The last of my coins in my account have been withdrawn by me.

I consider it my duty to put forward my thoughts on this, which have changed, since I don't want to be judged on earlier posts on this matter, even though I hate to be "that" FUD guy, and even though I wanted to hold off on it in public.

My assessment of the probability that it is no ponzi has shrunk from >50% to <1% within the course of 4 months, and particularly now, for many reasons:

First off, the debt seems to have tremendously grown especially with the start of the first passthroughs on the GLBSE. My estimate is it is very well in the 6 BTC digits, and even with only 100k BTC, the payouts generated are a multiple of what MtGox, the largest exchange, earns in a typical trading week (~2x more). Growing debt makes no sense for anything I know of but a ponzi scheme. It seems that the volume continues to grow since nobody has yet publically complained about being pushed out of the system, at least not significant sums, and not one from the passthrough-schemes.

Then we have the consistency of payouts, never do the rates spontaneously vary or vary at all until they are changed as planned.

Furthermore, the tiered system of higher interest rates for higher deposits. The explanation given for this was that small accounts are a hassle, but then it makes no sense to change to a new system where people can create as many accounts as they want without referral (although with lower interest). It also makes no sense that the interest rates remain 7% at the top end of the new tier, which probably will require tons of BTC deposits (big incentive not to withdraw), turning it into a sort of pyramid scheme where the "Trust" accounts have to refer new people to grow their interest rate.

In combination with growing volume and incredible consistency, the continuosly high interest rate of 7% over so many months makes absolutely no sense to me for anything but a ponzi as well.

Lastly, there is some sort of Pirate fan club going on here, where everyone else is bashed in a sort of group thinking, or alternatively sarcastic "jokes" are spammed to hide/annoy any critics. Reminds me of May/June 2011.

It’s impossible for me not to act on my conviction at this point and come out with this. I will personally apologize to Pirate if my assessment turns out to be wrong, and I will do it right in this thread.

I know most people are already aware of all of this, but there is a chance that it will help someone. Everyone should act as is his conviction.

Very few would do this or even have the means to do so, most are gamblers in the first place. Do you think the people affected by Madoff just went ahead and repurchased all their USD?

Goat is the guy who posted a bounty to find child porn association with gmaxwell. He is the guy who I suspect to have funneled (maybe continuing to do so?) his non-pirate passthrough investor money into BTCS&T, he is the guy who had problems with his shadiness with MtGox, had his supposed arbitrage bot and his GPU venture go poof, and he is a guy who wanted to create an open ponzi scheme asset on GLBSE!

Now, after all this ad hominem, I would bet against pretty much everything this person I consider a crook says.

If a ponzi as large as this were to collapse (with 6 digit BTC sum), you can be sure that the Bitcoin price will go to shit because of the loss of faith, negative media, loss of trust in BTC community, BTC spectacularly continuing to be an overall negative sum game (distributing money to those who drain wealth, namely hackers and scammers), how widely distributed and how many people are exposed to this etc., since it would probably cause further defaults.

Same thing that happened throughout fall when we had MyBitcoin (which was huge as well) and all the follow-ups.

Good thing you already have the scammer tag.

Why would you two want to educate people on that? Do you not like making money?

Also, Bitcoin is super silver.

Indeed. I keep hearing about a "Bitcoin economy", while in reality, this is simply not the case, similarly to it being a "currency". Bitcoins are first and foremost a speculative asset and only secondarily a sort of intermediary for fiat on both sides (see Silk Road), while the quoted prices are typically from MtGox, and updated live. Your Bitcoins have no (or very little) actual value besides the fiat value attributed to it via exchanges.

Now, for the event these exchanges fall, we have a huge problem: As long as there are no relatively popular goods/services actually providing a "backing" for BTC by setting sticky prices (which they adhere to), no arbitrage can occur from the fiat world to raise the Bitcoin value and set a floor, since buying in Bitcoins would be cheaper if their price goes down. Furthermore, to have any sort of economy, the majority of market participants need to receive their wages in Bitcoins, not fiat money.

I know this is nearly impossible to change since there is simply no Bitcoin nation, society or even village, and because Bitcoin excels only in internet transactions, but it amazes me when people hype stuff like Bit-Pay's recent spike in transactions due to BFL sales and a "major" Euro flight into Bitcoins as if it were indicative of any sort of economy.

Why exactly do you need to be anonymous in public if you are running a business that has 5 digit BTC sums of solicited investment money from the public?

Much better term, thanks. Just surprises me when such fallacies come from Bitcoin advocates.

Personally, if Bitcoins were not freely convertible like they are today and it could only be done at higher costs plus anonymously via shady avenues, the usefulness of Bitcoins to me would shrink enormously.

If a government has a problem with Bitcoin, MtGox will be target #1.

hazek is right, most of Bitcoin's value derives from its convertability with fiat money exchanges. If this goes, so does lots of its value as well as usefulness.

The comparison with alcohol or other drugs is idiotic because these goods' value derives from its consumption, not from convertibility with anything. Therefore, when production cost rises due to legislation, the price in the longer term will have to rise too, or else it cannot be profitable to produce.

Bitcoiners are quite stupid economically ignorant for the most part.

What do you imagine how people use a currency? They get paid in it, save it for a couple days, weeks, months or years and then spend it. Why would you immediately spend it?

Maybe you mean using Bitcoins as a "payment mechnism" or "value transfer" for fiat money?

Expenses
Debt
Diversification/Profit taking
Spending

Not true, purchasing power actually matters, and this is pretty much determined by the price. If the price keeps going down like it did in summer, then people who hold Bitcoins (a currency should be a store of value) are losing purchasing power.

So you decided not to hedge 100% on the spot and become a speculator instead of a payment processor, and then publicly disclose your position?

Seems like a very bad idea for you. Good luck selling all these Bitcoins for the prices the BFLs were sold for at the time.

Buy Bitcoins – Bankrupt Bitcoinica is out.

Sell Bitcoins – Bankrupt Bit-Pay is the new name of the game.

Another day, another Atlas.

Updated with four new accounts.

Enjoy!

http://en.wikipedia.org/wiki/Money_supply#European_Union

Actual printed notes and coins are a small fraction of the money supply.

Looks like their trade engine is. Other exchanges are unaffected on bitcoincharts, while for MtGox USD, EUR and GBP there have been no trades for a while.

I guess they are not really interested in making money.

MtGox fucked up precisely once in their entire history.

Bitcoinica fucked up 3 times.

For what it’s worth, I got my magazines within ~2 weeks of ordering, and I am in Europe.

I found it hilarious that Bitcoinica is listed as a Bitcoin success here on this issue.

Referral spam is an incredible annoyance, and to have such a such a nonserious scheme in an exchange is ridiculous.

I always hated Tradehill for the spam it created. If GLBSE goes this route, it might as well do other stupid stuff like embedding advertisments on the site.