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I talked to them and the BFL orders are actually from April, I think they may have messed up the wording on that...
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Well lets not go as far as compare john with TAT. I have nothing personal against TAT but he is not even close to beeing "trustworthy", he has long way before he prove himself and as of now he is not doing good job with his childish posts and not so professional behavior.
The last time I saw a scheme requiring trust and the operator used the name Pirate, and I thought your name says it all. This time I see the name Thieves , and I immediately think it is more daring that Pirate. It's a reference to one of my favorite movies about a man wrongly persecuted, and how he prevails, The Shawshank Redemption. The phrase itself merely means "loyal". Whoa whoa whoa. I haven't seen the movie in a while, but the audience never DEFINITIVELY knows that he didn't kill his wife, do we? Yes they do, remember the scene where the cackling guy admits it all? I mean he never gets absolved in court, but it's pretty blatant that we're meant to know he didn't do it. Either way, interesting point! |
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-- Regarding your worst-case scenario where Mr. Mutch can't "buy back" the shares in the event of dissolution, one one hand this is a risk for most assets. However, in this case, dissolution should involve the liquidation of assets on behalf of the shareholders, not a buyback.
It's a different risk here than for most funds. Most funds promise in the event they cant continue to sell off assets and share it out to investors. Sandstorm promises : "If on the unlikely chance that Sandstorm can't continue: Shareholders will be fully informed and a suitable replacement for management will be sought after. If this attempt is unsuccessful, shares will be purchased back at 105% of the 7 day average. All remaining assets will be liquidated and distributed to shareholders through dividends." So he promises to by buy back based on market price - which is horrible for a fund to do. Having made that promise I think korbman's perfectly valid point is that he should be demonstrating that he has the assets to do so (NOT just the assets the fund holds) otherwise the fund is backed by a promised buyback value which can't be delivered. Buy-backs based on market price are widely used - and are bad in pretty much every case. They either allow the issuer to talk (or flood) the price down first OR they expose the issuer to having to pay an excessive amount. With the current trading price for Sandstorm I have no idea whether the issuer could afford to buy back per his contract - and it would be unreasonable for him to do so anyway. But that's what his contract promises - and some part of the price rise MAY be due to that, with people realising that per the contract if they can inflate the price then even if it shuts down they get to keep whatever rise they've managed to achieve. Buy-backs should be based on what's received for assets - other than for bonds where a fixed price should be determined in advance (or a formula provided allowing calculation of the price). His contract APPEARS to say that shares will be bought back at 105% AND investors will receive proceeds from selling assets. Yep, he definitely set it up poorly. I hadn't even considered that it could cause the price to inflate, but I'm skeptical that is what's going on anyway. Pumping the price long-term is unsustainable, unless Mutch works some real magic with increasing the actual value of the fund. |
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(wall of text)
Korbman, you raise some good points, and some that are a little off the mark. -- The Sandstorm Description does not "promise" or "guarantee" profits, last I checked. He states the yield as goals. I agree that his methods and strategy are left to mystery though... -- When a fund issues new shares, it does not necessarily dilute the value because the bitcoins gained all belong to the fund. While they may not dilute things, it's possible for him to push down the price if they are overvalued however. Maybe the answer is that he should have included exactly how he will price future releases, and what will trigger him to do so, etc. -- Regarding your worst-case scenario where Mr. Mutch can't "buy back" the shares in the event of dissolution, one one hand this is a risk for most assets. However, in this case, dissolution should involve the liquidation of assets on behalf of the shareholders, not a buyback. -- Yes, Mr. Mutch could easily share his BitFunder wallet address so we can verify his holdings via the Public Asset list. He should also make public his BTCT.co portfolio since the allow this. Only Havelock does not have this feature, ironically... He could certainly share his asset listings, but to a certain extent this would somewhat undermine the value of the fund since anyone could watch his trades and benefit without being part of the fund. I'm not saying that the transparency wouldn't be worth it - merely that it somewhat reduces the value of underlying trading decisions, which seem to be a significant portion of the profits. I hate to bring this up since I don't want to compare Mr Mutch with one of the world's greatest investors, but Warren Buffett didn't tip his hands to investors - he expected them to trust him to do what was in their best interest, without being involved. Of course, he had yearly audits to prove his holdings. The rules need to be different in bitcoin. Trust is earned and justified, not gambled for. Plus, he already does share his holdings info, he simply doesn't prove it yet. So trade secrets are not the issue anyway. Has Mr. Mutch earned his license? Or is he driving blindfolded with kids in the car? |
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Well lets not go as far as compare john with TAT. I have nothing personal against TAT but he is not even close to beeing "trustworthy", he has long way before he prove himself and as of now he is not doing good job with his childish posts and not so professional behavior.
