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Might be able to sell it to others that are overpaying for it. Other than that not sure.
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What is it you think you can do in 2 that suddenly removes 75% of SELLING's value whilst leaving MINING unchanged? Yes, you're right it doesn't work. It's pretty obvious too, now that I think about it  I didn't mean to multiply everything by four though. Only the mining side. Still, that would destroy the 1:1 ratio between mining and selling for the old shares, and the exchange into new would not work. Well, well. Well, not dividing SELLING by 4 was one of the possible step 2s. The high volume of trade yesterday would suggest a lot of people are still finding value in both SELLING and MINING - but at any price point there are going to be some who believe neither offers sufficient profit to be worth investing in. DMS only works at all because people have different views on the value of MINING/SELLING - if everyone agreed on value then they'd trade a discount to PURCHASE (representing perceived CP risk/time-cost of money) and there'd be zero new sales of PURCHASE other than to the occasional random-clicker. When MINING is a small portion of PURCHASE there doesn't have to be a HUGE perceived profit on SELLING for it to make sense. That's because any valuation which makes SELLING worth the vast majority of PURCHASE MUST be based on very large short-term difficulty increases. Very large short-term difficulty increases necessarily mean very large SELLING dividends in the near future - meaning most of the price paid for SELLING gets returned fairly quickly. That last point is where a lot of people go wrong. It's entirely WRONG to turn down an investment just because it can 'only' make 10%, 5% or 1% profit. Time-scale has to be taken into account. What's better - an investment that gives 60% profit after a year or one that gives 1% profit after a week (assuming an unlimited availability of both at all times - and that capital is returned at same time as the profit)? The 1% per week is better - as with compounding it outperforms the 60%. Percentage profit on its own is meaningless - it needs an associated time-period to be a useful measure. None of which is to deny that for ANY investor there IS a point at which buying neither of MINING or SELLING makes sense. But I can't run a seperate version of DMS for every investor based on how they want to price them - people who believe the price now matches their personal valuation (and won't change favourably) and so want to liquidate their position represent a key part of liquidity for the securities. Good points. I do think there would be room for 2 or 3 more similar securites with different specs. One for every investor who has their own idea for what spec it should have would get ridiculous. Even 5 I think might be overdoing it. |
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I have no idea what you are saying. SELLING will always be valued at PURCHASE - MINING. Otherwise there will be arbitrage.
You were saying Mining and Selling could both be valued at around 0.014, then Dms. Purchase would be around 0.028 which with 4x the hashing power(20 Mh/s) would only be 1/4 the days dividends, ~100 days. No. The total amount paid in dividends stay the same because there are 4 times as much money paid per share but only 1/4 as many shares. Since the numbers are per share it doesn't matter how many more or less shares there are. |
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I have no idea what you are saying. SELLING will always be valued at PURCHASE - MINING. Otherwise there will be arbitrage.
You were saying Mining and Selling could both be valued at around 0.014, then Dms. Purchase would be around 0.028 which with 4x the hashing power(20 Mh/s) would only be 1/4 the days dividends, ~100 days. |
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The buyback and days of dividends kept would have to be lowered a lot for that security, otherwise it wouldn't just work out that way.
Why? Remember that there will be only half (or a quarter) the number of securities outstanding. If they change it to 20 Mh/s then the current dividend would be 0.00027 per share approximately. 400 days would be around 0.107 per share. Subtract what the Mining security might be valued around 0.014, and the Selling security would probably be valued at over 0.08 edited: used wrong numbers |
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I'm very impressed with the DMS.PURCHASE fund. It is a very clever construct that lets you go both long and short on mining. The problem with it is that it stops working when the two sides get "out of the money". Right now, in my opinion MINING is still overpriced but the potential profit on SELLING makes it unattractive.
For it to be an effective short it has to be more or less balanced, so that both sides has equal profit chances. SELLING is bounded above by the price of PURCHASE, so it has almost no upside when MINING gets cheap.
It could very well be the other way around if difficulty started decreasing, pushing up the price of MINING.
The optimal situation would be when we have the prices of MINING and SELLING roughly equal. This can be achieved by upgrading the MINING contract.
When MINING falls below a 25% of PURCHASE (NAV/U) then issue a new PURCHASE contract based on a mining contract with double the old hashrate. Whenever the price goes above 75% then issue one with half the hashrate. The old MINING/SELLING contracts don't need to be withdrawn.
