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Author Topic: [GLBSE] BDK -- LIQUIDATING UNDER NEGATIVE EQUITY PROVISION --  (Read 20783 times)
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April 20, 2012, 12:31:29 AM
 #1

(9/11/12) BDK is ceasing operations effective immediately due to crushing negative equity. BDK-holders who did not take part of the voluntary recall will receive .02BTC/share under the negative equity provision on 11/26 or ASAP if Nef allows it.



(6/30/12) Current and prospective BDK unit-holders, please read the new contract which will go into effect on September 4th, 2012 at https://bitcointalk.org/index.php?topic=77343.msg999596#msg999596

(7/11/12) BDK suffered massive losses in July as part of a liquidity crisis. Dividends will be "suspended" until early August. Details @ https://bitcointalk.org/index.php?topic=77343.msg1024725#msg1024725

What does BDK do?
The primary goal of BDK is to lend money where needed to stimulate the growth of Bitcoin-associated business. BDK additionally purchases and resells securities as well as invest in various Bitcoin-associated ventures for equity stakes. For details on BDK's finances & operations, go here: https://docs.google.com/spreadsheet/pub?key=0Ao892S4MOoDZdGZSbjJVd1ZTbFVLZE5aRE95bE91NVE&output=html

What is this offering, exactly?
Each share (I'm calling them shares, but this is more of a debt instrument -- it's a share of the profits, but "BDK" does not represent equity) represents .0009% of BDK weekly profit, paid every Monday. I add operating profits, deduct operating expenses, then pay out the amount due to shareholders. After that, I deduct personal expenditure from the amount my shares have earned. Everything leftover goes into BDK coffers. These "units" for sale are non-voting and do not represent equity.

How many shares are being sold?
Up to 5k shares will be sold on the second day of each month (until after the offering on the second day of August, when a new scheme may be in place). 4k shares may be sold pre-IPO, while at least 1k shares will be reserved for the IPO and sold on the open GLBSE market to the highest bidders. There are 100k shares in total. Since each share represents .0009% profit, that means up to 90% of BDK profit will be sold.

I still don't entirely understand how the offering works.
Until after August 2nd, I will be issuing up to 5,000 shares on the second day of each month. Up to 4,000 of those shares can be pre-purchased early. The remaining 1,000 will be sold on the open market through an ask order at the IPO price I determine before-hand. Nobody's guaranteed to get the 1k shares being offered on GLBSE - they go to the highest bidder at the time I place the ask order.

Why don't you sell all the shares at once and get it over with?
Every time I offer profit shares to the public, equity and (ideally) dividends increase. Each month, this means 4.5% of BDK's profits are more valuable than the previous month's. I'm quite familiar with the effects of compound interest and believe this is the best way to move forward most profitably and fairly. While early adopters will almost certainly be rewarded the most, BDK will, by design, always be growing, and doesn't depreciate in value like mining hardware, so the way I'm doing it, everybody should win. Smiley

What happens if BDK loses money?
The losses will carry over until the "profit balance" is positive. There will be no dividends until the "profit balance" is positive. The operator may choose to eat the losses and not roll over losses, just pay nothing for the week where there are losses, but that is entirely at my discretion.

How much of BDK's funds are invested in Pirate?
None.   Grin

I don't know if you're credible...
Then don't invest. I'm not desperate for your money. BDK is already operational and I appreciate all my investors, but there is certainly no necessity to sell BDK's profits for more funds up-front -- this only accelerates BDK's growth and ability to positively impact the economy. Eventually, I will initiate a buyback (see the provision in the contract for details) and operate without accountability to anyone but myself. Talk to enough people and I believe you'll find I've always stuck to my agreements and try to be generous while leaving very healthy margins for myself. A few people have my ID, but I'd rather not post it publicly.[/b]


June 2012 Net Income Expectations
Optimistic estimate: 85BTC
Reasonable estimate: 50BTC
Pessimistic estimate: 25BTC
(Guesstimated weekly dividend payouts -- June 4th: 0.0BTC/share Actual: 0.0BTC/share, June 11th - .00063BTC/share Actual: 0.00121358BTC/share, June 18th - .00014BTC/share Actual: 0.000406688BTC/share, June 25th - .00036BTC/shareActual: 0.00023112BTC/share)

GLBSE page: https://glbse.com/asset/view/BDK

Update: July 2nd IPO is next up. There will be no market order, but up to 4k units can be purchased up until the end of July 2nd @ .22/unit for anyone interested.

Contract:
Ben Malec (referred to within this contract as "me," "myself," "I," and "operator") will issue 100,000 shares of "BDK Hybrid Instrument." Each share not controlled by the operator represents .0009% of BDK's monthly profit.  Dividends will be paid every Monday, starting May 7th, 2012. Dividends will not be paid on the first of the month unless that happens to be on a Monday. 100,000 shares will be issued. Up to 5,000 shares are to be sold on the second day of each month for four months, starting on the month of May, 2012. After that time, shares may be issued at will of the operator.

Additional provisions
"Operator Equity" - The operator holds all equity of BDK. Shares are not tied to equity, and represent only .0009% of BDK monthly profits.

"Shareholder Votes, Non-binding Motions" - While motions may be introduced, they are non-binding. They exist only so the operator may gauge opinion of those invested in BDK's success.

"Change of Contract" - The operator is fully permitted to change the contract at will, without consent of shareholders. However, the modified contract is not permitted to go into effect until sixty days after the changes are made public. When the contract is changed, the operator will honor the ability for shareholders to sell shares back to him at a price of .125 Bitcoins per share between the time a change is made and the time 60 days have elapsed since the change was made public.

"Buyback" - At any time, the operator is permitted to buy back shares issued. The operator will pay .64 Bitcoins per share if the operator buys back BDK shares prior to August 3rd, 2012. If August 3rd, 2012 or later, the operator will pay ((.32 Bitcoins + GLBSE 5 day weighted average of trade transaction amount per share of BDK shares)/2)

"Share Value Protection" - If shares trade for less than ฿.01 on GLBSE for at least 168 hours continuously, the operator MUST issue a bid order of ฿.05 in an amount which equals 50% of shares issued not controlled by the operator. The "168-hour timer" does not again reset for 26 weeks after the "Share Value Protection" provision was last called to action.

"Negative Equity and Operator Liability" - BDK is permitted to operate while having negative equity so long as BDK has not had negative equity for 90 consecutive days. On the 90th day of having negative equity, the operator will be held personally liable to pay shareholders $.10/share (or ฿.02/share, whichever value is lesser). In cases where BDK is unable to achieve due to reasons unrelated to BDK experiencing prolonged negative equity (operator experiencing imprisonment, debilitating illness, GLBSE being hacked and made unusable, EMP strikes, police raid, or death, for example), the operator is not liable.

"IPO Value Preservation, Operator Trading" - The operator is not permitted to ever sell shares for less than he previously sold them for. However, he may sell shares for an amount equal to or greater than the amount he previously sold them for at will.

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April 20, 2012, 12:57:01 AM
 #2

Oh dear, no insurance for EMP strikes...

What have monthly profits been / what do you expect them to be?

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April 20, 2012, 01:19:48 AM
 #3

Oh dear, no insurance for EMP strikes...

What have monthly profits been / what do you expect them to be?
You can see in detail @ https://docs.google.com/spreadsheet/pub?key=0Ao892S4MOoDZdGZSbjJVd1ZTbFVLZE5aRE95bE91NVE&output=html


%RoE for January (first month of operation) was .22%
%RoE for Feb - .58%
%RoE for Mar - 2.39%
Q1 %RoE - 3.41% (~77.34BTC profits, but with average equity of ~2.25k -- also hadn't begun accepting a large quantity of deposits, yet)
%RoE for April (through the 19th -- should be significantly higher by end of month, and this month saw bad loan write-offs of 84BTC) - 3.6% (~110BTC profits so far)


I believe %RoE for May will be between 7.5% and 10% (possibly lower depending on how quickly I can reinvest capital brought in by this IPO offering), with profits of ~350-400BTC. May should be the month BDK really hits its stride, and I believe %RoE will consistently be ~7.5-10% per month after that. Monthly profits should consistently increase with time as IPOs are put out and profits reinvested. Early purchasers have two fantastic advantages. 1) I will never issue IPO shares for less than I previously issued them. 2) Capital raised from future IPOs can only increase profit potential for earlier shares.


For example:
You buy 5k shares for 250BTC today, owning 4.5% of BDK monthly profits. That 250BTC is immediately invested, and should show returns in ~ a month. We'll say that increases monthly profits from 400BTC to 425BTC.

Someone else buys 5k shares for 300BTC in a month, owning 4.5% of BDK monthly profits -- you still own 4.5% of BDK monthly profits, remember - that didn't devalue. Now, on top of the 25BTC in extra monthly profits your investment brought in, the other person buying 4.5% monthly BDK profits for 300BTC allows for an additional 30BTC of monthly profit for BDK. That 30BTC of profits translates to 1.35BTC increased monthly dividends for you.

This continues on, with BDK shares becoming more expensive and resulting in greater dividends for shareholders.

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April 20, 2012, 02:51:47 AM
 #4

1k of pre-IPO shares remain. Thanks to Nefario & GLBSE team for helping me along the way, answering questions and fixing my screw-ups.  Smiley

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April 20, 2012, 03:01:28 AM
 #5

That was nice and fast. Maybe I under-priced?  Cheesy


No pre-IPO shares remain unreserved. Remaining 1k shares will be sold @ .055BTC each on May 2nd. After that, 95k shares will remain to be issued at a later time, with the next public offering of 5k shares occurring on June 2nd at a price I haven't figured, yet.

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April 20, 2012, 03:16:27 AM
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That was nice and fast. Maybe I under-priced?  Cheesy
It's probably better to underprice them initially, especially when you are selling only a small amount. It helps build demand and allows the market to price the shares for future offerings.

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April 20, 2012, 03:25:57 AM
 #7

That was nice and fast. Maybe I under-priced?  Cheesy
It's probably better to underprice them initially, especially when you are selling only a small amount. It helps build demand and allows the market to price the shares for future offerings.
On a related note - those who have already paid and received their shares may of course sell them on GLBSE for whatever they please. While I won't use the going rate on GLBSE to price the 1k shares on May 2nd, I'll definitely keep it in mind when pricing the June shares.

Thanks again, everyone. I couldn't be more pleased with the interest in what I thought was overly-complicated, kludgy, and included a disclaimer that I'm not liable in case of EMP strikes disabling me from allowing BDK to function and pay out as intended.

ETA: Nefario said he'd get around to verifying my identity some time after he wakes up tomorrow (today, for him -- works into the wee hours of the morning improving GLBSE, and the upcoming facelift looks pretty darn slick), fwiw. He already has my ID and a utility bill which he checked out during the spat with Goat.

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April 20, 2012, 04:15:47 AM
 #8

Hm. Since this isn't really clear in the contract -- for reference, the IPO will be an askwall for 1k shares at .055BTC. There's already a bid on GLBSE for more than that.

I'm fairly sure it's not possible to sell the shares for less than that using GLBSE (even if I wanted to). So, while I may end up selling the IPO shares for more than .055BTC due to how GLBSE works, understand I only count the 1k shares as being sold for .055BTC when pricing future IPO shares. For example, if there were some wingnut bid of .5BTC/share and that's what I ended up selling the 1k BDK shares at that during the IPO even though I put the sell price at .055BTC, that doesn't restrict me to selling future IPO shares for only .5BTC or more in the future.

Just wanted to make sure that was clear before the IPO occurs. If any current shareholders are annoyed by that for some reason, feel free to sell your shares back to me for what you paid any time prior to May 2nd.  Grin

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April 20, 2012, 04:21:06 AM
 #9

On a related note - those who have already paid and received their shares may of course sell them on GLBSE for whatever they please. While I won't use the going rate on GLBSE to price the 1k shares on May 2nd, I'll definitely keep it in mind when pricing the June shares.
So I presume you'll do it like the gigamining IPO and just add a sell order for 1k at 0.055, but if there are bids above that amount the shares will be sold for the higher amount.

Will you still use 0.055 as your highest "IPO value preservation" price? FWIW, I think you'd be entitled to, since that is the price you are willing to sell for. Just thinking out loud.

Edit: Answered in post above while I was drafting this post.

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April 21, 2012, 01:12:15 AM
 #10

ID now verified. There seems to be a small problem with share transfers, perhaps because I had the IPO date changed to allow for pre-IPO transfers. Hopefully Nef can figure this out for me when he's up and about.

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April 21, 2012, 02:31:21 AM
 #11

ID now verified. There seems to be a small problem with share transfers, perhaps because I had the IPO date changed to allow for pre-IPO transfers. Hopefully Nef can figure this out for me when he's up and about.
Resolved speedily thanks to Nef. Shareholders should now be able to sell their pre-IPO shares should they choose to do so.


Cheers,

Ben

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April 21, 2012, 07:50:42 AM
 #12

I would like to take a moment to point out (to everyone's delight, no doubt) that since the MPOE and subsequent MPEx issues of nonvoting shares on large float everyone's doing nonvoting shares on large float (as opposed to the previously employed nonsensical if idealistic GBLSE method of voting shares, tiny float).

This is a good and welcome thing for a number of reasons that apparently either nobody felt equal to the task of discussing or nobody was too curious about.

We will obviously continue to lead the community by freely providing competence and insight into how securities markets actually work. Perhaps the greatest advantage of bitcoin for the "next door" demographic is that they get to interact directly with people they would not otherwise have met in a million years (gross estimate).

My Credentials  | THE BTC Stock Exchange | I have my very own anthology! | Use bitcointa.lk, it's like this one but better.
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April 22, 2012, 02:28:38 AM
 #13

(posted for the sake of disclosure -- these are not counted as gains or losses until time of sale, but changes the amount of assets BDK has -- I'll post this every week or two)

GLBSE Securities Re-valuation (reconciliation between BDK sheets & GLBSE):
TyGrr: BDK - 2BTC/share, GLBSE - 2BTC/share -- No Change
Cognitive: BDK - .69BTC/share, GLBSE - .63BTC/share -- total loss of 16.14BTC on paper
Gigamining: BDK - 1.5BTC/share, GLBSE - 1.55BTC/share -- total gain of .65BTC on paper


Total change in assets (on paper only) due to change in GLBSE asset valuation = -15.49



I also noticed someone paid .5BTC/share for 5 shares of BDK on GLBSE today. Just a quick reminder that IPO shares will sell for .055BTC.

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April 22, 2012, 04:35:20 AM
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I also noticed someone paid .5BTC/share for 5 shares of BDK on GLBSE today. Just a quick reminder that IPO shares will sell for .055BTC.

While they may be priced at .055 in theory, I suspect they'll sell for much higher at the IPO given the limited number of shares available for those who weren't able to put up 250 BTC in the pre-IPO.
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April 23, 2012, 07:31:25 AM
 #15

Decided to go about this much more conservatively. The sales of profits (until ~.32BTC/share) don't really help me boost my personal profits, and I don't need money to the extent where I'm willing to gather it at a loss of personal income. I think BDK can reach .32BTC/share much more quickly with an extremely conservative, slow release of shares. I now intend to release 2k shares on the second of each month (instead of 5k/month), and not sell shares pre-IPO. After the four scheduled public offerings (May 2nd, June 2nd, July 2nd, August 2nd), I'm thinking I will sell 2k shares every two months until 2013. At that point, 2k shares will be sold every three months. 2014, 2k shares every four months. Depending on how this works out, it's possible shareholders will not receive as much increase in dividends as they perhaps expected short-term and mid-term, but I believe this will dramatically reduce the possibility of stagnation, and long-term, will result in dramatically higher dividends/share than it would've if I proceeded as I outlined in the OP. Once the share price of BDK surpasses .32BTC/share, I will re-evaluate.

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April 23, 2012, 10:12:20 AM
 #16

I'm okay with this. Also next month, why not have the price start at .32?
I'll push out what I think the market will take. The last thing I want is a public offering where an ask order just sits around on GLBSE. I'm currently leaning toward (and given the first IPO hasn't even occurred, this is pretty meaningless) .1BTC/share next month. If the market thinks I've undervalued the shares, they can bid higher for them prior to the shares being sold. Eliminating pre-IPO shares gives "the market" a much more powerful megaphone, and investors more power in determining what they think the shares should be valued at compared to a number I whip out just because it'd be an amount where I break even with regards to how much I'll receive in income monthly. While personally making a profit through these public offerings is a goal I have no interest in not achieving, I don't think it'd be nearly as cool as controlling where >40k BTC goes.

Right now, the "business loan" group I arranged only guarantees each lender brings 200BTC to the table. They can have more cash-on-hand they're willing to invest, but requiring they have more than 200BTC becomes exclusionary and counter-productive at this time. The amount presented for "business-grade" loans is probably fine for someone whose project only needs to hire a developer for a couple months, or start up some type of gambling website, and I think having an organization where we do larger non-consumer loans is a big step in the right direction - but for someone seeking to produce something physical or complicated, it will barely even make a dent in purchasing specialized manufacturing equipment, or, say, hiring a few salaried CSR employees. With >$200k in equity, there are a lot of exciting opportunities I expect to be presented. Ultimately, there's no reason I need the money right now. As far as I'm aware, no producers currently need larger loans than a few hundred BTC -- nobody's applied for a for what I'm charitably calling a business-grade loan. It's consumer loans, loans (or investment) for bot-feeding, or mining, which are all investments which scale well if you invest just a tiny amount, or a very large amount. There aren't really any significant barriers to entry from capital requirements, except ASIC development and perhaps sophisticated trading bots.

Maybe there are no promising ideas in the Bitcoin community requiring funding. I don't believe that. I believe there isn't enough money available to them on reasonable terms to make their ideas viable (or at least, not viable to be done using BTC for funding), and I think pooling community resources (and lending/investment risks) will make BTC lending to businesses more practical, and create some truly outstanding products in the future.


ETA: Sorry, went a bit O/T in response. There's a finite % of profit which can be sold off. Once the 100k shares are sold, the only way it can grow beyond is with the 10% cut I'll have remaining or through initiating a buyback, then re-selling at a later time. It's a large commitment, and while I don't want to "give away" my income for it, what I want much more is unimpeded upward momentum. If I post 2k shares one month and they just sit there - per the "IPO value preservation" provision in the contract, that's pretty much it. If I issue more shares, they'll have to just sit there with the others. There is an extreme disincentive from the contract and nature of this offering against letting BDK shares stagnate. I may be taking losses of personal income toward the start, but being able to continue raising funds, IMO, is much more important. Because of the way the contract and offering is designed, I think there's an almost unreasonable lack of risk for investors, as BDK itself will only grow through these. Long-term, I believe the conservative, patience-demanding way the public offerings are implemented will provide BDK with dramatically more funds in the end versus trying to meet my own personal income goals.


ETA: motion created regarding the issue of selling 2k/month vs. 5k/month. 2 motions will be introduced ~ a week prior to future public offerings to help me determine what shareholders want me to price BDK shares at. One motion will be to issue at a conservative price. One motion will be to issue at a more aggressive price.

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April 23, 2012, 07:22:15 PM
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I would like to take a moment to point out (to everyone's delight, no doubt) that since the MPOE and subsequent MPEx issues of nonvoting shares on large float everyone's doing nonvoting shares on large float (as opposed to the previously employed nonsensical if idealistic GBLSE method of voting shares, tiny float).

This is a good and welcome thing for a number of reasons that apparently either nobody felt equal to the task of discussing or nobody was too curious about.

We will obviously continue to lead the community by freely providing competence and insight into how securities markets actually work. Perhaps the greatest advantage of bitcoin for the "next door" demographic is that they get to interact directly with people they would not otherwise have met in a million years (gross estimate).

I would like to take a moment to point out  (to everyone's delight, no doubt) that I provided some advice to Kluge on different classes of shares and alternative rights that might attach to those classes (I am a qualified professional in this area).  I have been structuring businesses for much longer than bitcoin has been in existence, and non-voting shares and stock exchange issues have been around for more than 100 years (too lazy to actually look up when it started).  MOPE and MPEx have nothing to do with it.
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April 23, 2012, 08:30:33 PM
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I would like to take a moment to point out  (to everyone's delight, no doubt) that I provided some advice to Kluge on different classes of shares and alternative rights that might attach to those classes (I am a qualified professional in this area).  I have been structuring businesses for much longer than bitcoin has been in existence, and non-voting shares and stock exchange issues have been around for more than 100 years (too lazy to actually look up when it started).  MOPE and MPEx have nothing to do with it.

I would be glad to hear your insights Patrick.
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April 26, 2012, 01:26:16 PM
 #19

Less than a week to go until 1k IPO shares are sold. My final decision on IPO shares is to go even more conservatively and not slate any public offering dates in the future, but simply to sell when I feel the price is high enough to justify it. I think this will allow me to distribute dividends enough where people are better-aware of what the value of these shares are. Already, I think there will be enough of a market where share-holders are comfortable with the trading volume (keeping in mind all share sales are still pre-IPO shares released in the last few days). I will alert everyone to sales after the trade has gone through. There will still be 1k shares sold on May 2nd. After that, no more are set to occur at any particular time, and they will not occur at any particular price, except at a price higher than previously sold.

[09:12] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.066 ] [ ASK: 0.067 ] [ SPREAD : 0.001 ] [ LAST TRADE: 395@0.066 ] [ VOLUME : 87.357 BTC ]



The essence of how early adopters are rewarded is as follows: Assume BDK currently has 3k of equity and I make 10% profit on equity, so the monthly profit expectation would be 300BTC. Let's say I sell 4.5% of profits @ 250BTC. Now, BDK has 3.25k of equity, and the monthly profit expectation would be 325BTC. June 1st rolls around and the dividends on 4.5% of profits (assuming 10% of BDK equity is profit) is 13.5BTC. Let's say I then sell another 4.5% of BDK's monthly profits (5k shares), this time for 500BTC. These people will pay more because BDK is now effectively worth more -- maybe not 2x as much as the first shareholders paid, but certainly more. Now, previous shareholders who bought 4.5% of profits for 250BTC still hold 4.5% of BDK's monthly profits - that percentage doesn't get diluted by future public offerings - but BDK equity has increased to 3.75k (more if you include growth due to dividends on shares I haven't sold and didn't use for personal expenditure), resulting in 375BTC of monthly profits. Now, 4.5% of monthly profits is 16.875BTC. Keep going and going, and you can imagine how incredibly high shareholder dividends can be. This has been over-simplified for the sake of explanation, but I hope it gives potential shareholders a better understanding of how this is intended to work if I don't screw it up.

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April 26, 2012, 09:42:38 PM
 #20

exact time of the ipo? thanks
Idunno... 5pm US Eastern.

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April 27, 2012, 06:35:15 PM
 #21

[09:12] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.066 ] [ ASK: 0.067 ] [ SPREAD : 0.001 ] [ LAST TRADE: 395@0.066 ] [ VOLUME : 87.357 BTC ]
[14:31] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.072 ] [ ASK: 0.10499999 ] [ SPREAD : 0.03299999 ] [ LAST TRADE: 1@0.105 ] [ VOLUME : 106.785 BTC ]


Will post the !ticker every day until the IPO to justify bumping this thread. I swear I'll stop spamming after May 2nd. Lips sealed

ETA: Wait -- I have something relevant to say! A motion has been created to simplify how BDK donates to IBB & BTC100. Instead of 3% for IBB, 2% for BTC100, but only counting monthly loan interest, I would like to now pay 1% of all profits (previously wasn't possible because I didn't include equity profits/losses in I/O reports) to each. Motion expires in ~24h. As always, it's nonbinding, and only done to spark discussion on what I'm proposing in case there's some critical flaw in my plan which I somehow missed.

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April 27, 2012, 10:43:03 PM
 #22

BDK has purchased 750 future shares of ZipConf for 300BTC (.4BTC/share). More on that when it's launched Monday.

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April 28, 2012, 12:15:28 AM
 #23

BDK has purchased 750 future shares of ZipConf for 300BTC (.4BTC/share). More on that when it's launched Monday.

Hmm? No thread on the forums and their website is only partially functional.

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April 28, 2012, 08:54:07 AM
 #24

BDK has purchased 750 future shares of ZipConf for 300BTC (.4BTC/share). More on that when it's launched Monday.

Hmm? No thread on the forums and their website is only partially functional.
Sorry for the delay in the IPO release thread as well as the service announcement, they should both be posted soon Smiley
//DeaDTerra
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April 28, 2012, 07:40:24 PM
 #25

BDK has purchased 750 future shares of ZipConf for 300BTC (.4BTC/share). More on that when it's launched Monday.

Hmm? No thread on the forums and their website is only partially functional.
Sorry for the delay in the IPO release thread as well as the service announcement, they should both be posted soon Smiley
//DeaDTerra

You've certainly piqued my curiosity.

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April 28, 2012, 07:58:56 PM
 #26

BDK has purchased 750 future shares of ZipConf for 300BTC (.4BTC/share). More on that when it's launched Monday.

Hmm? No thread on the forums and their website is only partially functional.
Sorry for the delay in the IPO release thread as well as the service announcement, they should both be posted soon Smiley
//DeaDTerra

You've certainly piqued my curiosity.
More info can be found at https://bitcointalk.org/index.php?topic=74975.msg873084#msg873084 Smiley
//DeaDTerra
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April 28, 2012, 08:16:49 PM
 #27

BDK has purchased 750 future shares of ZipConf for 300BTC (.4BTC/share). More on that when it's launched Monday.

Hmm? No thread on the forums and their website is only partially functional.
Sorry for the delay in the IPO release thread as well as the service announcement, they should both be posted soon Smiley
//DeaDTerra

You've certainly piqued my curiosity.
More info can be found at https://bitcointalk.org/index.php?topic=74975.msg873084#msg873084 Smiley
//DeaDTerra

Ah, missed that, thank you.

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April 28, 2012, 08:55:56 PM
 #28

[09:12] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.066 ] [ ASK: 0.067 ] [ SPREAD : 0.001 ] [ LAST TRADE: 395@0.066 ] [ VOLUME : 87.357 BTC ]
[14:31] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.072 ] [ ASK: 0.10499999 ] [ SPREAD : 0.03299999 ] [ LAST TRADE: 1@0.105 ] [ VOLUME : 106.785 BTC ]


Will post the !ticker every day until the IPO to justify bumping this thread. I swear I'll stop spamming after May 2nd. Lips sealed
[16:45] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.075 ] [ ASK: 0.09998999 ] [ SPREAD : 0.02498999 ] [ LAST TRADE: 20@0.09998999 ] [ VOLUME : 111.59 BTC ]

Four days left.

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April 28, 2012, 10:35:07 PM
 #29

I'm changing the buyback provision to account for how dynamic this asset will be. As it was, I believe it was unfair to shareholders. I believe this is a dramatically more generous offer. There is still a static amount of BTC factored into the buyback provision, which increases incentive for me to push BDK share value as high as it's able. Because I don't imagine any shareholders complaining, I have no intention to honor the requirement the contract not become effective for 60 days after I make the change -- this change is effective right now.

Before:
"Buyback" - At any time, the operator is permitted to buy back shares issued. The operator will pay .07 Bitcoins per share if the operator buys back BDK shares prior to August 3rd, 2012. If August 3rd, 2012 or later, the operator will pay ((.05 Bitcoins + GLBSE 5 day weighted average of trade transaction amount per share of BDK shares)/2)

Now, after change:
"Buyback" - At any time, the operator is permitted to buy back shares issued. The operator will pay .64 Bitcoins per share if the operator buys back BDK shares prior to August 3rd, 2012. If August 3rd, 2012 or later, the operator will pay ((.32 Bitcoins + GLBSE 5 day weighted average of trade transaction amount per share of BDK shares)/2)




Cheers!

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April 29, 2012, 07:31:41 AM
 #30

I'm changing the buyback provision to account for how dynamic this asset will be. As it was, I believe it was unfair to shareholders. I believe this is a dramatically more generous offer. There is still a static amount of BTC factored into the buyback provision, which increases incentive for me to push BDK share value as high as it's able. Because I don't imagine any shareholders complaining, I have no intention to honor the requirement the contract not become effective for 60 days after I make the change -- this change is effective right now.

Before:
"Buyback" - At any time, the operator is permitted to buy back shares issued. The operator will pay .07 Bitcoins per share if the operator buys back BDK shares prior to August 3rd, 2012. If August 3rd, 2012 or later, the operator will pay ((.05 Bitcoins + GLBSE 5 day weighted average of trade transaction amount per share of BDK shares)/2)

Now, after change:
"Buyback" - At any time, the operator is permitted to buy back shares issued. The operator will pay .64 Bitcoins per share if the operator buys back BDK shares prior to August 3rd, 2012. If August 3rd, 2012 or later, the operator will pay ((.32 Bitcoins + GLBSE 5 day weighted average of trade transaction amount per share of BDK shares)/2)




Cheers!

The upward jump of buyback price is impressive. Can't help estimating how much the trading price will rise to after some saturation.

