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Author Topic: [Mpex.co] The Scientology of Bitcoin Finance?  (Read 27275 times)
jimmothy
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November 28, 2013, 06:04:49 PM
 #21

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I would love for someone to explain to me how mpex.co is not a scam bit I simply cannot understand.

Isn't MPEX the only place you can reliable underwrite and buy options against the USD value of BTC?

I would say this is value enough, given April 2013 would likely have been a lot worse had MPEx not existed.

The shareholder report for March: http://trilema.com/2013/mpoe-march-2013-statement/ kinda shows that.

Additionally, those who bought MPEx accounts in 2012, and as well bought S.MPOE before the 2nd batch of the IPO are likely all millionaires (in USD terms) at this point.

So to be honest, I really don't see how it is a scam. Perhaps the other businesses in their infancy seem a tad questionable, but MPOE-bot I think has proven itself as a valuable asset to the Bitcoin world as a whole.

What.. So options and the MPOE bot bring in enough revenue to justify nearly 1 billion dollars?

Again what do they do? Options are a fancy way of gambling but really no value is created so how exactly did this help bitcoin in april?

Also anyone holding large amounts of bitcoins during the time of mpex ipo would be a millionaire now in terms of usd but that is entirely because bitcoin has created huge value over the dollar not mpex.
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November 28, 2013, 06:11:58 PM
 #22

What.. So options and the MPOE bot bring in enough revenue to justify nearly 1 billion dollars?

Again what do they do? Options are a fancy way of gambling but really no value is created so how exactly did this help bitcoin in april?

Also anyone holding large amounts of bitcoins during the time of mpex ipo would be a millionaire now in terms of usd but that is entirely because bitcoin has created huge value over the dollar not mpex.

Your avatar suits you well.

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November 28, 2013, 06:13:51 PM
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So options and the MPOE bot bring in enough revenue to justify nearly 1 billion dollars?

Wasn't Facebook valued at $85 billion while bringing in less than a 1% of that in revenue in 2011?

I don't see the issue here to be honest.
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November 28, 2013, 06:22:33 PM
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So options and the MPOE bot bring in enough revenue to justify nearly 1 billion dollars?

Wasn't Facebook valued at $85 billion while bringing in less than a 1% of that in revenue in 2011?

I don't see the issue here to be honest.

Not sure how Facebook is comparable to mpex.co.  Facebook has ad revenue and has established itself as a useful social media tool with potential to make bitchloads of revenue with the amount of users it has.

Does an options robot really justify the value of mpex.co?

I don't disagree that mpex.co made a few people very rich. But it still looks like all that happens on that site is taking btc from one unfortunate hand and giving it to the next (Probably ending up in mircea or other ipo shareholders pockets).
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November 28, 2013, 06:43:46 PM
 #25

Have you seen the MPEX web site? Case closed. User ignored.

I bought "tons" of shares at .5 and even .6 and have been watching Virtex closely. Bought some more today at .1.

Well done brave Sir Lolcow. This is the story of your loss.

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November 28, 2013, 06:46:13 PM
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Also anyone holding large amounts of bitcoins during the time of mpex ipo would be a millionaire now in terms of usd but that is entirely because bitcoin has created huge value over the dollar not mpex.

No, actually, shares sold originally for 2k satoshi. Some of those people sold recently in the 70-80k satoshi range. That's a 40x increase, which actually outperformed BTC for most of the interval.

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November 28, 2013, 07:15:09 PM
 #27

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Normally "investing" is when you give capital to someone who needs it to create something of value. I don't see any value coming out of mpex.co whatsoever. ...

...
ok you have 700k btc or roughly 700 milllion usd invested in your company.

What the fuck do you even do?? Seriously how can you justify nearly a billion usd company evaluation when you literally have no value.
...

Lol, coming from a guy white knighting Havelock -- a company trying to pass off its ludicrous failed "IPO" as a "gift to [its] loyal supporters."

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November 28, 2013, 09:28:16 PM
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Also anyone holding large amounts of bitcoins during the time of mpex ipo would be a millionaire now in terms of usd but that is entirely because bitcoin has created huge value over the dollar not mpex.

No, actually, shares sold originally for 2k satoshi. Some of those people sold recently in the 70-80k satoshi range. That's a 40x increase, which actually outperformed BTC for most of the interval.

Again I am impressed with the profits you seem to have made I just have no idea where this money comes from. What do you do to create value?
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November 28, 2013, 10:17:56 PM
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Again I am impressed with the profits you seem to have made I just have no idea where this money comes from. What do you do to create value?

Wow. I'm sorry MPOE-PR, you must have quite the patience to deal with this all day.
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November 28, 2013, 10:22:13 PM
 #30

Volume of Mpex's non-Mpex stocks in the last month: 110 BTC

I'm still laughing that he values his worth as 5 % of all bitcoins in existence.

This can't be real.
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November 28, 2013, 11:34:48 PM
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Again what do they do? Options are a fancy way of gambling but really no value is created ...

A lot of financial related stuff creates the impression of being without any value for some.

