would, I believe, have been unreasonably cautious. Let's hope LTC doesn't fall faster than we make profits - but if it does then hopefully it's at least clear what will happen (and why). I would NOT be able to give advance warning of such sales if the ratio was actually over 150% (I would have to immediately fix it). if the ratio was near 150% but below it then I'd try to give some advance notice to maximise the price new units sold at. Note that I have the right to personally purchase 25% of newly issed units at NAV/U - I would not exercise that right for small batches sold in a rush (nor would I place bids to buy them ahead of others - unless there were insufficent bids over NAV/U otherwise). I WOULD exercise that right if a larger batch were sold with advance notice - to maintain my own equity in LTC-ATF. Management fee of 111 units will be transferred after this is posted. Fund's own bid is at : .657 Back to testing the new transfer bot.
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An exchange-rate senstive IPO needs to either:
a) Only run for a very short period of time
OR
b) Be denominated in USD with the BTC price changing as the exchange-rate moves
OR
c) Have some other clear provision to address any such exchange-rate move.
This is one of the reasons we are offering smaller batches. The time to make changes to the contract is BEFORE you sell any shares or AFTER the IPO has sold out (after a shareholder vote). Making changes to contract in the middle of an IPO should be totally banned. You certainly don't have the right do so unilaterally - debatably (from the BTC-TC terms) you can do so if the change is approved by a shareholder vote (which has to last at least a week). The BTC-TC terms don't explicitly ban changes to contract during IPO (though they should) but there's zero provision for changes being made by editing a forum post. From past discussions on this issue if you DO change the contract now (after a vote) burnside would insist that you refund at full price any investor who no longer wanted to stay in. My view (likely NOT the same as burnside's) is that if there's a mistake/flaw in the contract so serious it needs to be fixed before the IPO has even ended then a full refund should be made to everyone, the asset put back to awaiting-approval status then the issuer allowed to change whatever they want before seeking moderator approval again. The contract is meant to be finished before asking for funds - not some 'under development' thing that changes in an attempt to stumble on a formula that will attract investment. |
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Let me explain what's happening to those too stupid to work it out for themselves (i.e. most of you).
...
Deprived, is this another drunkmail? Nope, that post was made just before I went to the pub not afterwards. Funds were being raised that would not be spent or converted into USD for at least a month (as a full refund was promised at end of September if less than 30k were sold). If BTC fell heavily vs USD then the issuer would be unable to provide what was promised as either: a) The price they were quoted was in USD and they'd no longer be able to buy enough USD OR b) The price they were quoted was in BTC and if they went to purchase they'd be told the quote was no longer valid as the exchange-rate had moved. Conversely if (as is so far the case) BTC rose heavily vs USD then the deal would represent far worse value to investors as they'd be giving away all the extra USD they could have bought. An exchange-rate senstive IPO needs to either: a) Only run for a very short period of time OR b) Be denominated in USD with the BTC price changing as the exchange-rate moves OR c) Have some other clear provision to address any such exchange-rate move. This had none of those. Which is one of the reasons it was horrible from the start - as its behaviour is undefined when exchange-rate moves heavily in EITHER direction. I don't think saying most people are too stupid to even notice that is inaccurate. |
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Look at the hashpower now, 825T/s. If the mining's price is higher than 0.0018, investors must/will lose. And also, selling don't have much profit rate now.
Network hashrate is back to ~575 TH/s, from 770TH/s a few hours ago - was there a lot of equipment turned on and then off, or just a lucky streak? Fluctuations are really never due to equipment getting turned on and off Dunno if that's true. One rather cynical explanation is that drops occur when the less honest suppliers decide to stop private mining with ASICs paid for on pre-orders and finally send a batch out. |
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