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April 29, 2012, 07:40:03 AM
 #31

Very excellent news!  Very much looking forward to the next offering Smiley

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April 29, 2012, 02:09:38 PM
 #32

[09:12] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.066 ] [ ASK: 0.067 ] [ SPREAD : 0.001 ] [ LAST TRADE: 395@0.066 ] [ VOLUME : 87.357 BTC ]
[14:31] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.072 ] [ ASK: 0.10499999 ] [ SPREAD : 0.03299999 ] [ LAST TRADE: 1@0.105 ] [ VOLUME : 106.785 BTC ]


Will post the !ticker every day until the IPO to justify bumping this thread. I swear I'll stop spamming after May 2nd. Lips sealed
[16:45] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.075 ] [ ASK: 0.09998999 ] [ SPREAD : 0.02498999 ] [ LAST TRADE: 20@0.09998999 ] [ VOLUME : 111.59 BTC ]
(9:49:09 AM) `MBot: [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.08000001 ] [ ASK: 0.19999 ] [ SPREAD : 0.11998999 ] [ LAST TRADE: 10@0.2 ] [ VOLUME : 154.884 BTC ]

Three days left. In other good news, the 2 icarus boards are being sent to me on May 4th. Not sure if I mentioned it in this thread or the other, but for accounting the 5850 & Icarus boards, I'm not counting income from the 5850 at all since there aren't significant profits after electricity. To compensate, I won't factor in electricity costs on the Icarus boards, so whatever those two boards bring in are counted as an equity dividend when I receive a payout.

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April 30, 2012, 08:12:22 PM
 #33

[09:12] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.066 ] [ ASK: 0.067 ] [ SPREAD : 0.001 ] [ LAST TRADE: 395@0.066 ] [ VOLUME : 87.357 BTC ]
[14:31] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.072 ] [ ASK: 0.10499999 ] [ SPREAD : 0.03299999 ] [ LAST TRADE: 1@0.105 ] [ VOLUME : 106.785 BTC ]
[16:45] <`MBot> [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.075 ] [ ASK: 0.09998999 ] [ SPREAD : 0.02498999 ] [ LAST TRADE: 20@0.09998999 ] [ VOLUME : 111.59 BTC ]
(9:49:09 AM) `MBot: [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.08000001 ] [ ASK: 0.19999 ] [ SPREAD : 0.11998999 ] [ LAST TRADE: 10@0.2 ] [ VOLUME : 154.884 BTC ]
(4:10:33 PM) `MBot: [ GLBSE ] [ TICKER ] [ BDK ] [ BID: 0.10001 ] [ ASK: 0.25 ] [ SPREAD : 0.14999 ] [ LAST TRADE: 28@0.1999 ] [ VOLUME : 184.191 BTC ]

Two days left. Plan on posting a link to ZipConf press release tomorrow for those who missed it. It should excite shareholders a fair bit. Very pleased to have gotten in pre-IPO. Tomorrow will also bring a not-particularly-exciting accounting summary of BDK operations in April. Smiley

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May 01, 2012, 05:40:16 PM
 #34

MBot ticker isn't functioning correctly since the GLBSE update yesterday. Last price is .1999BTC/share 30D volume now over 200BTC (which is the total amount raised from pre-IPO sales), there's a bidwall of 500 shares @ .1BTC/share.

April Summary:
Monthly Profit - ฿155.54BTC
Income - ฿309.29
Outgo - ฿153.75

Fwiw, the dividend per share would have been ฿.0014, or ฿6.9993 total for the 5k shares which were set to be sold by May 2nd. Next month shouldn't have a report of debt write-offs, which made up the majority of outgo for April and were the first write-offs I've ever done. The profit target for May is ฿325, so the dividend should be right around ฿.002925/share, or ฿14.625 total if there are 5k shares out. Already, May profit is ~฿215. Spreadsheet has been updated, everything's reconciled, May's up, April's finalized. https://docs.google.com/spreadsheet/pub?key=0Ao892S4MOoDZdGZSbjJVd1ZTbFVLZE5aRE95bE91NVE&output=html

Zipconf update seems like it will be delayed a short time, or out some time tonight. ETA: Looks like it's scheduled for the 3rd.



IPO IS TOMORROW @ 5PM EASTERN! (quit bidding >2x the lowest bid to get a share now from pre-IPO buyers -- buying aftermarket doesn't help me, dammit!  Tongue)


ETA: Donation drive for a band program @ https://bitcointalk.org/index.php?topic=78831.msg877658 will be included as my personal expenditure. It will affect the amount of "growth" funds BDK receives, but not the amount shareholders receive in dividends for the month. I'm planning on donating between 50-100BTC if I get the green-light from the director.

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May 01, 2012, 11:13:12 PM
 #35

OP updated. Please tell me if there are still confusing or unclear sections, or ask me questions. Better now than later.  Smiley


Cheers!

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May 02, 2012, 03:15:08 PM
 #36

Less than 6 hours left. 1h warning will be posted, 5m warning, a post of what BDK raised, then I'll quit spamming unless it is important. ... Until the next sale, anyway.

ETA: Noticed a conflict in the contract. ""IPO Value Preservation, Operator Trading" - The operator is not permitted to ever sell shares for less than he previously sold them for. However, he may sell shares for an amount equal to or greater than the amount he previously sold them for at will." This conflicts with what the main contract body states: Up to 5,000 shares are to be sold on the second day of each month for four months, starting on the month of May, 2012. After that time, shares may be issued at will of the operator.

The "main contract body" takes precedence over provisions. No more than 5k shares will be sold each month until (potentially) after the August 2nd offering.

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May 02, 2012, 07:55:27 PM
 #37

1h warning will be posted
Beep! Beep! 1h5m remaining.

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May 02, 2012, 08:31:38 PM
 #38

Unannounced 30m warning. Would like to call attention to an edit I made in the OP a couple hours ago. Dividends will be paid every Monday until further notice. If there is reasonable objection, this will require 60D to occur. Otherwise, first payment will be made on May 7th, then May 14th, etc.

Decreasing dividend payment rate to every two weeks or every month will require the standard 60D notice for the change to go into effect.


Cheers!

ETA: Surprisingly busy today (four people have used escrow in past three days, had a fairly long loan negotiation, too, which I believe turned out very well). Also wanted to add that when I pay dividends on Mondays, I won't be providing a detailed sheet for accounting. You can check for yourself in the spreadsheet I've posted in the OP. On the first of each month, I will still be providing a detailed "I/O report" for the last month. Additionally - just to be absolutely clear, I will not pay dividends on the first of the month as previously intended - unless the 1st of the month happens to fall on a Monday.

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May 02, 2012, 08:54:59 PM
 #39

Five...! Four...! Three...! Two...! One...!


Aaaaand....... Public offering offered!


BDK raised exactly 79.7255007BTC from the 1k public offering. 15 will be kept in the GLBSE BDK fund to pay dividends to shareholders on May 7th. Rest goes to my lending wallet. Next IPO will be on June 2nd. No pre-IPO shares will be sold.

Cheers!

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May 03, 2012, 08:24:28 PM
 #40

Last Valuation on 4/23 -- today is 5/3

GLBSE Securities Re-valuation (reconciliation between BDK sheets & GLBSE):
TyGrr: BDK - 2BTC/share, GLBSE - 2.08BTC/share -- total gain of 19.76BTC on paper
Cognitive: BDK - .63BTC/share, GLBSE - .58BTC/share -- total loss of 13.45BTC on paper
Gigamining: BDK - 1.55BTC/share, GLBSE - 1.509BTC/share -- total loss of .533BTC on paper
BitcoinTorrentz: BDK - .92BTC/share, GLBSE - .931BTC/share -- total gain of .044BTC on paper
Zip.A: BDK - .4BTC/share, GLBSE - .5BTC/share -- Total gain of 75BTC on paper

Total equity FMV change since last valuation -- gain of 80.821BTC


ETA: Even though GoogleDocs is set to autopublish the sheet any time a change is saved, it appears to only do this something like once per week. If you want to see current data and GoogleDocs is telling you the sheet was last updated a few days ago or something, just make a quick request in this thread and I'll manually republish.

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May 03, 2012, 08:35:31 PM
 #41

Five...! Four...! Three...! Two...! One...!


Aaaaand....... Public offering offered!


BDK raised exactly 79.7255007BTC from the 1k public offering. 15 will be kept in the GLBSE BDK fund to pay dividends to shareholders on May 7th. Rest goes to my lending wallet. Next IPO will be on June 2nd. No pre-IPO shares will be sold.

Cheers!

Excellent!

I just placed a question on the new glbse predictions page and am awaiting approval. I want to check in with the results and finalize my business plan then I will be on the loan scene looking for some start up capital.

Glad your initial ipo was successful

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May 04, 2012, 05:41:36 AM
 #42

May 2012 Net Income Expectations
Optimistic estimate: 450BTC
Reasonable estimate: 375BTC
Pessimistic estimate: 300BTC
(Guesstimated weekly dividend payouts -- May 7th: .002BTC/share -- May 14th: .0004BTC/share -- May 21st: .00086 -- May 28th: .00022BTC/share)
Targets will be added to OP each month. I've done May's today. Things change quickly, which can cause dramatic swings one way or the other. This uncertainty will persist until BDK has grown enough to have a mature, well-diversified portfolio of loans, equities, and deposits. Simply because I'll be collecting significantly more information this month over previous months, I'll be able to give tighter ranges in the future.


Cheers!

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May 04, 2012, 05:33:26 PM
 #43

Speaking of quick, dramatic changes... May targets are no longer valid. Profits will be quite significantly higher (~550BTC for the month expected, with a much larger payout on the 21st than originally predicted). However, I'm forecasting June to be a very unimpressive month (maybe 200-275BTC total profit for the month).

I'll update the forecasts with specific numbers again within a few hours.


ETA: New forecast:

May 2012 Net Income Expectations
Optimistic estimate: 725BTC
Reasonable estimate: 625BTC
Pessimistic estimate: 550BTC
(Guesstimated weekly dividend payouts -- May 7th: .0021BTC/share -- May 14th: .0004BTC/share -- May 21st: .00266 -- May 28th: .00022BTC/share)

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May 06, 2012, 06:18:04 AM
 #44

Having a spirited debate with myself, a couple shareholders, and invite others.


I think I can get .16BTC/share largely due to there being a large volume (4k) of shares available for pre-purchase. There's currently strong bids, but very weak asks, which I interpret as meaning the market's quite willing to gobble up more BDK shares. The ZipConf buy is going extremely well and will net "BDK Hybrid" owners (and myself!) a nice sum when dividends come out and/or I decide to sell. There's another quiet investment I'll talk about within a couple weeks, and  which I am optimistic about - may cause a "breakout." As well, I forgot I have extra USD loan income coming in this month. >3k coins will be freed up on the 19th to be reinvested, which should help turn the previously-unimpressive future of June's from "unimpressive" to "pleasing". There are plenty of exciting events going on and lined up.

OTOH, I did explicitly say I wouldn't offer pre-IPO shares for the June 2nd offering, but the spirit of that was thinking I'd sell way lower than the market would accept like I did with pre-IPO shares from the May 2nd offering. The way the offering is designed, I should regret even an offering of .16/share at the end of the year, assuming no catastrophe. Though, if there are only a few small nibbles on the pre-IPO offering, being stuck (via the contract) selling BDK shares @ .16 or higher may slow progress down for a month or so.

So far, the >50% shareholder thinks this is a reasonable price & way to proceed, and I got something like an all-clear from another. I plan on making a decision one way or the other within a couple days of issuing the first dividend on May 7th.


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May 07, 2012, 06:36:33 AM
 #45

First dividend.  Smiley

(Guesstimated weekly dividend payouts -- May 7th: .0021BTC/share -- May 14th: .0004BTC/share -- May 21st: .00266 -- May 28th: .00022BTC/share)
About on target.

Weekly profit: 237.02BTC
Total shares public: 5000 (4.5% BDK profit)
Total dividend: 10.67BTC
Dividend/share: 0.0021331436BTC
Next dividend: May 14th (revised estimated dividend - .00045BTC/share)

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May 07, 2012, 03:11:13 PM
 #46

Woho Smiley Bought yesterday 96 shares Smiley Keep up the good work Kluge! Smiley
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May 07, 2012, 07:57:10 PM
 #47

Next dividend: May 14th (revised estimated dividend - .00045BTC/share)
I'm a bit bogged down right now. Woke up, 7 PMs, 2 PM logs I need to read through on Skype.  Shocked  Lips sealed

Anyway, the revised estimate is now .0007BTC/share on May 14th, and I have decided to sell pre-IPO shares. 4k are available @ .16BTC/share, minimum order of 250 shares. PM/Skype/IRC/etc me if interested.


Cheers,

Ben

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May 08, 2012, 12:49:21 AM
 #48

Quick notice for shareholders copy-pasta'd from Operations thread. This shouldn't significantly impair BDK's ability to operate normally. I need to find a home for 3-4k coins on the 19th, still, but it shouldn't be too big an issue.

Yesterday, another cousin's (much closer) husband was diagnosed with lymphoma, tumor near the heart
Hrm. So close. Seems a lot of doctors are giving definite statements pulled from their ass. Originally, there was a slight chance he was dying, then he's probably dying and needs chemo, then an "all clear" saying it was fluid-filled/benign, and after what was supposed to be a relatively minor surgery, he's come out missing 1/3 of a lung and given a death sentence again. Supposedly, it's now assumed he has very aggressive cancer. They couldn't get all of it around his lung as it's invading his heart. I'm taking a couple days off and may be unresponsive for some time in the future. I'll always check emails after waking up and before going to sleep, fwiw.

He's in his late 20's, I believe. Experienced more than enough death for my liking, but this is the first time interacting with someone suffering imminent death who still speaks coherently. (ETA: I may appear as online in Skype or IRC, but don't assume I am unless talking there. If it's important, please email me @ kluge@bancokluge.com )

ETA2: So... Now it's up in the air. Chemo/radiation already started. Cousin's insisting the doctors got it all, which goes against what another family member said who was with his doctor. Lung which had a section removed is totally non-functional, so he'll have to rely on one lung for the rest of his life. Cousin's kids get a lesson in not transmitting germs tomorrow from wife, who's coincidentally well-studied and experienced in aseptic techniques. Just wanted to keep everyone informed -- always get paranoid someone'll start freaking out and make a big scene if I don't respond to them within a few hours.

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May 08, 2012, 07:30:45 AM
 #49

Contract change (relevant part [+ a word added for clarification] in bold). I will honor the modified contract now, but it won't be changed on GLBSE until after 60 days of this post just in case Nefario might take issue with me sidestepping the time requirement.

Previously read:
"Change of Contract" - The operator is fully permitted to change the contract at will, without consent of shareholders. However, the contract is not permitted to go into effect until sixty days after the changes are made public. When the contract is changed, the operator will honor the ability for shareholders to sell shares back to him at a price of .045 Bitcoins per share.

Modified to read:
"Change of Contract" - The operator is fully permitted to change the contract at will, without consent of shareholders. However, the modified contract is not permitted to go into effect until sixty days after the changes are made public. When the contract is changed, the operator will honor the ability for shareholders to sell shares back to him at a price of .125 Bitcoins per share between the time a change is made and the time 60 days have elapsed since the change was made public.


Very sorry to hear the bad new. I hope things will go as well as they can.
Thanks  Smiley

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May 08, 2012, 09:15:13 PM
 #50

May 2012 Net Income Expectations
Optimistic estimate: 725BTC
Reasonable estimate: 625BTC
Pessimistic estimate: 550BTC
(Guesstimated weekly dividend payouts -- May 7th: .0021BTC/share -- May 14th: .0004BTC/share -- May 21st: .00266 -- May 28th: .00022BTC/share)
A very pleasant revision for shareholders. I have sold BDK's stake in Zip.A for an amount I'm quite pleased with. In total, BDK made ~233BTC from buying & selling Zip.A in the past few weeks. Amazingly, this week's dividend will exceed the previous week's dividend. With that said, I want to be clear -- It's extremely unlikely these profits will be sustainable beyond May -- just a few great breaks in the recent past.

As such, the forcast has been revised to the following:

May 2012 Net Income Expectations
Optimistic estimate: 825BTC
Reasonable estimate: 700BTC
Pessimistic estimate: 575BTC
(Guesstimated weekly dividend payouts -- May 7th: .0021BTC/share Actual: .0021331436BTC/share -- May 14th: .0028BTC/share -- May 21st: .00266BTC/share -- May 28th: .00022BTC/share)

Cheers!  Grin

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May 12, 2012, 09:21:23 AM
 #51

~450BTC (in the form of PPUSD investment in an equity from personal funds) was added to the ownership equity today. I am not at liberty to discuss the actual project it was invested in (expect something within three weeks). However, I will be using ~4k BTC in total of BDK funds to make this investment, and wanted everyone to know that I am firmly committed to and expectant of great success with this project, backed up by an >$2k USD "personal" investment in the project. I make this statement because it will likely 2-6 months before BDK can record profit on this move. - And with that said, I'm expecting a record recording. So, short-term (next couple weeks) will show excellent profits, mid-term (3-16 weeks) will show relatively healthy (but not "extreme") profits, long-term (16-32 weeks) should show pretty darn extreme profits.

Fwiw. Cheers!

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May 13, 2012, 03:16:54 AM
 #52

Cutesy-Puff 1&2 on Ozcoin if anyone was interested. As noted before, all mining income from them is counted as profit without deducting electricity costs. In exchange, I don't list the 5850 in a different pool I'm about breaking even on.


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May 14, 2012, 08:04:08 AM
 #53

MAY 7 UPDATE

May 2012 Net Income Expectations
Optimistic estimate: 825BTC
Reasonable estimate: 700BTC
Pessimistic estimate: 575BTC
(Guesstimated weekly dividend payouts -- May 7th: .0021BTC/share Actual: .0021331436BTC/share -- May 14th: .0028BTC/share -- May 21st: .00266BTC/share -- May 28th: .00022BTC/share)
MAY 14 UPDATE
Dividend/share paid: .00246BTC/share
Total dividend paid: 12.3BTC
Running total dividends paid in May: 22.97101BTC

May 2012 Net Income Expectations
Optimistic estimate: 840BTC
Reasonable estimate: 800BTC
Pessimistic estimate: 775BTC
(Guesstimated weekly dividend payouts -- May 7th: .0021BTC/share Actual: .0021331436BTC/share -- May 14th: .0028BTC/share Actual: .00246BTC/share-- May 21st: .0027BTC/share -- May 28th: .000135BTC/share)

I'll re-check the #s for the next two weeks to make sure they're still fairly accurate and give an update within a few days. ETA: Done. These numbers were updated on 5/14 and I believe they will be +-15% of actual dividend paid. The total monthly profit I'm expecting is 815-840BTC (excluding ~15BTC to cover donation pledges), but assume I'm over-confident, so lower the numbers in the estimates. Smiley

Cheers!

ETA2: Minimum order (#shares, not #BTC) for June 2nd pre-IPO shares revised to 100. The June IPO price is .16BTC/share. I have no intention of lowering it. I am quite content not selling BDK IPO shares if not at a price I like. I'm pleased with fund-raising from BDK.BND.

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May 14, 2012, 10:18:44 AM
 #54

This certainly isn't the first time I've received a PM asking me what I've been going on about. I hope this is a little more easy-to-understand than the info in the OP.

Quote from: xx
Hi Kluge,

what is the pre-IPO price? Do you provide any discount or is it fixed at 0.16?
When do you sell these pre-IPO shares? What will be the 1st dividend date?

xx
Hi there. Sorry you couldn't get this information easily from the thread -- I've been thinking of ways to organize all the information, but I'm terrible at it. Seems really simple in my head, then seems excessively complicated when I write it down.

Anyway - the pre-IPO price is .16BTC/share, and that is fixed. When I do the public offering on June 2nd, what I'm really doing is filling all bid orders on GLBSE at or above .16BTC/share - up to 5k shares (rather, 5,000 minus #pre-IPO shares sold). The first dividend for buyers for the set of shares to be released on June 2nd would be June 4th, and every Monday thereafter. Shares may be pre-purchased prior to June 2nd, but those shares will not be transferred to the purchaser until June 2nd.

That may seem like a raw deal for those who pay up-front for June 2nd shares. However, they're guaranteed to get BDK shares @ that price. For the shares issued on May 2nd, I only had 1,000 shares to sell. Even though the IPO price was set @ .055BTC/share, because people bid high to be able to get those limited 1,000 shares, nobody who bid less than 0.07750001BTC/share for BDK shares was able to buy any. The majority of orders filled on May 2nd were @ .08BTC/share. So, if there's a bidding war like there was on May 2nd (and fwiw, there are already 7 unique bid orders on GLBSE ranging from .18BTC/share to .19BTC/share), then you may end up receiving a very significant discount -- or maybe not. That's the risk for you to choose whether or not to take.


Hope that helps. Tell me if there's still anything I can help clarify.

Cheers,

Ben


ETA: pt. 2

Quote from: xx
Ben,
Thanks for the info.

What is the maximum you are going to offer as pre-IPO?
Do you have already have some sold? Will you keep us informed about how many are still left?
I would buy 100-200 shares but as you'll sell only in 2 weeks I don't want to have the money blocked all the time?
Is it possible to put an order and pay later?

xx
I've stated these, but they get buried in the thread. I'll definitely update the OP within a couple weeks - maybe just post a spreadsheet.

On the second day of each month from May to August, I will sell UP TO 5k shares of BDK. After that time, I am permitted to sell however many shares as I please. However, at any time, I am contractually restricted to selling shares at a price equal to or greater than the price I last sold a share at, so after June 2nd, for example, I will never sell a share for less than .16BTC/share, which makes sense even if it weren't in the contract as funds raised through these public offerings go directly into BDK coffers to lend out. For example, BDK currently has ~4.35k BTC in equity. I expect to raise ~800BTC from the June IPO. Thus, in July equity should be in excess of 5k BTC and profits (dividends) should reflect that. For each subsequent public offering, people are very likely to be bidding on a portion of profits of an operation with higher equity and profits than it was the previous month.

No pre-IPO shares have been sold, yet, though a depositor expressed interest in converting amount due to BDK shares. I will update when shares have been sold in the thread. Reserving shares are fine, but I must receive the BTC by the end of the day prior to the public offering (so... June 1st in this case) or I'll sell them on GLBSE the next day.


Cheers,

Ben

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May 15, 2012, 02:13:47 AM
 #55

Over half of the BDK shares for June 2nd were reserved or pre-paid for today, leaving 1.7k shares remaining which I will be selling at the higher price of .175BTC/share. As well, for the reserved 1k (+ any pre-IPO shares not sold) shares for IPO date, I will only be fulfilling orders @ or > .18BTC/share.

ETA: fwiw, I'm guesstimating I'll be asking between .225BTC/share and .275BTC/share for the later July 2nd public offering.

ETA2: Down to 700 shares left Cheesy

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May 15, 2012, 02:52:44 AM
 #56

Fantastic. All pre-IPO shares have been sold. On June 2nd, then, I'll be fulfilling the top 1k bids (1k of 5k shares each month are reserved for the public offering date) on GLBSE above .18BTC/share.


Cheers,

Ben

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May 15, 2012, 03:29:21 AM
 #57

About to PM you, urgently had to go somewhere for an hour, and when I come back, all gone. Sad

Well, if anyone's interested in a quick turnaround, I'd buy 100 @ 0.18 BTC each.

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May 15, 2012, 03:45:10 AM
 #58

I can do that for you but no more than 100, .18 is cheap!  Smiley

Send me a PM.

Thx

Sent, thank you!

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May 16, 2012, 03:57:27 AM
 #59

My wife now has instructions on how to do a forced recall in the event of my death or incapacity. I will put together a plan in the event of the both of us dying within a few months as I decide who to trust with it.


In 60 days, the contract will be revised to read:

Contract:
Ben Malec (referred to within this contract as "me," "myself," "I," and "operator") will issue 100,000 shares of "BDK Hybrid Instrument." Each share not controlled by the operator represents .0009% of BDK's monthly profit.  Dividends will be paid every Monday, starting May 7th, 2012. Dividends will not be paid on the first of the month unless that happens to be on a Monday. 100,000 shares will be issued. Up to 5,000 shares are to be sold on the second day of each month for four months, starting on the month of May, 2012. After that time, shares may be issued at will of the operator.

Additional provisions
"Operator Equity" - The operator holds all equity of BDK. Shares are not tied to equity, and represent only .0009% of BDK monthly profits.

"Shareholder Votes, Non-binding Motions" - While motions may be introduced, they are non-binding. They exist only so the operator may gauge opinion of those invested in BDK's success.

"Change of Contract" - The operator is fully permitted to change the contract at will, without consent of shareholders. However, the modified contract is not permitted to go into effect until sixty days after the changes are made public. When the contract is changed, the operator will honor the ability for shareholders to sell shares back to him at a price of .125 Bitcoins per share between the time a change is made and the time 60 days have elapsed since the change was made public.

"Buyback" - At any time, the operator is permitted to buy back shares issued. The operator will pay .64 Bitcoins per share if the operator buys back BDK shares prior to August 3rd, 2012. If August 3rd, 2012 or later, the operator will pay ((.32 Bitcoins + GLBSE 5 day weighted average of trade transaction amount per share of BDK shares)/2)

"Share Value Protection" - If shares trade for less than ฿.01 on GLBSE for at least 168 hours continuously, the operator MUST issue a bid order of ฿.05 in an amount which equals 50% of shares issued not controlled by the operator. The "168-hour timer" does not again reset for 26 weeks after the "Share Value Protection" provision was last called to action.

"Negative Equity and Operator Liability" - BDK is permitted to operate while having negative equity so long as BDK has not had negative equity for 90 consecutive days. On the 90th day of having negative equity, the operator will be held personally liable to pay shareholders $.10/share (or ฿.02/share, whichever value is lesser).

"Operator Incapacity" - In an event where the operator of BDK is incapacitated due to death, kidnapping, imprisonment, or something else along those lines (arbiter & lawyers can hash it out over what's "along those lines"), the executor of the operator's estate is to initiate a buyback as instructed in the "Buyback" provision. If this is not done within 90 days of the operator's incapacitance, shareholders are entitled to sue the executor of the operator's estate for the amount they're due under the "Buyback" provision. In case where James McCarthy ("Nefario") is presented a death certificate by the executor of the operator's estate and she is able to provide login details for the operator's GLBSE account, James McCarthy is authorized to instruct the executor of the operator's estate on how to proceed with disbursement of due funds. It is also authorized that James McCarthey receive the amount due by the operator and disburse the funds himself according to this provision. Shareholders should be permitted to see the death certificate of the operator.

"IPO Value Preservation, Operator Trading" - The operator is not permitted to ever sell shares for less than he previously sold them for. However, he may sell shares for an amount equal to or greater than the amount he previously sold them for at will.

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May 16, 2012, 02:00:38 PM
 #60

My wife now has instructions on how to do a forced recall in the event of my death or incapacity. I will put together a plan in the event of the both of us dying within a few months as I decide who to trust with it.

-snip-

"Operator Incapacity" - In an event where the operator of BDK is incapacitated due to death, kidnapping, imprisonment, or something else along those lines (arbiter & lawyers can hash it out over what's "along those lines"), the operator's wife is to initiate a buyback as instructed in the "Buyback" provision. If this is not done within 90 days of the operator's incapacitance, shareholders are entitled to sue the estate of the operator for the amount they're due under the "Buyback" provision. In case where James McCarthy ("Nefario") is presented a death certificate by the operator's wife and she is able to provide login details for the operator's GLBSE account, James McCarthy is authorized to instruct the operator's wife on how to proceed with disbursement of due funds. It is also authorized that James McCarthey receive the amount due by the operator and disburse the funds himself according to this provision. Shareholders should be permitted to see the death certificate of the operator.


Kudos on thinking that far ahead Kluge, you are waaay ahead of most glbse issuers.

I have a suggestion: instead of referring solely to your wife, why not say your "agent" or "executor of your estate" and then outside of the contract you can say that for now that person is your wife.  One day it may be a business associate or lawyer.  But this way you can avoid having to modify the contract and wait another 60 days when you want to change the person who will be responsible.  I think my wife would be pretty upset about my death, probably not thinking about paying out my bitcoin peeps right away.

IANAL, but have have paid more than I can remember right now.  You might want to think about having a will and a durable power of attorney for this purpose.  Those two things can be done cheaply.  If you need a trust (or trusts) then it can start to get expensive.

Maybe glbse should have default terms for when an issuer dies or goes awol.  I hate to say it, but it's bound to happen eventually.

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May 16, 2012, 02:52:53 PM
 #61

My wife now has instructions on how to do a forced recall in the event of my death or incapacity. I will put together a plan in the event of the both of us dying within a few months as I decide who to trust with it.

-snip-

"Operator Incapacity" - In an event where the operator of BDK is incapacitated due to death, kidnapping, imprisonment, or something else along those lines (arbiter & lawyers can hash it out over what's "along those lines"), the operator's wife is to initiate a buyback as instructed in the "Buyback" provision. If this is not done within 90 days of the operator's incapacitance, shareholders are entitled to sue the estate of the operator for the amount they're due under the "Buyback" provision. In case where James McCarthy ("Nefario") is presented a death certificate by the operator's wife and she is able to provide login details for the operator's GLBSE account, James McCarthy is authorized to instruct the operator's wife on how to proceed with disbursement of due funds. It is also authorized that James McCarthey receive the amount due by the operator and disburse the funds himself according to this provision. Shareholders should be permitted to see the death certificate of the operator.

