[BTC-TC] Deprived Mining Speculation (DMS)

[Deprived]

Hopefully everyone who emailed/PMed me now has a response if their mail needed one.  Took me longer than expected to clear the remainder of the back-log and am going out before long so may not get everything posted now that I planned to.  Will see how much I can get done anyway - and do rest tomorrow.

The big question on everyone's mind is, I assume, where (and when) DMS will relist.

The favoured option has been (and remains) the new exchange being developed/run by the Ciphermine team.  But we are NOT committed (in the sense of having promised to go there) to it - and, at present, I am not committed to being involved either as part of the operational team for it OR as an investor in it.  I should be clear that DMS listing there and me being involved in operating/investing in it are NOT tied together - it is possible we may list there without me being otherwise involved in it and it's possible (though unlikely) that DMS could list elsewhere despite me ivnesting in/being involved in operating it.  That's because the criteria for DMS listing there (that it provides the functionaility and enivorment DMS needs) aren't the same as the criteria for my involvement in the site (for me to be involved in operating it, the site needs to match my vision of how an exchange should be run and be something I'm happy to link my name to.  For me to invest in it requires me to be confident that I'll make a profit from my investment).

It IS also possible that if I invest in the exchange it could cause a conflict of interest with my role as a manager of DMS.  The reason for that isn't necessarily obvious - and I'm not going to expand on it - but that's one issue that I do need to sort out before I can make a final decision (if I believe such a conflict of interest is likely then I'd decline to invest - giving precedence to my existing commitment to DMS investors).

The code-base for the initial functionality of the exchange is, to my understanding, fairly complete - requiring just final testing, third-party penetration testing and final user interface implementation.  It's still likely to be a few weeks away.  Right up until it launches I'll be continuing dialogue with other exchanges - if somewhere else provides a better fit for DMS' requirements then I'm in no way averse to listing elsewhere.

Here's the main points I'm considering in respect of exchanges we could list on:

1.  Obviously it needs the basic functionality - ability to trade, pay dividends etc.
2.  The ability to transfer shares is essential for DMS - to split PURCHASE and to redeem pairs of MINING/SELLING (there's no other way of doing these functions).  This rules out a lot of exchanges immediately.
3.  I must have ability to obtain a list of investors (either by email address or by BTC address) - BTC-TC closed down very neatly (nice job by burnside), Bitfunder more messily (continuing excuses why people can't withdraw BTC - I got all mine out a while back luckily) and thoe who have been around for a while will remember GLBSE's shoddy closure where some assets never received lists of investors and many that did receive them had to wait months.  I'm not chancing that with any new place I list - this functionality has to be in place or be promised to be in place shortly.
4.  Accountability.  Kate who runs Ciphermine is based in the UK - as am I.  So if anything gos wrong I have immediate access to a variety of means of recourse.  Knowing the identity of someone in a different country doesn't overcome the practical issues involved in taking action (of whatever nature) should they defraud you.  There's also the linked issue of wanting an exchange operator to have a good reason not to defraud (of particular relevance with relatively new exchanges) - i.e. significant assets other than the exchange which they wouldn't want to jeopardise.  With most operators I have no knowledge sufficient to give me such confidence.
5.  Ciphermine.B1.  With these being a large part of DMS' current assets there is definitely a benefit initially in being on the same exchange as they're listed on.  Redemptions initially would have to be part cash, part bonds - which is far easier where the bonds can be sent back to the same account as sent in the MINING/SELLING/PURCHASE.  This isn't a critical requirement - but rather is something that tips the balance when all other factors are close.

I'm sorry that we aren't relisted yet - I'd expected the exchange to be up at the end of last month.  But lisitng somewhere where we couldn't operate effectively isn't an attractive option.  And do remember that I have probably more reason to want to be relisted than anyone else - all the time we're not listed I earn exactly zero in management fees whilst still havign to expend time and, on occasion, BTC (e.g. the 1/3 of times difficulty change is between 16:00 and 00:00).  Hopefully I'll have more information by the end of the weekend - if I don't have a firm date by middle of next week (when all current changes of BTC addresses will be finalised) then I'll consider doing a payment of existing MINING dividends and accept that there'll be extra hassle and delay when we do get to relist.

Will have to post the updated financials tomorrow - as heading out now.  Have now got exact times for recent difficulty changes so can give precise figures.

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[burnside]

Thank you for the update Deprived.

I appreciate your approach to re-listing.  It's best to be patient and get it right.

(quick note: I sent an updated asset holder list this morning.  Hopefully will help fill in some of the btc address gaps.)

