Maybe I should also point out that we've been hacked a total of zero times since August 5, 2011.

From bitcoinica right now:


73661.62 BTC * 1.152 / 100 = 848.581862400 BTC

From Thursday, 1 September 2011 to Friday, 2 March 2012: 183 days.

If bitcoinica grew linearly (unlikely, but for the sake of argument)

848.581862400 * 183 / 2 = 77645.240409600 BTC, or less than twice the 43k lost.

Basically Zhou is putting most of this revenue to cover for this loss, which shows real mettle. To all the people going "o, he's a 17 yo kid": no. He's a 17 yo man.

After a few years of relatively happy marriage, a husband once discovered a crate under the bed. In it, three potatoes and about 50,000 dollars in cash.

Very puzzled, he asks the wife what's with the crate with three potatoes and a bunchload of money. She sits him down because they have to talk, and proceeds to explain that every time she cheated on him she had the stud bring her a potato, which she'd then put in the crate.

- Ok, and the fifty grand?!

- Well... when the crate'd get full I'd take it to the farmer's market and sell it.

Now all this aside, let's get to the point. The fact that a woman is exchanging sex for potatoes would then constitute potatoes into a currency and require any and all swapmeets where potatoes are found on the premises to AML, KYC, etc bla bla bla?

Obviously the general tendency of any and all institutions since the beginning of time is to posture themselves into unwarranted importance. Still, when exactly do the potatoes become a currency?

*Points to sig*

I hadn't realised bitcoinica was an exchange.

PS. 9% withdrawal fee ouch.

This.

That's very good news. GLBSE gets execution brownie points.

This is true, at least in principle it could be done. Onefixt and others have pointed this out privately, as a theoretical possibility.

Mircea Popescu isn't buying his own stock however sadly there's no practical way to prove or verify this. Also as a theoretical possibility the owner could tomorrow grant himself another billion shares, or decide on a 50% retainment of funds (which would in effect dilute the shares, at least on the basis of dividend outflow) and so on and so forth. The fact that none of these are happening or will happen is in the end a matter of trust.

Ideally as the price of the stock stabilizes the point will lose its relevance. It seems in a sense a self-limiting problem, and possibly the reason why such a small fraction of MPOE opened the stock sales.

The results of the first round are out.

What happens if Butterfly Labs just comes up with a bankruptcy/receivership announcement?

Bitcoins are new, the community spirit is strong, for most people this is more about having fun together than about turning $5 profit.

Indisputably it's worth something. In fact that's exactly what we're trying to find out: how much?

IP would be tangible, but since it's proprietary and like in all finance, a secret closer guarded than the king's crown it might as well be intangible (in fact, ideally it is intangible hehe). Brand recognition is outright an imponderable.

Overall, the discussion could be summarized something like this:
Step 1 : it's unfair that bonds are inferior to stocks in that they take risks when the stocks take no risks.
Step 2 : it's unfair that bonds are valued on a per-btc value whereas stocks are valued on a total pooled investment basis, so a bitcoin of bonds is a bitcoin of bonds but a bitcoin of stocks could be ten or ten million so there's a huge risk associated with stocks.

Well... which is it? Cause both can't be argued at the same time.

You might want to give a look here.

"Here's this thing with no tangible assets that I own and believe you me that it's worth X dollars." What would you call something of that kind?

This for one edge of the problem. Now, on the softer approach, "I sell this, and will not take less than Y", the Y is arbitrary and thus almost certainly mistaken. How would you go about establishing it?


The thing is, if you want to go that way about it you're probably best served trying to get ahold of someone who bought on IPO and buy from them. In other words, you're a 2ndary market buyer, not an underwriter. Nothing wrong with that, but just because you're B rather than A doesn't really make a good case for A not existing.

The alternative process you describe would also work, for sure. It'd be a lot more like a traditional bookbuilding exercise. It'd also carry slightly higher administration costs. Between something like you describe with a minimum of 50-100 BTC buy-in + no guarantee of block fulfillment versus the system actually in place with a 0.1 BTC minimum buy-in + guaranteed block fulfillment MP preferred in the end the latter. Obviously everything is a trade-off, with strong and weak points.

In fairness, he didn't (yet) eat the stone.

This has actually happened.

I think your analysis was biased, but not in the sense you suspect (swayed by your company ownership). It was biased by very specific and not necessarily universal assumptions you made. What teek pointed out about his shares tracking difficulty is very valid, for instance, I wouldn't expect his particular dividend to track the BTC/USD pair. Also the point about verbosity, an owner that spends a lot of time writing posts on the forum isn't either a silver bullet or necessarily a bad thing. Can pan out either way, and I don't see anyone holding the no BS approach against teek for instance.

Doesn't seem anything has changed or would need updating, but maybe a reference by link might be useful. I'll bring it up with Mr. P.



Depends what assumptions you are working on. If you assume everyone else is an idiot then it makes no sense to invest anything at all. If you assume the other people are clever, well informed individuals then investing 500 into something that sees a hundred times that investment from someone else seems a good bet. Being the top dog in the round might be dubious, but being one of the people who put money in seems hardly a bad idea.

Obviously, it's high risk so not a good place to put your house (and I think Mr. Popescu has already indicated he believes this first round to be oversubscribed already) but it has over bonds the advantage that you only risk once. Think of it as little turtles coming out of their eggs: they rush to the sea. Some make it. Those that made it get to lay eggs someday.



More than hard, it would be plain impossible. How do you value an entity with no tangible capital that you own? You don't, only the market can and only the market should. Anything else is practically speaking fraud.


Two points of importance here: first, that you can see what money flows in and when by looking at the exchange bitcoin address (1JPvucRfu3ZzEvfBUQTJwsxMrZjeTqD6zR) on any of the blockchain explorers, so you can make educated guesses about what's going on. Second, that if in fact someone is willing to offer 100k BTC for 0.1% then in fact that's what the interest rates are, and you've lost at most 0.1% over your capital. In the end nothing prevents you from also offering your capital for 0.1% which has no practical downside (if the needs fill at say 1.7% then everyone gets 1.7% anyway), except of course in the case everyone ends up doing this. But then again, if everyone ends up doing this that's the fair price and so on.



The thing here is that MPOE has been operating and will continue to operate for the foreseeable future with or without investment in the form of bonds from third parties. Thus the only incentive it offers for investing is a purely financial one, there's no social relations being built in this sense you seem to be thinking of. It's a financial, not an emotional venture. If people find the benefits sufficiently attractive they invest, if they find them insufficient they divest. If they get upset on the fork for being too long or too short... well really, that's not a problem the fork can address, a shrink is in order.


There's no practical way to fairly price that fee.


I think that's the situation for most people. Luckily MPOE isn't going anywhere, and so all these unknowns can work themselves out in time I imagine.


There have been plans for this since the beginning, from what I understand. The problem is that it's quite unclear yet how would one go about allowing anonymous underwriting. It sounds like a contradiction in terms, doesn't it? What do you write in that underspot?

Basically it comes down to a clash between anonymity and completeness and so far the former seems to be winning out. This may change, but it's not at all clear how exactly, or when.

Short story: We'd love to, we don't know how.

Your idea to make a sort of mining ETF is still pretty good.

FWIW, this sort of debate is very useful & productive if nobody loses their temper.