I think my wife would be pretty upset about my death, probably not thinking about paying out my bitcoin peeps right away.
... Well.  Undecided ...  Tongue

Anyway -- good idea. I'll check into it and make changes within a couple hours. Thanks.

ETA: Changed "wife" to "executor of estate." However, only my wife has the password to the instructions. I really don't trust anyone else with it right now, but things change.

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May 17, 2012, 07:40:10 AM
 #62

Last Valuation on 5/3 -- today is 5/17

GLBSE Securities Re-valuation (reconciliation between BDK sheets & GLBSE):
TyGrr: BDK - 2.08BTC/share, GLBSE - 1.9BTC/share -- total loss of 44.46BTC on paper
Cognitive: BDK - .58BTC/share, GLBSE - .59001BTC/share -- total gain of 14.28BTC on paper
Gigamining: BDK - 1.509BTC/share, GLBSE - 1.519BTC/share -- total gain of 8.47BTC on paper
BitcoinTorrentz: BDK - .931BTC/share, GLBSE - 1.19BTC/share -- total gain of 1.04BTC on paper

Total equity FMV change since last valuation -- loss of 20.67BTC

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May 18, 2012, 05:09:53 PM
 #63

There's a minor issue with the Icarus boards causing them to reset once every 2 days or so. I'm guessing it's related to the USB hub or cables. Simply disconnecting the hub from the PC and reconnecting it solves the problem. Will get it sorted out by end of tomorrow.

If any investors or potential investors (either in BDK or BDK.BND) have questions, comments, whatever - feel free to hit me up on Skype (Name: Ben Malec -- Skype Name: bdk_kluge -- add a note so I can recognize you as someone from here and not a rando commando). I also hang out in #bitcoin-assets. I'm almost always logged in, but not always on. Probably not snubbing you if it takes me a day to respond.  Tongue


For those interested in CDs and don't have interest in receiving bonds on GLBSE, feel free to PM me and we can work something out. I was hoping to do everything on GLBSE, but liquidity on BDK.BND is terrible right now and completely understand if someone'd rather do CDs. As well, I'm willing to convert BDK.BND to a CD if you'd like.

Cheers!

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May 19, 2012, 12:38:16 PM
 #64

There's a minor issue with the Icarus boards causing them to reset once every 2 days or so. I'm guessing it's related to the USB hub or cables. Simply disconnecting the hub from the PC and reconnecting it solves the problem. Will get it sorted out by end of tomorrow.
This situation might be resolved now. They no longer pass through a USB hub. If they both still go down around the same time, my second guess is that it may be a networking issue. My connection goes through three different routers and hiccups once a day or so.


ETA: Ozco.in image is delayed by ~10m, I believe, so just give it a few minutes to update if you're really interested. BDK.BND also received a 2000BTC buy this morning. BDK.BND now pays ~105BTC/month for 2630BTC, which is unprecedented and fantastic -- I'm really pleased. BDK has recently greatly increased its position in Cognitive, and I'm glad to be a part of it. I should be able to point to a Hermes announcement within a couple weeks. All the proceeds of the Pirate withdrawal will be going toward that project, and BDK is also investing in another yet-to-be-announced project as well as YABMC bonds under market price. So - exciting stuff. Smiley

ETA2: I'll make another announcement when I have the funds from the Pirate withdrawal today.

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May 19, 2012, 10:59:52 PM
 #65

Pleased to announce I've successfully withdrawn all funds from Pirate today. BDK now has no exposure at all to Pirate. I don't even lend to 100% insured pass-throughs.  Smiley

It seems the issue with Cutesy Puff 1&2 are resolved, and I've updated the OP to provide more information in a hopefully-more-coherent way. I'll get around to clearing it up even more in the next couple days. If anyone still has questions, please ask.

I'm also considering offering bonds which, over-simplified, pay face value + a partial % of BDK's %RoE. This should allow people to invest in BDK bonds which are "usually" higher than 1% but also insulates BDK from risk of over-paying. This would be kind of a hybrid between BDK & BDK.BND... likely lower return than BDK, likely higher return than BDK.BND, but higher risk than BDK.BND, with the spread between true %RoE and partial %RoE paid to bondholders used to boost BDK profits. However, they'd have a clear face value I'd try to maintain with walls on both sides, which I don't do at all with BDK (though I do with BDK.BND to provide a marginal amount of liquidity). Dunno, still thinking of how exactly to work it out.

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May 20, 2012, 10:35:37 AM
 #66

id like more information and would like to see how this will effect the bdk share price and dividends.

thanks
Being out of Pirate was a contingency of the 2k BDK.BND buy, and I've been turned down for CDs before for being exposed to Pirate. I believe I'll be able to consistently get more money at relatively low rates by having no exposure. The money investing in pre-IPO GLBSE securities has been far better than I expected, too.

That said, it's worth noting ~507.6 of ~807.6 of profits this month came from Pirate interest. I don't think I'll have trouble earning 6-15% monthly on the funds which were in Pirate, and the additional 2k BTC from being out of Pirate should bring profits pretty close to what they were, without worry of BDK one day losing 3k BTC on an extremely high-interest gamble. I had 3k in Pirate earning 28%. That'd be 840BTC/month revenues. Let's assume I can get 10% consistently, and I have the extra 2k from being out of Pirate. 1% of 2k paid weekly = a bit over 80BTC in interest on the bond per month. 10% of 5k = 500. So, I should get ~420BTC instead of 2x that keeping it all in an uninsured Pirate account, and I'll never have to answer "Why would you risk >3k of BDK's money with someone who's never presented ID, who you've never met, who won't even tell you where he lives, and refuses to disclose what he's doing while taking in tens of thousands of BTC each month?"

I still think it's very possible Pirate's doing something which could bring in what he's claiming, but I'd never loan to someone just because it's plausible they could pay back what they promise.

In total, BDK is extremely close to reaching the milestone of 10k BTC in assets. I think we can beat this month's profits in July (I don't have high expectations for June, and this month has been unprecedented as far as the profit margin [>15% %RoE this month, and we're just a bit over halfway through]), and it should only be up from there.

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May 20, 2012, 11:02:03 AM
 #67

This sure is interesting times:)
Would love for 100 shares at 0.20 as my debut with GLBSE if anyone is up for that?

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May 20, 2012, 09:55:22 PM
 #68

I'll be paying dividends in ~6h. ETA: Sorry for being a jerk -- I'll be paying dividends when I wake up tomorrow (going to sleep right now). Dividends will be a bit lower than expected -- ~.00249/share instead of .0027/share due to the huge influx of new deposits which will benefit dividends longer-term. I pay BDK.BND dividends before BDK dividends.

Additionally, fwiw, I plan on awarding myself a salary starting in July. While the earnings from "my shares" are currently almost entirely reinvested in BDK, I plan to award myself a salary of 40% of non-public earnings (fwiw, that's currently 95.5% of BDK earnings). For instance, this month, I'd be paid ~$1600. I think that's an amount shareholders will find quite reasonable while allowing me to buy tampons, diapers, ramen, and other luxury items demanded of a cyber-lender. These will be counted as "personal expenditure" and not affect shareholder dividends except to reduce company growth.


Cheers,

Ben

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May 21, 2012, 09:50:47 AM
 #69

Dividends will go out in ~1h. Some small trades executed while I slept and I haven't reconciled fees from GLBSE's .csv with Google Docs sheet in a few days.

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May 21, 2012, 10:15:33 AM
 #70

MAY 21 UPDATE
Dividend/share paid: .002496BTC/share
Total dividend paid: 12.48BTC
Running total dividends paid in May: 35.45101BTC

May 2012 Net Income Expectations
Optimistic estimate: 840BTC
Reasonable estimate: 820BTC
Pessimistic estimate: 800BTC
(Guesstimated weekly dividend payouts -- May 7th: .0021BTC/share Actual: .0021331436BTC/share -- May 14th: .0028BTC/share Actual: .00246BTC/share-- May 21st: .0027BTC/share Actual: .002496BTC/share-- May 28th: .000135BTC/share)

Spreadsheet has been updated to show loans by due date. They mess up when I try to auto-sort now and since a lot of them have USD->BTC conversions going of the latest price I have in the sheet, they get very screwy, so I have to do it all by hand, now, which really isn't that much work -- but anyway, it's fixed now.

ETA: IBB & BTC100 donations will henceforth be counted as "personal expenditure."

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May 21, 2012, 05:21:20 PM
 #71

Full $20k investment made to the Hermes project this morning. Project leader is heading over to Iceland soon to ensure we're free of regulation Hell. Before he does that, he'll be meeting with the ex-CEO (he spent 8 years as CEO) of a major web-based company whose work's niche is quite similar to our own. Additionally, an exciting person who's known in the community and has a solid, proven understanding of what we're doing has been brought on-board. There are so many exciting possibilities. The end result should not only empower those who hold Bitcoin to better-spend their money, but act as a powerful catalyst for the global economy, Bitcoin and beyond. Even if the mundane vision I originally imagined is all which comes true (I can be a bit of a pessimist  Wink), BDK stock-holders should be quite pleased. This isn't going to be some anon garage-hobby project, but part of the second generation of cryptocurrency infrastructure.

More info on that will be released in ~3 weeks.  There are semi-competing services, which is why I'd like to keep a balance between informing investors and not informing competitors about everything we're doing.  Wink  Grin

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May 23, 2012, 06:09:51 PM
 #72

There's about a week and a half left until the June 2nd public offering. The IPO price will be at .185BTC/share. However, there are already bids @ .2/share (well... alright - the bid volume at that price is only $25). I'll have profit guesstimates posted for the month of June on June 1st.

The OP has been cleaned up a bit more. I'm almost certain the USB cable on one of the Icarus boards is faulty, which is fine - I have spare mini-usb->usb cables.... somewhere in the stacks and stacks of moving boxes. :x -- Anyway, now they're each connected to a PC individually (instead of through a hub), only one of them is failing, though there's no error message - it just stops submitting shares after 4-48h.


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May 24, 2012, 05:22:59 AM
 #73

Pleased to announce a partnership in underwriting with ineededausername. Tomorrow, a full announcement with a new offering within a couple days. I expect this to be a mutually-beneficial, longer-term relationship. Just a few months ago, I was looking at 10BTC loans with intense scrutiny. Now, we're taking on tens of thousands of BTC worth of challenge, establishing relationships with the leaders of cryptocurrency infrastructure progression, and becoming a moving force in the community. June will be a good month after all. I am very content with the pace of progress.

As well, Bitcoin is truly entering its toddler years. No longer a newborn, no longer an infant, we now have something to offer other than novelty value, potential, and cute smiles. It's becoming a two-way street where you don't need to ask only what you can do for Bitcoin's success, but what Bitcoin can do for your success.

(no, I'm not sure where Silk Road fits into that analogy)

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May 25, 2012, 03:35:47 AM
 #74

Pleased to announce a partnership in underwriting with ineededausername. Tomorrow, a full announcement with a new offering within a couple days. I expect this to be a mutually-beneficial, longer-term relationship. Just a few months ago, I was looking at 10BTC loans with intense scrutiny. Now, we're taking on tens of thousands of BTC worth of challenge, establishing relationships with the leaders of cryptocurrency infrastructure progression, and becoming a moving force in the community. June will be a good month after all. I am very content with the pace of progress.

As well, Bitcoin is truly entering its toddler years. No longer a newborn, no longer an infant, we now have something to offer other than novelty value, potential, and cute smiles. It's becoming a two-way street where you don't need to ask only what you can do for Bitcoin's success, but what Bitcoin can do for your success.

(no, I'm not sure where Silk Road fits into that analogy)
Here's the promised announcement on that: https://bitcointalk.org/index.php?topic=83557

Additionally. I'm revising this week's dividend guesstimate to .0004BTC/share instead of .000135BTC/share, so there's another small bit of good news.  Smiley

The new monthly profit guesstimate is as follows:
May 2012 Net Income Expectations
Optimistic estimate: 845BTC
Reasonable estimate: 835BTC
Pessimistic estimate: 825BTC

BDK price has been odd on GLBSE. There was a large sell (accidental?) which brought the price down to one satoshi for a few minutes, and now the last trade is @ ~.24 -- next open-market offering will be in less than 10 days, now. 5pm Eastern, again. If there are any questions, feel free to open up a dialogue with me - here or privately.

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May 27, 2012, 06:35:54 PM
 #75

Fwiw, IOU gains and losses will be reported in the BDK spreadsheet, and IOU profits will be shared with BDK shareholders (really, BDK is more of a floating bond. I can see how "BDK" and "BDK.BND" could be very confusing). This will likely result in June having a monthly profit somewhere between 2k BTC and 5k even though equities and loans aren't expected to match revenues of this month. So, the exponential growth should continue, which is nice to look at. However, I will be awarding myself a % profit (this does not come out of shareholders' cut, but from the dividends due to the % of profit I hold) in June instead of July. I've settled on 40%. So, monthly growth will be ((profits minus shareholder dividends) minus 40% remaining profits). As-is, everything I don't pay to shareholders is reinvested in the company. After this month, only 60% of everything I don't pay to shareholders goes toward monthly growth.

I do not believe this requires a change of contract because I am the sole owner of all BDK's equity as well as profits not allotted to shareholders. While I should have made it more clear that everything I'm due wouldn't necessarily be reinvested in BDK, I do not believe this should be controversial, but I'm preparing to be surprised.  Wink



Dividends tomorrow, next public offering in less than a week (Saturday). Cheers,

Ben

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May 28, 2012, 05:33:35 AM
 #76

Valuations will now use 24h weighted avg instead of last price. If no trades in last 24h, last will still be used.

Last Valuation on 5/17 -- today is 5/28

GLBSE Securities Re-valuation (reconciliation between BDK sheets & GLBSE):
TyGrr: BDK - 1.9BTC/share, GLBSE - 1.91BTC/share -- total gain of 2.47BTC on paper
Cognitive: BDK - .59001BTC/share, GLBSE - .611BTC/share -- total gain of 38.92BTC on paper
Gigamining: BDK - 1.519BTC/share, GLBSE - 1.487BTC/share -- total loss of 16.86BTC on paper
BitcoinTorrentz: BDK - 1.19BTC/share, GLBSE - 1.01BTC/share -- total loss of .72BTC on paper
YABMC: BDK - .3BTC/share, GLBSE - .3BTC/share -- no change
REBATE: BDK .2BTC/share, GLBSE - .201BTC/share -- total gain of 1.77BTC on paper

Total securities FMV change since last valuation -- gain of 25.58BTC.

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May 28, 2012, 05:45:13 AM
 #77

Dividends for BDK.BND already paid. Dividend payment for BDK will be delayed until dividends are paid by YABMC at 12:00 UTC. (It's 05:45 UTC as of this post)

ETA: Heading to sleep. I should be awake and have dividends paid before 18:00 UTC, hopefully before 14:00 UTC.

ETA2: Heh. Little frazzled. Giga pays today, not YABMC. Dividends being calculated, then sent.

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May 28, 2012, 02:00:28 PM
 #78

MAY 28 UPDATE
Dividend/share paid: .000276BTC/share
Total dividend paid: 1.38BTC
Running total dividends paid in May: 36.83101BTC

May 2012 Net Income Expectations
Optimistic estimate: 835BTC
Reasonable estimate: 825BTC
Pessimistic estimate: 820BTC
(Guesstimated weekly dividend payouts -- May 7th: .0021BTC/share Actual: .0021331436BTC/share -- May 14th: .0028BTC/share Actual: .00246BTC/share-- May 21st: .0027BTC/share Actual: .002496BTC/share-- May 28th: .0004BTC/shareActual: 0.000276BTC/share)


Profit estimates for June and full May report will be posted on June 1st.

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May 28, 2012, 02:59:34 PM
 #79

A meaningful motion has been created for BDK. I will abide by the majority's will on this.

Motion created to separate IOU & BDK. If done, gains, losses, assets, and liabilities of IOU will not affect BDK. If something goes terribly wrong with IOU, BDK security holders will not be liable. If things go smoothly, BDK security holders will not receive any profits from it.

Holders of BDK can vote @ https://glbse.com/vote/view/28 -- it wil expire in 72 hours from ~15:00 UTC on 5/28

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May 28, 2012, 03:21:41 PM
 #80

A meaningful motion has been created for BDK. I will abide by the majority's will on this.

Motion created to separate IOU & BDK. If done, gains, losses, assets, and liabilities of IOU will not affect BDK. If something goes terribly wrong with IOU, BDK security holders will not be liable. If things go smoothly, BDK security holders will not receive any profits from it.

Holders of BDK can vote @ https://glbse.com/vote/view/28 -- it wil expire in 72 hours from ~15:00 UTC on 5/28

I have no idea what is going on:(  I lack the information needed to respond responsibly.
Here's the promised announcement on that: https://bitcointalk.org/index.php?topic=83557
What, specifically, do you need to know? I won't disclose details of the private contracts, and perhaps just for that, IOU should not be part of BDK. I'd be fine with that.

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May 29, 2012, 05:21:18 AM
 #81

A meaningful motion has been created for BDK. I will abide by the majority's will on this.

Motion created to separate IOU & BDK. If done, gains, losses, assets, and liabilities of IOU will not affect BDK. If something goes terribly wrong with IOU, BDK security holders will not be liable. If things go smoothly, BDK security holders will not receive any profits from it.

Holders of BDK can vote @ https://glbse.com/vote/view/28 -- it wil expire in 72 hours from ~15:00 UTC on 5/28

I have no idea what is going on:(  I lack the information needed to respond responsibly.
Here's the promised announcement on that: https://bitcointalk.org/index.php?topic=83557
What, specifically, do you need to know? I won't disclose details of the private contracts, and perhaps just for that, IOU should not be part of BDK. I'd be fine with that.
What is the capital structure of IOU and what is the ownership split between you/BDK and INAU?

FWIW, I voted to keep them together. I ask about capital structure because if you have a large personal stake in IOU and are not just using OPM (other people's money), then it helps to avoid you doing anything (too) stupid.

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May 29, 2012, 12:32:27 PM
 #82

A meaningful motion has been created for BDK. I will abide by the majority's will on this.

Motion created to separate IOU & BDK. If done, gains, losses, assets, and liabilities of IOU will not affect BDK. If something goes terribly wrong with IOU, BDK security holders will not be liable. If things go smoothly, BDK security holders will not receive any profits from it.

Holders of BDK can vote @ https://glbse.com/vote/view/28 -- it wil expire in 72 hours from ~15:00 UTC on 5/28

I have no idea what is going on:(  I lack the information needed to respond responsibly.
Here's the promised announcement on that: https://bitcointalk.org/index.php?topic=83557
What, specifically, do you need to know? I won't disclose details of the private contracts, and perhaps just for that, IOU should not be part of BDK. I'd be fine with that.

I think they should be connected just because there is a potential conflict of interest here. You will get to pick what projects are IOU and what projects are BDK. I was under the impression when we bought BDK we were getting part of the action of whatever you do.

However this bond issue has me worried. I will admit I do not know what is going on, but it seems to me a large amount of BDK funds could be tied up for months on this.

What percent of BDK funds are exposed to this? How many BDK.BONDs were sent to this? It is related because as I understand it, BDK.BOND gets paid out first, have a priority.

I do not know about the private deal you guys made with the group and I do not really need to know. However it seems from my limited and maybe incorrect understanding BDK just signed up to fund a huge bond (50% of $450,000?) and is having trouble reselling that bond.

I'm not trying to spread FUD so please correct me on all that I have wrong. I am posting because I would like to have a better understanding of what the risks are here.

Thank you.
No BDK funds are being tied up. However, I (BDK) have purchased >10k Kronos bonds. Funds aren't immediately being sent to Kronos. There are milestones we need to send payments by, and we're currently beating them with a LOT of wiggle room for the Kronos bonds. At any rate, BDK certainly isn't liable for 50% of $450k -- dunno where that # came from. There shouldn't be any problem selling the Kronos bonds. There was some heated discussion yesterday morning in the Kronos bond thread, but really, they're selling quite well, and faster than we planned. The announcement thread for Kronos Bonds have been up for a little over a day and we're still waiting on investor docs, yet we've sold >50k of 175k while our deadline isn't until June 15th.

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May 29, 2012, 12:40:02 PM
 #83

A meaningful motion has been created for BDK. I will abide by the majority's will on this.

Motion created to separate IOU & BDK. If done, gains, losses, assets, and liabilities of IOU will not affect BDK. If something goes terribly wrong with IOU, BDK security holders will not be liable. If things go smoothly, BDK security holders will not receive any profits from it.

Holders of BDK can vote @ https://glbse.com/vote/view/28 -- it wil expire in 72 hours from ~15:00 UTC on 5/28

I have no idea what is going on:(  I lack the information needed to respond responsibly.
Here's the promised announcement on that: https://bitcointalk.org/index.php?topic=83557
What, specifically, do you need to know? I won't disclose details of the private contracts, and perhaps just for that, IOU should not be part of BDK. I'd be fine with that.
What is the capital structure of IOU and what is the ownership split between you/BDK and INAU?

FWIW, I voted to keep them together. I ask about capital structure because if you have a large personal stake in IOU and are not just using OPM (other people's money), then it helps to avoid you doing anything (too) stupid.
First -- I should be pretty explicitly clear. While we've purchased the bond from Kronos, we're not expected to pay until later dates. We're operating on free credit from Kronos, then we pay them as we sell the bonds (we do have certain milestones we need to meet on specific dates, but at the rate we're going, this shouldn't be any problem at all).

As for IOU - it's a 50/50 split. As we sell bonds, we receive funds. As we receive funds, we send to Kronos. After we've paid them everything due, we split the profits 50/50. Were there bonds left, we'd decide who wants to take the bonds on - maybe even bid with each other. With Kronos bonds, however, I'd be fine buying the entirety if I had the BTC on-hand. I don't want to disclose all the mechanics of the private contract, but I'm very confident this is a great deal which won't have trouble selling out before June 15th.

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May 29, 2012, 02:02:21 PM
 #84

I swear everything piles on at once. Investors may wish to go to #bitcoin-assets. I'm trying to open a dialogue with Nef after receiving the following email:

It has been determined that you are in violation of the GLBSE terms of
service.

Your assets BDK and BDK.BND have been limited. You are no longer able to
use GLBSE for the purpose of raising funds.

Because your assets are actively traded we have not removed them, but
they will no longer be able to be used for new funding.

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May 29, 2012, 02:30:23 PM
 #85

I swear everything piles on at once. Investors may wish to go to #bitcoin-assets. I'm trying to open a dialogue with Nef after receiving the following email:

It has been determined that you are in violation of the GLBSE terms of
service.

Your assets BDK and BDK.BND have been limited. You are no longer able to
use GLBSE for the purpose of raising funds.

Because your assets are actively traded we have not removed them, but
they will no longer be able to be used for new funding.
I talked with Nef. GLBSE has prevented all BDK & JRO related projects from raising funds, and Kronos.BND IPO has been cancelled. Please do not raise pitchforks over this until I call JRO and have an update. This may all be sorted out amicably. Don't start some war.  Smiley


ETA from IRC: AFAIK, I am still able to pay dividends on BDK & BDK.BND. If a deal can't be reached, all who pre-paid on Kronos.BND & BDK's next offering will be refunded. BDK.BND may initiate a forced buyback. Again, please don't attack Nefario.

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May 29, 2012, 02:43:20 PM
 #86


I think they should be connected just because there is a potential conflict of interest here. You will get to pick what projects are IOU and what projects are BDK. I was under the impression when we bought BDK we were getting part of the action of whatever you do.


I don't have my pre-second-ipo shares yet, so maybe I don't get to vote, but I'll throw my two cents in anyway: I concur with Goat.  It seems that BDK should be the partner in IOU rather than Kluge (if you can logically separate BDK from Kluge) primarily to prevent conflicts and ensure fairness.

Think about it - Goldman Sachs (BDK) wouldn't allow one of their investment bankers (Kluge) to run his own separate bank (or fund, or whatever) and possibly divert business to that entity.  It might, however, partner on an investment company (IOU) and direct some business to that company.
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May 29, 2012, 03:20:57 PM
 #87

I talked with Nef. GLBSE has prevented all BDK & JRO related projects from raising funds, and Kronos.BND IPO has been cancelled. Please do not raise pitchforks over this until I call JRO and have an update. This may all be sorted out amicably. Don't start some war.  Smiley


ETA from IRC: AFAIK, I am still able to pay dividends on BDK & BDK.BND. If a deal can't be reached, all who pre-paid on Kronos.BND & BDK's next offering will be refunded. BDK.BND may initiate a forced buyback. Again, please don't attack Nefario.


Quote from: GLBSE TOS
The Exchange reserves the right to suspend trading of any asset, or suspend access to an asset creator's account, for failure of an asset creator to provide requested information, or in the event of suspected fraud.
The Exchange reserves the right to deny listing, or suspend trading, of an asset if such asset is deemed to be of a nature that potentially exposes the operations of the Exchange to unacceptable risks.

Only part of the TOS I could see applying. I couldn't see how your bonds expose GLBSE to additional risks, and AFAIK you've provided all requested information, so does Nefario think you are committing fraud?

(Not panicking, just querying as I don't have time to sit on IRC ATM)

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May 29, 2012, 03:31:13 PM
 #88

I think we are in pause mode until things get work out privately and then we will be updated.

"Patience, young padawan"?

Very well. Best of luck to Kluge and Nefario in getting this all sorted out.

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May 29, 2012, 03:37:39 PM
 #89

I talked with Nef. GLBSE has prevented all BDK & JRO related projects from raising funds, and Kronos.BND IPO has been cancelled. Please do not raise pitchforks over this until I call JRO and have an update. This may all be sorted out amicably. Don't start some war.  Smiley


ETA from IRC: AFAIK, I am still able to pay dividends on BDK & BDK.BND. If a deal can't be reached, all who pre-paid on Kronos.BND & BDK's next offering will be refunded. BDK.BND may initiate a forced buyback. Again, please don't attack Nefario.


Quote from: GLBSE TOS
The Exchange reserves the right to suspend trading of any asset, or suspend access to an asset creator's account, for failure of an asset creator to provide requested information, or in the event of suspected fraud.
The Exchange reserves the right to deny listing, or suspend trading, of an asset if such asset is deemed to be of a nature that potentially exposes the operations of the Exchange to unacceptable risks.

Only part of the TOS I could see applying. I couldn't see how your bonds expose GLBSE to additional risks, and AFAIK you've provided all requested information, so does Nefario think you are committing fraud?

(Not panicking, just querying as I don't have time to sit on IRC ATM)
There was no violation of ToS. This was unrelated. The email is in error. Please give us time to sort it out and please do not speculate. (not at you -- everyone)

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May 29, 2012, 04:04:56 PM
 #90

BTW I voted to keep IOU and BDK together. I'm pretty sure that is what will happen Smiley
I don't have access to the motion results (I believe it was deleted). Does anyone object to keeping IOU & BDK together? I will not disclose private contract agreements, but if everyone's okay with that, then I am perfectly fine splitting whatever happens.

So investors know, the June 2nd IPO is canceled as far as GLBSE goes.

Now - what I can do is take BDK investments privately. You would not receive GLBSE shares and thus could not sell there (unless we reach an agreement and my account is again unrestricted). Once we figure this out, I will issue shares on the exchange BDK will be using (which could be MPEX for all I know right now  Shocked ). I will still honor the contract. I will have this resolved by June 2nd. If someone wants to invest for the June 2nd offering, you are welcome to send me funds and give me a BTC address. I will pay you at the same time as GLBSE dividends go out, you'll be marked in my sheets, and dividends will be equal - proportionally, to that of a GLBSE bond/share-holder. You'll be able to sell privately, but I'll require notification from both parties involved. We can do this for Kronos.BND, too, but there's no point discussing options on Kronos.BND yet until I can get hold of JRO.

For current holders of BDK & BDK.BND, I believe you're still able to trade on GLBSE as you please. However, if BDK & BDK.BND move, I will require you to transfer your shares back to me to prove ownership, and then I will issue you new shares on the exchange we move to.

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May 29, 2012, 04:14:53 PM
 #91

On the asset page you can find "Old Motions"

https://glbse.com/asset/old_motions/BDK

PGP key id at pgp.mit.edu 0xA68F4B7C

To get help and support for GLBSE please email support@glbse.com
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May 29, 2012, 05:13:28 PM
 #92

1. I'd very much like to see BDK & IOU kept together. This is precisely what I'd like to see in banking developments in bitcoin.

2. It may be the case that if the chosen new exchange to list BDK (and BDK.BOND) on charges a fee. If you can somehow get that fee waived, or dramatically reduced for your shareholders, it could be a win (almost) all the way around.

If I understand correctly, GLBSE objects to underwriting as "competition" and "pinching their customers" - that seems incorrect thinking, to me. GLBSE seems poised to come out the clear loser on this deal if this is the case. It will certainly make me rethink my potential funding options.




