A Theory on what pirateat40 is doing

[apetersson]

So here is my guess:

Pirate was approached by "big players" that they want to invest USD in Bitcoin, but without moving the market.

They are committed to buy whatever amount he offers them, as long as the price stays low.

Pirate needs Bitcoins for two reasons:
1 - he sells them for a defined rate to the big players most likely at a high premium
2 - he uses bitcoins at strategic moments when the rate goes too high to create askwalls to push the price down gently. hopefully for him he does not actually sell them.

then he uses his USD to cover his expenses to pay the interest

their hope may be to aquire a significant amount of bitcoins without overpaying. and doing it that way it may actually work.

So my guess is, as long as the bitcoin rate stays relatively low his lending scheme will go on. once the price reaches his pain point (maybe 10 USD/BTC) he will start to unwind the loans and maybe even repay the lenders (or keep all the precious bitcoins himself). in my theory it could very well end with a drastic bitcoin rate increase which could spark another mania.

is this a possibility? is there any evidence which falsifies this theory?

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[proudhon]

So here is my guess:

Pirate was approached by "big players" that they want to invest USD in Bitcoin, but without moving the market.

They are committed to buy whatever amount he offers them, as long as the price stays low.

Pirate needs Bitcoins for two reasons:
1 - he sells them for a defined rate to the big players most likely at a high premium
2 - he uses bitcoins at strategic moments when the rate goes too high to create askwalls to push the price down gently. hopefully for him he does not actually sell them.

then he uses his USD to cover his expenses to pay the interest

their hope may be to aquire a significant amount of bitcoins without overpaying. and doing it that way it may actually work.

So my guess is, as long as the bitcoin rate stays relatively low his lending scheme will go on. once the price reaches his pain point (maybe 10 USD/BTC) he will start to unwind the loans and maybe even repay the lenders (or keep all the precious bitcoins himself). in my theory it could very well end with a drastic bitcoin rate increase which could spark another mania.

is this a possibility? is there any evidence which falsifies this theory?

Ah, yes, that's why he recently announced that his interest rate will go down - he knows that the price is going to $10/BTC.  High five!

[hazek]

OP, ever heard of Occam's razor?

[Vladimir]

OP, ever heard of Occam's razor?

Exactly, what I wanted to say.

[apetersson]

yes, of course i know about occams razor. my speculation assumes the statements pirate made were actually true.

[bitdragon]

what do you make of:

    Unlimited Deposits

For Trust accounts starting at 5%.

[finkleshnorts]

I used to believe that too.

[coretechs]

http://www.youtube.com/watch?v=_CPM6wsHkT8

[DarkEmi]

In my humble opinion the activity that Pirate is doing has all the characteristics of a Ponzi.

I am often quite surprised that they are so many people that seems to think that his business is genuine

[Vladimir]

In my humble opinion the activity that Pirate is doing has all the characteristics of a Ponzi.

I am often quite surprised that they are so many people that seems to think that his business is genuine

“it is impossible to make a man see something that his `paycheck` depends upon him not seeing it.”

[hazek]

In my humble opinion the activity that Pirate is doing has all the characteristics of a Ponzi.

I am often quite surprised that they are so many people that seems to think that his business is genuine

“it is impossible to make a man see something that his `paycheck` depends upon him not seeing it.”

That's one of the most important truths out there.

[bulanula]

I know no one has brought this up or even thought of it, but would I be too bold to say? PONZi!!!!  lulz

Love how you are all getting your panties up in a bunch.

Also, BurtW in the other thread with the same behaviour : shouting ponzi,ponzi,ponzi,ponzi,ponzi etc.

Game is over soon for the pirate ...

Funny because I thought you were one of the most trustful guys on this forum, goat !

[Vandroiy]

is this a possibility? is there any evidence which falsifies this theory?

No. Just that he can do all of this with his own funds and get less than 12 weeks amortization time and exponential growth of his own funds, so why the hell is he giving away free money?

Stay in reality. A shady charity? Are you serious?

[Serge]

If pirate ends up running not a Ponzi but instead does what he says: selling BTC at high premium, Bitcoin could be taken for a nice ride within next few years.

All Ponzi speculation aside, we know this theory has a merit and high probability it may be one. Are there any other plausible explanations to pirate's operation with such great returns?