The last time I saw a scheme requiring trust and the operator used the name Pirate, and I thought your name says it all. This time I see the name Thieves , and I immediately think it is more daring that Pirate. It's a reference to one of my favorite movies about a man wrongly persecuted, and how he prevails, The Shawshank Redemption. The phrase itself merely means "loyal". |
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(wall of text)
Korbman, you raise some good points, and some that are a little off the mark. -- The Sandstorm Description does not "promise" or "guarantee" profits, last I checked. He states the yield as goals. I agree that his methods and strategy are left to mystery though... -- When a fund issues new shares, it does not necessarily dilute the value because the bitcoins gained all belong to the fund. While they may not dilute things, it's possible for him to push down the price if they are overvalued however. Maybe the answer is that he should have included exactly how he will price future releases, and what will trigger him to do so, etc. -- Regarding your worst-case scenario where Mr. Mutch can't "buy back" the shares in the event of dissolution, one one hand this is a risk for most assets. However, in this case, dissolution should involve the liquidation of assets on behalf of the shareholders, not a buyback. -- Yes, Mr. Mutch could easily share his BitFunder wallet address so we can verify his holdings via the Public Asset list. He should also make public his BTCT.co portfolio since the allow this. Only Havelock does not have this feature, ironically... |
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Well said, Korbman.
Swinging back around, #3 is not the best option but should be a requirement for any company trying to dive into securities of this nature. But #1 is important - the immediate option for one/handful of parties to immediately take all stake in an IPO is a death knell. It serves as a race to the gate in which the only incentive is early buy and quick dump during excitement. I have serious doubt that anybody who purchased the initial shares genuinely gave a damn about the investment short of "First dibs, now you buy from be sucka!".
And to back my point, email from Havelock today in regards to PHM. 300k shares, 100k purchase option per person. Pump and dump with (sorry) a weak business plan attached (plan to buy from BFL is a business plan?). I'm really hoping this is a joke or a mistake because this will be Sandstorm v2.
I'm actually considering pulling by funds from Havelock completely because this is two strikes in the first week I've been involved with them. This is just plain irresponsible, it almost looks like PHM is literally a pump and dump of an IPO because the plan is *so* incomplete. I would expect some quality control for potential investments. As stated previously, BTC can be a shady world and I would hope/expect the goal isn't to sucker new people in with this stuff only to leave them burned and pissed at the whole process. 'Cause that's the gut feeling I'm having right now.
Out of curiosity, what's so missing from PHM, and how is that related to whether it will get an inflated price? Seems to me they are simply a mining fund looking to grow by issuing shares in proportion. The BFL appears to be an old order, not a "plan". Havelock does get identity info for issuers, and conducts a phone interview. I assume they did what they could in that regard with Sandstorm & PHM. Don't confuse the risks of ALL bitcoin investments and pin it on one. PHM could run with the money, and so could every other issuer, even the trusted ones. Furthermore, any business can also make mistakes and render their company worthless over time. These are risks across the board though. "Pump & dumps" are not a symptom of something Havelock or issuers are doing wrong. They are a symptom of investor ignorance, and probably a symptom that bitcoin is overvalued itself, since so many people are so willing to be irresponsible with their coins... |
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I'll even become a donor if it's implemented!
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3. Educating investors.
...
#3 is the best solution (to the extent that there is one). The problem right now is that investors over-react to anything they perceive as good or bad news. An IPO is considered good news - as is the arrival of an ASIC - and both are seen as a valid reason for a price to absolutely sky-rocket. When both should have already been largely priced in already - the former by the issuer and the latter by the market. We're in the silly situation where as soon as mining companies receive ASICs their price inflates making them even worse that over-priced PMBs. And where any time anything with a small market cap IPOs it's pumped by speculators/flippers/traders (or actual market manipulators) and the actual investors happily play along.