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May 29, 2012, 05:50:29 PM
 #93

Just to be clear, I'm able to deposit funds and pay dividends as necessary. Since we've been dinged with an unfounded ToS violation, we can no longer rely on GLBSE. We wish GLBSE well, but need to move. We need Hermes produced for our own assets (since we can no longer fund-raise for them), and given we can't put nearly the features we'd like into it within a week or two, will be rolling out a basic exchange and building onto it. We'll be transferring our own assets ASAP. For myself, since I'm now very concerned GLBSE will be locking me out of my account entirely, I will be selling off what I have on there as I'm able and withdrawing funds to provide buy assets on Hermes, where I know for sure I'll have access to my funds.

I'll provide investors with additional details within a couple days. I'm still working on acquiring funds to pay back June BDK reservations, though Hermes should be functional enough to issue the shares there on schedule for those interested.

So, consider this an semi-announcement of Hermes (I'll post a more fanfare-y thread later): Hermes will be listing platform, and include features which will compete with GLBSE. Goals include introducing a better crowdfunding solution as well as a better securities exchange. I decided to fund Hermes after being dissatisfied with GLBSE. I originally offered GLBSE $15k to improve its own service with, but that offer was rejected, so I decided to

Eventually, all BDK-related securities will be posted on Hermes, as well as all JRO-related assets. Since we've been forced to develop Hermes *now* instead of in 2 months or so, features will be very limited at launch, and only our own assets will be listed. As we improve Hermes, it will be open to everyone. I'll give full details as we better-form what we'll have and what we can do, and talk with the attorney in Iceland (we have one, now, but he's not as specialized in what we're doing).

ETA: I had a chat with GLBSE staff about allowing an easy-transfer method, but am assuming it will not be implemented. As such, currently holders of locked securities will need to transfer their shares back to me, I'll verify, then re-issue them to that person on Hermes. This is a tedious time-waster, but whatever. Assuming my account isn't totally locked down, there is no reason to immediately transfer shares to me. Wait until we know how quickly we can push out a basic, secure exchange.

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May 29, 2012, 05:51:38 PM
 #94

1. I'd very much like to see BDK & IOU kept together. This is precisely what I'd like to see in banking developments in bitcoin.

2. It may be the case that if the chosen new exchange to list BDK (and BDK.BOND) on charges a fee. If you can somehow get that fee waived, or dramatically reduced for your shareholders, it could be a win (almost) all the way around.

If I understand correctly, GLBSE objects to underwriting as "competition" and "pinching their customers" - that seems incorrect thinking, to me. GLBSE seems poised to come out the clear loser on this deal if this is the case. It will certainly make me rethink my potential funding options.
GLBSE is objecting to us raising funds while we're developing a direct competitor to GLBSE, Hermes. Since BDK owns a stake in Hermes and no longer is fully able to utilize GLBSE, BDK, BDK.BND, Kronos.BND, Zip.A, and REBATE will all be moving.

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May 29, 2012, 07:15:48 PM
 #95

Since we've been dinged with an unfounded ToS violation, we can no longer rely on GLBSE.
Which point of the ToS were you found guilty of violating?

Also, why not listing on MPEX or other exchanges (there's a german one for example) but coding your own Bitcoin stock exchange?

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May 29, 2012, 07:36:53 PM
 #96

Since we've been dinged with an unfounded ToS violation, we can no longer rely on GLBSE.
Which point of the ToS were you found guilty of violating?

Also, why not listing on MPEX or other exchanges (there's a german one for example) but coding your own Bitcoin stock exchange?
There was no ToS violation. Nefario has said this publicly in IRC. We had our securities delisted for funding a GLBSE competitor, which we've been planning for well over a month. It wasn't something instantaneous which happened after the delisting. As for listing on MPEX, I'd frankly rather just put it all on a spreadsheet. (sorry, MPOE-PR)

We're working on an amicable solution. I can totally understand GLBSE's position from a purely business standpoint. Idunno if it was the best way to go forward, but there's no reason for me to speculate on it. Though, if you were running a regional bank, and another fellow came up and asked for startup funding for his own bank, don't you think it'd be reasonable for the first bank who had the loan proposed to, to deny the loan? This isn't a very good analogy, though...

For now, we're discussing exchanging a stake in Hermes (or some type of equity swap) to get the securities transfer feature implemented on GLBSE and our securities relisted. There is room for both of our exchanges to thrive, and we'd both have a niche.

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May 29, 2012, 08:33:21 PM
 #97

For now, we're discussing selling a stake in Hermes (or some type of equity swap) to get the securities transfer feature implemented on GLBSE and our securities relisted. There is room for both of our exchanges to thrive, and we'd both have a niche.

Yes, please. Try as hard as you can to work it out in a civilized way. There's room for a lot of Stock Exchanges, and even there's really a need for them. Competing is good. Friendly competing would be just awesome. And on this community this would be absolutely possible.

Think even on work some more things together. It would be nice that our assets won't be exclusively dependent on a unique platform. Think about working out some compatibility layers between all the exchanges such that the same securities can be listed on all of them, on a compatible way. You could then give freedom to the users to manage their assets on the platform they feel more comfortable with, and you'll just be competing on offering different frontends with unique features and costs structures.

That would make the competition productive for everybody, incrementing the efficiency of everybody's work.
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May 30, 2012, 06:06:27 AM
 #98

neferio:

I understand your position from a personal point of view, I probably would be pissed as well.
But from a business point of view all you did is push up the development of a new exchange
faster than it would have, lose all the fees from trading these assets in the next 2 months
(or more depending how long or would be till it was ready) and possibly cause quite a few other
people to move over as well .

 It's much more profitable for businesses to  cooperate than to have a war.

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May 30, 2012, 06:33:49 AM
 #99

neferio:

I understand your position from a personal point of view, I probably would be pissed as well.
But from a business point of view all you did is push up the development of a new exchange
faster than it would have, lose all the fees from trading these assets in the next 2 months
(or more depending how long or would be till it was ready) and possibly cause quite a few other
people to move over as well .

 It's much more profitable for businesses to  cooperate than to have a war.


+1

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May 30, 2012, 09:06:35 AM
 #100

Kludge: Maybe it's time you splurged the hefty sum of 20 bitcoin to move over to the one exchange that actually works. By "actually works" I mean charges 1/4 as much per transaction as GLBSE does, is down an infinity percent less and in general has an infinity percent fewer issues, troubles, problems, defects and so forth.

Nefario: You are obviously unqualified to be anywhere near a project of the complexity of an exchange, even for play money (which I suspect BTC are, for most of you here, at least judging on behavior records). I will make you precisely one offer to buy the thing from you, so you get to actually make some money for all your effort over the past year, as misguided and mismanaged as it may have been, rather than have to walk away from a worthless wreck (like Zou Thong/Amir&co have with Bitcoinica). If you have half the maturity you should have to be involved in all this you will take this offer seriously, and consider your options carefully. Feel free to make contact via pm or in #bitcoin-otc-eu.

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May 30, 2012, 12:10:55 PM
 #101

Kludge: Maybe it's time you splurged the hefty sum of 20 bitcoin to move over to the one exchange that actually works. By "actually works" I mean charges 1/4 as much per transaction as GLBSE does, is down an infinity percent less and in general has an infinity percent fewer issues, troubles, problems, defects and so forth.
I was reading this, thinking, maybe I'll give it a look, but then
Nefario: You are obviously unqualified to be anywhere near a project of the complexity of an exchange, even for play money (which I suspect BTC are, for most of you here, at least judging on behavior records). I will make you precisely one offer to buy the thing from you, so you get to actually make some money for all your effort over the past year, as misguided and mismanaged as it may have been, rather than have to walk away from a worthless wreck (like Zou Thong/Amir&co have with Bitcoinica). If you have half the maturity you should have to be involved in all this you will take this offer seriously, and consider your options carefully. Feel free to make contact via pm or in #bitcoin-otc-eu.
thought again.
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May 30, 2012, 12:28:36 PM
 #102

Kludge: Maybe it's time you splurged the hefty sum of 20 bitcoin to move over to the one exchange that actually works. By "actually works" I mean charges 1/4 as much per transaction as GLBSE does, is down an infinity percent less and in general has an infinity percent fewer issues, troubles, problems, defects and so forth.

Nefario: You are obviously unqualified to be anywhere near a project of the complexity of an exchange, even for play money (which I suspect BTC are, for most of you here, at least judging on behavior records). I will make you precisely one offer to buy the thing from you, so you get to actually make some money for all your effort over the past year, as misguided and mismanaged as it may have been, rather than have to walk away from a worthless wreck (like Zou Thong/Amir&co have with Bitcoinica). If you have half the maturity you should have to be involved in all this you will take this offer seriously, and consider your options carefully. Feel free to make contact via pm or in #bitcoin-otc-eu.

If that is the way you speak to someone of Nefario's standing in the community  I wonder what you speak to your customers like. There is no need to descend into a slanging match.



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May 30, 2012, 01:11:40 PM
 #103

Kludge: Maybe it's time you splurged the hefty sum of 20 bitcoin to move over to the one exchange that actually works. By "actually works" I mean charges 1/4 as much per transaction as GLBSE does, is down an infinity percent less and in general has an infinity percent fewer issues, troubles, problems, defects and so forth.

Nefario: You are obviously unqualified to be anywhere near a project of the complexity of an exchange, even for play money (which I suspect BTC are, for most of you here, at least judging on behavior records). I will make you precisely one offer to buy the thing from you, so you get to actually make some money for all your effort over the past year, as misguided and mismanaged as it may have been, rather than have to walk away from a worthless wreck (like Zou Thong/Amir&co have with Bitcoinica). If you have half the maturity you should have to be involved in all this you will take this offer seriously, and consider your options carefully. Feel free to make contact via pm or in #bitcoin-otc-eu.

Not a good way to win customers.

Anyways I own some rebate shares.  Really don't feel like using 2 exchanges oh well
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May 30, 2012, 03:08:29 PM
 #104

Kludge: Maybe it's time you splurged the hefty sum of 20 bitcoin to move over to the one exchange that actually works. By "actually works" I mean charges 1/4 as much per transaction as GLBSE does, is down an infinity percent less and in general has an infinity percent fewer issues, troubles, problems, defects and so forth.

Nefario: You are obviously unqualified to be anywhere near a project of the complexity of an exchange, even for play money (which I suspect BTC are, for most of you here, at least judging on behavior records). I will make you precisely one offer to buy the thing from you, so you get to actually make some money for all your effort over the past year, as misguided and mismanaged as it may have been, rather than have to walk away from a worthless wreck (like Zou Thong/Amir&co have with Bitcoinica). If you have half the maturity you should have to be involved in all this you will take this offer seriously, and consider your options carefully. Feel free to make contact via pm or in #bitcoin-otc-eu.

I suspect you'd get a lot more usage of your exchange (I would certainly use it) if you didn't consistently slander Nefario/GLBSE. Regardless of perceived qualifications, most people don't like working with, and excuse my bluntness, jerks.

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May 30, 2012, 03:26:15 PM
 #105

shit
Fuck you and your exchange. Here is a nice example of some fail, in case anyone wants to know how not to make a website:



Do you seriously expect each and every trader to create a json encoded query in order to buy or sell or essentially do anything at all? Points for security though obscurity, anyway.

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May 30, 2012, 04:49:44 PM
 #106

Anyway... BDK & BDK.BND won't require an immediate switch. There will be a soft deadline when Hermes has trade features implemented. Investors are encouraged to verify holdings and switch by that time, but dividends will still be paid normally to GLBSE holders. Since we need to release something in really an alpha stage, investors will likely only get a type of report page for a few days to a week or two. Then we'll have graphs, ability for users to trade on the market, stats on trades, etc. Once we're confident we at least have a competitive product, a hard deadline will be set (aiming for one to two months). This hard deadline is when I'll stop paying GLBSE security-holders. It's my understanding REBATE and Zip.A will also be going this route.

Since it's seeming too expensive to get our securities on GLBSE relisted and an easy-transfer feature implemented for Issuers (and their investors), verification will consist of all security-holders transferring their shares/bonds to the Issuer. In my case, that means I need your bonds and shares transferred to Kluge on GLBSE. Once I verify, I re-issue you shares on Hermes. Please don't do this until we have something functional up for Hermes, or you may not be able to collect dividends next Monday.


For BDK investors: BDK operations will continue normally, though I'm trying to sell off my GLBSE securities somewhat more quickly to ensure my funds & securities aren't "locked," BDK is not having any cashflow problems, and AFAIK, I've come to an agreement with everyone who pre-paid for June BDK shares. All CD-holders will be able to be paid on schedule, and dividends will continue to be paid to those due without issue. Two people wanted to keep their reservation and will be issued shares on Hermes, one person wanted a refund to roll into a larger CD. The offer is open to everyone who reserved BDK shares in June -- just tell me by June 1st and know Hermes shares may not be tradeable for up to three weeks, though dividends will be able to be paid.

Additionally, BDK/IOU will not be held liable for the Kronos bond deal since GLBSE cancelled the Kronos.BND IPO. Both Kronos & IOU/BDK are in agreement on this. Kronos has been delayed by a week or two, the bond will be delayed for a similar amount of time, and since we've had to launch so many services way ahead of schedule, the bond offering will likely be significantly larger than originally planned. However, this did give us a chance to re-do the bond offering, and there were already many actions I took which I regretted. In the future, it'll hopefully be able to pay a fixed amount of interest.


Cheers,

Ben

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May 30, 2012, 05:22:54 PM
 #107

Update added to OP:

"UPDATE: BDK & BDK.BND have been "limited" by GLBSE staff because we planned on launching a competing service in 2-3 months. Since we are no longer able to fund-raise on GLBSE, the June offering is partially canceled in that I can no longer post an open-market order. Those who reserved shares are welcome to either honor their reservation and have shares issued on Hermes, knowing Hermes will likely not have trade functionality for 2-3 weeks, or you can cancel your reservation. I am not accepting new reservations. As well, an alpha version of Hermes will be released within a few days, which all GLBSE-"limited" securities will be transferring to. This includes Zip.A, REBATE, BDK, and BDK.BND.

Dividends will still be paid to GLBSE security-holders while we figure out how we'll handle a transfer. Please ask if you need any updates, clarifications, or have questions. I'm talking to ten people at a time, and forgetting what information I've given and what information I still need to give publicly. Sorry, and thanks for bearing with me.
"

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May 30, 2012, 07:06:49 PM
 #108

Just to be a real pain in the arse, but in the spirit of a) your openness and b) the concerns regarding the security of btc-related ventures, would you consider making your exchange source available (say, on github) for review and possible collaboration?

That would be really nice, almost a must. And don't forget to take a look into Open Transactions as a possible backend, or at least as a great inspiration for functionality and features.
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May 30, 2012, 07:17:24 PM
 #109

^ & ^^ - I'll make the suggestion to JRO when I call him this morning with everything which's happened in the past few hours. Though I've been the most publicly-talkative about this because I was still holding onto hope I could do a June 2nd IPO (there's still a sliver of hope for this, and for doing it on GLBSE) and wanted to prevent panic-sells (*mostly* succeeded, though there've certainly been some panic sells), I'm not majority stake-holder in Hermes nor do I do any dev work. I can pass stuff like this on to the dev team and JRO, but I'm no programmer and though I like the idea of open-source projects (frankly, I don't believe in absolute rights at all, especially not "IP rights"), don't know if it's the best route to go forward - so it's probably very good I'm not the person with the final say on how to go forward.  Wink  Smiley

Appreciate the suggestions. Will provide an update when I have one.

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May 30, 2012, 11:01:43 PM
 #110

There has been no suggestion at all that glbse will "lock" you out of your account. That is simply FUD and not how Nefario operates.




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May 30, 2012, 11:09:07 PM
 #111

There has been no suggestion at all that glbse will "lock" you out of your account. That is simply FUD and not how Nefario operates.
He has already "limited" all securities related to me & JRO without warning and not because of a ToS violation, even though some of those assets have almost no impact on Hermes funding at all. That said, I just put some more money into GLBSE securities, so obviously, I'm not too worried anymore.

For those questioning whether or not there was a ToS violation, this is from #bitcoin-assets:
(10:15:18 AM) DeaDTerra: What's the reason BDK is being limited?
(10:15:19 AM) nefario: the limited assets were being used to fund a competitor to GLBSE
(10:15:28 AM) nefario: AND they were attempting to pinch our customers

After I posted that, I asked Nefario straight-up if he'd lock me out of GLBSE accounts entirely and he said no. I'm satisfied, and apologize for saying that (though it was a real concern at the time). It was just a heat-of-the-moment comment.

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May 31, 2012, 10:26:43 AM
 #112

There has been no suggestion at all that glbse will "lock" you out of your account. That is simply FUD and not how Nefario operates.





This is not the first time Nefario has locked someone out of their account :/



No one has been locked out of their account.

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To get help and support for GLBSE please email support@glbse.com
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May 31, 2012, 12:23:30 PM
 #113

There has been no suggestion at all that glbse will "lock" you out of your account. That is simply FUD and not how Nefario operates.





This is not the first time Nefario has locked someone out of their account :/



No one has been locked out of their account.

But it has happened in the past.
You basically announced your GLBSE’s email account password in public, as seen in this message: https://bitcointalk.org/index.php?topic=75047.msg831580#msg831580

I was the one who immediately reported your post to have it deleted.

PS: I am looking forward to your "100% free market" p2p stock exchange which avoids the pitfalls of centralization. Although I am of the conviction that decentralized markets are inefficient and therefore will not be the use of choice, it is probably easier to accomplish than a p2p currency exchange which has to handle external fiat money.

Apologies for the offtopic, Kluge.
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May 31, 2012, 10:47:00 PM
 #114

    I'll have June profit guesstimates out tomorrow. Still not sure how BDK IPO will be handled. We may get everything resolved by the end of tomorrow, allowing me to make a market sell on GLBSE and issue shares to those who've paid for their reservation, so the IPO will occur as scheduled.

    Another note -- "Monthly Growth" doesn't include the amount received for selling BDK. I haven't spent much time thinking of how to account for both funds raised, and the variable amount due to shareholders when the time comes for a buyback in 8-18 months. The buyback amount due is not included as a liability, nor is the amount I've raised from BDK offerings recorded. I'll have that corrected by next month's report, and go back, fix old I/O reports. This report is not necessarily final and may change by the end of today in ~5 hours (I'm not expecting it to).

May Summary

Monthly Profit - ฿878.65BTC
Income - ฿991.96
  • Loan interest - ฿580.57
  • Gratuities - ฿2
  • Securities Dividends - ฿143.5
  • Equities sold at a gain - ฿256.29
  • Misc - ฿9.6
Outgo - ฿113.31
  • CD/BDK.BND dividends - ฿83.56
  • Misc - ฿29.75

Other Info
Assets - 10,082.98 ($52,330.64)
  • Loans (excl. default)   - ฿1,079.63
  • Equities - ฿8,713.35
  • Cash-on-Hand - ฿290.00
Liabilities - 4,986.21 ($25,878.45)
  • BTC100 Pledge   - ฿10.07
  • IBB Pledge - ฿0.46
  • BTC Deposits - ฿1,952.51
  • USD Deposits - ฿385.36
  • Shareholder Div. - ฿1.91
  • BDK.BND - ฿2,635.90
Equity - ฿5,096.76 ($26,452.19)
Operator Personal Expenditure - ฿9.94
BDK Growth for Month of March (profit - shareholder dividends - operator personal expenditure) - ฿829.17

Full details @ https://docs.google.com/spreadsheet/pub?key=0Ao892S4MOoDZdGZSbjJVd1ZTbFVLZE5aRE95bE91NVE&gid=18 (one last note -- Hermes funding will likely be rolled into funding for Kronos as a bond) (quit adding [/list] at the end of my post, SMF) (one post-last note -- The Q2 report in the spreadsheet will start displaying values as soon as I start the June I/O report tomorrow -- I'll use the current BTC per USD value while I don't have a Q2 end number so you can get more stats)

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June 01, 2012, 04:36:52 PM
 #115

BDK's been unrestricted. The IPO will continue as scheduled with a few minor time changes.

The IPO will be at 21:00 UTC tomorrow, on 6/2. Reservations must be paid for by 15:00 UTC tomorrow. Any shares not paid for by 15:00 UTC will be sold at a fixed price of .185BTC/share to anyone interested until 18:00 UTC. Beyond that, the 1,000 shares reserved for IPO (+ any pre-IPO shares not sold) will be offered on the open market as usual @ .185/share. If there are more bids above .185 than shares available, the shares will be sold at the highest bidder. If there are not enough bids @ .185 or above, the shares will be reserved until a later offering.

Currently, there are 700 pre-IPO shares which were decided not to remain reserved. These 700 shares can be reserved for a price of .18/unit.

I'll have profit guesstimates up within a couple hours. It will not be nearly as nice as May (initial eyeballing suggests 100-500BTC monthly profit). Lot of large deposits paid this month, and we're starting off with ~-84BTC profit to pay depositors.


ETA: BDK.BND and all JRO securities are still restricted AFAIK.

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June 01, 2012, 05:27:47 PM
 #116

June 2012 Net Profit Expectations
Optimistic estimate: 400BTC
Reasonable estimate: 100BTC
Pessimistic estimate: -150BTC
(Guesstimated weekly dividend payouts -- June 4th - 0BTC/share, June 11th - .00063BTC/share, June 18th - .00018BTC/share, June 25th - .00036BTC/share)


Week-by-week estimates assuming I somehow lose the ability to find new opportunity
Wk1 (May28-Jun4) - 90BTC income, 155BTC outgo (Assuming negative shareholder dividend, this shareholder "debt" will not rollover)
Wk2 (Jun4-Jun11) - 100BTC income, 30BTC outgo
Wk3 (Jun11-Jun18) - 110BTC income, 90BTC outgo
Wk4 (Jun18-Jun25) - 70BTC income, 30BTC outgo

Total: 370 income, 305 outgo, 65 profit (shareholders will likely receive dividends as if there were 130BTC profit as wk1 losses will not rollover). Additionally, the money I have in Hermes ($20k worth) will likely be rolled over into Kronos debt which may begin paying by the end of the month and would be expected to pay ~50-100BTC if so. Otherwise, July will be a much more profit-favorable month. Seeing these fairly low numbers for June - if you'd like a refund on shares you've prepaid for, or would like to cancel your reservation, I'd be happy to accommodate! Though, the price for BDK will never, in the future, be as cheap as they are now - so if you're going long-term or mid-term, I do believe BDK would still be a great investment.


Cheers,

Ben


ETA: OP updated with shares remaining

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June 01, 2012, 07:04:44 PM
 #117

Only 200 pre-IPO shares remaining for reservation.


Cheers,

Ben

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June 01, 2012, 07:17:28 PM
 #118

Only 200 pre-IPO shares remaining for reservation.


Cheers,

Ben
Aaaand there they go.

Will give a 5h, 1h, and 5m warning tomorrow for IPO. Cheers!

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June 02, 2012, 04:15:38 PM
 #119

The IPO will be at 21:00 UTC tomorrow, on 6/2. Reservations must be paid for by 15:00 UTC tomorrow. Any shares not paid for by 15:00 UTC will be sold at a fixed price of .185BTC/share to anyone interested until 18:00 UTC. Beyond that, the 1,000 shares reserved for IPO (+ any pre-IPO shares not sold) will be offered on the open market as usual @ .185/share. If there are more bids above .185 than shares available, the shares will be sold at the highest bidder. If there are not enough bids @ .185 or above, the shares will be reserved until a later offering.
~5h warning

All pre-IPO shares have been paid for, so only 1k will be sold at IPO time in ~5h.


Cheers,

Ben

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June 02, 2012, 06:48:01 PM
 #120

I have few questions.

IPO: An initial public offering (IPO) or stock market launch, is the first sale of stock by a company to the public.

Why do you keep calling it IPO? You do not offer any stock to investors. To me it looks like you are borrowing money for your operations without giving up a slice of your company. Those are not bonds either, because you are not offering a fixed return from the investment.

Quote
...These shares are non-voting and do not represent equity

Why do you keep calling it "shares"? Shares usually mean share of stock aka slice of a company's equity. Shares of what? Share of outstanding loans with no guaranteed interest nor maturity date? As I understand, you are not required to buy them back so you can just lift your hat and "say thank you". Did I misunderstood something?

Quote
Until after August 2nd, I will be issuing up to 5,000 shares on the second day of each month. Up to 4,000 of those shares can be pre-purchased early. The remaining 1,000 will be sold on the open market through an ask order at the IPO price I determine before-hand. ...

Every time I offer profit shares to the public, equity and (ideally) dividends increase. Each month, this means 4.5% of BDK's profits are more valuable than the previous month's.

 Huh What you are saying is when this "soup" gets watered down every month, a spoonful of it will be worth more? This makes no sense at all.
Every month you ask for more money to pay out dividends to previous owners of "buttons" and make it look like the value of those "buttons" has gone up?

If I have misunderstood how this works, please explain in more detail.
Thank you

While reading what I wrote, use the most friendliest and relaxing voice in your head.
BTW, Things in BTC bubble universes are getting ugly....
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June 02, 2012, 06:57:21 PM
 #121

I have few questions.

IPO: An initial public offering (IPO) or stock market launch, is the first sale of stock by a company to the public.

Why do you keep calling it IPO? You do not offer any stock to investors. To me it looks like you are borrowing money for your operations without giving up a slice of your company. Those are not bonds either, because you are not offering a fixed return from the investment.

Quote
...These shares are non-voting and do not represent equity

Why do you keep calling it "shares"? Shares usually mean share of stock aka slice of a company's equity. Shares of what? Share of outstanding loans with no guaranteed interest nor maturity date? As I understand, you are not required to buy them back so you can just lift your hat and "say thank you". Did I misunderstood something?

Quote
Until after August 2nd, I will be issuing up to 5,000 shares on the second day of each month. Up to 4,000 of those shares can be pre-purchased early. The remaining 1,000 will be sold on the open market through an ask order at the IPO price I determine before-hand. ...

Every time I offer profit shares to the public, equity and (ideally) dividends increase. Each month, this means 4.5% of BDK's profits are more valuable than the previous month's.

 Huh What you are saying is when this "soup" gets watered down every month, a spoonful of it will be worth more? This makes no sense at all.
Every month you ask for more money to pay out dividends to previous owners of "buttons" and make it look like the value of those "buttons" has gone up?

If I have misunderstood how this works, please explain in more detail.
Thank you
As for IPO & shares -- that's a misrepresentation on my part. I've tried to clarify it, and had trouble when originally naming it which is why it's a "hybrid instrument." They're more of a floating bond where the variable interest is determined by net operating profits.

As for the "soup" getting watered down - it's really being thickened. Previous BDK investment money is used to lend and purchase shares in bulk, either to flip or hold for dividends. Normally, this should result in increased profits, usually within 30 days, though sometimes it takes longer to "cycle" money. The 4.5% of BDK net operating profit increases in value as investment because investing in BDK increases assets without creating fixed-rate debt - BUT, it doesn't dilute the value of previous offerings. Those who got in last month paid ~.055/unit and have already received >10% of what they put in. For instance - this month's offering is the second wave of bonds/shares/whatever being issued. While it's also for 4.5% of BDK's monthly profits, that doesn't dilute the previous buyers' investment - they still will hold 4.5%, and that wave of investors always will while they hold BDK units - future offerings only increase the value of BDK unit holdings because BDK *should* be increasing profits with increased money invested in BDK. What's being diluted is my own cut of the profits each time I make a new offering, so I need to make up for that by bringing in enough money for my own "monthly split" to increase in value as well.


Cheers,

Ben

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June 02, 2012, 08:56:55 PM
 #122

Sorry - had meatspace stuff to do. I'm assuming I won't be selling the 1k units reserved for IPO today (.185/unit minimum). Regardless, here's a 3-minute warning.

ETA: 1k units reserved for IPO not sold. Current outstanding units = 8.1% BDK monthly profit. Distributing units to pre-IPO buyers.

Cheers!

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June 03, 2012, 12:48:40 PM
 #123


As for IPO & shares -- that's a misrepresentation on my part. I've tried to clarify it, and had trouble when originally naming it which is why it's a "hybrid instrument."

Thank you for clarifying this. I did not want to make your life harder or discredit you in any way. I guess GLBSE needs to add some new fancy securities to its list. Smiley


They're more of a floating bond where the variable interest is determined by net operating profits.
Yes and no. FRNs have a variable interest but it has nothing to do with net operating profits of the issuer. FRNs interest rate is a combination of so called spread (%) and some reference rate like LIBOR in the US. LIBOR+spred = rate you get from your FRN.

If you keep the new pile of BTC working as hard or better as the previous pile, we will be fine. Lets hope you understand the limits and do not get greedy. Wink
Cheers and thank you for clarifying this.

While reading what I wrote, use the most friendliest and relaxing voice in your head.
BTW, Things in BTC bubble universes are getting ugly....
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June 03, 2012, 10:21:47 PM
 #124


As for IPO & shares -- that's a misrepresentation on my part. I've tried to clarify it, and had trouble when originally naming it which is why it's a "hybrid instrument."

