Whatever, yeah I can make you a coin. Thinking you say shit doesn't prevent me to do business.
PM me the features you want, I'll tell you how many I want for this. And if you wonder, I publicly promise I won't disclose your great ideas. So Vlad is on to the next pump & dump. Funny thing is that with 2391 blocks to go and hashpower dying (180 sec between blocks vs 70 sec target) you could launch the new coin before NUG ever gets to the first super block. |
|
|
|
And if no one do not buy new hardware, nobody wants bitcoins and bitcoins price reduce. Now everyone usually buy bitcoins for new hardware. More hardware you have more difficulty you increase and you have buy more and more hardware. But if everyone stop buy new hardware where to put bitcoins? bitcoin price will 0 $ ;/
Um no. Bitcoin is more than mining. Lets be honest here, no its not. Not really. Probably 95% of people who back bitcoin and scream viva la revolution do so as they mine, in hopes of getting rich. I mean dont get me wrong the whole concept is pretty neat and all, but its not likely to ever get too big, because if it does you can bet uncle sam will lay the smack down. Not true at all. The vast majority of people are simply buying bitcoins on exchanges, not mining them! Bitcoin mining is only a tiny part of what bitcoin is all about. And it's becoming smaller and smaller. While true, there wouldn't be any coins to buy/sell without mining. And yes I understand in the future mining will be almost irrelevant after a certain point. We are close to that point already. Daily volume is significantly higher than total new coins mined even if we assume that 100% of newly mined coins instantly hit the exchange. You really think if mining output was zero tomorrow that there would be no coins to buy or sell? What about the 11M+ which already exist? In last 180 days 20,591,491 BTC exchanged hands on the top 10 exchanges combined. That is 114,397 BTC per day. New minting is 3,6000 BTC per day or about 3.1% of total volume (assuming 100% of mined coins go directly to the exchanges for sale). http://www.bitcoinity.org/markets/list?currency=ALL&span=6m |
|
|
|
Solar isn't free. You are simply buying the lifetime power output up front.
(Total purchase costs + total lifetime maintenance cost) / (lifetime power produced = cost per kWh.
That's true. You're right, it's not free. It just gets less and less expensive the longer it runs... but it could need replacement too. I suppose I didn't look at it this way-- thanks. You have helped me come to grips with the modern power grid and not waste my time and money lol Well it isn't they "may" need replacement. Solar panels have a finite lifespan. Even excluding things like damage due to hail, wind, etc the panels will slowly lose output. Not electronic circuit will last forever. Every single solar panel ever produced (and everyone one which will be produced) will eventually become worthless. Now the lifespan is measured in decades (most panels have a 20 yr or 30 yr rating) but the output will slowly degrade, a 0.25% to 0.5% drop in output annually is a good starting point. The inverter generally won't last more than a decade. It is under a lot of stress and heat. Even a high efficiency one say 94% means 6% is converted into heat and 5KW * 6% = 300W which is a lot of heat for 24/7 operation over a decade). Add to that annual maintenace (cleaning panels, replacing frayed wiring, checking connectors, etc) and it is hardly infinite power with no additional work/cost. Solar power is simply a source of power. With the right prices, right location (amount of solar insolation) and right subsidies it can be cheap power (well cheap for you paid on the backs of taxpayers) but it is still power at a certain cost. Another thing to consider is cost of capital. With a solar power plant (much like a nuclear power plant) most of the cost if upfront. This means you are essentially buying 20-30 or even 40 years of power on day 0. If your return is low say 3% return (lifetime cost is 3% lower than buying grid power on an annualized basis) it may be "cheaper" to invest that money and earn a return of say 6% and use that to buy grid power. |
|
|
|
The issue with solar power is the need for 24x7 uptime on your rigs (your ROI would drop precipitously if you only ran them during the day when the sun is up). That isn't necessary with net metering and grid tie system. Batteries are only necessary if you want power during a power outage. Kinda useless for mining (as likely your ISP will be down as well) but useful for other things (like having AC and refrigeration). IF your miners use (hypothetically) 1000W then in a day it would use 1KW * 24 hrs = 24 kWh. If your local solar insolation (# of hours of peak sunlight) is 5 then you would need a ~5KW system. The output will vary durring the day. Durring peak sunlight (say noon on a clear day) the unit may output as much as 5KW, earlier and later in the day it may output only 2KW-3KW, in the morning or evening it may only produce a small fraction of that. It doesn't really matter the individual output each hour. In the long run over a year a 5KW system located where solar insolation is 5 will produce 5 * 5 * 365 = 9124 kWh. Sometimes it is producing more than your miners need, and sometimes it is producing less. When it is producing an excess your meter "spins backwards" and when it not producing enough your rigs will draw from the power grid. You can think of the entire power grid as a "battery" of sorts. In the end you are just billed for your NET USAGE. That is the total power drawn from the grid minus the excess power returned back to the grid. That being said solar (even with subsidies) in most countries is still relatively expensive. The break even point is often 10-15 years out and the lifetime (yes solar panels have a finite lifespan) is generally a pretty low ROIC%. |
|
|
|
TL/DR version:
FinCEN wanted to regulated Bitcoin exchanges. The proper thing to do would get Congressional oversight in the form of expanded regulatory powers but that might have taken years. FINCEN did a bunch of mental gymnastics and called exchanging currency money transmission and that is what we are stuck with.
