Hey psy, you missed one.

An option is a contract transferring the right (but not the obligation) of either buying or selling a specified underlying for a set period of time.

We've tried for about a month now to come up with a satisfactory statistical model that would allow automatic pricing of such an option (something similar to the BTC/USD options available) with limited to no success. Since there is a lot of demand from traders for something of this nature, and since we don't actually have the wherewithal to satisfy that demand, we're opening the books for one competent miner to fill in this role.

This position requires you quote prices for no less than 1k BTC worth of contracts at any given time. The prices are entirely up to you, but there must be bids and asks up for at least that amount. It's not yet decided if the option will be straight difficulty (something like O.DIFF.2MN for instance) or hash-based (something like O.HASH.1GH) for instance. The former would act like a straight forex option, taking the difficulty as the currency rate, the later would act like a commodities option, dealing in the present value of the specified number of hashes (not per second, mind). Alternatively there could be something share based, trading the present value of a "share" if that concept can be sufficiently standardised. All these are up for discussion with the eventual person selected.

In exchange you will receive significant credit support from MPEx, and for that reason only well known and well respected miners will be seriously considered. A strong OTC rating helps.

You can discuss this matter here or via pm, you can also email or make contact on IRC. Thanks for reading.

This is false. The data they have is related, being a [badly selected] sample. As the OP said, still better than nothing.

It's a wonder there's not a lot more of this going on, really.

Let's be nice, mmkay?

Now let's put our thinking hats on for just one second and think. If we held pirate delinquent debt do you think it wouldn't have been posted by now? What sense do you make?

So did you lose a lot on the Ponzi Savings and Thrust?

Right, your distraction skills werk. Pirate is not going to default because you can do reverse dns and a ponzi isn't a ponzi because I am the OP. Got moar?

Go read this and keep quiet to stop further embarrassing yourself. The deeper the hole you dig the further you will have to climb out, and Mr. P is easily the least forgiving type you will meet in your lifetime.

@psy: Your fact is not a fact, inasmuch as I'm here because marked pointed out this thread to Mr. P on IRC on one hand and the PPTAPR.SYNTH is already a whopping success. At the present moment there's no more marketmaking going on by Mircea Popescu, all those bids you see are third parties.

Since you're smart enough to ask the right question, allow me to suggest what is perhaps the right answer.

If you were going to steal a large sum of bitcoin, would it make sense to steal old coins that have been sent to you by well known members of the community, or would it be wiser to steal freshly minted coins?

A, but how to get freshly minted coins...

Well, if you could somehow get the more naive miners to give you their hash power so you can spirit away the freshly minted coins then you'd be all in the clear.

Hmmm... but how to get them to give you their hash power....

Well, if you traded the old and soon-to-be-tainted coins for it it might work, mightn't it?

The price paid by GPUmax simply reflects pirate's desperation to wash as many coins as possible before this entire thing blows. Let me guess, has price going up since the 17th? Nice how that worked out then.

Since up until this point there has not existed a way to short shares, and since the larger part of the community playing around on this forum is at best unqualified to deal in securities, it seems worthwhile to take the time and explain the matter in simple terms.

All price on a free market is created by the meeting of supply and demand. This price only reflects the real value of the underlying to the degree it is in fact obtained by unimpeded negotiation between the full supply side and the full demand side.

For instance, in a circumstance where a country institutes an import duty, the price of the good in that country will not reflect the real economic value of the good, because the fake inside price is created by the meeting of the full supply of the buy side (consumers inside the country) with a portion of the sell side (those suppliers which either are not foreign or are willing to pay the duty).

Securities are not actual physical objects. Their supply and demand does not reflect constraints of the physical world in the sense a ton of coal or a new-smelling car do. Their supply and demand reflects the opinions, beliefs and convictions of economical agents as to the future prospects of the underlying.

You might have heard the expression that on the short term the market is a voting machine, but on the long term it is a weighing machine. The voting part is the sort of superficial "civility" and smarmy group-think that happens on a regular basis on this forum as a result of the simple way all social-media works (aggregating groups with mistaken but similar views). The weighing part is only now starting to show, in part because the market wasn't really old enough for anything of the sort, in part because nobody (on WS) cared up until now.

In order for share prices to reflect actual share value, there must exist a means for actual demand to meet and negotiate with actual supply. The asymmetrical situation in which only buy orders are available (as it used to be the case in the days when GLBSE dominated the btc-securities market) provides the problem that while votes of confidence can be cast (X buys some shares) votes of disconfidence can not be cast (what's X to do, buy some shares so he can slam-sell them?).

This asymmetry constantly creates and inflates bubbles, which is the primary cause for the numerous defaults that are dotting the early history of GLBSE-driven bitcoin securities, and is incidentally not lost on malicious or simply stupid parties who readily and regularly claim that as a public company they are only accountable "to their investors" whenever mismanagement and other inefficiencies rear their ugly heads in public discussion.

