Raize (OP)
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August 23, 2012, 11:22:13 PM |
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This will happen sometime after pirate finishes paying back the loans.
Until this week I didn't know Silk Road even offered this service, then someone mentioned it and suddenly it all makes sense. I wanted to get this prediction out there before it went away. That is all.
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Stephen Gornick
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August 24, 2012, 12:10:03 AM |
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This will happen sometime after pirate finishes paying back the loans.
Until this week I didn't know Silk Road even offered this service, then someone mentioned it and suddenly it all makes sense. I wanted to get this prediction out there before it went away. That is all.
Ah, so you suspect those previously hedged coins are delivered in dollars at future dates? Still unlikely it could have covered the 1% daily interest cost. |
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notme
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August 24, 2012, 12:13:03 AM |
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Correct me if I'm wrong, but I've read they charge 4% for hedging. Even assuming no trading fees, that's not enough for 1% per day unless SR sellers always use very quick shipping.
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Raize (OP)
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August 24, 2012, 12:28:16 AM |
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Ah, so you suspect those previously hedged coins are delivered in dollars at future dates? Still unlikely it could have covered the 1% daily interest cost.
Unless we've been underestimating just how much business is being done on Silk Road. Also, it changed to 3% when Bitcoin crossed $10, right? Being able to move the price wherever you want would be an EXTREMELY handy tool for any hedging service. Borderline imperative, in fact, which is why I'm predicting it will go away. You could keep two books, with never the two needing to cross, you just move the price where you need it to be to cover hedges accordingly. Once you've accumulated enough coin using this method, you no longer need the loaned BTC and can use your own reserves (at least for a while, you will eventually run out and have to close your hedging service). |
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bigasic
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August 24, 2012, 12:51:21 AM |
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They would never get rid of it. Now,they may up it's fee for hedging.. That would be my guess.
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556j
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August 24, 2012, 01:01:27 AM |
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Ah, so you suspect those previously hedged coins are delivered in dollars at future dates? Still unlikely it could have covered the 1% daily interest cost.
Unless we've been underestimating just how much business is being done on Silk Road. Also, it changed to 3% when Bitcoin crossed $10, right? Being able to move the price wherever you want would be an EXTREMELY handy tool for any hedging service. Borderline imperative, in fact, which is why I'm predicting it will go away. You could keep two books, with never the two needing to cross, you just move the price where you need it to be to cover hedges accordingly. Once you've accumulated enough coin using this method, you no longer need the loaned BTC and can use your own reserves (at least for a while, you will eventually run out and have to close your hedging service). Yah no. SR entire operator volume isn't enough to pay out interest pirate was obligated to. That you think it was coming from just the hedging is cute. BTW barely any vendor uses hedging. Really, the fee varied from 4%-7%+, it went from lowest buy to highest ask, on average no way to lose money long term. Pirate had nothing to do with SR. Not smart enough. Try again. |
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Raize (OP)
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August 24, 2012, 01:58:56 AM |
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Really, the fee varied from 4%-7%+, it went from lowest buy to highest ask, on average no way to lose money long term.
This is even MORE evidence that it would be feasible. I'll admit I don't know that much about Silk Road, but from some of these descriptions it sounding more and more like this could totally cover Pirate's obligations if it's really doing the kind of business independent sources are estimating it is. It's raking in fees on risk arbitrage by moving the price accordingly, if it is based on lowest buys and highest ask and cannot be losing money, and it's making from 4-7%, that could easily cover the weekly costs in coin. A side effect of this, however, would be that the price would likely keep increasing the more it was used, as that coin wouldn't be sold, and new buyers would still buy coin to buy more SR goods. I'm not sure how we're supposed to construe your comment as anything else but more proof of this. The safer the gamble is for Silk Road, the easier it would be for Pirate to cover his obligations. Your argument basically comes down to "it's too safe for Silk Road, so they can't possibly cover pirate's operating costs for this service." Except for this part: BTW barely any vendor uses hedging. Do they publish public statistics on this or is this just a shot in the dark guess on your behalf? |
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Bitcoin Oz
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August 24, 2012, 02:32:37 AM |
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Really, the fee varied from 4%-7%+, it went from lowest buy to highest ask, on average no way to lose money long term.
This is even MORE evidence that it would be feasible. I'll admit I don't know that much about Silk Road, but from some of these descriptions it sounding more and more like this could totally cover Pirate's obligations if it's really doing the kind of business independent sources are estimating it is. It's raking in fees on risk arbitrage by moving the price accordingly, if it is based on lowest buys and highest ask and cannot be losing money, and it's making from 4-7%, that could easily cover the weekly costs in coin. A side effect of this, however, would be that the price would likely keep increasing the more it was used, as that coin wouldn't be sold, and new buyers would still buy coin to buy more SR goods. I'm not sure how we're supposed to construe your comment as anything else but more proof of this. The safer the gamble is for Silk Road, the easier it would be for Pirate to cover his obligations. Your argument basically comes down to "it's too safe for Silk Road, so they can't possibly cover pirate's operating costs for this service." Except for this part: BTW barely any vendor uses hedging. Do they publish public statistics on this or is this just a shot in the dark guess on your behalf? That doesnt explain why he would share all of his profit |
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556j
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August 24, 2012, 06:09:34 AM |
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Do they publish public statistics on this or is this just a shot in the dark guess on your behalf?
You can add any item to your cart and it will say hedged Yes / No. Check the biggest vendors yourself. |
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