Could you expand on this? You mean increased barriers of entry (aka moat)? What market would this be?
Yes, 'moat' would be a good term. By keeping entry into, not only his model but other's models, he can maintain a lead during expansion.
First into a market doesn't always succeed if others figure it out to early. But if enough market share and trust has been accomplished then the first in can turn it into a powerhouse.
As to 'What market it would be', that is for others to speculate or pirate to explain. But given the math and the finite amount of bitcoins, the end can be calculated. Remember, he pays in BTC not USD and it is relatively a small market.
He is paying 150% pps as stated earlier.
Someone wanted a list of ways to do it. I'll offer 'other' possibilities rather than the dark nefarious ones.
I stated that I would pay people 2¢ for 1¢ for pennies before 1982. With quantity, I might even do, 2.5¢ for 1¢. Why? Cause they are worth 3¢.
1. How much do you pay for Gas? Is that what it really costs though? Buying Oil on the Spot Market would be way cheaper for you. What determines the prices at the spot market? All the 'farmers' agree to a price they are willing to accept in payment for their work. What does the the 'broker' who paid these rates charge?
2. Leased Computing Power paid in BTC to miners but contracted in USD from one of the largest distributed computing project in existence.
3. Let us suppose Pirate controls 40K BTC in his account and pays 1% per day of 400 BTC back out to those investors. Now lets suppose he makes 2% per day off of those 40K BTC. How many BTC are created each day? 7,200 or so. So all he needs to get is 800 BTC of those per day on average to pay 1% to others and 1% to himself. But he would need to know where the blocks are going to hit. hmm...
What are the odds of accidentally calling the Pool and time of the next block to the minute? nah, nvm couldn't happen. But, hedging markets could net some 800 BTC if done appropriately.
4. and many, many others. Good and Bad from individuals, companies, and governments.
5. Any or all of the above.
But as to the OP. Pirate's End Game.
I assume Pirate's End Game is to make money for the longest period of time possible, and if that isn't everyones 'End Game', go home. The not so wise do this through schemes such as ponzies, pyramids, etc... Something tells me Pirate is a little smarter than that. I am relatively certain that investors will get at least their principle back. That is all one can ask for today. But I can see a whole lot of people bitching when Pirate returns their money and says: 'No Thanks'.
I will tell you what I do know. Anyone with 5K BTC or more that wanted to invest with Pirate would know who he was, where he was, how his model works, and judge the risks for themselves and avoid posts like ours as a waste of time cause they don't make financial decision's from forum posts. Although, apparently, a lot of people do.