[HowlingMad]

Deprived,
If the MINING dividends become too small, I would be willing to trade for shares or bonds, if that makes life easier.  I have been reinvesting about 50% of my divs anyway so ....

[realrover]

Hi Deprived,
I saw your calculation regarding delayed MINING divs. What about SELLING divs? Any numbers? Thanks.

[stripykitteh]

Hi Deprived,
I saw your calculation regarding delayed MINING divs. What about SELLING divs? Any numbers? Thanks.

There won't be any SELLING divs until CIPHERMINE.B1 is liquid, or there is a large enough volume of PURCHASE sales (the former is more likely, though).

You can probably work out for yourself though what dividend SELLING would be due if CIPHERMINE.B1 could be sold at face value. Though there's no saying what it actually will trade for until there's an exchange (and it might take a while for the exchange to achieve liquidity).

[Deprived]

Hi Deprived,
I saw your calculation regarding delayed MINING divs. What about SELLING divs? Any numbers? Thanks.

There won't be any SELLING divs until CIPHERMINE.B1 is liquid, or there is a large enough volume of PURCHASE sales (the former is more likely, though).

You can probably work out for yourself though what dividend SELLING would be due if CIPHERMINE.B1 could be sold at face value. Though there's no saying what it actually will trade for until there's an exchange (and it might take a while for the exchange to achieve liquidity).

This.

I'm just back from the pub (full of beer) so not necessarily as coherent as I should be.  But the value of SELLING depends very much now on what CIPHERMINE.B1 is worth.  I can't comment on that more as to do so could jeopardise DMS' position (the conflict of interest I referred to earlier refers, at root, to this - I need to be able to act on behalf of DMS without having a contrary interest from being invested in the new exchange).

Bottom line is that, for dividend purposes, I can only value CIPHERMINE.B1 at whatever the lowest price is that I would have to accept were I to sell all our holdings in it.  In theory that's face-value with a 3 month delay - whether that's the case in practice is something I need to resolve over the next few days.

[Deprived]

Here's the updated report I promised.  This includes MINING dividends up to Monday.

BTC Balance (BTC-TC)   0
CIPHERMINE Bonds    260.56000000
BTC Balance (Wallet)    150.79576392
Dividends (Wallet)    3.27310018
Owed by Deprived    0.24621154
TOTAL ASSETS    414.87507564
   
Outstanding MINING   152575
Outstanding SELLING   152575
Outstanding PURCHASE   10479
Effective Units   163054
   
Dividends/Mining Owed   0.00010645
Total Dividends Owed   17.3570983
   
Block reward   25
Difficulty   609,482,680
Hashes per MINING   5000000
   
Daily Dividend    0.00000413
50 days (Min Liquid)    0.00020628
100 days (Forced Close)    0.00041257
365 days (Buyback)    0.00150587
405 days (IPO)    0.00167090
400 days (Post SELLING div)    0.00165027
410 days (Pre SELLING div)    0.00169153

NAV/U    0.00083995    BTC +    0.1598    CIPHERMINE.B1   
NAV/U (if CM.B1 at face)    0.00243795             

"Owed by Deprived" refers to the amount I owe in respect of the last but one difficulty change - where difficulty changed between 16:00 and 00:00 so I personally will be paying the difference between old and new dividends for that date.  I haven't bothered actually transferring the funds into the DMS wallet - as seems silly to pay a fee to transfer there when they'll have to go to an exchange anyway.

Only very minor inaccuracy in the report is that a very small portion of the received CM.B1 dividends are due to an investor who DMS owes 200 Cm.B1 to (he cashed out MINING+SELLING just before transfers got disabled so was unable to send him the shares).  That amount is tiny but will be paid when I transfer him his CM.B1 shares.

Here's the list of dividends included in the above report:

Date   Dividend
04-Nov    0.00000643
05-Nov    0.00000643
06-Nov    0.00000643
07-Nov    0.00000492
08-Nov    0.00000492
09-Nov    0.00000492
10-Nov    0.00000492
11-Nov    0.00000492
12-Nov    0.00000492
13-Nov    0.00000492
14-Nov    0.00000492
15-Nov    0.00000492
16-Nov    0.00000492
17-Nov    0.00000492
18-Nov    0.00000413
19-Nov    0.00000413
20-Nov    0.00000413
21-Nov    0.00000413
22-Nov    0.00000413
23-Nov    0.00000413
24-Nov    0.00000413
25-Nov    0.00000413
   
Total    0.00010645

[kingfzero]

Hi Deprived,I have some new ideas.
can you use the DIV to buy some new equipment to increase the hash?

[BitThink]

Hi Deprived,I have some new ideas.
can you use the DIV to buy some new equipment to increase the hash?

