Interesting stuff... well done...

Diamond Plus has copied my post from a few weeks ago, posted it again verbatim. Don't know WTF that is all about.

It was not me....

Agreed that actual trading performance is paramount, and I will continue to track it and make it public. The performance to date is disappointing. It is still early days - I am hoping it will pull ahead, and stay ahead, before too long. The period of tracked actual performance is still short, and there are plenty of time periods like it in the model so I'm personally not too discouraged.

The fund is priced in USD so the price quoted in BTC varies with the exchange rate in exactly the same way that anything priced in USD would. So if BTC appreciates more than the fund does, the price quoted in BTC will go down.

The aim of the fund is to generate return in USD, not BTC. BTC is simply used as a means to transact. If people want to invest in BTC themselves, all they need to do is buy it on MtGox and keep it. There's nothing wrong with that, although I personally think it is a very risky investment and note BTC has lost 35% of its value since the fund started trading 40 odd days ago (it was $17 then, it is now $11).

I think there are two reasons to be interested in bitcoin. One is to speculate on it by buying or selling it on MtGox. The other is to use it for commerce, which is what I'm doing. If there is no one using it for commerce, then it would have no value, there would be no point speculating on it and it would not appreciate to $1000 to make you a millionaire. I don't understand why anyone who has an interest in BTC appreciating would go out of their way to 'bash' anyone who wants to use it - seems a bit self-defeating to me.

1,000 units of the fund have been listed on GLBSE under the ticker XID.ALPHA

Thank you, your post has given me some confidence.

As a potential shareholder, I would ask for a commitment that you don't lower the price below 0.109 for the unsold shares. Either that, or you commit to a smaller IPO sale (say 5,000 shares) at 0.109 and keep the rest in reserve. IMO, you should try to sell enough so that you can operate the business with an initial cash injection, and only issue more when you have a business case to increase the value of the company, for example to buy more equipment. By then, you should be able to demonstrate the ability to derive profit and so be able to issue the shares at a higher price preserving initial shareholder value. Even then, you should put it to a shareholder vote.

I don't want to sound to lecture-y, but this is what I expect as a shareholder. Good luck with your IPO and with your business.

I note you are now selling shares at 0.107, completely undercutting your own IPO.

Why would anyone buy any of your shares knowing you might be selling them cheaper in just a few days time? Especially considering you have so many of them? Do you know what you are doing?

This is a very disappointing response. If you are serious about floating your company then you must understand that right now, you have issued 45,000 shares, and sold 724 of them, meaning you own 44,776 shares. You could offer these for sale whenever you like for 0.0001 btc or 1 btc. No one knows unless you say. You are in complete control of the price, not the market.

So I ask again, how many of these shares are you going to sell and for what price? If you can't answer this simple question, you obviously don't know what you're doing when it comes to offering a business or investment opportunity.
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I hate to nit-pick, but you cannot 'use stock to convert to USD'. You received btc in proceeds from the sale of some of your stock. I assume you mean you bought USD with the proceeds in order to invest in the business. Good, but please say so.


Yes but who are the shareholders? You have issued 45,000 shares and sold 724 so far. Assuming the sale of 724 shares netted 79btc which you have invested in the business. If you somehow manage to make 100 btc, say, who gets this 100 btc? Is it split evenly between 45,000 shares or by the 724 you have sold?

This is an incredibly important distinction.


You will not be able to get a base value of your company by randomly offering shares for random prices and being unable or unwilling to say what you are going to do with the rest. You need to have a plan. Articulate it. Execute it.

So lay this out then. A plan could be to offer 45,000 shares at 0.11 btc. As these are sold, the proceeds are invested immediately. Interim proceeds are paid out to external investors evenly until the IPO is filled.

Or maybe you ladder the offer, first 500 are 0.11, second 1000 are .12. Next 2,000 are 0.13 etc. etc.

Whatever, it is imperative you have a plan otherwise your shares are worth nothing.
 

Hmmm. You have issued 45,000 shares. Do they fully limit the company? Or does that represent the 49% of the company you are not going to be selling? Because you have not offered for sale either 49% of those, or 100% of those, it is impossible to know where this 51% figure comes from.
 

Hi PBJ,

What are you doing with your company's stock?

You issued 45,000 shares and so far sold 500 of them at 0.11 btc. Then you put up another 5,000 at 0.12 btc and have sold 226 of them.

Where are the details about how much you hope to raise in your IPO? How much stock do you own and how do you intend to return value to the shareholders? How many of the 45,000 issues are you going to sell and for what price?

Or maybe it was not a real transaction - there was the following glitch reported by MtGox:
https://support.mtgox.com/entries/20323996-mt-gox-system-update-troubles

Looks like a large buy order pushed price up from around $13.20 to $14.20 in about 10 minutes. This removed a lot of liquidity from the market, looks like 20k btc were bought up. After the buying stopped at $14.20, the bid/ask spread was probably very large and nothing traded for about 1/2 hour. Then, on low volume, price spiked at $14.89 and then came down to around $13.50 where it had been about 12 hours prior.

My guess - a single buyer placed a huge order. Possibly 20k btc for 1/4 million USD?

YIKES

Try...

https://glbse.com

now...

True. I have just been playing with it and it seems to work. There are some recently listings too.

You could consider floating your investment on http://glbse.com - it gives you the mechanism to issue shares and reward your investors with dividends...

I look forward to it.

BTW, is the GLBSE platform designed to scale?

Is there, or will there be, an API for placing orders. API would need to:

o) Query existing orders in the owners account
o) Cancel or adjust said orders
o) Create new ones

Then I could write a market maker for what I have planned....

Also, can I request a 'GTD' order type (Good 'Til Date) so that you can place an order that will automatically expire at a given date/time.

You could float taxi shares on the https://glbse.com/ (not sure if it is up and running). For each share sold, you would need to pay a dividend per month to return the earnings to the owner of the share. The question is whether you need to capitalize a whole taxi before you can start to pay earnings on it. In other words, do you have a taxi that is operating right now that you could sell a portion of? If not, you need to attract investors to put in 2600 btc up front and that will be tricky.

I'm mostly interested in bitcoin for its utility. Speculating on bitcoin's future value wrt USD is not the only thing people are interested in. Besides, if bitcoin had no utility, it would have zero value and therefore no reason to speculate on it. The more utility it has the more chance you speculators have of making money from your hoard!

I have had 5 years trading experience. The last 2 years specializing in systems like http://www.xidcapital.com/alpha-fund.

AMD's stock went up after publishing its quarterly report, showing a profit on reduced costs - not on increased revenue. So I doubt bitcoin had anything to do with that. Having said that, mining for bitcoin is an interesting new use for retail computing power, especially considering computing seems to be migrating from the PC to the cloud these days.