Thank you for clarifying this. I did not want to make your life harder or discredit you in any way. I guess GLBSE needs to add some new fancy securities to its list. Smiley


They're more of a floating bond where the variable interest is determined by net operating profits.
Yes and no. FRNs have a variable interest but it has nothing to do with net operating profits of the issuer. FRNs interest rate is a combination of so called spread (%) and some reference rate like LIBOR in the US. LIBOR+spred = rate you get from your FRN.

If you keep the new pile of BTC working as hard or better as the previous pile, we will be fine. Lets hope you understand the limits and do not get greedy. Wink
Cheers and thank you for clarifying this.

Thanks & right. I'm at the point where I'm denying CDs requests, now. Not running into scaling issues, yet, but I need to correct my judgment before taking on more liabilities. For example, putting $20k into Hermes so soon was a mistake. That's ~1/3 of BDK funds. Way too large a % of funds for a project too far off, and opening a dialogue with GLBSE about it was a near-fatal mistake. I over-committed myself, gave away too much too soon (I did this with the Kronos bond deal, too -- most of that should have been handled privately before starting a forum thread), and am kicking myself for it, now.

I tend to do well with loans, but I really shouldn't be allowing myself to buy equity in startups I don't fully understand in and out (and that means I'm due for learning some programming languages with emphasis on security -- I should be able to do code-review personally), especially not with such a huge % of funds. That was a mistake I won't repeat. It's effectively costing BDK ~$1k (between paying depositors & opportunity cost) every month until the product launches, and that's too expensive when it's compromising BDK's diversification. I'm definitely not blaming the dev team or JRO - I think both Kronos and Hermes will both be great products for the community and net equity-holders a boat-load of cash - but it was definitely an over-commitment by me to tie up such a relatively large amount of funds in it, and I & other investors are paying for it now.

Good learning opportunity, though. BDK should be better for it in the future. After I pay bondholders tomorrow, I need a break for 2-4 days. I'll make sure I have all my chips on the tables, then make up for neglecting family - maybe go watch a movie or something. Cheers!

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June 04, 2012, 04:04:10 AM
 #125

Before I take a break from the Internet for a few days, starting tomorrow - does anyone want to have a dialogue with me over the 0BTC dividend I'll be paying tomorrow, or anything else?

As to why BDK took a loss this week, it's due to CDs reaching maturity around the same time. I foresaw problems like this, and is why I originally wanted to do monthly dividends (and still do later down the road when BDK is ("I am") better-trusted), so stuff would have time to "balance out." As-is, the current shareholder dividend is calculated to be -4.86BTC, ~-5.5BTC after I pay dividends to BDK.BND-holders. This "debt" will be wiped using BDK funds, but I will not always be wiping debt, especially if "unit"-holders own >30% or so of BDK. There will very likely be a dividend paid on June 11th, particularly because I have no CDs due in that timespan, so the only expenditure will be ~27BTC to holders of BDK.BND.

I think it'd be a good temporary solution use amortization when calculating CD expenditure - and loan income, too. Instead of suddenly accounting for a 100BTC loss due to CD maturation, make it weekly. It would be easy to account for on the spreadsheets... Give a gain/loss per week column in the loan sheet, then in monthly I/O reports, use the sum of that column, and add a static amount I "paid on paper" for previous weeks to the current weekly amount lost/gained from interest each week. This seems like much more sound accounting to me, allow less volatile dividend returns, and would give me a better idea of how I'm doing, but am open to other ideas. Cheers!

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June 04, 2012, 05:25:29 AM
 #126

June 4 UPDATE
Dividend/share paid: 0.0BTC/share
Total dividend paid: 0BTC (-6.99BTC negative liability to shareholders being wiped)
Running total dividends paid in June: 0BTC

May 2012 Net Income Expectations
Optimistic estimate: 400BTC
Reasonable estimate: 100BTC
Pessimistic estimate: -150BTC
(Guesstimated weekly dividend payouts -- June 4th: 0.0BTC/share Actual: 0.0BTC/share, June 11th - .00063BTC/share, June 18th - .00018BTC/share, June 25th - .00036BTC/share)
* Kluge heads over to the scenic vacation destination of the deck.

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June 04, 2012, 04:16:11 PM
 #127

BDK down to 0.11
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June 04, 2012, 04:38:15 PM
 #128

BDK down to 0.11

Panic selling, surely. I was expecting something like this, due to the lack of dividends, and the general low returns expected this month.
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June 04, 2012, 05:15:28 PM
 #129

BDK down to 0.11

Panic selling, surely. I was expecting something like this, due to the lack of dividends, and the general low returns expected this month.

Bids are there, but no actual trades at that price.  You really have to check the ticker before saying its panic selling.

Anyone who wants to dump a lot of shares without moving the price can PM me.

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June 04, 2012, 09:07:22 PM
 #130

BDK's been traded @ practically nothing three times in the past couple weeks. I'd be willing to call those panic sells -- I believe those were moreso over the GLBSE drama than from no dividends being paid today. Someone saw enough opportunity in those sells to keep up some small bidwalls, now, so probably won't happen again. Anyhoo - will have to just wait it out for BDK to market to re-evaluate BDK once some solid dividends come out. At this time, I'm not intending to offer more than 500 units next month. 500 "pre-IPO", none reserved for offering date - but I'll wait to make a more firm commitment for 2-3 weeks when I can have a better gauge of the market on July 2nd. Should have a solid month in July, so will likely offer maximum amount again in August.
* Kluge heads back out to vacation, which is actually just another Chrome tab with a non-business spreadsheet.

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June 08, 2012, 09:42:14 AM
 #131

I'm alive! Kicked caffeine while on "vacation." 8 cups coffee per day -> no caffeine intake. - And I didn't kill myself!

Will place some phone calls today, see how everything's going, roll out the "amortization" update on the spreadsheet (not sure why I thought it'd be "easy" at first -- once everything's updated, it should be easy, though), add fees & profits from GLBSE trades to the spreadsheet (I've been getting lazy with that), then get to the PM backlog tomorrow. Also working on mechanics for "BDK-BLoC." "LoC" may be a giveaway.  Wink

ETA: Noticed some other things I really need to fix on spreadsheet. "Amortization" update may need to be put off until tomorrow.
ETA2: I also bought back 10k BDK.BND units @ face value a day or two ago, so profits will likely be a bit higher than originally estimated.
ETA3: May have a defaulter. Need to check on it. Two weeks without dividends would be pretty shitty.

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June 10, 2012, 08:31:57 AM
 #132

I'm alive! Kicked caffeine while on "vacation." 8 cups coffee per day -> no caffeine intake. - And I didn't kill myself!

Will place some phone calls today, see how everything's going, roll out the "amortization" update on the spreadsheet (not sure why I thought it'd be "easy" at first -- once everything's updated, it should be easy, though), add fees & profits from GLBSE trades to the spreadsheet (I've been getting lazy with that), then get to the PM backlog tomorrow. Also working on mechanics for "BDK-BLoC." "LoC" may be a giveaway.  Wink

ETA: Noticed some other things I really need to fix on spreadsheet. "Amortization" update may need to be put off until tomorrow.
ETA2: I also bought back 10k BDK.BND units @ face value a day or two ago, so profits will likely be a bit higher than originally estimated.
ETA3: May have a defaulter. Need to check on it. Two weeks without dividends would be pretty shitty.
Very likely default of 110BTC. I won't count this loss immediately, but space it out throughout next month assuming I don't receive payment. Loss = principal - amt. recovered selling to debt-collector.

Spreadsheet has been prettied up a bit. I'm still debating how to handle accounting for the "liability" of BDK in the event of a forced buyback. It's really "my" liability, not BDK's, but these two entities are so much connected, it takes some thought... I mean... if I file for bankruptcy, I wouldn't cede my BTC holdings. BDK would still operate. OTOH, if BDK had negative equity, I would not bail it out by further increasing my BTC holdings.


... I've also been thinking about splitting BDK up further. Since BDK has transformed dramatically from what it was at the time of the IPO, and become much more an investment bank than a "lending operation," and I'm a bit more comfortable with issuing securities... I think I want to create "subsidiary funds" of BDK. My idea is to create 5 or so securities, each with a specific investment category: BDK.FND.MINING (self-explanatory), BDK.FND.BTCSEC (investment in non-mining industrial and commercial Bitcoin-related ventures such as Kronos, BitVPS, and GPUMoney), BDK.FND.USDSEC (investment in industrial and commercial ventures unrelated to Bitcoin -- there were some interesting loan requests in the business loan form I posted a while back -- I was expecting more stuff along the lines of BitVPS, but instead found requests from people opening "deluxe" massage parlors in Canada, and a fellow doing something with lasers which was way over my head), BDK.FND.INTERESTFREE (gratuity-based loans to reputable individuals, with no gratuity required), and BDK.FND.ABNORMAL (the weird shit. Satoshis Daemon, IMPACT, Bioethanol -- I'm sure I could find odder [and profitable!] investments if someone gave me the funds to do so - though that's certainly not encouragement to do so Tongue).

Anyhoo, BDK would take 10% off the TOP of these funds' net profit. No profit, nothing for BDK from that fund. However, by splitting everything up, BDK also minimizes its potential reportable losses (less the security revaluations I post, and need to do again soon). Additionally, investors are able to invest in the sector they choose, or they may continue to invest directly in BDK so they're exposed (for better or worse) to all the different sectors BDK's currently in. BDK will likely keep interest-bearing loans to itself, and BDK-BLoC is expected to bring a lot of new, safe, profitable business that way. BDK would do equity-swaps with these funds, but this can only be done before the IPO, with the deals posted publicly, to ensure I am not allowed to do any scammy nonsense where BDK receives more than FMV for its holdings. For what BDK invests using securities, it would receive fund units and receive dividends as any other normal unit-holder. From that point on, if BDK wants to invest in one of these funds, it must send that fund BTC. Wallets would be kept totally separated.

To summarize that, BDK would be split up 6 ways. Five "subsidiary funds," with interest-bearing loans staying with BDK, the parent company. BDK will swap securities with these various subsidiary funds, receiving, for example, 500BTC worth of BDK.FND.MINING for 500BTC worth of YABMC. BDK's profits will remain exactly the same, except it will also collect an additional 10% off the top of these various funds' net profits. So... say 50% of total BDK.FND.MINING units are held by BDK, 50% by others. In that scenario, BDK will effectively receive 55% net profits (50% it owns + [10% of 50% others own]). I think, this way, I'd be much more willing to take on liabilities than currently, where I'm turning down potential CD-holders and buying back bonds.

(.... .... If I keep writing like this, I'll develop schizophrenia for sure.)

I'll talk about BDK-BLoC some other time. I have papers written on it as well as on the benefits of setting some general interest rates in collaboration with the lending syndicate. Eventually, we will need credit agencies, too. I think the community's still tight-knit enough where we probably don't need independent audits... though eventually, that will become a necessity - but for now, analysis of company's income statements would be adequate and a huge step up from now.... BDK-BLoC will have an auxiliary objective of prodding BTC businesses to open up their finances to the public. (rambling, again -- sorry)

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June 10, 2012, 08:30:23 PM
 #133

So - in all this rambling, I'm really kind of not sure where BDK stands.

I understood above that the GLBSE contract for BDK was to be changed - it's not changed on GLBSE.
(changing the buyback numbers, in particular) - so this is not very clear - and certainly affects traders who are not present in this thread.

It seems confusing what the plans are above. It's not very clear if these funds are supposed to produce revenue for BDK holders or not.

It's especially disturbing to see some comment about your bankruptcy? What's going on? Comments like that are very discouraging on top of news that there is essentially no revenue.





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June 10, 2012, 09:46:32 PM
 #134

So - in all this rambling, I'm really kind of not sure where BDK stands.

I understood above that the GLBSE contract for BDK was to be changed - it's not changed on GLBSE.
(changing the buyback numbers, in particular) - so this is not very clear - and certainly affects traders who are not present in this thread.

It seems confusing what the plans are above. It's not very clear if these funds are supposed to produce revenue for BDK holders or not.

It's especially disturbing to see some comment about your bankruptcy? What's going on? Comments like that are very discouraging on top of news that there is essentially no revenue.
Just throwing stuff out, seeing if anyone has any opinions/ideas. I can get my head in the clouds sometimes, waste time on pointless hypotheticals. Obviously, I have no intent to declare bankruptcy, and am not at any risk of it. There have been decent revenues this month (~160BTC after I account for securities sold for a gain today), but losses have been pretty hefty, too, due to having to account for 130BTC in losses to pay interest on CDs and bonds due within the first week of the month. Additionally, $20k of BDK funds are still tied up in Hermes, largely sitting there at the moment. That's being sorted out within a few hours, so they can find a nice, productive home, and start earning money instead of just costing money to maintain. It's not reasonable to look at week-to-week performance, and is why I initially did not want to have BDK dividends paid every week, but I worried there wasn't enough trust for me to pull that off. Ironically, it turns out having a week without dividends has created its own dent in trust, even if only temporary. I have the formula ready to have loan/deposit interest spread out over time, but this will only affect loans/deposits made after I made the change this morning.

I'm pretty certain I asked for the contract on GLBSE to be changed many weeks ago and was told it was. I'll prod people to get that corrected (Issuers aren't allowed to change the contract on GLBSE -- Nefario has to do it manually, and that's why I frankly don't consider it valid). I know I talked about that with Nef in IRC, but I believe I have email logs about the contract changes. I'll post it if I find it when I get to main PC. The contract in the OP of this thread is *the* contract, and the contract I will abide by. I'd send a message to shareholders through GLBSE were it possible.

The funds would be targeted at providing investors options instead of just getting the current two options - one a bit bland (BDK.BND), and one with pretty broad involvement in various sectors (BDK). BDK would effectively be the parent company of these "funds" - and these funds aren't something concrete - just probing for comments. As I posted, BDK would receive dividends from these subsidiary funds just like any other security-holder, so BDK profits on what it contributes to these funds would earn revenues as they currently do. Rather, BDK would receive exactly what it currently does on investments, plus take 10% of net profits from non-BDK investors in these subsidiary funds as a management fee. However, I think BDK would benefit beyond that 10% in that I'd be willing to take on liabilities if BDK is not liable for more than it puts in were, say, "BDK.FND.ABNORMAL" to invest in an alpaca farm that goes bust. Having more OPM (Other Peoples' Money) is extremely important because that's how I get access to the backroom deals, where huge chunks of securities can be bought at dramatically reduced rates. I'm struggling a bit to do this now with so many funds committed. There's a bit of a scaling issue going on. I have access to the deals now, but I'm uncomfortable having BDK directly take on more liabilities than there is equity (which is why I bought back 1kBTC worth of BDK.BND and turned down some interested in buying CDs).

Long-term, I believe the best way to go forward (again, not set in stone) is to do a forced buyback toward the end of the year, own all of BDK without buyback liability (I think creating "BDK" may've been a mistake on my part thinking now of all the other ways I could've gone about this), then have anyone with interest in investing with me either buy BDK.BND or one of the "funds."


Any other questions - throw 'em at me while I'm up. Cheers!

ETA: And now I'm down. See y'all tomorrow.

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June 11, 2012, 05:41:45 AM
 #135

June 11 UPDATE
Dividend/share paid: 0.00121358BTC/share
Total dividend paid: 9.83BTC
Running total dividends paid in June: 9.83BTC

June2012 Net Income Expectations
Optimistic estimate: 300BTC
Reasonable estimate: 125BTC
Pessimistic estimate: -75BTC
(Guesstimated weekly dividend payouts -- June 4th: 0.0BTC/share Actual: 0.0BTC/share, June 11th - .00063BTC/share Actual: 0.00121358BTC/share, June 18th - .00014BTC/share, June 25th - .00036BTC/share)

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June 11, 2012, 11:54:58 AM
 #136

Sounds like BDK is thinking about adopting the Macquarie model.

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June 11, 2012, 07:01:47 PM
 #137

OK. Thanks for clarifying all that I definitely noted the better than expected earnings this week.

I'm personally not really wild about the way the contract situation works @ GLBSE, so I'm only concerned really about the potential effect it has on people who read nothing but that. (the numbers on the contract do not support the current market price)

I also am not hugely in favor of weekly dividends - it lessens the degree of trust needed by the investor, thus decreases the investors risk, and therefore decreases the potential reward in the long run. But - this is what the market has chosen in the short term Wink

Knowing that, indeed, BDK will hold some of those newly created securities is good, however, I do share some of the concern expressed by brendio, above. It's a lot of debt, with not a lot of tangible equity. While most investors are shying away from equity deals, IMO, any one entity with too many debt deals, and no equity offering is starting to look  more risky. Even more concerning if you continue to release additional shares of existing offerings also. In reality, if done correctly,

From other discussions, it seems like a 10% management fee for the funds is a little high. YMMV, of course Smiley

Quote
Long-term, I believe the best way to go forward (again, not set in stone) is to do a forced buyback toward the end of the year, own all of BDK without buyback liability (I think creating "BDK" may've been a mistake on my part thinking now of all the other ways I could've gone about this), then have anyone with interest in investing with me either buy BDK.BND or one of the "funds."

There are several paths this could take - currently this looks like a pretty significant liability (at the august buyback price) or, really, significant risk for shareholders at later prices if share prices do not significantly increase. So - the date of the buyback is probably very significant.








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June 11, 2012, 07:43:45 PM
 #138

For the sake of clarity, the price I'll pay when I initiate a buyback (assuming it's after August 2nd, which it almost certainly will be) is ((.32+5daywtdavg)/2), so even if the 5-day weighted average trade price of BDK some time in October were .1, I'd be buying back @ .21BTC/share. I wouldn't be too willing to listen to unitholders' complaints at that price given I've earned ~.11BTC/share from issuing and selling BDK so far.  Tongue


With that in mind, I'd like to state it's very possible I will not be issuing an IPO on July - possibly August, too, and want to point out that I'm not contractually obligated to actually issue and sell shares on the 2nd day of each month until August 2nd. There will be an IPO when I believe the price justifies the time and buyback liability (noting an offering can only occur on July 2nd or August 2nd, until August 3rd, when I can issue & sell whenever I please). I have also reconsidered the multiple funds idea, and will not be going forward with it. I doubt, even with a 10% fee off the top, there's enough potential profit to justify the time.

I will be a bit less talkative in this thread and with unit-holders. I'm at my peak workload right now and have a backlog of PMs I need to get to again. I will not be reducing my commitment to BDK operations, but I promise to spend much less time thinking about new securities to issue.  Wink

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June 12, 2012, 06:56:33 AM
 #139

[...] however, I do share some of the concern expressed by brendio, above. [...]
It's a moot point now that the satellite fund model is off the table, but I would like to clarify my above post. The Macquarie model was highly profitable for Macquarie during the boom and the reasoning behind it is similar to Ben's thoughts using it with BDK. It segregates the risk, while still benefiting from some of the upside. The ones getting the rawer deal is the investors in the satellite funds, but Macquarie found plenty of takers for their funds and I think there are plenty of suckers willing investors in the bitcoin world to fuel the model here for a while yet.  Grin

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June 13, 2012, 07:06:25 PM
 #140

Finally got around to finding the email I sent to GLBSE about the contract change:

From: "B.R." <benjm00@gmail.com>
To: "GLBSE Support" <support@glbse.com>
Subject: Re: Contract Changes
Date: Wednesday, May 09, 2012 4:00 PM

Oh. While you're poking around in the DB - any chance I could have BDK.BND
launch ASAP? I think it's supposed to go live in ~6 hours, but I'd like to
get to barking for it before going to sleep.

Cheers & thanks always for the help.

On Wed, May 9, 2012 at 3:55 PM, B.R. <benjm00@gmail.com> wrote:

> Howdy. I'd like to have two contract changes committed. First, the BDK.BND
> contract should be updated to read as follows:
>
>
> ----
> BDK.BND pays 1% of face value every week (Monday). Percentage will remain
> at 1%/week until the bond is bought back by the bond-issuer ("Ben Malec").
> Bonds will be issued @ .1 BTC each. Thus, each share will pay .001BTC every
> week. There is no limit on how many bonds may be issued nor when they may
> be issued. Bonds can be issued and sold without warning by the bond-issuer
> at any price he wills. Bonds cannot be sold back to the bond-holder except
> in case of a buyback. BDK.Bond does not have a set date of maturity.
>
> "Buyback" -- The bond-issuer may buy back all bonds at a price of
> .101BTC/share at any time he wills, without warning. In this case, the
> bond-issuer will use GLBSE's forced buyback feature to pay .101BTC/share.
>
> "Contract Changes" -- The bond-issuer is not permitted to change this
> contract at any time under any circumstance. To "change the contract," a
> buyback must be placed and a new bond asset listed on GLBSE.
> ----
>
>
>
> While it states there should be no contract change, the IPO has not yet
> occurred. No pre-IPO shares have been issued, and potential bond-purchasers
> have been alerted to the change on the forum (yesterday, I believe). The
> only change was made to the "Buyback" provision to account for the new
> forced buyback feature. If you really need a (meaningless, since it can be
> postponed) date for it to mature, it can be set to 5/10/12. It's so soon
> because IIRC, I can't do a forced buyback until the present is beyond the
> set date of maturity.
>
>
> The second contract change I'd like is for BDK. Since the contract was
> issued, multiple changes to values (all beneficial to shareholders) and
> some clarifications were made. While I state in the contract that 60 days
> must elapse after I've made the change public, since the changes are all
> beneficial for share-holders and nobody has objected to the changes being
> committed immediately. Understand if you insist on waiting for these
> changes to be committed to GLBSE. However, I will be honoring the
> shareholder-favorable changes whether the GLBSE contract is updated or not.
> The modified contract is as follows:
>
> ----
> Ben Malec (referred to within this contract as "me," "myself," "I," and
> "operator") will issue 100,000 shares of "BDK Hybrid Instrument." Each
> share not controlled by the operator represents .0009% of BDK's monthly
> profit.  Dividends will be paid every Monday, starting May 7th, 2012.
> Dividends will not be paid on the first of the month unless that happens to
> be on a Monday. 100,000 shares will be issued. Up to 5,000 shares are to be
> sold on the second day of each month for four months, starting on the month
> of May, 2012. After that time, shares may be issued at will of the operator.
>
> Additional provisions
> "Operator Equity" - The operator holds all equity of BDK. Shares are not
> tied to equity, and represent only .0009% of BDK monthly profits.
>
> "Shareholder Votes, Non-binding Motions" - While motions may be
> introduced, they are non-binding. They exist only so the operator may gauge
> opinion of those invested in BDK's success.
>
> "Change of Contract" - The operator is fully permitted to change the
> contract at will, without consent of shareholders. However, the modified
> contract is not permitted to go into effect until sixty days after the
> changes are made public. When the contract is changed, the operator will
> honor the ability for shareholders to sell shares back to him at a price of
> .125 Bitcoins per share between the time a change is made and the time 60
> days have elapsed since the change was made public.
>
> "Buyback" - At any time, the operator is permitted to buy back shares
> issued. The operator will pay .64 Bitcoins per share if the operator buys
> back BDK shares prior to August 3rd, 2012. If August 3rd, 2012 or later,
> the operator will pay ((.32 Bitcoins + GLBSE 5 day weighted average of
> trade transaction amount per share of BDK shares)/2)
>
> "Share Value Protection" - If shares trade for less than ?.01 on GLBSE for
> at least 168 hours continuously, the operator MUST issue a bid order of
> ?.05 in an amount which equals 50% of shares issued not controlled by the
> operator. The "168-hour timer" does not again reset for 26 weeks after the
> "Share Value Protection" provision was last called to action.
>
> "Negative Equity and Operator Liability" - BDK is permitted to operate
> while having negative equity so long as BDK has not had negative equity for
> 90 consecutive days. On the 90th day of having negative equity, the
> operator will be held personally liable to pay shareholders $.10/share (or
> ?.02/share, whichever value is lesser). In cases where BDK is unable to
> achieve due to reasons unrelated to BDK experiencing prolonged negative
> equity (operator experiencing imprisonment, debilitating illness, GLBSE
> being hacked and made unusable, EMP strikes, police raid, or death, for
> example), the operator is not liable.
>
> "IPO Value Preservation, Operator Trading" - The operator is not permitted
> to ever sell shares for less than he previously sold them for. However, he
> may sell shares for an amount equal to or greater than the amount he
> previously sold them for at will.
> ----
>
>
> Cheers,
>
> Ben
>

Nef PMd me on IRC after I sent those, but I don't have logs of what he said (I don't remember, either, except that he said he's uncomfortable having the BDK.BND IPO launched before schedule). Sent another email to GLBSE about it. Fwiw, 60 days hasn't elapsed from when I stated that change would take effect, which may be why Nef didn't change it. It was stated on April 28th, so 60 days would be June 27th.

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June 13, 2012, 11:12:41 PM
 #141

*straightens tie, exhales slowly, keeping in mind that BTC was worth ~$5.20 at the last valuation*

Last Valuation on 5/28 -- today is 6/13

GLBSE Securities Re-valuation (reconciliation between BDK sheets & GLBSE 5dayavg):
Cognitive: BDK - .611BTC/share, GLBSE - .599BTC/share -- total loss of 12.672BTC on paper
BitcoinTorrentz: BDK - 1.01BTC/share, GLBSE - .74BTC/share -- total loss of 1.08BTC on paper
YABMC: BDK - .3BTC/share, GLBSE - .258BTC/share -- total loss of 675.444BTC on paper
REBATE: BDK - .201BTC/share, GLBSE - .172BTC/share -- total loss of 27.356BTC on paper
BitVPS -- new purchase: 0.003125BTC/share (27.68k purchased)


Total securities FMV change since last valuation -- loss of 716.552BTC.


ETA: Contract on GLBSE has been updated. Thanks, Nef.

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June 17, 2012, 04:45:41 PM
 #142

Hey, everyone. A small update. I've been neglecting the public spreadsheet a fair bit. "Keeping up with it" will largely be a problem of the past once BDK-BLoC is launched. BDK-BLoC will take on a larger scope than I originally imagined, effectively becoming the "me" most people talk to when they have business to discuss, and will handle CD sales and repays. Additionally, because I am able to separate access/edit privileges, I may soon hire and permit an employee to do some of the more time-intensive parts of maintaining that website (scoping out companies, ID verification, filing an internal evaluation with me, and calculating their credit score using banks' template Starfish generously posted which I altered a bit, as well as reviewing new financial reports the company submits and updating the credit scores as necessary). Additionally, I can give that employee my GLBSE .csv, BDK-BLoC .csv files, and have him fill out the I/O reports as appropriate. I do enjoy the accounting, but I don't have the time, and the spreadsheet's wildly out of date, with inaccuracies accumulating.


Hiring an employee allows me to spend my time talking with the Movers/Shakers, working on deals, and concerning myself more with meta, big-picture stuff, including fundraising for BDK and revisiting doing securities offerings for Producers. I've decided to remove my coins from Hermes/Icehill, which I got a green-light on yesterday, and will instead issue a lesser USD loan to Icehill's 20Mission Project at more reasonable rates. I also learned last night that I will be gifted a 5% equity stake in Icehill upon its public registration, which was very surprising, very pleasing, and very much appreciated. This asset will be considered a part of "BDK." I'm excited to continue working with Icehill and the associated players.

BDK dividends tomorrow will be ~.00045/share after I receive 18BTC from imsaguy, pay 36BTC interest to a CD-holder and 16BTC to BDK.BND-holders. There was another potential default on ~60BTC, which will be counted in next month's report (principal - bad-debt-sale) after I'm certain it's an intentional default.


Cheers!


ETA: If someone's interested in doing the tasks I outlined in the first paragraph, it should take 5m-90m per day (excluding additional workload upon BDK-BLoC launching) to reconcile GLBSE .csv & BDK Google Doc, and account for the daily transactions I'll email/Skype to you. Once BDK-BLoC launches, workload will increase quite a bit. Initially, I'll be willing to pay 1BTC/day (paid on Mondays when I do the rest of the dividends) - work on your own terms, just get everything in there and updated by the end of the day. Once BDK-BLoC launches, I'll probably be willing to move up to 2BTC/day, and give raises as workload increases if performance doesn't deteriorate. You must be fairly competent at spreadsheet software (incl. Google Docs), be willing to use Skype, and have the initiative/generosity to prettify & prune the sheets, adding new statistical calculations as would be helpful.

ETA2: Updated spreadsheet. The ~60BTC loan I talked about maybe being a default likely will not be. Lendee just contacted me. Cheers!

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June 18, 2012, 04:46:13 PM
 #143

Sorry for later-than-usual dividend - took car to mechanic, did some shopping this morning. Waiting on 6 confirmations. Dividend will indeed be .00045/unit.

Cheers!