At first I couldn't imagine who would want to buy bitcoins at high premium and why. do you know?! Besides drug cartels, money laundry and some three letter agency questionable special covert ops funding?

What if there are smart and wealthy individuals who realized great potential of Bitcoin and decided to get in. Their target may be significant amount of bitcoins without driving exchange rate through the roof and they are ready to invest several million dollars. Although they could have gone through exchanges and probably buy bitcoins even at $10-20/BTC wouldn't it make sense to setup bitcoin lending operation and purchase at 10-15% premium all sub $10 bitcoins - given that they don't want to spend significant amounts of time on exchanges to acquire bitcoins at slow steady pace. They want to sign a check each week and get their bitcoins. Here comes the pirate and ready to sell at 10-15% premium. Pirate alone or conspiring with these individuals to keep bitcoin rate as sane prices (sub $10/BTC for instance) throughout their acquisition period. Bitcoin prices at $4-7 seem fair and pretty stable. Sub $4-3 prices - and everyone wants in so the rate isn't stable; over $8 and there is a risk of another bitcoin hype and explosion which could potentially get out of their control.
Once these individuals hit their target and complete acquisition they will start telling about Bitcoin to all their other wealthy buddies or simply start a new hype, or they don't even have to do anything if they have managed to acquire all available sub $10 bitcoins and the price will naturally start to rise (through the roof) to mid double or maybe even up to triple digits.

$5-6/BTC + 10-15%   better than over $10 BTC when purchasing, is it not?

Could this possibly work while providing great interest rates to lenders at the same time manipulating exchanges with great psychological walls to keep bitcoin prices at low rates for the time being? Or it doesn't make any sense? What do you guys think?

[pirateat40]

If pirate ends up running not a Ponzi but instead does what he says: selling BTC at high premium, Bitcoin could be taken for a nice ride within next few years.

All Ponzi speculation aside, we know this theory has a merit and high probability it may be one. Are there any other plausible explanations to pirate's operation with such great returns?

At first I couldn't imagine who would want to buy bitcoins at high premium and why. do you know?! Besides drug cartels, money laundry and some three letter agency questionable special covert ops funding?

What if there are smart and wealthy individuals who realized great potential of Bitcoin and decided to get in. Their target may be significant amount of bitcoins without driving exchange rate through the roof and they are ready to invest several million dollars. Although they could have gone through exchanges and probably buy bitcoins even at $10-20/BTC wouldn't it make sense to setup bitcoin lending operation and purchase at 10-15% premium all sub $10 bitcoins - given that they don't want to spend significant amounts of time on exchanges to acquire bitcoins at slow steady pace. They want to sign a check each week and get their bitcoins. Here comes the pirate and ready to sell at 10-15% premium. Pirate alone or conspiring with these individuals to keep bitcoin rate as sane prices (sub $10/BTC for instance) throughout their acquisition period. Bitcoin prices at $4-7 seem fair and pretty stable. Sub $4-3 prices - and everyone wants in so the rate isn't stable; over $8 and there is a risk of another bitcoin hype and explosion which could potentially get out of their control.
Once these individuals hit their target and complete acquisition they will start telling about Bitcoin to all their other wealthy buddies or simply start a new hype, or they don't even have to do anything if they have managed to acquire all available sub $10 bitcoins and the price will naturally start to rise (through the roof) to mid double or maybe even up to triple digits.

$5-6/BTC + 10-15%   better than over $10 BTC when purchasing, is it not?

Could this possibly work while providing great interest rates to lenders at the same time manipulating exchanges with great psychological walls to keep bitcoin prices as low rates for time being? Or it doesn't make any sense? What do you guys think?

Oh boy!!!  Someone is stepping close to treasure.  ATTACK!!!!!

[Bitcoin Oz]

I wonder who will be wearing a bathing costume when the tide recedes?

[Vladimir]

Oh boy!!!  Someone is stepping close to treasure.  ATTACK!!!!!

Infantry cannot hold the lines, cavalry to the rescue!

[bulanula]

If pirate ends up running not a Ponzi but instead does what he says: selling BTC at high premium, Bitcoin could be taken for a nice ride within next few years.

All Ponzi speculation aside, we know this theory has a merit and high probability it may be one. Are there any other plausible explanations to pirate's operation with such great returns?

At first I couldn't imagine who would want to buy bitcoins at high premium and why. do you know?! Besides drug cartels, money laundry and some three letter agency questionable special covert ops funding?

