Right, that's what happens when I hijack the thread for 2 pages
For what you're doing I think putting a fixed USD or BTC value on the buyback price would be best.
At least he admits taking this crazy train off the rails for two days.
Bringing this thread back on topic, since this is not a mining bond, nor comparable to one.
@burnside- you are proposing a bond issue that is heavily slanted in your favor. GLBSE is the perfect place for this.
Looking at your proposal:
COMPANY.BND.A - Initial offering of 100,000 shares at 0.25 BTC/ea. Bond to mature at 5 years. Company converts all 25000 BTC to USD, ends up with some amount USD, call this $VALUE. Company pays interest at 3% of $VALUE, minus the USD->BTC transaction costs at monthly intervals. Company reserves right to buy back bonds at 1.5x the 5 day average at any given time. At maturity, company buys back all bonds at $VALUE USD, converted to BTC at that time.
I take it that's 3% Annually (APR) so .25% monthly. That's lower than what I pay on my 30 year mortgage and less than I earn on some tax-free muni bonds. I have publicly traded stocks (MREITs) currently yielding 5x that (check out AGNC), and have loaned money to larger more stable entities at even higher rates.
If you succeed in borrowing at that rate under the terms you propose, I will jump in right after you.
COMPANY.BND.B - Initial auction of 100,000 shares starting at 0.25 BTC/ea. Bond to mature at 5 years. Each share is a coupon entitled to 0.000003% (total offering value = 0.3%) of the company's actual revenue, currently a bit north of $1 mil/yr and growing at ~8% annually. Company converts all BTC to USD, ends up with some amount USD we will call $VALUE. Company pays dividends monthly based on company's actual revenue. Company reserves right to buy back bonds at 1.5x the 5 day average at any given time. At maturity, company buys back all bonds at $VALUE USD, converted to BTC at that time.
So we're talking $1MM * .3% = $3k and $3k/100,000 shares = $.03/share per year. At current exchange rates thats .03/6.5 = .0046 BTC Yielding .0046/.25 = 1.85%/year.
1.85% APR for a junk bond. I can get more than that in an FDIC-insured 5-year bank CD. If you pull it off you will have to stop the web hosting biz and run an investment bank, CEOs from all over will beat a path to your door wanting to borrow at such low rates too!
COMPANY.BND.C - Initial auction of 100,000 shares starting at 0.25 BTC/ea. Bond to mature at 15 years. Each share is a coupon entitled to .000008% (total offering value = 0.8%) of the company's actual revenue, currently a bit north of $1 mil/yr and growing at ~8% annually. Company pays dividends monthly based on company's actual revenue. Company reserves right to buy back bonds at 1.5x the 5 day average at any given time. At maturity, company buys back all bonds at $0.01 USD, converted to BTC at that time.
Same math as above with .8% gives us $.08/share per year and 4.9% APR. That's a little better. But I can still beat it at 7% staying in USD with JNK or HYG.
So why should I convert my dollars to bitcoins, for you to turn around and convert them back to dollars, so you can buy servers and advertising (or whatever) for a business that will only pay well below market on that debt?
Some music comes to mind: burnside's goin' off the rails on the crazy train...