There's no hashing. MINING is like a virtual mining bond, and the mining income is supported by the SELLING holders. I suggest you to spend some time learning this fund more first.

[HowlingMad]

Hi Deprived,I have some new ideas.
can you use the DIV to buy some new equipment to increase the hash?

Please read the very first few entries in this thread, you will get a complete idea of how it works.

[inspiredinvestor]

Here's the updated report I promised.  This includes MINING dividends up to Monday.

BTC Balance (BTC-TC)   0
CIPHERMINE Bonds    260.56000000
BTC Balance (Wallet)    150.79576392
Dividends (Wallet)    3.27310018
Owed by Deprived    0.24621154
TOTAL ASSETS    414.87507564
   
Outstanding MINING   152575
Outstanding SELLING   152575
Outstanding PURCHASE   10479
Effective Units   163054
   
Dividends/Mining Owed   0.00010645
Total Dividends Owed   17.3570983
   
Block reward   25
Difficulty   609,482,680
Hashes per MINING   5000000
   
Daily Dividend    0.00000413
50 days (Min Liquid)    0.00020628
100 days (Forced Close)    0.00041257
365 days (Buyback)    0.00150587
405 days (IPO)    0.00167090
400 days (Post SELLING div)    0.00165027
410 days (Pre SELLING div)    0.00169153

NAV/U    0.00083995    BTC +    0.1598    CIPHERMINE.B1   
NAV/U (if CM.B1 at face)    0.00243795             

"Owed by Deprived" refers to the amount I owe in respect of the last but one difficulty change - where difficulty changed between 16:00 and 00:00 so I personally will be paying the difference between old and new dividends for that date.  I haven't bothered actually transferring the funds into the DMS wallet - as seems silly to pay a fee to transfer there when they'll have to go to an exchange anyway.

Only very minor inaccuracy in the report is that a very small portion of the received CM.B1 dividends are due to an investor who DMS owes 200 Cm.B1 to (he cashed out MINING+SELLING just before transfers got disabled so was unable to send him the shares).  That amount is tiny but will be paid when I transfer him his CM.B1 shares.

Here's the list of dividends included in the above report:

Date   Dividend
04-Nov    0.00000643
05-Nov    0.00000643
06-Nov    0.00000643
07-Nov    0.00000492
08-Nov    0.00000492
09-Nov    0.00000492
10-Nov    0.00000492
11-Nov    0.00000492
12-Nov    0.00000492
13-Nov    0.00000492
14-Nov    0.00000492
15-Nov    0.00000492
16-Nov    0.00000492
17-Nov    0.00000492
18-Nov    0.00000413
19-Nov    0.00000413
20-Nov    0.00000413
21-Nov    0.00000413
22-Nov    0.00000413
23-Nov    0.00000413
24-Nov    0.00000413
25-Nov    0.00000413
   
Total    0.00010645

is the plan to wait to pay when all have moved to new exchange? or is there a chance of a payout before?  or are you still waiting for people to get in touch with there bitcoin address that didn't have them on btct.
I am not desperate for coin, i just was wondering the plan.

[Deprived]

is the plan to wait to pay when all have moved to new exchange? or is there a chance of a payout before?  or are you still waiting for people to get in touch with there bitcoin address that didn't have them on btct.
I am not desperate for coin, i just was wondering the plan.

I'd far prefer to pay all dividends after we relist - but at the same time it wouldn't be right for me to withhold significant sums from investors that they may need for a long period of time.

I don't see any way that I'd be able to make a general payout of all dividends in the near future - I'm still receiving new contacts from people asking for BTC addresses to be changed because they're inputs.io ones or addresses that they have no control over.

What I will offer next week (if I'm not able to provide a firm date for relisting by then) is to pay back dividends out to anyone who wants them - they'd be processed individually with the recipient paying the .001 (or is it .0001) BTC transaction fee.  In any relisting their shares would then NOT be transferred automatically - but would be transferred manually by me after back dividends had been paid to all other shares.  This would add significant extra work for me - as once people had requested back dividends on different days the process of importing and paying out back dividends on a new exchange would become progressively longer and more messy.  But it would address both issues currently faced:

1.  Allowing those owed significant amounts of back dividends to collect them.
2.  Avoiding the scenario where I pay dividends to an address no longer under the control of the owner where the BTC vanish.

In theory I could ignore #2 - and claim it's the investor's responsibility to have provided a clean address that they control.  But I don't feel comfortable with potentially losing funds where an investor has been away for a while, thought they'd provided a 'safe' address and haven't yet become aware of/dealt with the inputs.io scam/theft.