The Foundation challenged this in its response letter. It may yet get litigated if not legislated. Agreed however US law is slanted against such action. There is an issue of standing. For example the foundation has not registered as a MT, they have not been indicted by the SEC, by their own admission they are not a MT. Therefore they have no standing to fight this in federal court. The SEC wouldn't even defend such an action they would simply file motion to have the case dismissed for lack of standing. To fight it in court requires you to violate the law, get charged, and then use that as a defense. Most entities won't take that route, they will a) comply (even if they know that the law is stupid/bogus, b) go around the law (operate outside the US for non-US clients), or c)willfully violate the law in such a manner that makes prosecution difficult (aka Silk Route method). It is entirely possible there will NEVER be a well funded, well operated entity which has standing. I will give you a concrete example. DC had a gun ban for 30+ years. It was obviously unconstitutional, it wasn't licensing, or registration it was a complete ban on the most common form of firearm used for self defense. It wasn't a ban on carrying in public, or transporting, or use. It was an absolute ban on personal ownership in all forms and places with the city. It took 30+ years to find someone with standing and not for a lack of trying. There were dozens of cases which were summarily dismissed for a lack of standing. To have standing would require someone in DC to a)have a firearm, b) bring it into the city, and c) take it in person to a Police Station in an attempt to register it. If they did that they would have standing when denied, they also would be arrested on the spot and would be looking at 5 to 15 years in prison for unlawful possession of a firearm. Not surprisingly nobody had standing. Lots of people broke the law in secret but since they didn't attempt to register it they lacked standing, many more requested to register a firearm but since they didn't have a firearm they also lacked standing. It wasn't until the Heller case that a civil rights group found a plaintiff with standing. Mr. Heller was a licensed security guard and as such had a limited license to carry a firearm ONLY on duty. While on duty he took it to a Police Station and attempted to have his work firearm registered for personal use and was denied. BLAMO.... the legal challenge survive a motion to dismiss and the rest is history. Even then the court cases took 7 years to reach a decision by the Supreme Court and required a legal team with costs over a million US dollars. Had there not been that "Heller loophole" it is entirely possible that the DC gun ban would still be standing today. Not due to any Constitutional merit but merely because no plaintiff had the required standing to challenge it. |
|
|
|
There have been quite a few references and questions regarding BTC-TC, so I'll address things as best I can. - One of the fun things that I'd like to know regarding the 1933 securities act is what their definition of profit is. Since I've never cross-connected BTC and Fiat, I'm not sure where the connection gets made. For all I know, a hole in sha256 will be discovered tomorrow and BTC will be shown to have zero value in terms of Fiat. It seems like by the strict letter of the law, playing a game such as Monopoly is illegal, as the little paper moneys have SOME fiat value, no matter how finite. - Location of the servers is an issue. This is partly why we do the several times a day emails to issuers of the share lists. Addressing the server location issue has been discussed and will be tackled as soon as I can garner some trustworthy help from someone that can bootstrap an installation from bare metal. Biggest issue is that I simply cannot trust a random ISP's platform install. I may even end up having to make the trip myself. - Humans involved could be nabbed. Three things about this: 1) They'll nab anyone they want for anything they want. We've all done something wrong. (google "three felonies a day.") There's so much vague crap on the books in the US that they can find something on anyone. 2) Things changed very recently with the "Bitcoin is money" approach the feds have taken. Prior to that our legal approach was that Bitcoin is WOW Gold or Linden Dollars and we were a game. (Someone want to explain to me the difference? Why is WOW Gold or Linden Dollars not on the SEC website? Both have exchanges (eg: ebay) and investments going on.) To what extent law breaking occurred depends on a whole lot of things. Probably the easiest way around this is for BTC-TC to stop accepting traffic from US users. 3) I've been looking for overseas investors to take over the majority stake. My personal goal is to get to where I'm the "programmer for hire" and really nothing more. This is why so much of the site is setup to be self sustaining. The site really won't miss me much with the exception of the issues I have been running. Which brings me to: - Exposure on LTC-MINING and LTC-MINING.LTC... Please sell me back your shares.  