Right now though, MINING has fallen in price so much that it would be better to quadruple the hashrate to 20. Rename the old PURCHASE to PURCHASE5 and issue a new instrument PURCHASE20 (=MINING20 + SELLING20) which is exactly like the old with one difference. The MINING part is a 20MH/s bond instead of 5MH/s. This will in theory quadruple the price of MINING to about 0.014 and lower the price of SELLING to about 0.014. Mission accomplished.
You then stop selling the old PURCHASE5 and start offering PURCHASE20 instead. Also offer the holders of current combo to turn every four pairs of MINING5+SELLING5 into one PURCHASE20.
The only question remaining is. What if you don't have an amount evenly divisible by four that can be converted? I don't see a real problem with this, since the market for MINING5/SELLING5 will still exist and anyone can just sell the instruments or buy a few extra to make the numbers work out.
Is this something you would consider?
The buyback and days of dividends kept would have to be lowered a lot for that security, otherwise it wouldn't just work out that way. |
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I did a quick comparison of bitcoin stock exchanges today and thought I'd share my initial impressions. Please let me know if I missed any major exchanges, or if I got the wrong impression anywhere:
Thought it would be interesting to see what others thought. Where they agree or disagree. I posted a poll here: https://bitcointalk.org/index.php?topic=272848.0 |
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After reading the recent comparison by RangerK, I was interested in seeing what some of the other users thought about the BTC stock exchanges and which they preferred. Vote for your favorite and you can say why also if you want.
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I was just wondering with the increasing difficulty why the demand is still there for some seemingly high priced (though somewhat readily available) miners that don't seem like they can break even. After tomorrow's difficulty jump, USB BE units will make ~0.1BTC/month assuming 0% difficulty increases thereafter.
After tomorrow's difficulty jump, blades will make ~3.25BTC/month assuming 0% difficulty increases thereafter. (AnonBitcoinBuyer posted this on a group buy thread and it seems reasonable.) Can anyone with a better understanding of the difficulty, calculate something more detailed and farther out? So, an erupter USB stick at .5 BTC (333Mh) or so is probably not going to pay for itself with the difficulty going up as it is. And, a blade costing 10.5 BTC (10-13Gh) or so might not as well. The reasons why people are so game to get in, might be:Support the network (me) It is a hobby, if you break even all the merrier. (me) A more anonymous way of getting your hands on BTC's. Expecting a much higher BTC price (but even then, buy them now). Want to take part in the largest social experiment (outside of money itself) of all time. (me)  Personally, I got into a group buy for a 400Gh machine with an October delivery. That probably will be profitable if it arrives in October. My Jalapeno that was ordered at the beginning of June probably won't break even if it comes later than late September. My chips ordered through a GB and placed though Yifu, might never come. A wash? Lots of chances... IAS well, USB miner is so effective, it's profitable even with difficulty around 2 billion (electricity costs at 0.15USD/kWh, 1 BTC at 100 USD), which is 44 times tomorrow's difficulty. You will certainly make your money back (also, they cost 0.32 BTC, not 0.5) It's possible, but even if they do this could take a very long time. Not great from an investment perspective. |
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I have a coinbase account. I didn't know it was possible to buy with Paypal or Credit Card there though?
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I think you at least need to work on your business model / pricing structure.
You do realise that the transaction fees charged by MtGox / BitStamp / ... are more like 0.5%
No sane business would decide to use your software as opposed to creating their own. At 1% transaction fee, they are already pricing themselves out of the market, with no room to even make any money themselves.
The hardest part of running an exchange is arguably dealing with the regulations/banks/AML/fiat transactions. It is not the software. Your product is a tiny part of what is needed. Your pricing needs to reflect that.
Good luck
Agree with greBit. I was hoping the trend would be towards lower transaction fees. |
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Price adjusted fast. We've had a nice run for Dms.Selling. Any plans to issue a renewed version of these securities?
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I did a quick comparison of bitcoin stock exchanges today and thought I'd share my initial impressions. Please let me know if I missed any major exchanges, or if I got the wrong impression anywhere:
MPEX
website: primitive
30 day volume: 22,000 btc
listing fee: 30 btc!!!
other comments: They operator seems insufferably rude. You can see it in his FAQ. These guys are best known for handling the recent SatoshiDice deal. Between the high fee and rude operator, it's not clear to me why people use this service.
BTCT
website: so-so
30 day volume: 108,000 btc
listing fee: 5 btc
other comments: Based in Bolivia. You can really sense the legal uncertainty of bitcoin securities on this websites. There are huge, very verbose disclaimers all over the place.
Cryptostocks
website: nice!