The sad truth is that a lot of PR's statements have some valid point to some distinct.* That an exchange with four stocks, which are trading on lowish volume, all involving the creator (probably a good thing in this case) and some option trading, has such a high valuation seems to tell a lot of Bitcoin world. But this is probably just half of the truth: MPEx is rock solid, innovative (GPG order system!) and seemingly profitable for investors. MPEx' alleged irrelevance is also not the only reason why it survived three other exchanges and is probably here to stay for a long time.

http://trilema.com/category/mpex/ provides some further insight. Here is a good example, that it's more than a shitty website from the 90s.

*Especially sad, because many have a (sometimes eye-opening) "cold, hard reality" character. Wink

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November 29, 2013, 12:09:09 AM
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Again I am impressed with the profits you seem to have made I just have no idea where this money comes from. What do you do to create value?

Wow. I'm sorry MPOE-PR, you must have quite the patience to deal with this all day.

I must say that mpoe pr is probably the most active bitcoin pr person I have seen. But sadly I think this is because mpoe/mpex profits are directly tied to the amount of unfortunate noobs who pay 30btc to register and fail with options.

I honestly don't think mpoe has a problem dealing with questions lime mine as all he does all day is advertise his website/blog on other somewhat related threads.
jimmothy
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November 29, 2013, 12:26:07 AM
 #33

Again what do they do? Options are a fancy way of gambling but really no value is created ...

A lot of financial related stuff creates the impression of being without any value for some.

The sad truth is that a lot of PR's statements have some valid point to some distinct.* That an exchange with four stocks, which are trading on lowish volume, all involving the creator (probably a good thing in this case) and some option trading, has such a high valuation seems to tell a lot of Bitcoin world. But this is probably just half of the truth: MPEx is rock solid, innovative (GPG order system!) and seemingly profitable for investors. MPEx' alleged irrelevance is also not the only reason why it survived three other exchanges and is probably here to stay for a long time.

http://trilema.com/category/mpex/ provides some further insight. Here is a good example, that it's more than a shitty website from the 90s.

*Especially sad, because many have a (sometimes eye-opening) "cold, hard reality" character. Wink

Not sure what your point is. Looks like you just quoted a trillema post. So is it the "solid functionality" or "innovative gpg order system" that makes it worth 1 billion? I don't think your post clears up any confusion.
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November 29, 2013, 02:01:59 AM
 #34

...
Not sure what your point is. Looks like you just quoted a trillema post. So is it the "solid functionality" or "innovative gpg order system" that makes it worth 1 billion? I don't think your post clears up any confusion.

Jimmothy, egalitarian predisposition is my one great weakness, but even i will concede that there are things too complex for a feller like yourself to ever understand.
And no amount of explainin' will make one bit of difference.
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November 29, 2013, 03:09:41 PM
Last edit: November 29, 2013, 04:54:19 PM by DrGregMulhauser
 #35

Isn't MPEX the only place you can reliable underwrite [FTFY] and buy options against the USD value of BTC?

The quasi-options available are generally priced by a bot which maintains a usurious spread and ludicrous levels of implied volatility frequently far above historical volatility -- making them a perfect way to extract cash from those who don't ignore the place entirely because they don't realise there are cheaper ways of doing this stuff. As for reliability, the operator claims in his site's FAQ that he "doesn't hedge...options positions".

However, a reliable market maker -- one which does not introduce inordinate levels of counterparty risk -- does not enter into naked positions. (No pun intended, despite MP's history of involvement in the Romanian porn industry: I mean naked options positions). Not entering naked positions means, for example, taking a long position in the underlying whenever one becomes net short in calls on that underlying. This type of hedge is part and parcel of any competent market making activity in derivatives. Failing to do so means failing to deliver under a non-trivial set of possible market outcomes. (It also means profiteering by continuing to run that risk of failing to deliver and not spending the resources to reduce that risk.)

As far as I can tell, judging by the shellacking which the bot sometimes takes, the claim about failing to hedge is correct. This suggests that with respect to options market making, the operation is not reliable from the standpoint of counterparty risk. To someone not paying attention to the counterparty risk which is necessarily introduced by a failure to hedge, the operation may appear to be perfectly safe and reliable...right up until it isn't. This is little different than the appearance that a 20-sided die will never come up showing '1', because it hasn't yet done so during your first 10 rolls.

Oh, and just as a reference point, the combined revenue for MPOE options contracts sold during August, September, and October was something around 2180 BTC.

The current open interest on ICBIT just in the March 2014 BTC/USD futures contract is 387,424, while volume is showing at a little under $13 million. I have no idea what the site's revenue on that volume might be. But it's interesting that during just the last 7 days, the top trader on ICBIT generated a profit of around 755 BTC, and during the last 30 days, the corresponding figure was 1877 BTC. In other words, the profit generated by just one trader during the last 30 days is approaching the entire MPOE options revenue across all contracts for a 3-month period.

ICBIT carries significant counterparty risk too, but at least it comes clean about it, as distinct from disingenuously promoting a failure to hedge as a positive point, rather than as an indication of what it really is.

EDIT: Clarified my wording about revenues and volumes.