Both of these are in closure mode. - Exposure on ASICMINER-PT... this one I'm not sure there's much exposure on... it'd be hard to pin any losses for example on the PT rather than the underlying issue. Probably I'll have to close it to US participation though as well. - It'd be interesting to try to pin down -exactly- what distinguishes a game from an investment. To me it's always been about learning the trading ropes in an environment that didn't involve losing "real money". That was why we started on Litecoin. It was a convenient in-game currency. To me it's as cut and dry as it is for WoW. I have no problem telling the difference between the game world and the real world. One I walk around in for real. The other I have to sit at the computer and log in and interact through a computer. Take this same argument to BTC-TC and I have to ask myself, can I interact with BTC-TC in the real world? Or do I HAVE to sit down at a computer and log in to play? The answer so far as I can tell is that no, I cannot use my bitcoin in the real world. I cannot hold them, I cannot buy starbucks with them, I cannot trade them at any shop in town that I am aware of. I cannot call my broker and buy them or buy anything tangible using them. For me and 99.9% of americans they're still an imaginary experiment. I get back to wondering why all of a sudden the SEC/FinCEN decided out of the blue to recognize them. The only thing I can come up with is so that they can prevent them from ever becoming "real". To prevent people from using them they have to make examples out of people and to make examples out of people they have to first recognize them. A bit of a catch-22 for sure. I'm also still wrapping my brain around why all of a sudden Bitcoin is money to the US when so many prior incarnations of similar things are not money. The Feds have argued for a century that the only real money is the money they (or another government) print. Time and again rather than allowing commodities that act like money to exist, they have shut them down and denied that they ever were "money" or "currency". It's definitely caught me somewhat by surprise and the site needs to make some changes to co-exist in this new world order. In any case, there are definitely things that need to be improved for the site. I hate to say this, but barring some kind of loophole, it may come down to excluding US citizens from playing the game.  Rather than try to naunce some terms like "profit" why not look at SEC case against BTCST. Pretending something is a "game" is not a defense. If it looks like a duck, and quacks like a duck, the courts are going to find that it is a duck. There is ABSOLUTELY nothing which requires an investment to be in legal tender or even money in general. The definition is intentionally broad and courts have created substantial precedent allowing non-standard investments to be considered investments. The very fact that Mr. Shavers advertised in the "Securities" portion of the forum is used against him. However why not read what the SEC actually allegedes in the complaint. Spoiler alert the following are not a legal defense and no competent counsel would tell you otherwise: 1) It is not an investment because ... Bitcoin. 2) It is not an investment because ... "it is a game". 3) It is not an investment because ... "I can't interact with BTC-TC in the real world" (Hint: I can't interact with the NYSE in the real world either). Trying to self-rationalize why "LTC is a game" is a fools errand. The law rarely ever is based on "common sense". Find legal counsel able to stipulate that you and you might have the start of something. The BTCST Investments Are Securities as Defined by the Federal Securities Laws
The definitions of “security” under Section 2(a)(1) of the Securities Act [15 U.S.C. §
77b(a)(1)] and Section 3(a)(10) of the Exchange Act [15 U.S.C. § 77c(a)(10)] include both
“investment contract” and “note.” Courts “are not bound by legal formalism, but instead take
account of the economics of the transaction” to determine whether a security exists. Reves v.
Ernst & Young, 494 U.S. 56, 61 (1990); see, e.g., SEC v. SG Ltd., 265 F.3d 42 (1st Cir. 2001)
(holding virtual shares in virtual company existing only online were securities). “Congress’
purpose in enacting the securities laws was to regulate investments, in whatever form they are
made and by whatever name they are called.” Reves, 494 U.S. at 61. (emphasis in original). The
BTCST investments qualify as both investment contracts and notes and, thus, are securities.
An investment contract is any contract, transaction, or scheme involving (1) an
investment of money, (2) in a common enterprise, (3) with the expectation that profits will be
derived from the efforts of the promoter or a third party. SEC v. W.J. Howey & Co., 328 U.S.