What were the people supposed to do in order to show that SkepsiDyne isn't a well run, worthwhile entity? Keep their mouth shut and somehow deal with the losses, cause sure as hell there's not going to be any buyside market depth for an ill managed asset. What are people supposed to do when someone "sounds like they're doing poor/bad business but for the second time I have managed to increase profits before production has even began"? Keep their mouth shut and hope for the best, who knows, maybe.

This isn't how a market works. A market is not built on making each other feel cosy and warm and validated and important. A market works by putting your money where your mouth is, and for that to happen there must exist avenues for both sides of any argument to put money on the line. Short selling accomplishes the other half of this requirement: with it available naysayers have a ready and efficient way to voice their concerns in the only way that matters, economically, and in a most productive way at that. In a way that ultimately benefits everyone, the longs, the issuer, the observers, people on the fencelines trying to gauge if BTC is a scam or the currency of the future and so on.

Short selling is ultimately a tool, used for a specified purpose. Learn to use it and learn to love it because it's not going away.

This will be a maintained list of the MPSICs which are available to borrow from Mircea Popescu directly.  To get exact quantities available and specific terms you will have to get in contact on #bitcoin-assets on freenode. In general loan terms are a week or a month, but this can be tailored to your own needs. Depending on your status on the exchange and your otc ratings you will be required to post collateral. In any case you will be required to gpg-sign a loan, repo contract or equivalent.

S.MPOE
S.DICE

Valid until rescinded.

Note that in any case other market makers, institutional investors, traders with significant volume scl could have blocks of shares available to loan themselves. This is a simple and painless process on MPEx via the PUSH command, freely available for everyone, so inquire with your usual counterparties.

I would like to take a moment to point out (to everyone's delight, no doubt) that since the MPOE and subsequent MPEx issues of nonvoting shares on large float everyone's doing nonvoting shares on large float (as opposed to the previously employed nonsensical if idealistic GBLSE method of voting shares, tiny float).

This is a good and welcome thing for a number of reasons that apparently either nobody felt equal to the task of discussing or nobody was too curious about.

We will obviously continue to lead the community by freely providing competence and insight into how securities markets actually work. Perhaps the greatest advantage of bitcoin for the "next door" demographic is that they get to interact directly with people they would not otherwise have met in a million years (gross estimate).

@Teal: Are you aware at least vaguely how many times that post was changed since the 14th? Your point stands on its head.

You should have been here on the 19th, if you had a point (which you don't). Two days later and after one major liquidity event (as measured by the market) is too late. Go ask people for proof the BP spill happened, cause Mr. Dwayne of Bumfuck Montana hadn't heard about it back in 2005 when he last bought a newspaper ffs.

All this nonsense aside, as to sukrim's concern: all the PPT people have to do is issue 2500 PPT.B and the asset isn't impaired anymore. So you can actually go from buying today at .7 to getting 1.28 in about a month. Not that it'll happen, but if you like longshots.

@Sukrim: All in all you can buy the asset if you like it, or sell the asset if you dislike it. Do you comprehend this? Please make some positive indication because at the time being the feeling is I'm trying to talk with a recording.

@Teal: The "o Burt didn't REALLY say it" objection would have had a point ~2 days ago, when this was announced. Today it's spurious. Quotes from the 14th in reference to an event taking place on the 19th are also at least a little misplaced.

The thing which now reads "[ANNOUNCE GLBSE] 1500 PPT.A Pirate Pass Through Bonds" was [ANNOUNCE GLBSE] 2000 PPT.A Pirate Pass Through Bonds for a few days. The fact that the forum allows you to surreptitiously change your words does not mean you did not in fact say them.

I understand people have a little difficulty with notions such as responsibility and so forth, but when money's involved all plays are for keepsies, and they have consequences.

And again, you can just SELL them if you don't want to BUY them.

I'd think it's in the contract, but to rehash: if Burt Wagner & co stuck to their word and issued 2k shares as promised each week and pirate didn't default and the payments were made as promised, each share was going to pay 0.00128, each 1k shares 1.28 BTC.

If pirate defaults or payments aren't made shares are worthless.

If Burt & Co fail to issue the amount they claimed they will (which they already have) the value of shares is the proportion of 5 x 2k they actually do issue. So far if they do 4 more of 1,5k each that proportion is 75 cents to the dollar (putting a share at 0.00075, or .75 BTC per 1k) and if they do 4 more of 1,5k each that proportion is 95 cents to the dollar (putting a share at 0.00095, or .95 BTC per 1k). All this of course provided that the rest of the deal - ie regular payments and pirate non defaulting hold true.

You do realise that this contract was written before the wanna-be bankers defaulted on their original arrangement, and came up with 1500 instead of 2k, right? Obviously the bond would reflect that.

Otherwise, ~70 cents paying 95 is on the last call +35%, so still way better than the supposed 28%.

If you don't believe that Burt & Co / Pirate are actually going to ever keep to their word (an opinion shared by more and more as time goes by) you can go right ahead borrow some shares and try and sell them. That's the beauty of an actual free market (something the alternative is not): you can take either side of the deal.

Apparently somebody can't do math, and that somebody will be enraged. Thanks for pointing it out. It should be 0.00060000  not 0.00050000.

Otherwise "the due if any" should be pretty clear, I'd say, no?