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1021
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Economy / Securities / Re: [ANNOUNCE GLBSE] Pirate Pass Through Bonds
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on: April 17, 2012, 10:24:35 PM
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In the event that BS&T stops payments or changes its terms and conditions so that the intended pass through of interest is either stopped, pays lower interest or at a schedule that does not align with PPT bonds, PPT reserves the right to buy back the currently issued bonds by paying the coupon (currently 1% per day, accrued, simple interest) to current holders. 2. In the event that interest payments from BST is below your expectations then PPT can buyback the bonds at 1% per day on the initial bond listing price of 1.00 BTC per bond. The wording was intended to be tighter than simply "below expectations". It is to cover the event where Pirate stops and winds up the whole thing, or changes the interest rate scheme materially so that we cannot pass through the intended 1%/day rate. It does not give us the right to issue the bonds on day 1 at a premium and then immediately buy them back. |
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1023
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Economy / Trading Discussion / Re: GLBSE IPO Handling and Interaccount Transfers Discussion Thread.
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on: April 17, 2012, 05:18:35 AM
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1st argument is in box 1 - not carrying out a business. BTC is not recognised as currency or security, so trading with them exempts GLBSE.
I've dealt with tax officials on the definition of "carry on a business" with respect to value added taxes, and the intention is basically to create taxable income. GLBSE is not aiming to create taxable income in the UK (or probably anywhere else).
(the S could be for "stuff")
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1024
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Economy / Securities / Re: [GLBSE] - TCC The Coin Continuum
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on: April 17, 2012, 03:55:29 AM
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Are you planning to verify ID? If so, when?
Today tomorrow I'll send in scans Patrick from lending base also has my information Do I? I'd have to look. Zer0's always been reliable on his loans and I've been dealing with him for a few months now. |
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1025
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Economy / Securities / Re: [ANNOUNCE GLBSE] Pirate Pass Through Bonds
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on: April 16, 2012, 07:27:10 AM
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Public knowledge that my first deposit was 17 December (four months ago). My balance with Pirate has been pretty static for the last month or two and accounts for around 1/3 of the coins I have invested. I also have a couple of thousand in investments like GLBSE, and a diversified loan book covering 18 different people for terms from one week to six months (ranging from 50 to 1500 coins). So, insuring/backing these bonds is just another part of the portfolio.
So, yes, we have some decent sized accounts of long standing with Pirate.
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1026
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Other / Off-topic / Re: Which (natural) language should I learn?
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on: April 16, 2012, 12:52:56 AM
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At the age of 40-something, I started learning Japanese. I know enough to get me around the place and scare the locals. I also learn kanji and can read enough, but still enjoy the slow progress I'm making. If you're wanting to learn that later in life, starting now makes some sense.
I could have learnt Chinese, as may more people speak it, and in the future (a few decades) they will be a major international influence, however, my interest was in Japan, not China), While in Kyoto recently we met a student from Shanghai - amongst her amazing traits was fluent english, chinese and japanese and could simultaneously translate between the three. She was very smart - doing law.
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1028
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Other / Politics & Society / Re: usury = not cool
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on: April 15, 2012, 10:33:42 PM
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Due to inflation, in most situations a naïve zero interest loan is a negative interest loan. As senbonzakura notes, he's losing money.
When you advise 0% interest rates, you are asking people to give away money, even if the person pays back on schedule. Taking purchasing power into account, a lender could at best hope to come out slightly behind where she would be if you held the BTC out of circulation, or at worst lose a significant percentage of wealth. Pricing goods and services based on "x USD in BTC" rather than using BTC as the base currency, introduces an even greater risk than usual.
There is a reason even tiny co-op credit unions charge interest, even before the current level of deregulation. Fixed costs, transactional costs, risk, and of course rates set by the fed (which does not apply in this case) are all part of the rake.
Hmmm (note not the two "m" version reserved for Sen). So, I could do zero interest loans, and they are structured like this: 1: Establishment fee 5 BTC (covering credit checks and negotiations) 2: Completion fee 2BTC (covering the costs at the end of the deal - and yes there are some) 3: Default insurance 10 coins per 100 borrowed. So a one month, 100 coin 0% interest free loan would cost 117 coins. I would expect howls of anguish and complaint, but for 0% it's not necessarily a bargain. |
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1029
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Other / Politics & Society / Re: usury = not cool
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on: April 15, 2012, 08:51:10 PM
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How does an islamic bank then cover the costs it has from giving out 0% loans (personel, scams, inflation(!), ...)? Only by accepting tips, cross-financed by the investments in companies or somehow else? It might be an ideologic thing or some kind of charity to give out these loans, but without actual income on that end I guess it would make sense to have only a small percentage of total funds going out as loans...
Currently IBB is valued at 270 BTC in total (1000 shares @0.27) while having a balance sheet that is barely positive. Also you seem to have defaulted on a 39(!) BTC loan, at that time ~ 1/2 of all your money. Do you have some regulations in place now that you will only had out max. x% of your money as loans?
Also I wonder how you determine if shares you invest in on GLBSE (like MergedMining, CheaperInBitcoins...) are halal - or do they not have to be halal?