ETA: Derp. They would have been .00045 if there were 8100 shares, not 9000. My bad  Lips sealed

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June 18, 2012, 05:06:12 PM
 #144

June 18 UPDATE
Dividend/share paid: 0.000406688BTC/share
Total dividend paid: 3.66BTC (I had a tiny amount leftover in the account, now that I've realized so true dividend paid is 3.66002 -- enjoy  Tongue)
Running total dividends paid in June: 13.49BTC

June 2012 Net Income Expectations
Optimistic estimate: 175BTC
Reasonable estimate: 75BTC
Pessimistic estimate: -50BTC
(Guesstimated weekly dividend payouts -- June 4th: 0.0BTC/share Actual: 0.0BTC/share, June 11th - .00063BTC/share Actual: 0.00121358BTC/share, June 18th - .00014BTC/share Actual: 0.000406688BTC/share, June 25th - .00036BTC/share)

ETA: Looks like GLBSE refuses to take dividends which aren't large enough to send at least one satoshi to each unit-holder. That explains why I had .00002BTC left in the account, so the actual total dividend was 3.65994BTC. The difference between that and what's owed will be carried over to the next month. Sorry.

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June 19, 2012, 04:38:06 PM
 #145

I'll have ~3.25kBTC coming to me within a week. I want to convert 1kBTC to USD to lend to a project I'm familiar with @ ~2.75%/month. Keep in mind that I paid 2.5%/month for USD deposits a bit over a month ago, and that depositor isn't me, so couldn't trust my intentions or know my situation as much as I can.

The remaining 2.25kBTC are currently uncommitted. I'd like to sell off into this rally and use the USD to loan to myself for the purchase of a house, and I'd like to pay no more than 2% monthly on it to be repaid as soon as our house in PA sells (it's been on the market for ~3 months, now, so I'm not holding out too much hope of it selling within, or otherwise have enough funds to pay it. Partial repayment would reduce interest payments.


Thoughts?

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June 19, 2012, 04:44:20 PM
 #146

Subbed, and interested to see where this might lead to.
Just one thing to add: Be careful that this might only be the start of a rally.  Wink

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June 19, 2012, 05:02:19 PM
 #147

Subbed, and interested to see where this might lead to.
Just one thing to add: Be careful that this might only be the start of a rally.  Wink
Yeah - there's fx risk. I'm thinking I should start trying to get more USD CD sales to hedge with, then I could effectively lock rates in -- as my USD debt decreases as BTC price rises, so too do the depositors' CD value in USD - and opposite if BTC decreases in price. The alternative is staying entirely in BTC, but dumping all my securities, because almost all of their BTC value decreases as the exchange rate rises. - and BTC's great, but for startups, USD pays the bills.

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June 22, 2012, 02:26:20 AM
 #148

Probably won't need a home loan at all, which is nice. Someone on the forum even offered me a free house (in need of some fairly large repairs/appliances [like... a furnace], but still crazy-generous). Figured out how to handle some tax issues in a brilliantly simple way... so everything's looking good.


BDK spreadsheets need a massive overhaul. It's not reporting enough information, and too much shit's lumped together when it should be split up, then all come together in the summary sheet. Google Docs is cumbersome and inadequate for complicated work. When I do the spreadsheet overhaul, I'll do my work in Excel, and publish sheets each week. I'm going back and forth from MI to IN to look at various houses, so haven't been around too much the past couple days, and will likely be only sporadically online for the next couple weeks. June 25th dividend guesstimate looks to be right on target ATM. Oh -- just noticed I messed up the last weekly report.... will fix that. ETA: Done.

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June 24, 2012, 08:34:52 AM
 #149

Relevant cross-post:

Fwiw, the end goal is to re-release BDK.BND @ .65%/wk (roughly 2.625% monthly, little over 40% per year - assuming you reinvest dividends -- without reinvestment, ~2.6% monthly, 33.8% annually). I intend for this to be the one and only reduction in rates, and in the contract, 6 months will be required to elapse before I recall the bond. 1%/wk is doable for now, but I'd prefer to allow allow investors to "set it and forget it," and this rate should be acceptable for many months, perhaps years. Some extra breathing room makes me happy, too.

The future BTC CD rate is intended to be 3%/32D, 6.75%/63D. The future USD CD rate is intended to be 1.25%/32D, 3%/63D. Bonds and CDs will, in some way, be allowed to convert to each other once everything's sorted out for the re-launch, which probably won't be until early August (+- a month) -- buyback will occur as soon as I get the funds I've requested back, which should have been nearly a week ago....

The BTC prime rate (minimum lending rate, reflects only BDK's opinion) is expected to be set at 3.55% per month, ~0.1267%/day. The USD prime rate (minimum lending rate, reflects only BDK's opinion) is expected to be set at 1.6% per month, ~.057633%/day.

Thus, for USD loans, a most creditworthy business can expect to pay ~51.985% annually for BTC loans. For USD loans, that rate will be ~20.983% annually. For comparison, SMB loans in the US are typically made with the business paying ~6-10% annually in interest. Meanwhile, US credit cards, which are more in line with what BDK-BLoC seeks to compete with, charge ~11-23% annually (avg is 14% or so for business cards). We'll get there eventually.


-----


Additionally, I ended up finding a different dev for BDK-BLoC (due to no fault of the original). The dev costs have not been determined, but will probably be around 150-200BTC. He's expected to start work this Thursday. A designer will not be hired. Maintenance costs will be ~5.5BTC/month total for two VPS servers (through BitVPS) + domain hosting. I believe BDK-BLoC will be worth the costs due to me being able to go on "auto-pilot" for some of the more trivial-but-time-consuming stuff, while helping Bitcoin businesses, and forcing transparency into the Bitcoiniverse. I will feel much more comfortable being able to secure low-risk loans, and pleased the funds are going toward projects which will ultimately benefit every user of Bitcoin. As such, I will resume taking on debt (I've been fairly aggressively buying back debt the past few weeks), which I believe will ultimately result in an increased %RoE. With BDK-BLoC establishing a relatively low "minimal profits" Prime Rate, and forcing the lending market below "natural" rates, I believe BDK will continue to nurture long-term beneficial business relationships with the Producers of the community, as well as foster trust with those businesses enough for them to purchase CDs in times when they have excess funds, even though I do not offer the high yields of many other lenders accepting deposits. The benefits of being a mutually-beneficial business as opposed to a regretted "lender of last resort" far outweigh the cost of operating at reasonable (though ultimately sustainable) profit margins on coin-shuffling. I'm extremely bullish on BDK's mid-term prospects, enough to offer any investor interested July pre-IPO BDK units well above market price @ .22BTC each and feel generous about it. There is a limit of 4k units to be sold by July 2nd, and none of them will be posted on GLBSE. As always, if they don't sell, they don't sell, and I keep the units for a later time.

Dividends are now expected to be roughly .00031/share, though that may change for the better tomorrow. Securities re-valuation and monthly guesstimates for July will be posted sometime before the end of the week. Additionally, I'll try to remember to clearly state BDK's position in the various securities held when I post the re-valuation. My current sleep schedule allows me to be up while family's asleep, so I can get a fair bit done. First priority is to get BDK-BLoC mock-up and formulas complete, then I will re-vamp the public spreadsheet. After that, there's a lot I need to think about regarding Icehill and 20Mission. I'm extremely excited to be hearing everything in development, and progress being made. For everything "lost" in the ASIC mining bond panic sales, the Icehill equity gift.... well - BDK is undervalued by a fair bit, IMO, though it will be difficult to determine by how much until a few months pass.  Smiley

I'm pleased to be meeting so many new people lately. We have added new people to our lending group, including finance professionals and academics, who will surely help us act more efficiently. The more people I know, the more I can do, and the better it can be done. Money's great, but it's easy to squander when not gaining wisdom from co-workers and associates. So - thanks, everyone, and a special thanks to those who call me out and keep me in line.

Cheers!

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June 24, 2012, 03:50:12 PM
 #150

Thanks for the big update, Kluge!

Maybe I've been afk too much, but I have a few questions:

1.  Are you still planning to move?  And find a "regular day job"?  If so, will this affect the amount of time spent on BDK (and hence the profitability)?

2.  BDK-BLoC is part of BDK, right? (won't be a separate glbse ticker)

3.  What happened to IOU?

4.  Would you consider publishing a proper Balance Sheet and cash flow statement at least monthly?  The spreadsheet is hard to follow for some of us more used to GAAP-style statements.

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June 24, 2012, 07:18:06 PM
 #151

Thanks for the big update, Kluge!

Maybe I've been afk too much, but I have a few questions:

1.  Are you still planning to move?  And find a "regular day job"?  If so, will this affect the amount of time spent on BDK (and hence the profitability)?

2.  BDK-BLoC is part of BDK, right? (won't be a separate glbse ticker)

3.  What happened to IOU?

4.  Would you consider publishing a proper Balance Sheet and cash flow statement at least monthly?  The spreadsheet is hard to follow for some of us more used to GAAP-style statements.
1. I still plan on moving, hopefully within a month, and it won't be somewhere terribly far away. The moving process should take less time than the Realtor process. I'll probably not take a regular day job - at least not for a year or so. Likely, wherever we move will require a lot of work to bring up to a habitable standard, and I'll probably take a day's break three times a week or so to do that. If I neglect BDK too much where operations are affected and it's noticeable, I'll spend more time on it.

2. BDK-BLoC is a part of BDK. Every loan and CD transaction relating to BDK-BLoC is counted as a part of BDK. What BDK-BLoC allows is the automation of many of my current tasks (among some other stuff), which are definitely "BDK tasks."

3. It's been tabled for the time being. AFAIK, that GLBSE account is still restricted. I'll probably get into doing something with a similar goal to IOU, but alone, and with less ambitious goals. IOUcoin.com may end up being repurposed as the site for BDK-BLoC. Dunno if that's too tacky, though, heh. Eventually, the name "BDK" needs to be scrubbed, and the lending operation renamed, as I originally tied the acronym to "banco," when BDK is not a bank in any manner of speaking. Being in the US, that poor word-choice could result in extreme legal consequences (depending partially on what the gov't determines a "Bitcoin" is) if I don't make absolutely sure nobody associates BDK with "bank."

4. I gave a monthly report for May @ https://bitcointalk.org/index.php?topic=77343.msg933687#msg933687 -- Same will be done for June. If there's anything in particular you want to see, I can include it. I'll look through some examples and try to better-standardize my books. I do need some education on GAAP, so I'll see what I can find. Then, when I completely overhaul my spreadsheets around the end of this week, there'll hopefully be something detailed, easy-to-follow, and perhaps even enjoyable to read (Graffs!).


Cheers!

ETA: Pleased to announce it's very likely BDK-BLoC will be released open-source. ETA2: I should also note all the important information which gets lost in this forum thread will be posted on the website. Can have it on an old, general-purpose host when I finish with the spreadsheet overhaul.

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June 25, 2012, 06:36:31 PM
 #152

Dividends ended up below target. To pay dividends for BDK.BND & BDK, I had to sell some YABMC, resulting in realizing the loss of ~9BTC. Bad month as far as profits go. Will be pleased for it to end.

June 25 UPDATE
Dividend/share paid: 0.00023112BTC/share
Total dividend paid: 2.08BTC
Running total dividends paid in June: 15.57BTC

June 2012 Net Income Expectations
Optimistic estimate: 85BTC
Reasonable estimate: 50BTC
Pessimistic estimate: 25BTC
(Guesstimated weekly dividend payouts -- June 4th: 0.0BTC/share Actual: 0.0BTC/share, June 11th - .00063BTC/share Actual: 0.00121358BTC/share, June 18th - .00014BTC/share Actual: 0.000406688BTC/share, June 25th - .00036BTC/shareActual: 0.00023112BTC/share)

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June 27, 2012, 03:41:56 AM
 #153

20.01BTC paid for multiple VPS services, billed quarterly, so BTC6.67/mo will be counted as "Misc" starting next month. Expenses are one-off, so not really an operational expense, but a capital expense. My intent is to call hosting an operational expense, while the 150-200BTC for dev-work will be called a capital expense, amortizing over twelve months.

Thus, BDK-BLoC will effectively cost something like 21.25BTC/month for twelve months, only VPS hosting costs thereafter.

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June 29, 2012, 09:26:54 AM
 #154

It's very likely we will be starting July with a first week's dividend (July 2nd) of 0BTC, with another zero-week likely on July 11th. The 18th & 25th should show modest to respectable dividends. Depending on just how large the losses of the first two weeks are, I may eat whatever BDK-holders would otherwise be "liable" for ("liable" meaning losses would rollover and negate future dividends).

In the larger scope, it's likely earnings will be very low (potentially negative) for July, and possibly August, though things may pick up by then. Not to apologize for poor performance, but just to point out exactly why BDK's earnings are so bad lately - take a look at the Securities sheet. You'll notice both Hermes and GPUMoney. Combined, they make up almost the entirety of BDK equity. GPUMoney investment will likely be mostly refunded within the next couple weeks -- the objective of the project was to put out a miner which interfaced with a website, where individuals (gamers, likely) would run the miner, and accumulate points toward purchasing Steam items and games. Development for the project seems to have stalled, and has otherwise been fairly slow. With ASICs fast approaching, I do not believe the project has a profitable outlook long-term, and it seems like it will be scrapped, pending agreement by all investors. Hermes, as many are already familiar with, was a project intended to become the premier BTC listing platform, with emphasis on Kickstarter-like features, and giving Issuers a strong voice. This project has been put on hold for at least a couple months due to a dispute with GLBSE. There have been many changes and a restructuring of Icehill, the soon-to-be publicly-registered Icelandic company, which will implement developed projects (Kronos, REBATE, PawnCoin, and many others). While Icehill projects are still being developed, Hermes is currently not, and as such, the money invested will be refunded in full, but this relies on Icehill acquiring funds to do so. BDK has been gifted 5% of Icehill equity, which will be realized in the future, along with a valuation of what that's worth. However, while funds have been stuck in "Hermes," they have accumulated no revenues -- it was strictly an equity deal.

So, what that last paragraph effectively means is that BDK's earnings this month are effectively the reflection of BDK operating as if it had no equity for the whole of June. As investment money is refunded, it can be used to generate revenues for BDK, which is when revenues will pick back up. I do not know exactly when that will be... I was hoping about two or three weeks ago, but it may be a couple weeks in the future, still. I've been experimenting a lot, trying to figure out what works and what doesn't. Moving BDK from loans to securities was a high-risk move which did not pan out exactly as I would have liked. This is certainly not limited to Hermes (in fact, the 5% equity gift from Icehill, I believe will be worth >$40k within a year, and will be the largest, most ambitious, and long-term-minded service provider in the whole of the community, with a great many services to fall back on if they have both studs and duds). Rest assured, BDK will never again be majorly involved in equity, but hold very little other than debt. Though, that isn't to say BDK will not take on additional tasks such as purchasing and repackaging/reselling securities from project managers.

Future spreadsheets will need to start accounting for depreciation of mining bonds, which will cut hard into profits, because it should have been accounted for in the past, but I neglected to do, assuming the market would not react nearly as harshly as it has to recent events. Combine these loss-creators with amortization of BDK-BLoC capital expense starting next month, I would guesstimate it's almost certain July will be a negative-profits month if I am unable to quickly secure repayment of investment money into no-longer-developed ventures. Once investment money is repaid, however, %RoE should be around 4-8% monthly (if BDK had funds to repay almost all deposits and bonds, June %RoE would have been around 6% -- May's 17.7%RoE was definitely a fluke).

I do have some positive news, though... BDK-BLoC is currently in development, and the dev's doing great work. He's very communicative, accepts pay by milestones completed, and walks me through what I don't fully understand. BDK will likely be renamed to IOU. This is a wholly a legal precaution, to prevent BDK from being confused with a bank. Simply saying "BDK" stands for nothing is inadequate when it's been put out in the past that BDK represents "Banco de Kluge." It does not. "BDK" is not a bank. Possibly, the project will be renamed "IOU," after the tabled "purchasing/reselling" venture, which may also pop up again in some form by the end of this year.


Any comments/questions - I'm all-ears.

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June 29, 2012, 03:21:04 PM
 #155

I appreciate your frankness in reporting, Kluge. I think the up and down are to be expected in a start up operation of this type and the weekly dividend cycle in the bitcoin world exaggerates this. Meatspace companies usually pay dividends biannually, so these up and downs can be smoothed out and not affected so much by the timing of transactions (which is not to say that window dressing does not occur).

Value investing is the flow of capital from impatient to patient hands, and I believe long term investors in BDK will benefit from patience in seeing the value realised.

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June 29, 2012, 03:58:49 PM
 #156

Meatspace companies usually pay dividends biannually, so these up and downs can be smoothed out and not affected so much by the timing of transactions (which is not to say that window dressing does not occur).

I think you meant semi-annually (twice a year).  And really most dividends are quarterly (4x a year).


Value investing is the flow of capital from impatient to patient hands, and I believe long term investors in BDK will benefit from patience in seeing the value realised.

+1 to this.  Keep the train on the tracks and moving forward, Kluge, and you'll get us all there.

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June 30, 2012, 04:10:41 AM
 #157

I appreciate your frankness in reporting, Kluge. I think the up and down are to be expected in a start up operation of this type and the weekly dividend cycle in the bitcoin world exaggerates this. Meatspace companies usually pay dividends biannually, so these up and downs can be smoothed out and not affected so much by the timing of transactions (which is not to say that window dressing does not occur).

Value investing is the flow of capital from impatient to patient hands, and I believe long term investors in BDK will benefit from patience in seeing the value realised.
It physically hurts to have to report 0BTC dividend weeks - doing it weekly definitely creates a lot of pressure, and creates anxious thinking which could otherwise be put into something productive. It causes hasty decisions. There's some burn-out being caused by frequent dividends, too. I agree that patience in investing is preferable, but I was doubting investors would feel the same way and not demand extremely frequent dividend payments. I'll consider going to monthly dividend payments as was originally intended and review what I've written to see if I allowed myself to switch instantly or if I boxed myself into requiring 60 days before changing that. (I don't believe it was added to the contract that payments will be made weekly -- that was a last-minute pre-IPO change, which I imagine I assumed and wrote as temporary, but need to check). Since it's pretty close to August, and I don't intend to sell "too much" of BDK's profits, I guess I shouldn't care too much if share price were to drop to lessening the frequency of dividend payments, assuming investors are insistent on weekly dividends. There's really no need for BDK to fundraise by selling profit splits right now. When share price nears or surpasses the point where a buyback would be favorable to me, I can start comfortably selling more monthly profits. Fwiw, I don't intend to switch to quarterly or 2x-annual dividend payments, though I may switch to quarterly payments a year or two down the road if I end up sticking with this for years.

With BDK-BLoC (soon-to-be IOU-BLoC), BDK's becoming much more of a "fixture" than I originally intended. I was planning on leaving within a year and a half or so of starting, which would be around this time next year. I'll try to keep everyone up-to-date on my intentions. If anyone wants, they can get a hold of me on Skype as bdk_kluge (name Ben Malec) and ask me directly if they have any questions/suggestions/comments. I've been on Skype every day consistently for months.

I've been hesitant to disclose this publicly, but I'm only 21 years old. I do not have experience in this sector outside of the seven months with BDK, now. My work experience is comprised almost solely of filing paperwork, creating forms for employees, and doing payroll for a family LLC. I have no formal post-secondary education outside of a couple textbooks, and largely "skipped" high school. It's hard for me to justify my existence in my current capacity, and is why I'm pretty averse to taking on liabilities. If I get more comfortable with this, and have years of experience under me, that will change - but not before I fully trust myself to handle others' money in an amount greater than the amount I've put in. I am pleased to have people question everything I do and make suggestions. The Bitcoiniverse is a great place to experiment and learn, but it's not as though I have a board of 5-10 experienced people to bounce most of my ideas off of. I tell other lenders sometimes about my intentions, looking for input, but occasionally get no feedback. I can't guarantee I won't get defensive and angry if someone attacks my ideas publicly, but I'll appreciate it when I'm in a reflective mood.  Wink

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June 30, 2012, 06:08:00 AM
 #158

Meatspace companies usually pay dividends biannually, so these up and downs can be smoothed out and not affected so much by the timing of transactions (which is not to say that window dressing does not occur).

I think you meant semi-annually (twice a year).  And really most dividends are quarterly (4x a year).


I had a suspicion as I wrote that about whether is was the right term but was too tired to look it up. Frequency must differ by countries, because none of my share holdings pay quarterly, other than some hybrid debt securities.

It physically hurts to have to report 0BTC dividend weeks - doing it weekly definitely creates a lot of pressure, and creates anxious thinking which could otherwise be put into something productive. It causes hasty decisions. There's some burn-out being caused by frequent dividends, too. I agree that patience in investing is preferable, but I was doubting investors would feel the same way and not demand extremely frequent dividend payments.

As an investor focussed on long-term profits, I prefer my money managers to have a similar focus. Investors of other people's money with short-term goals will tend to focus on opportunities that deliver short term profits at the neglect of generating longer term value. It may also mean they will miss out on great investment opportunities that will not deliver profits, or will even show unrealised losses, in the short term, but that more than make up for it in the long term.

So I guess you need to decide on your timeframe and communicate that to your investors so that they either have the same focus or sell to those that do.

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June 30, 2012, 08:38:27 AM
 #159

Meatspace companies usually pay dividends biannually, so these up and downs can be smoothed out and not affected so much by the timing of transactions (which is not to say that window dressing does not occur).

I think you meant semi-annually (twice a year).  And really most dividends are quarterly (4x a year).


I had a suspicion as I wrote that about whether is was the right term but was too tired to look it up. Frequency must differ by countries, because none of my share holdings pay quarterly, other than some hybrid debt securities.

It physically hurts to have to report 0BTC dividend weeks - doing it weekly definitely creates a lot of pressure, and creates anxious thinking which could otherwise be put into something productive. It causes hasty decisions. There's some burn-out being caused by frequent dividends, too. I agree that patience in investing is preferable, but I was doubting investors would feel the same way and not demand extremely frequent dividend payments.

As an investor focussed on long-term profits, I prefer my money managers to have a similar focus. Investors of other people's money with short-term goals will tend to focus on opportunities that deliver short term profits at the neglect of generating longer term value. It may also mean they will miss out on great investment opportunities that will not deliver profits, or will even show unrealised losses, in the short term, but that more than make up for it in the long term.

So I guess you need to decide on your timeframe and communicate that to your investors so that they either have the same focus or sell to those that do.
Then I will be clear. (looked at thread -- I did indeed modify the contract to change time between dividend payments, so 60 days will be required before the changes can go into effect. I may as well prune the contract of largely-irrelevant provisions, and take the opportunity to better-word the contract so it can all be done on one day. Before and After contracts will be posted in reply below.)

Changes which will be made to the BDK contract, effective September 4th, 2012:

  • BDK will officially be renamed "IOU" -- On September 4th, 2012, "BDK" will become "IOU" on GLBSE. "BDK.BND" will become "IOU.BND" if there are any remaining BDK.BND units outstanding.
  • The first contract paragraph will be modified to read as follows:

"Ben Malec (referred to within this contract as "Operator") will issue 100,000 shares of "IOU Hybrid Instrument" (each representation of which referred to within this contract as "unit"). Each unit not controlled by the operator represents .0009% of IOU's monthly profit.  Dividends will be paid on the first of each month in an amount equaling .0009% of IOU's monthly profit to each outstanding share the Operator does not control. 100,000 shares will be issued. Shares can be bought and sold at will of the Operator, though he must abide by any and all rules set forth in additional provisions of this contract. IOU is not a bank, but a personal lending operation on the part of the Operator.

  • The "Operator Equity" provision will be modified to read as follows:

"Operator Equity" - The Operator holds all equity of IOU. IOU units are not tied to equity in any manner, and represent only .0009% of IOU monthly profits. IOU unit-holders are not allowed to issue binding motions, and no motion issued by the Operator to unit-holders is to be considered binding unless the Operator specifically declares a particular vote binding.

  • The "Buyback" provision will be modified to read as follows:

"Buyback" - At any time, the operator is permitted to initiate a forced buyback of IOU units on the listing platform(s) it is currently utilizing. The Operator will pay ((.32 Bitcoins + GLBSE 5 day weighted average of trade transaction amount per unit of IOU)/2). The Operator may buy back  IOU units on the open market of the utilized listing platform(s) on behalf of IOU at any time and at any price he wills.

  • The "Share Value Protection" provision will be removed, and its contractual bindings no longer valid unless reintroduced into the contract.
  • The "Shareholder Votes, Non-binding Motions" provision will be removed, and its contractual bindings no longer valid unless reintroduced into the contract.
  • Any reference to BDK not already mentioned which was made in the contract will be changed to instead reference IOU.

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June 30, 2012, 08:39:08 AM
 #160

Current ("old") Contract:
Ben Malec (referred to within this contract as "me," "myself," "I," and "operator") will issue 100,000 shares of "BDK Hybrid Instrument." Each share not controlled by the operator represents .0009% of BDK's monthly profit.  Dividends will be paid every Monday, starting May 7th, 2012. Dividends will not be paid on the first of the month unless that happens to be on a Monday. 100,000 shares will be issued. Up to 5,000 shares are to be sold on the second day of each month for four months, starting on the month of May, 2012. After that time, shares may be issued at will of the operator.

Additional provisions
"Operator Equity" - The operator holds all equity of BDK. Shares are not tied to equity, and represent only .0009% of BDK monthly profits.

"Shareholder Votes, Non-binding Motions" - While motions may be introduced, they are non-binding. They exist only so the operator may gauge opinion of those invested in BDK's success.

"Change of Contract" - The operator is fully permitted to change the contract at will, without consent of shareholders. However, the modified contract is not permitted to go into effect until sixty days after the changes are made public. When the contract is changed, the operator will honor the ability for shareholders to sell shares back to him at a price of .125 Bitcoins per share between the time a change is made and the time 60 days have elapsed since the change was made public.

"Buyback" - At any time, the operator is permitted to buy back shares issued. The operator will pay .64 Bitcoins per share if the operator buys back BDK shares prior to August 3rd, 2012. If August 3rd, 2012 or later, the operator will pay ((.32 Bitcoins + GLBSE 5 day weighted average of trade transaction amount per share of BDK shares)/2)

"Share Value Protection" - If shares trade for less than ฿.01 on GLBSE for at least 168 hours continuously, the operator MUST issue a bid order of ฿.05 in an amount which equals 50% of shares issued not controlled by the operator. The "168-hour timer" does not again reset for 26 weeks after the "Share Value Protection" provision was last called to action.

"Negative Equity and Operator Liability" - BDK is permitted to operate while having negative equity so long as BDK has not had negative equity for 90 consecutive days. On the 90th day of having negative equity, the operator will be held personally liable to pay shareholders $.10/share (or ฿.02/share, whichever value is lesser). In cases where BDK is unable to achieve due to reasons unrelated to BDK experiencing prolonged negative equity (operator experiencing imprisonment, debilitating illness, GLBSE being hacked and made unusable, EMP strikes, police raid, or death, for example), the operator is not liable.

"IPO Value Preservation, Operator Trading" - The operator is not permitted to ever sell shares for less than he previously sold them for. However, he may sell shares for an amount equal to or greater than the amount he previously sold them for at will.


New (will be effective on September 4th, 2012) Contract:
"Ben Malec (referred to within this contract as "Operator") will issue 100,000 shares of "IOU Hybrid Instrument" (each representation of which referred to within this contract as "unit"). Each unit not controlled by the operator represents .0009% of IOU's monthly profit.  Dividends will be paid on the first of each month in an amount equaling .0009% of IOU's monthly profit to each outstanding share the Operator does not control. 100,000 shares will be issued. Shares can be bought and sold at will of the Operator, though he must abide by any and all rules set forth in additional provisions of this contract. IOU is not a bank, but a personal lending operation on the part of the Operator.

Additional provisions
"Operator Equity" - The Operator holds all equity of IOU. IOU units are not tied to equity in any manner, and represent only .0009% of IOU monthly profits. IOU unit-holders are not allowed to issue binding motions, and no motion issued by the Operator to unit-holders is to be considered binding unless the Operator specifically declares a particular vote binding.

"Change of Contract" - The operator is fully permitted to change the contract at will, without consent of shareholders. However, the modified contract is not permitted to go into effect until sixty days after the changes are made public. When the contract is changed, the operator will honor the ability for shareholders to sell shares back to him at a price of .125 Bitcoins per share between the time a change is made and the time 60 days have elapsed since the change was made public.

"IOU Growth, Operator Performance Pay" - All profits accumulated representative of non-Operator units (.0009% monthly net IOU profits per unit) are paid out as dividends. Profits due to Operator units (all units not outstanding) are the Operator's. The Operator will pay 60% of his units' net profits back to IOU, and keep 40% of his units' net profits as a "performance pay." The Operator may choose to have BDK "withhold" his earnings in the form of an interest-free loan, though the Operator is permitted to recall that loan at any time he deems fit. Changes made to this provision require the standard 60 days and other restrictions outlined in the "Change of Contract" provision to take be put into effect.

"Buyback" - At any time, the operator is permitted to initiate a forced buyback of IOU units on the listing platform(s) it is currently utilizing. The Operator will pay ((.32 Bitcoins + GLBSE 5 day weighted average of trade transaction amount per unit of IOU)/2). The Operator may buy back  IOU units on the open market of the utilized listing platform(s) on behalf of IOU at any time and at any price he wills.