293, 298-99 (1946); see Long v. Shultz Cattle Co., Inc., 881 F.2d 129, 132-33 (5th Cir. 1989).
The “investment of money” element may be satisfied by consideration other than money. See
Int’l Bhd. of Teamsters, Chauffeurs, Warehousemen and Helpers of Am., 439 U.S. 551, 560, n.12
(1979) (the “investment” may take the form of “goods and services”). Moreover, BTC is money.
BTC may be used to purchase goods or services, or exchanged for conventional currencies,
including the U.S. dollar, Euro, Yen, and Yuan. Recognizing as much, the Department of the
Treasury issued guidance concerning the applicability of the regulations implementing the Bank
Secrecy Act to virtual currencies such as BTC. See Treasury Guidance (FIN-2013-G001) –
Application of FinCEN’s Regulations to Persons Administering, Exchanging, or Using Virtual
Currencies (Mar. 18, 2013). In the Fifth Circuit, the second and third elements of an investment
contract are met where investors are dependent upon a promoter’s expertise, just as the BTCST
investors were dependent upon Shavers’ supposed expertise in BTC market arbitrage, to generate
the returns promised on their investments. See Long, 881 F.2d at 140-41.
Any note is presumed to be a security unless the presumption can be overcome because
the note bears a strong resemblance to one of several judicially-enumerated instruments that are
not securities. Reves, 494 U.S. 56. The types of notes that are not securities include a consumer
financing note, a note secured by a mortgage on a home, a short-term note secured by a lien on a
small business or its assets, and a note which simply formalizes an open-account debt incurred in
the ordinary course of business. Id. at 65. The factors used to determine whether a note
sufficiently resembles these “non-securities” and, thus, is not a security under the federal
securities laws are: (1) the motivations that would prompt a reasonable buyer and seller to enter
into the transaction; (2) the plan of distribution of the instrument; (3) the reasonable expectations
of the investing public; and (4) whether some factor, such as the existence of another regulatory
scheme, significantly reduces the risk of the instrument, thereby rendering application of the
securities laws unnecessary. Id. at 65-67. Here, the transaction between Defendants and the
BTCST investors had all the earmarks of an investment, suggesting a security, and no
commercial or consumer aspect, as with the judicially-enumerated instruments that are not
securities. The BTCST investments were offered and sold to a broad segment of the public as
Plaintiff’s Emergency Motion for Order to Show Cause, Asset Freeze and Other Ancillary Relief
investments. Moreover, no risk-reducing factors existed to militate against a finding that the
BTCST investments were securities. No other regulatory agency oversees the BTCST
investments, and BTC itself is a virtual currency, with no single administrator, or central
authority or repository http://ia600904.us.archive.org/35/items/gov.uscourts.txed.146063/gov.uscourts.txed.146063.1.0.pdfBTW I am not a lawyer and none of this should be considered legal counsel however the highlighted #3 is going to be a killer. You can call it a "game" all you wan't, you can scream "GAME, GAME, GAME" as they deliver a summons but if the "reasonable expectations of the investing public" don't see it as a game but as an investment well that is going to ring hollow. This entire forum is already reviewed by the SEC (as evident by the detailed threads recorded and notarized in the action against Mr. Shavers). You pointed out what about Linden dollars and WOW gold. Well Linden has taken steps to eliminate in game investing and gambling for this EXACT reason (to avoid being regulated by SEC) and Blizzard provides no convertibility and takes steps to ban gold to USD exchangers. Now people still do it but it provides Blizzard and Linden some level of deniability. Having an "asset exchange" which is denominated in the worlds largest and most liquid virtual currency is hardly the same thing. What steps have you taken to prevent people from generating (or promising) real world profits by playing this "game". I mean if you call it a game in name only it isn't going to take a rocket scientist to pierce that paper defense. Sudaffed can be used to make meth and that isn't the distributors of Sudafed's fault however if the box of Sudafed came with instructions on making meth and your local drug store held meth demonstrations on weekends obviously the DEA would be looking at those distributors in a different light right? There is a difference between misuse of a product and the use of product as intended. Do you honestly think (hint SEC likely has already downloaded an archived copy of this entire forum, plus your entire website) that based on your words, the words on your site, and the words of your issuers that an average juror is going to see this as a "not for profit" game. Forget the prosecution's case imagine the jury just read "your side". Do you honestly think they are that dumb? Really you have three logical ways forward and one of them involve anything as silly as "if we keep calling it a game we are exempt" a) The MtGox model. becomes licensed and regulated. Most likely it will be insanely expensive, time consuming, and difficult. Even if licensed your business model would need to change radically (hint there are no anonymous investments in the US, so called "bearer" bonds/notes have been prohibited for the better part of 40 years). I just include this option for completeness. b) The PokerStars