Hi Sukrim, when thinking about IBB, you might also like to think about the Islamic banks that deal in the billions of dollars and not just the small bitcoin amounts that Sen works with. It's a challenging business, but it still works for financing a $500 million power station or $5 for something else. (I came across this a few years ago when researching project finance and the inability to charge interest posed some interesting problems for bond issuers). Also, having a positive balance sheet isn't necessary for business value - check what-ever the latest internet darling is and you might find zero income/loss making businesses valued in the millions. |
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1030
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Other / Politics & Society / Re: usury = not cool
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on: April 15, 2012, 08:32:01 PM
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I do micro lending through Kiva at US25 a pop, and they are syndicated loans to about $2000 (some might be higher), and I receive zero interest on these. However, there is a small interest rate charged at the local level to help cover costs. I can choose what type of ventures I put funds into (your moral dimension, if you like), and mostly I target people wanting to expand their businesses - but I'm not getting a share in the business, and there are donations added if you want to. http://www.kiva.org/lender/patrick7928 |
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1032
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Other / Politics & Society / Re: usury = not cool
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on: April 15, 2012, 03:45:13 AM
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Not lending, but bitcoin related economy stuff, I would like to mention that recently I purchased some shares on GLBSE for 0.41 on 4 April. I had someone buy them 14 April for 0.50. So the 25% return is about 75% MPR. Someone obviously is happy to pay me a decent return.
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1033
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Economy / Securities / Re: [ANNOUNCE GLBSE] Pirate Pass Through Bonds
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on: April 15, 2012, 03:31:22 AM
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We think we have a way around this - see if you can game it:
On the day and hour the bonds mature we issue a buy order for all the outstanding bonds for 1.28 BTC each. This will buy all the bonds except 1) those bonds that are not currently up for sale and 2) those bonds that may be listed for more than 1.28.
There is then a one week buy back period. This gives everyone a chance to get their bonds listed and sold.
What if you decide to buy back early? The OP mentions the possibility of your buying back on day 15 at 1.15. All those people who bought, immediately put in a sell for 1.28, and went on vacation for a month will be SOL? Seems like a mechanism to forcibly recall all shares is really in order. Actually that is a fair point. It was designed to cover the event where the pass-though suddenly stops. It doesn't protect someone who buys above the "forced buy rate, and it is greatest at the start of the round. i.e. if the average sale price is 1.10 and we do a buy-back on day two, there would be a lot of pissed off people. I think Burt can re-word to tighten the circumstances, but the potential remains (at some stage in the future) for Pirate to change his business. |
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1035
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Other / Politics & Society / Re: usury = not cool
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on: April 14, 2012, 11:51:07 PM
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Yes, the cost of transactions. Interesting you should bring that up.
The cost of setting up a loan varies, but does take time. I've spent several hours in pre-work on some, and a few minutes on others. Even valuing my time fairly frugally, it adds quite a lot to what are short duration loans.
For example, if I spend 10 BTC of time on a 50 coin loan for a month, then before accounting for risk, that's 16%, and doesn't cover the back-end or collection. The loan I did with Cobra took about two hours before we finally agreed terms, and for 200 coins, it's still a decent few percent. (and if you think the cost of my time is high, yes it is and I would recommend you don't employ me)
The point I think you are missing is that most loans are not for a whole year, so the multi thousand percent numbers you are throwing around are not valid. My longest loans are current 27 weeks (half a year), and the people paying interest on those know the total cost of finance. Also, I don't long for long periods where the interest cost would cause a problem for the borrower. It's bad for business.
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1036
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Other / Politics & Society / Re: usury = not cool
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on: April 14, 2012, 10:23:43 PM
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As much as i dislike spongbobsquarepants.
Patrick is always Owning people with his posts. AKA, You have been served by a starfish sir.
Maybe you need to watch it in a different language/country/time of day. It's hilarious in Japanese, and helps pass jet-lag hours at 2 a.m. |
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1038
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Other / Politics & Society / Re: usury = not cool
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on: April 14, 2012, 09:50:54 PM
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If someone really insists on borrowing money at 10000+% interest,
well, people do all kinds of things. But what kind of customers do you
attract with such terms? Scammers who have no intention of paying you
back and therefore could not care less about the interest rate (no
shortage of those), and on the other hand the truly desperate. Even if
you do not care about exploiting them, if 1-10 BTC is a big deal for
someone, how are they supposed to come up with the ludicrous amounts
of interest? (How do you honestly generate money at that rate? Play a
lot of roulette? Lend it to someone else at 10001%?) Either way, it
seems like a shaky business proposition, and it is not how
microfinance is supposed to work.
As for 10000+ btc loans, that is pushing the envelope if we are
talking about microcredits, but the principles of interest-free
lending should still apply, and nobody is claiming they are "have no
steady sorce of income, hand over cash to all comers, no questions
asked, and absorb all losses if/when they occur." It seems we are not
quite there yet, but none will be happier than I when experimental btc
finance like IBB gets to the point where one can fund your 15000 btc
project. Remember, a big part of the bitcoin philosophy was to solve
many of the problems people have with traditional institutions such as
banks, not make things worse.
A couple of things. Stealing is "not cool" either, and if you knew anything about risk/return you might find that several months ago I wasn't making money off these high-interest rate loans. Second, I would like to defend the good quality people that borrow funds from me at 10%-15% per month. Most are reliable and good people that I have a good business relationship with. I do not like you disparaging them and their motives for borrowing. Third, the service I offer is competitive - there are several others around and rates are negotiable, as are payment terms. I have previously donated to IBB and like what Sen is doing. At the level I typically loan at (not micro) there are high stakes and real money involved. I give awa enough money elsewhere to not be worried about the high rates I charge, and if all my loans were repaid tomorrow and I didn't do any more, that would be fine. |
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1039
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Economy / Long-term offers / Re: [OPEN] Offering relatively large, short loans at 1.5% interest per day
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on: April 14, 2012, 04:55:45 AM
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I'm here to request a 1-day, 30 BTC loan.
12QcUPyHNqdB4xJNiXBa6r9qVovMpfuZKP
Scammer. I'M NOT A SCAMMER. To prove it, I won't take out a loan, unless I REALLY need one. Out of curiosity, what did you want the loan for anyway? (and while it might look like it, we're not all sharks, but we've collectively lost a lot of money to fraud, and some people like to bash new user loan requests) |
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