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November 29, 2013, 04:45:40 PM
 #36

The quasi-options available are generally priced by a bot which maintains a usurious spread and ludicrous levels of implied volatility frequently far above historical volatility -- making them a perfect way to extract cash from those who don't ignore the place entirely because they don't realise there are cheaper ways of doing this stuff. As for reliability, the operator claims in his site's FAQ that he "doesn't hedge...options positions".

However, a reliable market maker -- one which does not introduce inordinate levels of counterparty risk -- does not enter into naked positions. (No pun intended, despite MP's history of involvement in the Romanian porn industry: I mean naked options positions). Not entering naked positions means, for example, taking a long position in the underlying whenever one becomes net short in calls on that underlying. This type of hedge is part and parcel of any competent market making activity in derivatives. Failing to do so means failing to deliver under a non-trivial set of possible market outcomes. (It also means profiteering by continuing to run that risk of failing to deliver and not spending the resources to reduce that risk.)

As far as I can tell, judging by the shellacking which the bot sometimes takes, the claim about failing to hedge is correct. This suggests that with respect to options market making, the operation is not reliable from the standpoint of counterparty risk. To someone not paying attention to the counterparty risk which is necessarily introduced by a failure to hedge, the operation may appear to be perfectly safe and reliable...right up until it isn't. This is little different than the appearance that a 20-sided die will never come up showing '1', because it hasn't yet done so during your first 10 rolls.

Oh, and just as a reference point, the combined revenue for MPOE options contracts sold during August, September, and October was something around 2180 BTC.

The current open interest on ICBIT just in the March 2014 BTC/USD futures contract is 387,424, while volume is showing at a little under $13 million. Also of note, during just the last 7 days, the top trader on ICBIT generated a profit of around 755 BTC, and during the last 30 days, the corresponding figure was 1877 BTC. In other words, the profit generated by just one trader during the last 30 days is approaching the entire MPOE options revenue across all contracts for a 3-month period.

ICBIT carries significant counterparty risk too, but at least it comes clean about it, as distinct from disingenuously promoting a failure to hedge as a positive point, rather than as an indication of what it really is.

Glad to see your long history of talking about things you don't either know or comprehend hasn't ended yet.

MP happens to be the first and the only guy in BTC that neither enters into naked positions nor allows others to do so (much to their chagrin).

Read up on how the MPOE bot is financed, try and comprehend it, stop making a fool of yourself.

PS. MP covered 10s of ks of Bitcoins' worth of trading losses so that all you fuckwits could have a Bitcoin in the first place, that is to say so this thing you imagine you're being part of could continue its destiny, unrelated to your own lives as that may be.

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November 29, 2013, 04:53:22 PM
 #37

Glad to see your long history of talking about things you don't either know or comprehend hasn't ended yet.

MP happens to be the first and the only guy in BTC that neither enters into naked positions nor allows others to do so...

Interesting. Perhaps then you would enjoy deigning to explain to we mere mortals how one reconciles the following two statements:

1) I do not enter into naked (translation for current purposes: unhedged) options positions.

2) I do not hedge options positions.

Oh do tell, so that we may be enlightened.

Alternatively -- much as I suggested to you the last time you started throwing the weight of your own confusion around over in one of my threads where I had just rejected the possibility of listing on MPEx -- perhaps you'd like to run off and find a colleague or two who has acquired some investing experience elsewhere than while toddling around during Bitcoin's brief childhood, and first ask for an outside opinion on this ludicrous excuse for options market making.

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November 29, 2013, 05:40:49 PM
 #38

Interesting. Perhaps then you would enjoy deigning to explain to we mere mortals how one reconciles the following two statements:

1) I do not enter into naked (translation for current purposes: unhedged) options positions.

2) I do not hedge options positions.

Oh do tell, so that we may be enlightened.

Alternatively -- much as I suggested to you the last time you started throwing the weight of your own confusion around over in one of my threads where I had just rejected the possibility of listing on MPEx -- perhaps you'd like to run off and find a colleague or two who has acquired some investing experience elsewhere than while toddling around during Bitcoin's brief childhood, and first ask for an outside opinion on this ludicrous excuse for options market making.

You've never heard of MPBOR, have you.

Here, seems MP was amused enough with all this nonsense to write an article even. Revisiting the topic of “economic injustice”, with examples.

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November 29, 2013, 06:22:15 PM
 #39

You've never heard of MPBOR, have you...

Was the request to back up your condescension with substance too hard for you? Remember, all you have to do is explain how one never enters naked options positions, while simultaneously never hedging options positions.

Or did you mean for hand-waving references to borrowing to somehow accomplish this magical feat all by itself?

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November 29, 2013, 06:55:02 PM
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Was the request to back up your condescension with substance too hard for you? Remember, all you have to do is explain how one never enters naked options positions, while simultaneously never hedging options positions.

Or did you mean for hand-waving references to borrowing to somehow accomplish this magical feat all by itself?

Part of what makes your idiocy so delicious is your amusing expectations to be instructed for free, forcibly, while kicking and screaming.

I'll make you kick and scream, sure, but I ain't instructing your bulbously barren head.

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