model. ACTIVELY exclude US residents, citizens, and entities from either listing or trading. Simply having a checkbox "I am not a US resident" is likely not sufficient, just ask the foreign online poker sites that the DOJ took down (servers, companies, and bank accounts all in non-US soil and the DOJ got sufficient help from governments where the activity was legal to seize assets in excess of >$500 million). You likely will need to consult with SEC on what would provide you a safe harbor exception but based on online poker's fallout I would imagine they would look for policies which require proof of non-US residence and actively blocking US based IP addresses. c) The SR model. It is illegal and so what. SR doesn't try to pretend they are a "game" that is just an idiotic half step. Make sure your servers, operator's identities, assets, and operations are sufficiently shielded that prosecution becomes difficulty if not impossible. Note that the SR wouldn't exist if they tried to pretend US laws didn't apply, that is just dumb. They embrace the illegality of their actions AND are very conscious that lots of agencies with lots of resources would love nothing more than to shut them down forever. I am sure that provides a lot of motivation to ensure they are diligent in keeping themselves shielded. Nobody on the SR has to check a box saying this is just a "indirect delivery game", everyone is a grown up and they know what is going on. |
|
|
|
|
Solar isn't free. You are simply buying the lifetime power output up front.
(Total purchase costs + total lifetime maintenance cost) / (lifetime power produced = cost per kWh.
|
|
|
|
|
Two things make it dead in the water:
a) it would require a hard fork and that is simply not going to happen. I know people love to think up these great "hard fork" solutions but it is similar to thinking up how to make cars runs on magic when wizards return. Great for mental masburbation but 0.000% chance of getting beyond the paper stage.
b) you shouldn't be reusing addresses. Period. For anything. Ever. Under any circumstances. All it does is reduce your security, and make it significantly easier to track your transactions. Addresses are essentially free. No need to conserve them.
|
|
|
|
|
Because FINCEN felt the need to force Bitcoin (square peg) into a round hole (existing MSB regulations) and the only place it would fit (kinda) was Money Transmitter classification. They DID NOT determine that exchanging USD for BTC (or BTC for USD) was similiar to someone exchanging USD for EUR or EUR for USD = currency exchange. They decided exchanging BTC to USD was similar to Bob paying Alice by using a third party (think Western Union) = Money Transmitter.
There is a classification called "foreign currency exchange" which is a MSB (money service business) but isn't a MT (money transmitter). Using "common sense" OF COURSE exchanging Bitcoin for "real" currencies has more in common with a currency exchange then money transmission but FINCEN couldn't make that fit (regulations define the words foreign in foreign currency exchange). The only thing they could force Bitcoin (square peg) into in the MSB regs (round hole) with a massive amount of force (asinine leaps of logic) was Money Transmitter.
TL/DR version:
FinCEN wanted to regulated Bitcoin exchanges. The proper thing to do would get Congressional oversight in the form of expanded regulatory powers but that might have taken years. FINCEN did a bunch of mental gymnastics and called exchanging currency money transmission and that is what we are stuck with.
|
|
|
|
I read an article about this today where the headline was "Bitcoin ponzi" and it just made me wonder. Would they really be making the same headline if it was using USD? It seemed almost like they were implying that bitcoin is a ponzi too.
That is intentional and reporting bias. The reality is the SEC doesn't see Bitcoin as a ponzi they see ponzi involving Bitcoin to be equal to ponzi involving other "real" currencies (USD, EUR, etc). |
|
|
|
|
Oh and last thing looks like SEC is seeking $100,000 civil penalty on top of forfeiture of proceeds.
|
|
|
|
Some more interesting excerpts (whenever possible I like to go to the original source): SEC rational for seizing his assets (and it looks like they will be seeking additional seizures and records if/when necessary). Given they already know his exact trading losses I would assume MtGox has supplied detailed records. I would hope MtGox waited until served rather than just hand over information without due process. Maybe MtGox can comment? Here, the Commission easily makes a prima facie showing that Defendants: (1) operated
a Ponzi scheme in violation of Securities Act Section 17(a), and Exchange Act Section 10(b) and
Rule 10b-5; and (2) sold unregistered securities in violation of Securities Act Sections 5(a) and
5(c). Moreover, Shavers diverted BTCST investors’ BTC to a BTC currency exchange
headquartered in Japan, misappropriating it for his personal use. Given the nature the conduct
and these violations, a preliminary order freezing Defendants’ assets, authorizing expedited
discovery as to the location and extent of their assets, directing them to repatriate ill-gotten gains,
directing them to provide verified accountings, and requiring them to preserve evidence is appropriate
and necessary to preserve assets for possible recovery for victims of this fraud. For
the same reason, an order temporarily freezing Defendants’ assets and requiring the preservation
of evidence is warranted to preserve the status quo pending a preliminary injunction hearing.