What if there are smart and wealthy individuals who realized great potential of Bitcoin and decided to get in. Their target may be significant amount of bitcoins without driving exchange rate through the roof and they are ready to invest several million dollars. Although they could have gone through exchanges and probably buy bitcoins even at $10-20/BTC wouldn't it make sense to setup bitcoin lending operation and purchase at 10-15% premium all sub $10 bitcoins - given that they don't want to spend significant amounts of time on exchanges to acquire bitcoins at slow steady pace. They want to sign a check each week and get their bitcoins. Here comes the pirate and ready to sell at 10-15% premium. Pirate alone or conspiring with these individuals to keep bitcoin rate as sane prices (sub $10/BTC for instance) throughout their acquisition period. Bitcoin prices at $4-7 seem fair and pretty stable. Sub $4-3 prices - and everyone wants in so the rate isn't stable; over $8 and there is a risk of another bitcoin hype and explosion which could potentially get out of their control.
Once these individuals hit their target and complete acquisition they will start telling about Bitcoin to all their other wealthy buddies or simply start a new hype, or they don't even have to do anything if they have managed to acquire all available sub $10 bitcoins and the price will naturally start to rise (through the roof) to mid double or maybe even up to triple digits.

$5-6/BTC + 10-15%   better than over $10 BTC when purchasing, is it not?

Could this possibly work while providing great interest rates to lenders at the same time manipulating exchanges with great psychological walls to keep bitcoin prices as low rates for time being? Or it doesn't make any sense? What do you guys think?

Oh boy!!!  Someone is stepping close to treasure.  ATTACK!!!!!

It just does not make sense mate.

Why did you lock the thread ? Feeling the pressure building up ? Can't hold off the accusations ?

Why not talk to BitPay which holds 50K from BFL sales nobody wants ? Or come to an early adopter like me and we can work something out.

I don't buy it, sorry.

Also, no more storage updates is weird.

[Vandroiy]

The reason Pirateat40 responded to Serge is because it draws attention to the wrong side of the problem, the one that takes more time to discuss.

Serge, an idea for the most profitable enterprise of all time is not the point of discussion here. The question is why would he continue to share it! Sure, in the beginning he might have lacked funds. But now? There's just no way any sensible person would now try to get as many investors as possible!

This argument kills it in one go. All counters have been quickly debunked. Wake up and help spreading the word already.

[naima53]

If pirate ends up running not a Ponzi but instead does what he says: selling BTC at high premium, Bitcoin could be taken for a nice ride within next few years.

All Ponzi speculation aside, we know this theory has a merit and high probability it may be one. Are there any other plausible explanations to pirate's operation with such great returns?

At first I couldn't imagine who would want to buy bitcoins at high premium and why. do you know?! Besides drug cartels, money laundry and some three letter agency questionable special covert ops funding?

What if there are smart and wealthy individuals who realized great potential of Bitcoin and decided to get in. Their target may be significant amount of bitcoins without driving exchange rate through the roof and they are ready to invest several million dollars. Although they could have gone through exchanges and probably buy bitcoins even at $10-20/BTC wouldn't it make sense to setup bitcoin lending operation and purchase at 10-15% premium all sub $10 bitcoins - given that they don't want to spend significant amounts of time on exchanges to acquire bitcoins at slow steady pace. They want to sign a check each week and get their bitcoins. Here comes the pirate and ready to sell at 10-15% premium. Pirate alone or conspiring with these individuals to keep bitcoin rate as sane prices (sub $10/BTC for instance) throughout their acquisition period. Bitcoin prices at $4-7 seem fair and pretty stable. Sub $4-3 prices - and everyone wants in so the rate isn't stable; over $8 and there is a risk of another bitcoin hype and explosion which could potentially get out of their control.
Once these individuals hit their target and complete acquisition they will start telling about Bitcoin to all their other wealthy buddies or simply start a new hype, or they don't even have to do anything if they have managed to acquire all available sub $10 bitcoins and the price will naturally start to rise (through the roof) to mid double or maybe even up to triple digits.

$5-6/BTC + 10-15%   better than over $10 BTC when purchasing, is it not?

Could this possibly work while providing great interest rates to lenders at the same time manipulating exchanges with great psychological walls to keep bitcoin prices at low rates for the time being? Or it doesn't make any sense? What do you guys think?

+100 You are very smart ..