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Author Topic: [GLBSE] BDK -- LIQUIDATING UNDER NEGATIVE EQUITY PROVISION --  (Read 18625 times)
brendio
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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

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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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