The big one. "Bitcoins based investments are investments". This should silence any dubious claims that BTC based investments aren't "really" investments because they are based on play money, etc. The BTCST Investments Are Securities as Defined by the Federal
Securities Laws
The definitions of “security” under Section 2(a)(1) of the Securities Act [15 U.S.C. §
77b(a)(1)] and Section 3(a)(10) of the Exchange Act [15 U.S.C. § 77c(a)(10)] include both
“investment contract” and “note.” Courts “are not bound by legal formalism, but instead take
account of the economics of the transaction” to determine whether a security exists. Reves v.
Ernst & Young, 494 U.S. 56, 61 (1990); see, e.g., SEC v. SG Ltd., 265 F.3d 42 (1st Cir. 2001)
(holding virtual shares in virtual company existing only online were securities). “Congress’
purpose in enacting the securities laws was to regulate investments, in whatever form they are
made and by whatever name they are called.” Reves, 494 U.S. at 61. (emphasis in original). The
BTCST investments qualify as both investment contracts and notes and, thus, are securities.
An investment contract is any contract, transaction, or scheme involving (1) an
investment of money, (2) in a common enterprise, (3) with the expectation that profits will be
derived from the efforts of the promoter or a third party. SEC v. W.J. Howey & Co., 328 U.S.
293, 298-99 (1946); see Long v. Shultz Cattle Co., Inc., 881 F.2d 129, 132-33 (5th Cir. 1989).
The “investment of money” element may be satisfied by consideration other than money. See
Int’l Bhd. of Teamsters, Chauffeurs, Warehousemen and Helpers of Am., 439 U.S. 551, 560, n.12
(1979) (the “investment” may take the form of “goods and services”). Moreover, BTC is money.
BTC may be used to purchase goods or services, or exchanged for conventional currencies,
including the U.S. dollar, Euro, Yen, and Yuan. Recognizing as much, the Department of the
Treasury issued guidance concerning the applicability of the regulations implementing the Bank
Secrecy Act to virtual currencies such as BTC. See Treasury Guidance (FIN-2013-G001) –
Application of FinCEN’s Regulations to Persons Administering, Exchanging, or Using Virtual
Currencies (Mar. 18, 2013). In the Fifth Circuit, the second and third elements of an investment
contract are met where investors are dependent upon a promoter’s expertise, just as the BTCST
investors were dependent upon Shavers’ supposed expertise in BTC market arbitrage, to generate
the returns promised on their investments. See Long, 881 F.2d at 140-41.
Any note is presumed to be a security unless the presumption can be overcome because
the note bears a strong resemblance to one of several judicially-enumerated instruments that are
not securities. Reves, 494 U.S. 56. The types of notes that are not securities include a consumer
financing note, a note secured by a mortgage on a home, a short-term note secured by a lien on a
small business or its assets, and a note which simply formalizes an open-account debt incurred in
the ordinary course of business. Id. at 65. The factors used to determine whether a note
sufficiently resembles these “non-securities” and, thus, is not a security under the federal
securities laws are: (1) the motivations that would prompt a reasonable buyer and seller to enter
into the transaction; (2) the plan of distribution of the instrument; (3) the reasonable expectations
of the investing public; and (4) whether some factor, such as the existence of another regulatory
scheme, significantly reduces the risk of the instrument, thereby rendering application of the
securities laws unnecessary. Id. at 65-67. Here, the transaction between Defendants and the
BTCST investors had all the earmarks of an investment, suggesting a security, and no
commercial or consumer aspect, as with the judicially-enumerated instruments that are not
securities. The BTCST investments were offered and sold to a broad segment of the public as
Plaintiff’s Emergency Motion for Order to Show Cause, Asset Freeze and Other Ancillary Relief
investments. Moreover, no risk-reducing factors existed to militate against a finding that the
BTCST investments were securities. No other regulatory agency oversees the BTCST
investments, and BTC itself is a virtual currency, with no single administrator, or central
authority or repository The portion about " Courts are not bound by legal formalism, but instead take account of the economics of the transaction to determine whether a security exists." is rather important as it shows the SEC intent when it comes to virtual currency transactions. If a hypothetical "asset exchange" were hiding behind the paper thin defense that it's assets are just "play money" and don't represent real investment then it might be a good idea to get competent legal counsel to look at the cites the SEC provided. Simply calling something a pretend asset on a pretend exchange for fun doesn't make it so. What matters is the intent. If investors are expecting real world profits, and issuers attract investors advising real world profits then it isn't "play money". |
|
|
|
Philip Moustakis ran the SEC investigation. He did send out the e-mails and collected evidence.