The solution isn't trying to stop the speculators/flippers etc - it's trying to inform investors so they don't play along other than where it's actually warranted.
On that note, I've been tossing the idea of spec'ing a Bitcoin Asset Listing Standard (that's right, BALS). I haven't decided whether to do this wholly in the open or get a big chunk of work done first and then get help editing it, but Deprived, if you are up for helping with the project, let me know. The idea would be for it to serve as reference guide and standard for exchange operators and issuers to strive for and meet, and serve as a reference and primer for investors to have in wrapping around their heads around investing, specifically within the nuances of the bitcoin environment. BALS could include things like IPO methods, prospectus specs, types of assets, due diligence processes, etc, etc. I know some may snicker, but MPEx has done a lot of work already in this area, and I intend to build of some of MP's sentiments, as well consider adding things like his AN0 accounting spec, etc. It would be a potentially time-consuming undertaking, and may end up have no affect on the quality of bitcoin investing at all, considering so many people seem so determined to lose their money, but I personally see it as a potential learning experience and useful research as well. |
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Let's just say that TAT is much cheaper when transfering > 8 shares, and John when having < 8 shares  * Both are very trustworthy guys, and considering it's a small part of the total amount it's 100% worth it using escrow! (Or buy from other members with a good trust rating - *Based on a share price of 4.2BTC/share)
I created a new temporary page for the dividend prediction: www.asicminercharts.com/divpredictionEventually I'll add the meter next to the wallet meter on the live page  Well lets not go as far as compare john with TAT. I have nothing personal against TAT but he is not even close to beeing "trustworthy", he has long way before he prove himself and as of now he is not doing good job with his childish posts and not so professional behavior. I think this is a bit of an exaggeration, exacerbated by AMC shareholders that are angry at me for my skepticism in their investment. John K certainly has more history than me, and I use his services from time to time as well. This isn't a competition of trust. In the context of this escrow topic, you must realize it would be absolutely insane for me to scam on a deal. My trust, reputation, and TATI brand are of utmost value to me. Expect only more demonstration and delivery from me. I am here to help set standards, not to lower them. Keep an eye on people like Deprived and myself, as we're the kind of forces that will root out the weeds, making it harder for scammers and the irresponsible. More to come! Anyone want this soapbox? I need to sit down  |
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Then someone will simply use two or three or four accounts.
If you're running an exchange, you need to be fair. If someone wants to buy all their shares available, then let them. Do not create artificial limitations.
A better IPO would have been launched in batches anyways.
+1 I don't think there should be limits on how much of an IPO can be purchased. Also, I think the IPO could have been advertised better. I talk to James all the time, and I am on Havelock's website all the time, but I had no idea the IPO was at 1am EST. I just happened to not be subscribed to this thread. I probably wasn't going to buy anyway, but if I had known it was so soon, I would've read the prospectus and known right away the 100btc IPO would sell out and could be flipped. |
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In case anyone didn't already know, I provide escrow services for AM trades only.
Fees are .5btc or .5%, whichever is greater.
It's a small price to pay to be safe. I have dealt in thousands of btc worth of AM shares without a problem.
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Why is this IPO live, and why are people paying 20x more than it's worth. Wake up people.
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The argument boils down to this:
DMS.MINING is less prone to profit from ignorance than any other mining asset.
This doesn't make it actually worth less than the others, it makes the others more prone to being overvalued.
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Sorry, that's what I get for not paying attention! |
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ASICMINER just finished a 14 transaction block of 175BTC. I didn't even know that was possible..
Sometimes people accidentally put the transaction amount as the mining fee. Poor guy! |
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I guess over 200 new blades were sold in one day.
where? Right behind you! |
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The fact of the matter is, that ASICminer is not receiving any Avalon chips - those chips are going elsewhere. ASICminer are going to have to increase their current hash rate by a large % to keep their current global hash % (this costs money, which in turn affect dividends). ActiveMining is adding hashing power that is already paid for. ActiveMining profits will go up. ASICminer profits will go down.
That's rich. So when ASICMINER can and will increase hashing to keep up, they lose money, but when ActiveMining sits idly by and watches all this, their profits somehow go up? mmhmm... |
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