[Ashitank]

I think we should put a deadline may be 15 days from now by when all share holders have to sort them self's out , it is their money & if they don't care about their own BTC then their dividends should be absorbed into DMS.

[Rannasha]

I think we should put a deadline may be 15 days from now by when all share holders have to sort them self's out , it is their money & if they don't care about their own BTC then their dividends should be absorbed into DMS.

I'm not sure if 15 days is the right length of time, but some plan on what to do with those investors that haven't provided the relevant information after some time would be useful.

Anyway, @Deprived: I assume the on-request dividend payments are only for MINING holders, since there's not enough liquid BTC for SELLING dividends?

[Deprived]

I think we should put a deadline may be 15 days from now by when all share holders have to sort them self's out , it is their money & if they don't care about their own BTC then their dividends should be absorbed into DMS.

I'm not sure if 15 days is the right length of time, but some plan on what to do with those investors that haven't provided the relevant information after some time would be useful.

Anyway, @Deprived: I assume the on-request dividend payments are only for MINING holders, since there's not enough liquid BTC for SELLING dividends?

The problem isn't so much those who haven't provided a BTC address at all - as those are obvious.  The issue with those is purely that they can't be paid dividends, so as soon as the rest are paid (and they aren't) then shares cease to be fungible.  But that problem becomes reality as soon as I allow anyone to claim dividends - so from that point on is moot.

The problem IS that some people's BTC addresses are inputs.io ones - and I have no way of knowing which ones that is.  I know that some are - as, even in last few days, I've received more mails stating that to be the case and asking for the address of record to be changed. As noted before I could quite reasonably just pay out and say "tough luck, you should have been paying more attention" to anyone who still hasn't corrected such an error - but I'm reluctant to do that unless/until absolutely necessary as losing investors' funds (even if it's clearly their fault) when avoidable is something I'd prefer not to do.

And yes - I'm only referring to MINING dividends: at present no SELLING dividends can be paid.

[shmoula]

Do you have some service selected? Or do you have any list of features you want from it? We may help you with searching

. . . relisting . . .

[DaSheep]

And yes - I'm only referring to MINING dividends: at present no SELLING dividends can be paid.

Will they be paid (back) once it's possible to do so?

I'm holding >1000 shares of DMS.SELLING, is there anything i should/can do besides just.. waiting?

[Rannasha]

And yes - I'm only referring to MINING dividends: at present no SELLING dividends can be paid.

Will they be paid (back) once it's possible to do so?

I'm holding >1000 shares of DMS.SELLING, is there anything i should/can do besides just.. waiting?

You could offer to buy CIPHERMINE.B1 bonds at face value from DMS.

Those things are what's holding back SELLING dividends from being payable. The total NAV of the fund is sufficient, but since the shutdown of BTCT it hasn't been possible to rebalance the funds portfolio and now these illiquid assets make up the majority of the NAV.

[stripykitteh]

And yes - I'm only referring to MINING dividends: at present no SELLING dividends can be paid.

Will they be paid (back) once it's possible to do so?

I'm holding >1000 shares of DMS.SELLING, is there anything i should/can do besides just.. waiting?

I also hold DMS.SELLING.

It's all about the liquidity of CIPHERMINE.B1. Once that is listed on an exchange and has a live quote NAV/U can be calculated and it would be possible to pay DMS.SELLING a dividend (provided that the NAV works out to be more than 410 days of MINING dividends at the time, which it almost certainly would be).

We have to be patient, I'm afraid. Deprived is a dependable asset manager and CIPHERMINE isn't going away so I see the risk of not getting paid as being very low. But Kate and her people have to get their exchange operational first.

Lack of liquidity is frustrating, I agree. I've done a couple of very stupid trades in other things waiting for this to re-list and have been lucky to only lose a little bit.

[odolvlobo]

And yes - I'm only referring to MINING dividends: at present no SELLING dividends can be paid.

Will they be paid (back) once it's possible to do so?
I'm holding >1000 shares of DMS.SELLING, is there anything i should/can do besides just.. waiting?

You could offer to buy CIPHERMINE.B1 bonds at face value from DMS.
Those things are what's holding back SELLING dividends from being payable. The total NAV of the fund is sufficient, but since the shutdown of BTCT it hasn't been possible to rebalance the funds portfolio and now these illiquid assets make up the majority of the NAV.

At the risk of being really annoying... I told you so!
I was totally against investing the fund's assets because of the unnecessary risk, but everyone else let their greed rule them. We took a big loss from Just Dice and now the funds are stuck in limbo. We narrowly missed losing big time with CoinLenders. ... and all for the sake of a few more percent of return.