30 day volume: 300 btc
listing fee: 2btc!
other comments: looks great. I'm not sure how long they've been around. Maybe they're new and that's why the volume is so low. I dig the low listing fee.
BitFunder
website: nice!
30 day volume: not sure, but I think it's very high
listing fee: 5btc
other comments: another great-looking site. Everything seems professional
That's it.
The reason I'm looking into this is that I'm thinking of doing crowdfunding for a literary project, and rather than appealing to straight philanthropy, I thought it'd be more fun and effective to sell shares of the proposed book. Is anyone aware of this having been done before? I'm not. Any thoughts are appreciated.
I prefer Btct.co to the others listed for various reasons. I think it has the best overall combination of usability and variety of stocks right now. |
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few months ago I started a topic about "ASICs are over priced", and allot of people shitted on me and told me to shut up, and ASICs are not expensive and I just cannot afford them, I felt dispointed at the time because I've thought that the Bitcoin spirit was bigger than that and some guys manipulating the community. https://bitcointalk.org/index.php?topic=222770.0well look, most ASIC vendors are playing you, and I am so happy that I couldn't afford to buy one. What you gonna do about it? still continue to pre-order and lick their ass, even when they take your investment and doesn't give a f*** about your concerns. I work in a big company where we are one of the best in what we do, and customer satisfaction is our capital. think about this very well No one is forcing you to buy them. If they're overpriced don't buy any, and they will have to lower the price to sell them. |
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Launching this site into beta today: https://www.bitnopoly.com/"Bitnopoly is an online real time board game for 2 or 4 players where the players buy in and then compete against one another to win all the points. Games can either be based on Fun Points (play for pride and fun) or Bit Points (play for Bitcoins)." Please leave feedback here or on our site. thanks! This was a good idea. Not as colorful(yet?) as I would have expected. We just can't get away from Dice rolling Bitcoin games can we.  |
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Quick action! 1. Have you considered the option of going public-owned so the risk could be shared among peers? like http://mpex.co/?mpsic=S.BBET, http://bitbet.us/. Trust me, it's going to catch lots of attention which is exactly what the website need. 2. Another question is that is peer allowed to create contract through some kind of review/approval mechanism? 3. Your website is mentioned in bitcoinmagazine: http://bitcoinmagazine.com/july-in-review/At last, the website features lots of innovation. I have already promoted it in my twitter. Keep on the good work. 1.Don't think they have risk unless they're market making. 2.This is good, I think either bitbet or betsofbitcoin has this, and would help them get a feel for which events players would like to see. As I watched some of the events I noticed some expire, bitcoin difficulty for example, without another one to take it's place for a while. That makes it difficult to do continuation bet. I hope the betting picks up, would like to see volume similar to Intrade eventually. |
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So, we had a total of 106 participants, all started this race with 0.01 BTC. Congrats everyone for playing, we have a lot of winners, but for this race we know we can only reward the top 5 players!
Without further ado, the following players, starting from only 0.01 BTC managed to win the most.
These are the winners for the SatoshiBet Roulette 10BTC Launch Race (trademark pending!):
1st: Hfleer reached 0.437 BTC, you win 4 BTC
2nd: DiamondCardz reached 0.365 BTC, you win 2.5 BTC
3rd: Bifta reached 0.205 BTC, you win 2 BTC
4th: 001sonkit reached 0.165 BTC, you win 1 BTC
5th: Boelens reached 0.100 BTC, you win 0.5 BTC
Winnings received. Thanks for this, was exciting. nice to meet you sneaky guy  hjow did youj get here high on top, roullete? I was playing roulette. Congrats to you and all the other winners also. |
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So, we had a total of 106 participants, all started this race with 0.01 BTC. Congrats everyone for playing, we have a lot of winners, but for this race we know we can only reward the top 5 players!
Without further ado, the following players, starting from only 0.01 BTC managed to win the most.
These are the winners for the SatoshiBet Roulette 10BTC Launch Race (trademark pending!):
1st: Hfleer reached 0.437 BTC, you win 4 BTC
2nd: DiamondCardz reached 0.365 BTC, you win 2.5 BTC
3rd: Bifta reached 0.205 BTC, you win 2 BTC
4th: 001sonkit reached 0.165 BTC, you win 1 BTC
5th: Boelens reached 0.100 BTC, you win 0.5 BTC
Winnings received. Thanks for this, was exciting. |
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Now it's dipping a little. What price do you think September will see?
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As much as I hate ripple, i think you can go usd-->ripple-->bitstamp
Where do you buy the ripple at? |
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