Well I guess the wheels of justice do indeed turn, too bad they turned soooooooo slowly that according to SEC docs Pirate already burned through or lost playing day trader 90%+ of what he defrauded. Also looks like Mr. Moustakis asked the Eastern Texas courts for the right to appear "Pro Hac Vice". Simple version Pro Hac Vice is a request for an attorney to practice in a specific case outside of their jurasdiction. Rather than have the plantiff (SEC) be represented by a TX based attorney they petition the courts to allow Mr. M (who has license to practice law in NY) the right to appear in the TX court. It would appear the request has been granted. http://ia600904.us.archive.org/35/items/gov.uscourts.txed.146063/gov.uscourts.txed.146063.12.0.pdf |
|
|
|
LOLZ Pirate is more stupid then I thought. From the above complaint. III. SHAVERS’ ADMISSIONS
In an October 3, 2012 interview with Commission staff, Shavers admitted, among other
things, that:
Case 4:13-cv-00416-RC-ALM Document 3 Filed 07/23/13 Page 6 of 18 PageID #: 22SEC v. Trendon T. Shavers, et al. 6
Plaintiff’s Emergency Motion for Order to Show Cause, Asset Freeze and Other Ancillary Relief
a. His Internet name was pirateat40; he posted the November 3, 2011 BTCST
solicitation on the Bitcoin Forum; all other statements attributable to
pirateat40 on the Bitcoin Forum were his own; and he, alone, was responsible
for creating and operating BTCST (Id. at ¶ 27);
b. He sold BTCST investments to 446 investors, but claimed that he produced
documents to staff for only 46 BTCST investor accounts because all records
for closed accounts had been deleted (Id.);
c. He used new BTCST investor BTC to pay the promised returns on
outstanding BTCST investments (Id.);
d. He comingled BTCST investor BTC with his personal BTC and BTC received
from customers of GPUMAX Technologies, LLC (“GPUMAX’), a BTC
mining company he co-founded with friends (Id.);1
e. He made preferential redemptions to friends and longtime BTCST investors,
in August 2012, as he closed BTCST (Id.); and
f. He was still in possession, at the time of the interview, of approximately
100,000 BTC (Id.).
In the same interview, Shavers claimed to generate BTCST investor returns by lending
BTCST investor BTC to anonymous borrowers he met online who wanted enough BTC to
manipulate or control the price of BTC on Mt. Gox, the leading BTC currency exchange
(headquartered in Tokyo, Japan), and other BTC currency exchanges. (Id. at ¶ 28.) Shavers
claimed these anonymous borrowers paid him at least 10% interest weekly on the BTC he lent to
them. (Id.) Shavers claimed to generate additional returns for BTCST investors, up to 4% daily,
by lending BTC to an online service which provided users with leverage for purposes of trading
BTC on BTC currency exchanges. (Id.)
All that will be used against him in any civil or criminal trial. Miranda doesn't apply if he wasn't a suspect of any criminal investigation at the time. His statements (assuming they are recorded) make any defense much harder (dare I say impossible). It now requires an affirmative defense. If he did run BTCST and it lost funds "legitimately" he can't just rely on a lack of evidence, he needs to prove that. I also found e to be interesting. While I am not sure the SEC will seek it (given the relatively small scale), they can attempt to locate those who benefited from the ponzi and clawback any net gains. Also given how upstanding Shavers is, if pressed with even the possibility of jailtime I wonder who he will roll on and how much evidence he kept. |
|
|
|
So if the asics are getting released at a steady pace, shouldn't the difficulty increase each retarget go down? if I introduce 10 more hashing power bringing the total to 100 for an increase of 10%, next week i introduce 10 more hashing power for a total of 110 and an increase of 9%. Shouldn't we be seeing reducing increases each retarget unless the amount of released hash power increases each retarget? Point is, the difficulty increases we have seen simply cant continue to be this high unless the rate of new hash releases is increasing??