"Negative Equity and Operator Liability" - IOU is permitted to operate while having negative equity so long as IOU has not had negative equity for 90 consecutive days. On the 90th day of having negative equity, the operator will be held personally liable to pay unit-holders $.10/share (or ฿.02/share, whichever value is lesser). In cases where IOU is unable to operate as specified in the contract or has negative equity for over 90 days due to reasons unrelated to IOU experiencing prolonged negative equity (operator experiencing imprisonment, debilitating illness, IOU's current listing platform(s) being hacked and made unusable, EMP strikes, police raid, or death, for example), the operator is not liable.

"IPO Value Preservation, Operator Trading" - The operator is not permitted to ever sell units of IOU for less than he previously sold them for. However, he may sell units for an amount equal to or greater than the amount he previously sold them for at will.

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June 30, 2012, 08:56:14 AM
 #161

I will also state that BDK will be reverting direction. While there was an effort I announced two or three months ago to shift BDK's direction from primarily being a lender to dabbling heavy in securities -- this will no longer be the case.

All coins in securities will be slowly extracted and placed in BDK coffers to buy back current debt and "refinance" at lower rates, and to go toward making loans, both to individuals, and with BDK-BLoC - businesses. Businesses will be the primary focus within a few months, and efforts will be made, once BDK-BLoC launches, to keep an adequate reserve to fund all reasonable loan requests. BDK will be re-opening the doors for bonds and CDs once BDK-BLoC launches publicly.


Cheers!
-Ben

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July 01, 2012, 05:56:01 AM
 #162

June Summary

Monthly Net Profit - ฿79.35
Income - ฿405.30
  • Loan interest - ฿56.98
  • Gratuities - ฿0
  • Securities dividends - ฿257.82
  • Securities sold at a gain - ฿86.41
  • Misc - ฿4.1
Outgo - ฿325.96
  • CD/BDK.BND dividends - ฿310.37
  • Misc - ฿0
  • Securities sold at a loss - ฿15.59

Other Info
Assets - ฿10,572.06 ($70,832.80)
  • Loans (excl. default)   - ฿1,606.63
  • Securities - ฿8,748.19
  • Cash-on-Hand - ฿105
Liabilities - ฿5,218.36 ($34,962.99)
  • BTC100 Pledge   - ฿10.85
  • IBB Pledge - ฿1.24
  • BTC Deposits - ฿3,783.2
  • USD Deposits - ฿311.94
  • Shareholder Div. - ฿1.84
  • BDK.BND - ฿1,087.30
  • Operator Pay Reserved in BDK - ฿22
Equity - ฿5,353.7 ($35,5869.81)
Operator Monthly Performance Pay (40% of net profits after shareholder dividends) - ฿25.544
Operator Monthly Performance Pay After Modifiers (Performance pay - IBB&BTC100 donations - Personal Expenditure) - ฿22
BDK Growth for Month of March (profit - shareholder dividends - operator performance pay) - ฿40.31

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July 01, 2012, 05:58:01 AM
 #163

{ADJ info is now correct, I believe. Formula is (((%ChangeInBTCExchangeRate+1)*EoQEquity)+(Net Profits * EoQBTCexchangerate)) -- tell me if that's incorrect, please.}


2012 Q2 Report (April-June)

Quarterly Net Profit (BTC, non-adj) - ฿1,113.54
     Quarterly Net Income (BTC, non-adj) - ฿1706.55
     Quarterly Net Outgo (BTC, non-adj) - ฿593.02
Quarterly Net Profit (USD, with equity adjusted for exchange rate change over quarter) - $14,776.16


Quarterly %RoE (in BTC, non-adj) - 23.77%
Quarterly %RoE (in USD, adjusted for exchange rate change over quarter) - 60.23%

     April %RoE (non-adj) - 4.6%
     April Net Profits (non-adj) - ฿155.54

     May %RoE (non-adj) - 17.7%
     May Net Profits (non-adj) - ฿878.65

     June %RoE (non-adj) - 1.48%
     May Net Profits (non-adj) - ฿79.35

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July 01, 2012, 06:00:03 AM
 #164

2012 SA1 Report (January-June)

Semi-Annual Net Profit (BTC, non-adj) - ฿1,190.88
     Semi-Annual Net Income (BTC, non-adj) - ฿1799.49
     Semi-Annual Net Outgo (BTC, non-adj) - ฿608.59
Semi-Annual Net Profit (USD, with equity adjusted for exchange rate change over last two quarters) - $17,786.63


Semi-Annual %RoE (in BTC, non-adj) - 26.96%
Semi-Annual %RoE (in USD, adjusted for exchange rate change over last two quarters) - 67.89%

     Q1 %RoE (BTC, non-adj) - 3.19%
     Q1 Net Profits (BTC, non-adj) - ฿77.34

     Q2 %RoE (BTC, non-adj) - 23.77%
     Q2 Net Profits (BTC, non-adj) - ฿1,113.54




(fwiw, these numbers are not perfect representations of the truth. Equity amount changes over the quarter, and I use the "last" equity amount to adjust USD profits when determining USD gains. The adjusted calculations assume I had exactly the same amount of equity in January as April. It also assumes I bought or accumulated BTC at the last quarter's end (at the previous quarter's "EoQ BTC price"), which isn't true as I was rapidly acquiring BTC for BDK when it was entirely "my own" - from Q1 beginning to early Q2. So... adjusted profit numbers [this is a guess out of my ass] are probably artificially inflated by something like 10-30%.)

Additional information can be found on the spreadsheet @ https://docs.google.com/spreadsheet/pub?key=0Ao892S4MOoDZdGZSbjJVd1ZTbFVLZE5aRE95bE91NVE&output=html

ETA: Made a change to the September 4th contract to make my pay explicitly clear.

ETA2: Just to be clear -- The adjusted net profit # in USD is NOT realized. It's on-paper only, and not really a meaningful figure for anyone but myself in keeping track of how much my original investment is worth.

ETA3: No, I haven't started work on transferring everything to Excel, yet, and still have some work to do on BDK-BLoC mockup, formulas, and other stuff necessary for the dev to complete work. I should have Excel book completed within 20 days. I'd really like to make it nice and collect some information automatically instead of requiring I change a certain values around every day or so.

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July 01, 2012, 07:25:31 AM
 #165

Do I need to read all of that? Damn it's long and I'm not interested to do anything more today (because it's the end of the weekend and burbon is not stopping me checking speelling) - is there a short version?
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July 01, 2012, 07:59:35 AM
 #166

Do I need to read all of that? Damn it's long and I'm not interested to do anything more today (because it's the end of the weekend and burbon is not stopping me checking speelling) - is there a short version?
Heh. Sorry.

TL;DR - https://bitcointalk.org/index.php?topic=77343.msg999596#msg999596 read new contract only, make sure it seems reasonable to you. https://bitcointalk.org/index.php?topic=77343.msg1001183#msg1001183 read only for summary of operations in June.

Summary of important changes in contract - BDK is being renamed IOU. Dividends will be paid monthly (first day of month) instead of weekly. Most other changes were either removing largely-irrelevant wastes of words, making things more clear, or cleaning up for post-August when buyback price changes.

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July 01, 2012, 11:10:12 AM
 #167

BDK-BLoC is expected to launch publicly some time in mid to late August (+-1month). BDK-BLoC will be issuing credit ratings for free within a few days so I can tweak my formulas more. There is a fine balance between being acknowledging that Bitcoin-centric businesses will be too new for a great score, and exposing myself to unjustified risk because too few businesses have a high-enough credit rating to take out a loan in an amount which could significantly impact a startup. Those who submit their financials during this free trial period will be welcomed to participate in BDK-BLoC closed beta. I expect closed beta to start some time late this month, possibly early next month.


BDK unit-holders who currently hold 1k or more BDK units: I am accepting applications for seats on the "Board." You will have no voting powers, but I'll listen to what you say very carefully and you'll be placed in a Skype room with me and the other Members. There is currently a limit of three Members. Unit-holders with a background in finance or web development are strongly preferred. You should have ideas to bring to the table to help BDK operate more effectively, both in increasing revenues and minimizing expenses, and communicating with investors. You'll need to use Skype and confirm your holdings with me by transferring shares to me on GLBSE, which I'll then transfer back (GLBSE currently does not allow Issuers to see who holds their security).

All BDK unit-holders are invited to sign up for the new mailing list which will regularly publish on the second and fourth Monday of each month if they wish to receive notification outside of this forum. It will include the critical stuff I post in this thread (monthly reports, what was going on when there was GLBSE drama, contract changes, BDK-BLoC being ready to be launched, etc), without some of the less-important stuff (weekly reports, ramblings about satellite funds, "biannual vs semiannual," etc). You can sign up @ http://eepurl.com/nfxz1 -- I may not send any of these out for a month or two.


Cheers!

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July 02, 2012, 08:25:37 PM
 #168

July 2 UPDATE
Dividend/share paid: 0.000106688BTC/share
Total dividend paid: .96BTC
Running total dividends paid in July: .96BTC

July 2012 Net Income Expectations
Optimistic estimate: 150BTC
Reasonable estimate: 25BTC
Pessimistic estimate: -150BTC
(Guesstimated weekly dividend payouts -- July 2nd: 0.0BTC/share Actual: 0.000106688BTC/share, July 9th - 0BTC/share, July 16th - .00045BTC/share, July 23rd - .000135BTC/share, July 30th - .000225/share)

ETA: On "official" break from 7/5 to 7/6. Will be back on 7/7. ETA2: Back. Smiley

ETA3: Posted Guesstimates. Keep in mind I need to count a 100BTC or so loss from a default last month.

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July 08, 2012, 11:36:09 AM
 #169

Spreadsheets updated (still needs work), profit guesstimates made, responded to PMs/emails (if I missed you - sorry - please re-send).

May be going to San Francisco mid-September for a week or two on BDK-related business. Details in due time.

If you have a deposit with me, you may wish to check the deposit sheet on the public spreadsheet to be sure I have you in there. I'm pretty sure everyone's in there, but better safe than sorry.


Apologies for being slow and a bit scattered in the past week. We accepted an offer on our house in Erie, are making an offer on a house, and was thinking/working on the reason for going to SF. It's likely I will be fairly busy until some time in October, but BDK/IOU operations will continue normally -- profits should not be affected. One place I always keep up on is the Skype lending room to see what opportunities are out there. When we move, I'll give myself business hours so I can give my full focus toward lending operations for at least a couple hours per day while everything else's going on. IOU-BLoC development is continuing, though has been paused the past couple days, waiting on me to review some options.

Cheers!

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July 09, 2012, 03:09:32 PM
 #170

July 16 UPDATE
Dividend/share paid: 0BTC/share
Total dividend paid: 0BTC (-2.48BTC, but I will eat this as I've done in the past)
Running total dividends paid in July: .96BTC

July 2012 Net Income Expectations
Optimistic estimate: 150BTC
Reasonable estimate: 25BTC
Pessimistic estimate: -150BTC
(Guesstimated weekly dividend payouts -- July 2nd: 0.0BTC/share Actual: 0.000106688BTC/share, July 9th - 0BTC/shareActual: 0BTC/share, July 16th - .00045BTC/share, July 23rd - .000135BTC/share, July 30th - .000225/share)

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July 12, 2012, 04:19:35 AM
 #171

BDK survived its first major liquidity crunch without any major failures. For about two weeks, I had liabilities I needed to pay, but no liquid assets, which resulted in me scrambling around to get enough coins in my wallet to repay depositors. There was one CD it took me two extra days to pay out because I failed to ask about whether it'd be renewed or cashed out before the CD actually matured. Outside of that (which I compensated for generously), there was no negative impact on depositors.

I have sold my entire holding of YABMC both on the open market and privately, >16k bonds. This came with a major loss of >1kBTC over what I paid (ignoring dividends, which were ~335BTC for the duration of time I was holding them), but it was absolutely essential to BDK's survival. With >2.5kBTC of new funds, I repaid 900BTC worth of intra-lender loans I took out, paid off a $2045 USD deposit early, increased the amount I have lent out, with 1.5kBTC being held in cold storage looking for lendees, and a few hundred held as cash.

Losses in July now exceed 1kBTC. I think it is a fair compromise to not have shareholders eat their entire "liability" of that (that is, having "negative dividends" rolled over until positive again, as is how it's to work in the contract), but to have dividends suspended for a time while I recoup losses. With that in mind, I will not be paying dividends until after August 6th, at which time, shareholders will get a clean slate, with all negative dividend liability written off. Put in another way, dividends will be paid as I'm contractually obligated to (which is almost certainly nothing, but I guess it's remotely possible I could somehow profit >1kBTC in a month) until August 6th, when I will wipe any remaining "negative dividend rollover" from my spreadsheets. Then, assuming I'm profitable between August 6th and August 13th, dividends will be paid on August 13th.

If you read that and were confused by my phrasing, please ask questions, privately or publicly, and I will try to re-phrase until I'm coherent. It may help to take a look at https://docs.google.com/spreadsheet/pub?key=0Ao892S4MOoDZdGZSbjJVd1ZTbFVLZE5aRE95bE91NVE&gid=20 in the "Shareholder Div" cells in the "Liabilities" section on the right of the screen (F7 & G7 on my sheet).

Cheers,
Ben


ETA:
Last Valuation on 6/13 -- today is 7/12

GLBSE Securities Re-valuation (reconciliation between BDK sheets & GLBSE 5dayavg):
BitcoinTorrentz: BDK - .74BTC/share, GLBSE - .553BTC/share -- total loss of .748BTC on paper
REBATE: BDK - .172BTC/share, GLBSE - .123BTC/share -- total loss of 30.527BTC on paper
BitVPS -- BDK - 0.003125BTC/share, GLBSE - .004 -- total gain of 24.20075BTC on paper
27658

Total securities FMV change since last valuation -- loss of 7.07425BTC.


ETA2:
Consolidated monthly report in PDF format coming at end of the month. I will not be making weekly reports unless "Shareholder Dividend" becomes positive.

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July 29, 2012, 09:19:50 AM
 #172

Dividend calculations will be resumed on August 6th, as scheduled. I'll be making a gratuity dividend payment within a couple days in an amount that gets my wallet to a round number as an apology for the "BDK" asset being locked, and for only now realizing I never provided a single update in this particular thread. If you are unaware of the happenings in the past week, please see the "BDK" thread in my signature.

July report will be released on the 1st or 2nd of August.

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August 01, 2012, 02:42:11 AM
 #173

Special dividend of 2.94771552BTC paid as a gratuity for the asset being frozen a few days, and the lack of dividends, lately.

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August 01, 2012, 08:39:22 AM
 #174

    What a complete clusterfuck of a month. I finished adding up losses from GLBSE. I was avoiding adding in losses from securities dumped on the BTC account which amounted to roughly 160BTC extra I did not previously include (though, fwiw, it's a bit of a guess as to the FMV, and how much value the securities lost due to a sudden dump on the market). In total the hack cost ~709BTC in damages between actual BTC withdrawn, the cost to forcibly buyback dumped BDK-related bonds, and the securities dumped way below FMV in the BTC account. More of a hit, losses from selling YABMC bonds during a major price crush resulted in losses of ~1235BTC. Additionally, 100BTC worth of loans were written off. In total, monthly G/L was -฿ 1,549.58. All things considered, TBH, that's not too bad, though it should be noted that relief funds sent from other lenders and associates totaled a whopping 245BTC, for which I am extremely grateful. Note that while IBB & BTC100 donation amounts do not look correct because they're negative - they are, in fact, correct, and BDK did "profit" off these charities due to massive losses this month, where the negative balance will rollover until positive, at which point I'll begin paying monthly, again (BTC100 being an exception, where I pay as new charities demand it).

    An extraordinary gratuity dividend was paid to bondholders on 7/31 in the amount of 0.00035184BTC/bond.

    IMPORTANT: Because of exceptional losses in addition to the YABMC loss, I have decided to extend the dividend blackout until August 27th, at which point, bondholders' dividend will start from 0, instead of being fully liable for losses (in the form of losses rolling over and dividends never being paid until the rolling balance becomes positive). Due to extreme circumstances, I will be permitting BDK-holders to exchange their BDK bonds for BDK.BND bonds in a 1-for-1 swap from now through the end of 8/8/12. BDK.BND has the advantage of paying 1% per week, guaranteed, and is not at nearly as much danger of price swings, though this comes with obvious disadvantages, too. The contract's a Hell of a lot simpler, too. Smiley I strongly encourage BDK-holders to swap for BDK.BND units. Keep in mind this is completely voluntary -- nothing about this offering is changing less the contract change going into effect on September 4th which I've already talked about at great length. You can read more about BDK.BND by clicking the link in my sig.

July 2012 Summary

Monthly Profit - --฿1,549.58
Income - ฿671.133
  • Loan interest - ฿218.45
  • Gratuities - ฿0
  • Securities Dividends - ฿117.69
  • Equities sold at a gain - ฿0
  • Misc - ฿90
  • Hack Relief Fund Cheesy - ฿245.00
Outgo - ฿2,220.72
  • CD/BDK.BND dividends - ฿168.42
  • Loan Write-Offs - ฿100.00
  • Misc - ฿8.00
  • Securities Sold At Loss - ฿1,235.33
  • Losses From Hack - ฿708.97

Other Info
Assets - ฿ 7,800.00 ($73,944.04) (yes, it literally was 7.8kBTC exactly)
  • Loans (excl. default)   - ฿2,959.98
  • Loans in Default (100BTC of this has been written off) - ฿ 172.50
  • Securities - ฿4,418.83
  • Cash-on-Hand - ฿120.00
  • Reserved USD - ฿128.69
Liabilities - ฿3,880.888 ($36,790.79)
  • BTC100 Pledge - ฿1.65
  • IBB Pledge - -฿7.96
  • BTC Deposits - ฿2,966.90
  • USD Deposits - ฿0
  • Shareholder Div. - -฿ 123.68
  • BDK.BND - ฿ 1,111.70
  • Op Performance Pay - -฿ 73.12(Consider this a loan from BDK to me. It will be repaid out of future Op Pay.)
Equity - ฿3,919.12 ($37,153.25)
Operator Personal Expenditure - ฿95.12
Shareholder Dividends - ฿3.86
BDK Growth for Month of March (profit - shareholder dividends - operator personal expenditure) - -฿1,648.56

Quick note -- numbers may not add up this month. A few calculations were fucked up by negative numbers, and I'm not sure I've totally corrected them.

ETA: Noticed a flaw. I sold more BDK.BND this month which I didn't account for, all the proceeds of which unfortunately went to the attacker. This has been corrected in my sheets and this post. The I/O report for the month has now been "finalized" and August is up.[/list]

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August 02, 2012, 10:23:14 AM
 #175

Mining has quietly changed over to BitMinter. One of the Icarus boards have been refusing to work with CGMiner for nearly two weeks for reason I still don't understand. Surprised by how "Plug & Play" BitMinter is, though I was very skeptical about running a Java miner... web stats are updated "live" and the GUI's pretty slick when enabled.


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August 05, 2012, 11:31:50 AM
 #176

I/O report now has the feature nobody's requested! Charts showing data already readable with a quick glance at the relevant section! I'm not sure what's going on with the Q2 graph -- it was giving me troubles earlier. I wanted to show quarter-over-quarter earnings, but the labels were messed up no matter what I tried. I settled on just showing two quarters' earnings consecutively on a graph, but when I look at the "public" version of the spreadsheet, it shows "Access Denied." Maybe it's drawing on information in one of the hidden sheets.

Enjoy.


ETA: I've also noticed the values I enter occasionally change and revert. Comments are sometimes lost without explanation. I assume this is because I'm logged into the spreadsheet on the same account using multiple computers. I don't really see a way to resolve this while using Google Docs except to make effort to be logged in only from one computer at a time.


Relevant information: As I stated in the BDK "public" thread (it should have been posted here, not there), BDK is now taking on Pirate exposure. Exposure will be permanently capped at ~1430BTC (1428BTC + some fraction of a BTC, for a clean 100BTC/wk). Current exposure is 1kBTC -- I intend to deposit the additional ~430BTC within a week. I have entered an agreement where IOU receives 7% weekly on this balance, with interest sent back each week.

IOUcoin progress is coming along. It should be ready in roughly one month. I sent a PM to the owner/op of BitMit asking him to utilize BitMit to permit charities to really utilize Bitcoin instead of just buying USD with it. Waiting to hear back from him. It could be kind-of implemented on IOUcoin the way I envision it, but it would be quite ugly, I think. Smiley

CD and lending rates continue to decline, and I have lowered rates accordingly, in hopes of finding new lendees. I wonder if the OP for the "public" BDK thread is too "harsh." Critiques? If I did not have contacts with some of the more prominent producers in the community, there'd basically be 1800BTC invested, and 6kBTC just lying around or all in a Pirate account, so we have that going for us. Smiley Finding new lendees I'm comfortable loaning coins to has become quite difficult.

As stated previously, the "dividend blackout" will end on August 27th. All shareholder "debt" will be wiped out at that time, and dividends will resume as they should have if July wasn't an exceptionally junk-y month. The 1:1 swap offer for BDK.BND is open for a few more days. I should note I have been buying back a few hundred BDK shares here and there on the market as I see beneficial. I don't count them as G/L since I failed to correctly input them as a liability when I was initially confused over how to classify the offering. Of course, this also means BDK equity is over-reported by some TBD amount. I would enjoy having BDK recalled entirely within a few months as I dislike the risk it exposes investors to (a month and a half of no dividends, and shaky dividends in June, is embarrassing, frankly), and don't believe I'll be able to raise the volume of capital with it I initially hoped for.

Any questions, comments, disclosure requests - whatever - I'd be happy to reply. If you have a question about a specific program, however, it may already be talked about in length if you click one of the relevant links in my sig. Cheers,
Ben

Oh. ETA: I've put off the trip to SFO for a while. Idunno how long, or if I'll ever end up going. Personal/business reasons I'm not particularly interested in disclosing. When I talk about it, it leads to me smoking a pack of cigarettes in a single day. :x

Another quick addition: I don't believe I ever talked about Ghetto P&P Exchange here. Basically, I've begun providing a pen and paper ("P&P") fixed exchange service for "significant" depositors, more-or-less at cost. I both buy and sell -- users do not bet against each other, and there is no order book. Users can buy or sell Bitcoins instantly through supported CUs and banks, or through one of the slower methods. I'm also willing to do in-person transfers. This is not much of a for-profit service, and only two people have taken me up on the offer, but I hope it will go toward encouraging trust and familiarity with me among customers, as well as help ease the pain of lowering deposit/loan rates.

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August 28, 2012, 11:34:30 PM
 #177

BDK bondholders (not to be confused with BDK.BND bondholders) have had their "debt" incurred from operational losses wiped. It'll appear correctly on the public sheets as soon as I get to a computer where I can easily edit them on (2 days, likely). Need to make a lot of formula adjustments and in-sheet comments since it's a mid-month change.

This was originally posted in the wrong thread. Reposting here because it's extremely relevant.

Maybe you should buy back BDK before you go offline, and further erode the value of those shares. They pay virtually nothing at this point due to massive losses, and now, with you not really participating for 2-3 months, they're going to show no value increase for that time? Remember, dividends are practically non-existent on BDK, so we're looking for (positive) growth. This hasn't been happening. We're trading .08BTC below your last offering price. That's just over 50% of the last offering price!!! anyone who bought in at .18 has lost their ass. You taking time offline suggests that negative growth will continue.

Been holding onto this hoping to see some value from it, and it's apparently not going to happen. I've very disappointed in the performance of BDK (and your apparent lack of concern about this)
I'll admit I don't like the "BDK" offering at all. I have bought some shares back on the open market (not in the past couple weeks -- I'll revisit that since I haven't looked at that security in a while), but am not willing to do a forced buyback with the contract price.

I've lost something like 2kBTC in the past 2-3 months(another 3.xk if JRO has no assets or imminent income, and another 1k with Pirate). BDK is actually in serious danger of insolvency with the likely loss on the JRO debt. It's very possible BDK will be liquidated. In this case, I will effectively close BDK since I'd be operating with negative equity, which is contractually unacceptable. At that point, I'd personally inject enough funds into the company just enough to pay everyone what's owed. It's very likely I'd then re-launch "BDK" as "IOU" at that point.

So, assuming there's no hope with JRO (it is looking bleak) and Pirate (also looking grim), I need to force non-renewals on all my loans, let them all expire, liquidate BDK and pay out remaining bond-holders the contractual liquidation amount, close all deposit accounts, and inject personal funds to make that all happen so when I fully "close," there are no debts. The alternative is to liquidate BDK and then start "IOU" as a separate entity. IOU would buy BDK's liabilities for whatever funds are necessary for zeroed equity. BDK.BND would transform into IOU.BND, but I would not carry over BDK, since that's a shared-risk venture (unlike BDK.BND, which will pay out no matter what I do with BDK), and will fail if JRO doesn't repay. I have stuff going on with that... if it turns out I'm unable to collect enough to keep positive equity, then BDK will liquidate. If I do collect enough, then BDK will continue to exist as normal.

I've talked about this with a couple shareholders on Skype who make up "the Board," but I haven't been sure how to handle it publicly, since it'd seem like I'm trying to push down the price of BDK to buy back far below the price were I to go for a forced buyback option, which is true, but I'm also uninterested in paying bond-holders the marginal liquidation value. Idunno, lots of waiting to be done. I can't say anything "will" happen because I have so little control over both the giant potential losses. I should have time in a couple days to run through all the numbers and see where different situations would leave us.

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August 29, 2012, 08:43:02 AM
 #178

Man, this is really bad news.

The investment in pirate recently was a bad move as I personaly did the oposite. I invested in BDK as you said you are clear from Pirate.
Ok, you did that decision when the shares were trading lower ... so I waited ... and now see that I've made a mistake.
But maybe you can get at least part of that debt.

Regarding JRO, I don't know much. Last I read was that it should be solved and that part of that money was blocked on MtGox account.
So I hope that you'll do EVERYTHING to get this money back.

Regarding your idea of closing down BDK and opening up IOU as a new entity - forget about it.
I know that you have in the contract that clause about negative equity but those outstanding debts are still debts ... and volountarily settling them down to get into negative equity ... that would ruine your credibility.

We've invested and we new that there are risks. You made some bad decisions and were treated badly in some good ones. That's bad luck.
But you have to fight till the end and work the way out of this. You shouldn't announce things like that you give up and want to get it settled in a cheap way while planning a new IPO ... this would effectively break your contract where you promised that you'll never sell more shares lower.

We've put our trust in you so stand up to it.
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August 29, 2012, 12:41:46 PM
 #179

The fact that you lost 1k in Pirate isn't relevant here.  I invested in BDK, and you said you had no pirate exposure.

Anyway, I for one would like to invoke the "Change of Contract" clause to sell you my shares for 0.125 BTC each. 

"When the contract is changed, the operator will honor the ability for shareholders to sell shares back to him at a price of .125 Bitcoins per share between the time a change is made and the time 60 days have elapsed since the change was made public."

Today is the 60th day since your announced change. 

Thanks.
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August 29, 2012, 04:31:10 PM
 #180

The fact that you lost 1k in Pirate isn't relevant here.  I invested in BDK, and you said you had no pirate exposure.

Anyway, I for one would like to invoke the "Change of Contract" clause to sell you my shares for 0.125 BTC each. 

"When the contract is changed, the operator will honor the ability for shareholders to sell shares back to him at a price of .125 Bitcoins per share between the time a change is made and the time 60 days have elapsed since the change was made public."

Today is the 60th day since your announced change. 

Thanks.
I did say I had no Pirate exposure when I did not, but I was pretty blunt abut having put 1k in Pirate a few weeks ago, which is when I did. https://bitcointalk.org/index.php?topic=77343.msg1079489#msg1079489 (Not that Pirate's relevant, the 3.xk from JRO is what's been leaving me basically operating with no equity for months, now)

At any rate, I think your solution is clever and workable. Any bond-holders who make that request using the .125BTC/bond figure today will be paid out within a few days. I'm not sure if I'll extend the offer to everyone who doesn't send me a PM today, since I simply don't have 1050BTC liquid. "Today" ends in 11 hours, 30 minutes.

ETA: If you want payout ASAP, please send your BDK shares to Kluge:BDK on GLBSE. GLBSE records the sender in the .csv file which makes it very easy to send the appropriate amount of coins back to them. If you place a request today, but do not send shares -- that's okay, the .125BTC/bond price is still valid so long as you made it clear to me that you request the .125BTC/bond buyback price.

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August 29, 2012, 06:50:25 PM
 #181

I'm going to extend the .125BTC/bond offer a couple days until I have time to figure stuff out. I'll also offer a concurrent offer where you can receive BDK.BND units, which I personally insure. BDK.BND will be priced favorably to just receiving a BTC payout, but I'm not sure what the offer will be, exactly.

Fwiw, so it doesn't look like I'm slouching *too* much - I'll be filing and sending a formal complaint to JRO on the 10th, preceding a formal suit. I 99.99% expect this to bring in an additional ~$2-4k loss to pay the attorney with no funds recovered, assuming there is nothing to recover.