If steady pace yes but there is a massive amount of pre-orders something on the order of 4,000 TH/s. So if all of that was released today we would expect difficulty to spike up to 600M or so (within the limits of max 4x per difficulty adjustment). There is no guarantee that the rise will be slow and decreasing. It might come is some giant waves. For example if you are to believe BFL they have some supply chain issues, say they resolve it and their delivery rate (which is abysmally slow) jumps by a factor of 10 and then within a few months by a factor of 50. It will still takes months (maybe a year) to deliver all those pre-orders (the vast majority are already "dead money" regardless) so you would see the trend upward accelerate not decelerate. |
|
|
|
I'm starting to think im too math dumb for this hobby but ... There has to be a ceiling or a level off for increasing difficulty soon dont you think?
Uhm, not really in the foreseeable future. If difficulty levels off it's because hash rate levels off. And there's no reason why hash-rate should level off. Sure there is, there are only so many IC wafers made, so eventually rates of increase will be linear. What about Moore's Law? That would suggest that, for the same number of wafers, you would get a doubling of transistors (and thus hashes) every 18 months or so. The limit isn't wafers but profitability. Today we don't know what future difficulty is so while we can estimate it is going to be high, very very very (probably way beyond what you imagine as worst case scenario) high, it still means some people can delude themselves into thinking THEIR purchase will arrive before difficulty goes up and they will makes 2000% ROI in a couple months. Some will but obviously most (the overwhelming most) won't however it leads to the "I AM SPECIAL" thinking. "Other people might lose but I won't because ... Bitcoin". It is easy for this delusion to continue UNTIL the difficulty goes up a magnitude or two. Lets fast forward 12 months and BFL has already delivered 500+ TH/s of rigs, ASICMiner has built out another 300 TH/s privately and sold another 500 TH/s publicly, Avalon has delivered 2 PH/s of chips and half of them have been assembled into boards and sold by a variety of companies and throw in KNC delivering 1 PH/s of rigs. Hashing power in 12 months (under this scenario) will be more like 4 PH/s (4,000 TH/s) and difficulty will be 600M. Note it doesn't matter if you think these exact numbers won't happen. Draw up your own guestimates based on pre-order numbers. Maybe it is 5 PH/s or "only" 2 PH/s the point is that the STARTING DIFFICULT for new hardware purchases will be much higher than today. At this point profitability isn't just based on some vague guesstimates of future difficulty, it is largely based on day 0 difficulty (i.e if I bought X and it arrived today how many BTC could I produce TODAY). At that point say ASICMiner was offering a hypothetical second gen USB Miners, 500 MH/s for "only" 0.25 BTC. Would you buy one? Would anyone? Well lets see. Lets assume the buyer assumes difficulty will remain flat for the next year. 500 MH/s @ 600M difficulty = ~0.0004 BTC per day and the break even point (assuming no power costs) would be 625 days. So would you buy new hardware? Even if you are buying (or pre-ordering) new hardware today because you are "special" would you still be doing so when difficulty is ALREADY 600M? If people don't buy/deploy new hardware the hashrate will "stagnate". Many purchases made over the last year are likely never going to break even but until we get through this "pre-order bottleneck" people will always find ways to rationalize why they will be profitable despite the evidence to the contrary. When the cold hard math of 600M difficulty is staring them in the face suddenly the unprofitability is in black and white and people will stop buying new hardware. |
|
|
|
Someone got an ASIC working on TRC?
You can use Asic on TRC and others that are sha256D Off topic but what is up with the "D". For the first couple years nobody got the hashing algorithm wrong and then recently there has been this poliferation of "SHA-256D" and "SHAW-256". Once could be a typo, one person multiple times could been someone who is repeating a mistake but multiple people over multiple threads. It is SHA-2 or SHA-256 (or without the hyphen SHA2, SHA256). |
|
|
|
I wanna give a shout out to my homie and home boy, r3, the man kept his word like a real man and gave me double what he promised, I extorted every worthless coin he had and even what he mined, by making false accusations and running his good name through the mud until he just gave up and in frustration of dealing with a sociopath washed his hands by giving me every last coin. FYPFY |
|
|
|
Or I could just lite it up right here on this thread but I'm afraid to scare away the "many loyal NUGGETS miners".
Wonders if I should mention that there is only 1.7 MH/s on the network and <6 active nodes. |
|
|
|
|
Show Posts