ETA: Sorry I've been away and unemotional throughout this. Hay fever season started last week, and I feel like garbage. Being on 90mg of dipoloiznifirin and 360mg of whateverthefuckeffedren just puts me to sleep.

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August 30, 2012, 02:08:53 AM
 #182

I'm going to extend the .125BTC/bond offer a couple days until I have time to figure stuff out. I'll also offer a concurrent offer where you can receive BDK.BND units, which I personally insure. BDK.BND will be priced favorably to just receiving a BTC payout, but I'm not sure what the offer will be, exactly.

I'm glad to hear that.  There's far too much drama and rushing into things around this forum, so taking time to sort things out puts you on top of the heap in my book.


Fwiw, so it doesn't look like I'm slouching *too* much - I'll be filing and sending a formal complaint to JRO on the 10th, preceding a formal suit. I 99.99% expect this to bring in an additional ~$2-4k loss to pay the attorney with no funds recovered, assuming there is nothing to recover.

When you say "formal complaint" are you talking about filing a lawsuit, or simply sending a formal demand letter?  A demand letter should not cost $2k.  Filing a federal suit should cost quite a bit more.


ETA: Sorry I've been away and unemotional throughout this. Hay fever season started last week, and I feel like garbage. Being on 90mg of dipoloiznifirin and 360mg of whateverthefuckeffedren just puts me to sleep.

Don't stress about it, and take your time.
For me the worst part of allergies is being drowsy and not able to sleep, so I end up feeling like a zombie all day.

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August 31, 2012, 05:25:01 AM
 #183

I kid you not - it took me 30 minutes just to get to this god-damned page. I filed a BBB complaint against Hughesnet, but the BBB needs its own BBB, so nothing expected there. DSL company dropped contact with me suddenly. I'd ask for an update, but I'd have to sit around in the McDonald's parking lot.  Angry

Anyway - there's an important piece of information y'all should add to your calculations. An anonymous human being... - we'll call him Anon - offered me the $3xK to pay off JRO's debt in the event that Pirate pays out depositors in a timely fashion. Anon had a few conditions - most of them insisting I act illogical. So, now, in the event that my JRO debt ends up being covered by someone else, I'll initiate a forced buyback as soon as I receive funds at the contractual forced buyback price. I don't really want to expand on this at all - it's a very absurd situation.

I've come up with the concurrent BDK.BND offer, so BDK-holders have the following choices - BUT, you need to choose by September 3rd, 5pm EDT (unless it's EST. I'd check, but.... >.>). I'll process all outstanding requests some time between then and the end of September 4th. After September 4th, you've effectively selected option 3.

Options for holders of BDK:

1) Request a .125BTC/bond payout in the form of "straight BTC." Transfer bonds to Kluge:BDK on GLBSE and I will transfer the appropriate amount of BTC to your account.

2) Request a .135BTC/bond payout in the form of BDK.BND. Transfer bonds to Kluge:BDK on GLBSE and I will transfer the appropriate amount of BDK.BND to your account.

3) Hold out. If Pirate pays - when I receive the BTC promised, I'll initiate a forced buyback under the contractual terms. If Pirate doesn't pay, I write off the JRO debt, Pirate debt, and liquidate BDK, in which case, remaining BDK-holders receive practically nothing under the negative equity provision, which allows for something like $.05/bond, I believe.


If you are sending bonds back to me, please indicate, via forum PM, what you want me to do with the bonds. If I receive no instruction, I will send BTC. GLBSE records the names of everyone who sends me bonds in a nice .csv file I can also use to easily calculate what I owe everyone.

(@exa: filing against him -- a demand will almost certainly do nothing, since I don't believe he has means of obtaining income within a reasonable amount of time. For as much as I know, he could have died over a week ago. Filing against him will do nothing [less cost me thousands] for the same reason, but it'd be a gesture of goodwill toward BDK-holders to ensure I'm doing everything possible. Personally, I think it's a terrible idea, and am waiting for BDK-holders to agree so I can "humbly" say "okay, I guess I won't do that if you guys insist.")



If anyone has anything else to say to me - for the next week or so, I strongly suggest using telephone @ 814-314-9308, or email @ Benjm00@gmailDOTcom. The forum takes way too long to try loading. However, if you only have a bond "sell-back" request, please send to me via forum PM, since I'll have to do that somewhere with a faster Internet connection, anyway. Cheers, and sorry again for all of this,
Ben

ETA: Skype also works fairly well with an intermittent Internet connection. bdk_kluge

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August 31, 2012, 07:16:48 AM
 #184

First exchange requests have been processed. I wanted to get these out of the way since I didn't set a time-frame when these two accepted the deal I offered and I appear to have something of an Internet connection ATM:
300BDK->405BDK.BND
785BDK->98.125BTC

BDK outstanding: 10,000
BDK in my account: 2707
BDK units left to close: 7293


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September 01, 2012, 02:52:52 AM
 #185

Internet connection's bad enough where BitMinter keeps running out of work on 1GH :/

So, here're the additional exchanges I'm aware of being requested, without responding to everyone individually (sorry):

10 BDK -> 14 BDK.BND (BDK has been transferred in)
500 BDK -> 62.5BTC (BDK has been transferred in)
150 BDK -> 18.75BTC (BDK has been transferred in)
320 BDK -> 432 BDK.BND (BDK has NOT been transferred in)

These exchanges will execute on September 4th. With these accounted for, my closing stats are currently as follows (assuming the 320 not in my account will be):

BDK outstanding: 10,000
BDK in my account: 3687
BDK units left to close: 6313

I'd advise current holders against "holding out," because the situation where the JRO debt will be paid off by someone if Pirate pays (there are other conditions which need to be met both on his part and mine) is outlandish. I don't think it's "too" unreasonable to think Pirate might pay out - eventually - but it's probably unreasonable to expect the JRO debt to be covered, and after paying out a "pre-liquidation liquidation" price to BDK-holders, BDK will likely still have negative equity until I personally inject funds.

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September 01, 2012, 06:35:41 PM
 #186

Good call - a decent solution for you (knowing the situation you're in) and us, (knowing we've lost significant value here). I'm not stoked with how this has worked out, but I am grateful that you're going about this is a way that preserves as much value as possible.

Thanks.

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September 03, 2012, 10:17:05 AM
 #187

Here're the additional exchanges I'm aware of being requested, without responding to everyone individually (new ones and changes in bold):

10 BDK -> 14 BDK.BND (BDK has been transferred in)
500 BDK -> 62.5BTC (BDK has been transferred in)
150 BDK -> 18.75BTC (BDK has been transferred in)
320 BDK -> 432 BDK.BND (BDK has been transferred in)
20 BDK -> 27 BDK.BND (BDK has been transferred in)
100 BDK -> 135 BDK.BND (BDK has been transferred in)
372 BDK -> 503 BDK.BND (BDK has been transferred in)
220 BDK -> 297 BDK.BND (BDK has been transferred in)
2036 BDK -> 2749 BDK.BND (BDK has been transferred in)
97 BDK -> Huh (BDK has been transferred in, no instructions received by sender)
9 BDK -> Huh (BDK has been transferred in, no instructions received by sender)
40 BDK -> 54 BDK.BND (BDK has been transferred in)


These exchanges will execute on September 4th. With these accounted for, my closing stats are currently as follows:

BDK outstanding: 10,000
BDK in my account: 6581
BDK units left to close: 3419

BDK is paying dividends this week. I might get them before daughter wakes up, or else it'll be a day late. For those who have transferred BDK but not received BTC or BDK.BND, the appropriate amount of dividends will be applied to your BTC or BDK.BND balance to be transferred to you.

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September 03, 2012, 10:43:27 AM
 #188

September 3 UPDATE
Dividend/unit paid: 0.0000882BTC/unit
Total dividend paid: 0.6432426BTC (0.3015558 to remaining BDK-holders, 0.3416868BTC to those who have transferred)
Running total dividends paid in September: 0.6432426BTC

(BDK units outstanding = 7293 [8378-300-785])

For those wanting BTC, this is straight-forward, and I'll run through and apply the balance changes in the next post. For those wanting BDK.BND, this is more tricky -- basically, as I see it, since I claim BDK.BND is ~7.3% less valuable than BTC, those requesting BDK.BND should receive 107.3% of dividends, or 0.0000946386BTC/unit worth of BDK.BND. (Ugh, 6am math - what the Hell am I doing?)

So... say you're the fellow with 2036 BDK looking for BDK.BND. Each unit of BDK is worth .135 when converted to BDK.BND, right? Well, with dividends, now it's effectively worth 0.1350946386BTC/unit. Instead of receiving 2749 units of BDK.BND, he should now receive (1.350946386*2036) = 2751 units of BDK.BND.


God, that was terrible. This is a trivial waste of time. Alright -- next week, when the exchanges to BDK.BND have been complete, I'll throw in a few extra BTC of dividends and that should more-or-less cover the insignificant dividend y'all missed this week. For those who wanted BTC, the revised amounts are:
500 BDK -> 62.5441BTC (BDK has been transferred in)
150 BDK -> 18.76323BTC (BDK has been transferred in)

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September 03, 2012, 02:59:14 PM
 #189

September 3 UPDATE
Dividend/unit paid: 0.0000882BTC/unit
Total dividend paid: 0.6432426BTC (0.3015558 to remaining BDK-holders, 0.3416868BTC to those who have transferred)
Running total dividends paid in September: 0.6432426BTC

(BDK units outstanding = 7293 [8378-300-785])

For those wanting BTC, this is straight-forward, and I'll run through and apply the balance changes in the next post. For those wanting BDK.BND, this is more tricky -- basically, as I see it, since I claim BDK.BND is ~7.3% less valuable than BTC, those requesting BDK.BND should receive 107.3% of dividends, or 0.0000946386BTC/unit worth of BDK.BND. (Ugh, 6am math - what the Hell am I doing?)

So... say you're the fellow with 2036 BDK looking for BDK.BND. Each unit of BDK is worth .135 when converted to BDK.BND, right? Well, with dividends, now it's effectively worth 0.1350946386BTC/unit. Instead of receiving 2749 units of BDK.BND, he should now receive (1.350946386*2036) = 2751 units of BDK.BND.


God, that was terrible. This is a trivial waste of time. Alright -- next week, when the exchanges to BDK.BND have been complete, I'll throw in a few extra BTC of dividends and that should more-or-less cover the insignificant dividend y'all missed this week. For those who wanted BTC, the revised amounts are:
500 BDK -> 62.5441BTC (BDK has been transferred in)
150 BDK -> 18.76323BTC (BDK has been transferred in)

Why don't you just send BTC for the dividends after (or before) you send the bonds?

Also, will we receive the BDK.BND interest paid today when you clear the transfers?
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September 04, 2012, 04:48:55 AM
 #190

September 3 UPDATE
Dividend/unit paid: 0.0000882BTC/unit
Total dividend paid: 0.6432426BTC (0.3015558 to remaining BDK-holders, 0.3416868BTC to those who have transferred)
Running total dividends paid in September: 0.6432426BTC

(BDK units outstanding = 7293 [8378-300-785])

For those wanting BTC, this is straight-forward, and I'll run through and apply the balance changes in the next post. For those wanting BDK.BND, this is more tricky -- basically, as I see it, since I claim BDK.BND is ~7.3% less valuable than BTC, those requesting BDK.BND should receive 107.3% of dividends, or 0.0000946386BTC/unit worth of BDK.BND. (Ugh, 6am math - what the Hell am I doing?)

So... say you're the fellow with 2036 BDK looking for BDK.BND. Each unit of BDK is worth .135 when converted to BDK.BND, right? Well, with dividends, now it's effectively worth 0.1350946386BTC/unit. Instead of receiving 2749 units of BDK.BND, he should now receive (1.350946386*2036) = 2751 units of BDK.BND.


God, that was terrible. This is a trivial waste of time. Alright -- next week, when the exchanges to BDK.BND have been complete, I'll throw in a few extra BTC of dividends and that should more-or-less cover the insignificant dividend y'all missed this week. For those who wanted BTC, the revised amounts are:
500 BDK -> 62.5441BTC (BDK has been transferred in)
150 BDK -> 18.76323BTC (BDK has been transferred in)

Why don't you just send BTC for the dividends after (or before) you send the bonds?

Also, will we receive the BDK.BND interest paid today when you clear the transfers?
I'd have to send BTC to those who requested BDK.BND as a separate transaction. With this Internet connection, that's a whole lot of extra time to portion out .3BTC. BDK.BND dividends were paid early yesterday morning. Those who requested the exchange from BDK to BDK.BND will not receive yesterday's BDK.BND dividends unless they were one of the two orders I did not give a set date of exchange execution to since I did their transfers early.

The 3BTC on top of normal BDK.BND dividends on September 10th should come pretty close to covering what's owed due to this problem on top of being a bonus to current BDK.BND holders. It'd be more than enough if I gave only the "true" amount of BDK dividends to, but probably a bit less than if I gave both BDK dividends and BDK.BND dividends.

Exchanges will execute in ~1 hour. I expect it to take me 1-3 hours to process everyone. If there's anyone in this thread who either did not give me instructions or hasn't sent me the BDK units (and want to), please do so now. Failing to do so by the time I finish processing orders tonight forfeits this current voluntary offer and will keep you locked into the BDK contract (which, incidentally, changes today, I believe), including the negative equity provision which is likely to be exercised within a couple months.

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September 04, 2012, 04:52:04 AM
 #191

Here're the additional exchanges I'm aware of being requested, without responding to everyone individually (new ones and changes in bold):

10 BDK -> 14 BDK.BND (BDK has been transferred in)
500 BDK -> 62.5BTC (BDK has been transferred in)
150 BDK -> 18.75BTC (BDK has been transferred in)
320 BDK -> 432 BDK.BND (BDK has been transferred in)
20 BDK -> 27 BDK.BND (BDK has been transferred in)
100 BDK -> 135 BDK.BND (BDK has been transferred in)
372 BDK -> 503 BDK.BND (BDK has been transferred in)
220 BDK -> 297 BDK.BND (BDK has been transferred in)
2036 BDK -> 2749 BDK.BND (BDK has been transferred in)
97 BDK -> 131 BDK.BND (BDK has been transferred in)
9 BDK -> 1.125BTC (BDK has been transferred in)
40 BDK -> 54 BDK.BND (BDK has been transferred in)

These exchanges will execute in ~1h from this post (processing is expected to take 1-3h). With these accounted for, my closing stats are currently as follows:

BDK outstanding: 10,000
BDK in my account: 6581
BDK units left to close: 3419

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September 04, 2012, 05:32:57 AM
 #192

Exchanges are now being executed. This will take me an hour or few. I'll report back when I think I'm done. When I post my belief of being finished, feel free to give me lots of shit if I forgot or bungled your exchange, but please not prior -- stressful week. Smiley

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September 04, 2012, 07:07:36 AM
 #193

I believe every exchange has now been processed except this one:
500 BDK -> 62.5441BTC (BDK has been transferred in)

Waiting on deposit to register on GLBSE. Only two mistakes I'm aware of: sent someone 14BTC instead of 14 BDK.BND units, and sent someone BTC without the dividend adjustment (corrected this). If I made other mistakes, lemme know.

For now - this is official notice that I've written off the JRO debt (on the books -- he still owes the money, I just think it's unreasonable to expect repayment at this time), and after paying out BDK-holders, BDK is now experiencing negative equity. Remaining BDK units will close under the "negative equity" provision in 90 days from today if equity does not become positive by that time. At that point, I'll have all my loans called, will have sent in some cash to cover what else I owe, and then I'm disappearing for a few months to sulk. (well, actually, I have another venture to tend to, and I wouldn't mind spending time on the house)

In addition, the new contract went into effect today. All the changes, aside from dividends becoming a monthly event, are likely irrelevant since BDK/IOU is liquidating. Finally - I am burnt out, have hay fever, and have over-burdening burdens. I'm tired, whiny, and still have a ton of work to do on the house. Don't bother me with bullshit for a while. I don't care what it is, just know I'll probably be an asshole in response if it isn't good news. I haven't updated my public sheets in a week or two, and have no interest in doing so ATM. IOUCoin.com will still be launching eventually. I no longer know when, and I don't feel like talking about more bad news. - And god-damn does Hughesnet's service suck ass -- everything has to be so damned drawn-out. By the time my client broadcasts a transaction, two fucking blocks have been solved, and BitMinter - it only has 1GH/s of work.... It can't keep up. Who the fuck would charge $80/mo for that?! What's wrong with these people?! Ahhhhhhhhh! *kehpooooooo!*

Have I mentioned I'm heavily sedated and vertigo's been on-and-off the past couple days? Anyhoo, see y'all next Monday.

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September 04, 2012, 06:38:33 PM
 #194

My guess would be Anon=Matthew Wink

"We are just fools. We insanely believe that we can replace one politician with another and something will really change. The ONLY possible way to achieve change is to change the very system of how government functions. Until we are prepared to do that, suck it up for your future belongs to the madness and corruption of politicians."
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September 05, 2012, 06:45:43 PM
 #195

Thanks for making those exchanges happen quickly for us. I really appreciate that.

Hope you feel better soon.

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September 05, 2012, 11:16:19 PM
 #196

Thanks for making those exchanges happen quickly for us. I really appreciate that.

Hope you feel better soon.

Ditto.

Starbucks/Panera/McDonalds usually have free wifi and central a/c (which knocks out the allergens, for me at least).  Oh, and the caffeinated beverages are a plus.

And if you need a little motivation... Warren Buffet is well-known for saying "try to be fearful when others are greedy and greedy only when others are fearful"

That means now is the time to load up on deposits at super low you-know-they're-safe-cuz-I'm-Kluge rates and lend them out to the people who need liquidity at you're-a-bad-risk-cuz-you-bet-it-all-on-pirate rates.


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September 06, 2012, 07:12:20 AM
 #197

Thanks for making those exchanges happen quickly for us. I really appreciate that.

Hope you feel better soon.

Ditto.

Starbucks/Panera/McDonalds usually have free wifi and central a/c (which knocks out the allergens, for me at least).  Oh, and the caffeinated beverages are a plus.

And if you need a little motivation... Warren Buffet is well-known for saying "try to be fearful when others are greedy and greedy only when others are fearful"

That means now is the time to load up on deposits at super low you-know-they're-safe-cuz-I'm-Kluge rates and lend them out to the people who need liquidity at you're-a-bad-risk-cuz-you-bet-it-all-on-pirate rates.



Trust's low across the board, and it's a terrible time for all this to happen in some ways. Just bought a property outright. I have enough left-over to still go a couple years with all the repairs needed, and covering $5-10k in a failed venture, but it's getting too close for comfort. I'm not too interested in re-capitalizing until I know I'm personally in a secure position, and for me, that means taking a steady job again for 2-3 years, and maybe doing this on the side. I'm not one of those people who come to people with an idea, no sweat-equity put in, and ask for $250,000 - fuck that, I like being able to sleep. One thing I definitely don't want is to operate with insignificant equity compared to liabilities like the majority of conventional banks. They usually are able to get away with this by having hundreds of thousands, or millions, of customers, where operational income/outgo can be reasonably estimated day-to-day (bailouts are probably pretty helpful, too). Someone could withdraw $500k from Huntington one day, and their operations would be only negligibly affected. The way Bitcoin lenders work is by being extremely meticulous in making sure loan repayments line up with deposits, and there are at least two back-up plans if the lendee of the depositor's money ends up disappearing. The way many of us operate - we merely guarantee a lendee's loan in many cases (maybe not most, though). All the risk's on us for a much, much smaller reward than depositors receive - BUT, there's been pretty severe competition, and Pirate's really fucked with the rates. If someone can personally guarantee 2%/wk and deposit almost all of it into Pirate, there's not really a place for me. It practically forced us to put money into Pirate because it's the only way to be competitive, and we did this in a very cannibalistic way. We should've just stuck with what we had, not taken on debt the way we did, turned money down, and operated either entirely on equity and the few depositors willing to take 1/10 the rate guaranteed PPTs offered. We didn't do that, though - we had gentlemen's agreements on the maximum rate we could offer on guaranteed deposits, but it wasn't enough, and once PPTs started popping up, those agreements pretty much went out the window, especially since many were operated by individuals outside the lending cartel.

It's not all bad, though. With Micon's shit-brush, Pirate defaulting, JRO defaulting, the asinine warning on the top of "long-term offer" threads (just sent theymos a long rant about that...), and the massive runs these have all colluded to create, Patrick's more-or-less out of the game. HK will probably wind down if Pirate doesn't repay, Imsa's possibly gone, Burt might be gone... The playing field's going to be pretty empty -- all these great people who ultimately should've overshadowed me - people who have been extremely generous to me in sharing lots of information on finance an innovation (and their coins when I've needed it!) -- many of them will be leaving, or are already leaving. I'll be less without them, and the economy on the whole will be less without them, but as far as business opportunity goes, it's a great time to really push forward (well, it would be if I had lots of spare cash to throw back in).

I happened to have been winding down operations and I believe I only have 3 outstanding fixed-term deposits. The rest are in BDK.BND, which people can't force me to give them face value for at any time of their choosing - and, if people sell that down on the open market, I win, anyway, by getting to buy back my debt very cheaply. So, I believe it was mostly only coincidental that I've been pretty-well protected in the current environment (even with all the horse-shit which's happened since June). There are still people willing to deposit money with me... but I'm not interested until I feel better about where I am financially.

Idunno. Sitting and waiting with BDK/IOU, for now. I put the designers for IOUCoin.com on hold, and that's close to being canned altogether after the dev's paid for "phase one." I have a house to fix up, and we just found a cat crying outside a few hours ago. Named her Rusty Joe.

ETA: And thanks everyone. I should've received way more shit than I did for pulling a "voluntary recall," I think. I appreciate the trust. I was pleasantly surprised by how many requests there were for BDK.BND over BTC payout.

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September 07, 2012, 11:26:23 AM
 #198

Those of you "lucky" enough to be together with me in the new IOU contract may be pleased to know I talked to JRO 2-3 days ago on the phone. Sounds like they're working extremely hard, even if they are isolated in a safehouse. He gave 3-12 months as a time when he'd probably be drawing significant income... I expect repayment will be in something like 1-3 years unless Jered gets a favorable settlement with Dwolla and's feeling mighty generous. With that in mind, I've decided against writing the JRO debt off. However, it's necessary I inject more capital into IOU. Working capital starvation sucks. I have absolutely no interest in releasing more units of IOU - I don't think I could get what I got, and I *REALLY* dislike this offering, now. I think BDK.BND units are going to tie me to too-high rates post-Pirate, so I'm not interested in issuing more of those. I hate to do it after all the fear-mongering, but I think the only solution is to personally re-invest in IOU. I wouldn't be a dick enough to dilute IOU bonds' profit % with it... that doesn't make much sense, anyway, since IOU units don't directly represent equity. If someone stuck on-board with me is particularly enthusiastic, it would encourage me to invest more if a % of what I put in were being matched.... Wink

I contributed 40BTC back in from a loan I effectively gave myself to buy appliances while BTC was high a few weeks ago. I still have ~250BTC to go. Started repaying now that we're creeping back up. Always regret missing the highest peaks and lowest dips, but I can't really complain about that bet. Need to take a deep breath before putting more in. In my mind, I still get this feeling of having done 9 months work, massive headaches, stress put on family, long hours when I get obsessed with spreadsheets... and came out with nothing but loss... ultimately, though, I put in ~$15k, got a $3k ring, $2.5k in appliances, $3k in cash, all sorts of little things...It wasn't a total loss, anyway... Experience evens it out, maybe.... God - I have to stop letting my mind wander.

Anyway - some changes in spreadsheets. I'm not going to give monthly reports in this thread, anymore. If you want a monthly report, look at the damn sheet. I don't have employees to spend their time on reformatting redundant information, and it ain't worth mine. Individual monthly reports have been hidden on the public sheets, less those for the past three months -- I'm running out of room.

I don't plan on writing off Pirate's debt, yet. However, I'm converting the Hermes debt (currently accounted for as a security) into a JRO debt on the books... Both his and Pirate's debts will be accounted for as defaults. When/if I write one or both of them off, I'll probably express it over a relatively long period of time... something like one to two years.

Pfew... What else...? Oh yeah, I'm "re-launching" (still quietly accepting orders from a regular) P&P Exchange. Last month, I was hoping to get a good, symbiotic relationship with someone looking to mix coins (given "my" coins come from many different sources, including fresh), but that didn't end up working out quite as much as I wanted. I shot SteamGames an open partial purchase offer, but he never got back with me... disappointed by that. Not completely sure on ETA for IOUcoin.com - dev's working on other projects. I told the designers I can't take them on right now, thanked and apologized, said I'd probably come back by the end of the year... they were very polite about it. Any other news, any other news... IOU.Canopy is very unlikely to be launched at this point - I'm going to be stuck with Frontier's satellite service (switching from Hughesnet), which they're launching in November. My ability to use the Internet will be... probably about as equally limited as it is now until Frontier starts doing installations, and after, I'll probably get shitty service until they run DSL to the area in late 2013 to mid 2014. I kind of like the guy I'm talking to at Frontier... asked him for a job. Heh - I ask just about every executive or business owner I meet for a job, directly or indirectly. No follow-up on that, yet. Someday, someone might feel in the mood for asinine, informal applications out of left-field. Wink

I'm re-considering standard business hours, but they'd have to be something insane to work with this Internet connection... or I'd have to find somewhere to drive to everyday. Think there might be a cafe in town... there are a couple truck-stop type places not too far. Wife could drop me off everyday and head back home so she has a vehicle to drive... though, one of those truck-stop-type places is a strip club........... >.> Mind's wandering again. Anyway, I'd have to re-load the laptop with my wallets. Not fond of the idea of doing business on a public network. I guess I'm probably not at much risk of security breaches at a small agricultural village diner, though, heh. Actually, probably a market here for PC repair at asinine rates.

Anyway - I think that's all the news I have for now. Pandora's cutting out more than playing, so usable Internet connection's coming to an end. I should have spreadsheets updated by end of day. Need to contact a depositor, too. May re-launch IOU operations as soon as tomorrow.

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September 08, 2012, 07:16:30 AM
 #199

I'm looking at 4-10am Eastern (all days of the week) as standard business hours. Weird hours, but that's most convenient for me. If it creates problems, I can easily change it. I plan on resuming operations on the coming Monday. Sheets are updated, but I still need to build up the courage to see where I stand after counting JRO & Pirate as defaults - and Pirate will probably be written off soon. I'm reconsidering what I want to do with remaining BDK bonds... no clue who owns them from GLBSE's side, of course, so there's not much a way to negotiate individually with them. There's someone out of their home country I think might hold the majority of remaining bonds, so I'll talk with them whenever I can track 'em.

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September 10, 2012, 12:19:37 PM
 #200

So.... Here is a short string of level-headed, professional posts I made this morning in Skype not long after rising from bed:

[5:05:46 AM] Ben Malec: Ah.... Okay. Finally coming out of denial. I'm totally fucked.
[5:05:59 AM] Ben Malec: Totally and utterly fucked.
[5:06:48 AM] Ben Malec: Completely, totally, utterly fucked.
[5:06:52 AM] Ben Malec: Fuck.

This was followed, not too long after, with:

[7:32:37 AM | Edited 7:32:55 AM] Ben Malec: Anyone selling coins? I need at least 525BTC, and may possibly need up to 1600BTC on top of that. Would be able to send USD either on the 13th or 14th. Would prefer to do instant shared branching transfer at a CU, but could also do PNC's version of instant p2p transfer. I'd want coins as soon as the amount posts into your account because I need to stop my bleeding from BTC loans pretty much right now before I go under.
[7:38:26 AM] Ben Malec: Oh. 14th is a Saturday. Friday or Monday, then.

Pfffffffffffffffffffffffffffffffffffffeeeeew. So, at this point, I'm definitely going to wind down, contrary to posts from short-lived enthusiasm I was feeling. I'm buying out the remaining three large CD-holders within a week - USD if they'll take it, or BTC if not - from personal funds. I have not defaulted, and interest is still accumulating.

BDK.BND will not be bought out within a week. I'll place large open-market bids on GLBSE (likely one around the middle of this month, and then one large order each month starting in January) until I have enough coins to do a contractual forced buyback. I'm thinking that may take as long as mid-2013 - but I'll still be paying out consistent weekly dividends until that time. BDK/IOU will be liquidated under the contract's "negative equity" provision within 90 days, with a forced buyback at .02BTC/share. BDK.BND will remain after liquidation, which I will pay for out-of-pocket. Most loans I have out (which haven't defaulted) are either being called, or not allowed to renew -- these funds will also be used to slowly buy back BDK.BND on the open market until I'm able to buy them all back in one shot.

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October 02, 2012, 08:25:48 AM
 #201

BDK.BND will remain after liquidation, which I will pay for out-of-pocket. Most loans I have out (which haven't defaulted) are either being called, or not allowed to renew -- these funds will also be used to slowly buy back BDK.BND on the open market until I'm able to buy them all back in one shot.

Can you ELI5 what is happening to BDK.BND? I received an odd dividend today and I can't decipher why by reading this thread. Th