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Author Topic: Putting your money where Pirate's mouth is.  (Read 46251 times)
organofcorti
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July 05, 2012, 02:05:04 AM
 #1

After just having read this I propose a couple of 'bond' type securities to allow people to express their opinion one way or the other.

Start two securities (I can't see any other public way to do this, since betsofbitcoin doesn't seem to have gotten much traction). One will be a Pirate pass-through, the other will be a pass through to a more low risk investment. I know something similar has been attempted before, but perhaps it's time to try again.

Pro Pirate Bond: Coins invested in the Pro Pirate Bond are invested with Pirate, at whatever the current rate is. Any interest obtained will be moved to an escrow service.

Pirate Default Bond: Coins invested in the Pirate Default Bond do not increase in value.

Investment coins from the Pirate Default Bond and interest payments for the Pro Pirate Bond obtained will remain in the GLBSE accounts or be moved to an escrow service if trust in GLBSE is not sufficiently high.

In both cases, one coupon will be paid on the expiry of the bond. The bond will expire in one year, or when Pirate defaults, or when Pirate ends his business without defaulting.

If Pirate defaults: the 50% of the BS&T interest payments will go to each bond. 50% of the BS&T interest payments or the average interest rate at the PPT, whichever is lower, will go to the Pirate default bond. The remaining amount will go to the pro Pirate bond.

If Pirate does not default within one year: interest payments pay the Pro Pirate coupon, and the Pirate Default bond simply receives their initial investment back.

If you're pro Pirate, then you'll either have a interest plus your principal, or just half the interest and no principal.
If you assume Pirate will default within a year, you'll either have your principal back and no interest, or your principal back and and half the interest.

Example: 100 coins of the Pirate default bond are bought and 110 coins of the pro Pirate bond, and the average interest paid is 6%:

If Pirate does not default, interest accumulated = 110*0.06 *52 = 343.2, since it's not being re invested.
Pirate default bond pays 100 coins to its investors.
Pro Pirate bond pays 110 + 343.2 = 453.2 coins to its investors

If Pirate defaults in 6 months, interest accumulated = 110*0.06 *26 = 171.6.
Pirate default bond pays 100  coins + half the Pro Pirate bond interest =  85.8 coins (since this is less than 100*0.06 *26).
Pro Pirate bond pays the remaining 85.8 coins to it's investors.

In this way there's risk and reward on both sides. But is it fair?

Opinions please people?



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July 05, 2012, 02:08:24 AM
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I was thinking this is the way to do it. Make someone from each side donate the 16btc first Smiley

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July 05, 2012, 02:23:57 AM
 #3

Meh. Chances are the current flamewar kills BS&T, and I get nothing, or half of a week's interest or something. Just because I name long time-frames doesn't mean I'm astonished if he runs tomorrow. These are just for tail risks or Pirateat40 personally changing the schedule to get back at me or something.



How about I just make a bond that pays a little above BS&T interest but does not pass-through and has a little withdrawal delay? When he defaults, I just do the same as him: take all deposited funds and walk off. The difference is that I'm honest about it.

I will have to follow the Ponzi rules, so I am allowed to do forced withdrawals and apply limits just like him. That way, I can time myself against his expected default schedule without going bankrupt too fast. If I can't afford it anymore, I'll have to force withdraw everyone.

Oh, did I just explain why he does that again? My bad.

Again, I can't do it on a super-large scale because Pirateat is watching and may take on extreme measures to take me out and then obtain the funds from this.
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July 05, 2012, 02:31:30 AM
 #4

Sorry for double-post, but this is actually a new one:

I just noticed the odds between the bonds you proposed will be absurd. The 50% interest loss is enormous. The people believing BS&T will yield 7% for a year would get a factor 33 out of their money or something, remember? With half of that accumulating, it's only 6 or so.

I would have to do 27:1.

It doesn't work. It just all goes haywire on these time-scales. That's just the thing, nothing ever works if you assume an exponential money-making machine.
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July 05, 2012, 02:32:41 AM
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Meh. Chances are the current flamewar kills BS&T, and I get nothing, or half of a week's interest or something.


No, you get your principal plus 50% of whatever interest is paid. You only risk what interest you could have gotten for the life of the bond.

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organofcorti
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July 05, 2012, 02:34:32 AM
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Sorry for double-post, but this is actually a new one:

I just noticed the odds between the bonds you proposed will be absurd. The 50% interest loss is enormous. The people believing BS&T will yield 7% for a year would get a factor 33 out of their money or something, remember? With half of that accumulating, it's only 6 or so.

I would have to do 27:1.

It doesn't work. It just all goes haywire on these time-scales. That's just the thing, nothing ever works if you assume an exponential money-making machine.

The risk is worse on the Pro Pirate side. On the anti Pirate side, much less. Is this what you meant?

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July 05, 2012, 02:38:41 AM
 #7

The risk is worse on the Pro Pirate side. On the anti Pirate side, much less. Is this what you meant?

For a sane player to take the bet against me, the anti-pirate bond must be 27 times larger than the pro-pirate bond. This is what I meant.

Give it up. You just can't build a logic instrument on bullshit assumptions. Anything involving BS&T and a time-frame of one year or above inserts the fact that believers can multiply their money with a factor of roughly 33 instead of playing. Of course we can't beat that!
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July 05, 2012, 03:43:16 AM
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The risk is worse on the Pro Pirate side. On the anti Pirate side, much less. Is this what you meant?

For a sane player to take the bet against me, the anti-pirate bond must be 27 times larger than the pro-pirate bond. This is what I meant.

Give it up. You just can't build a logic instrument on bullshit assumptions. Anything involving BS&T and a time-frame of one year or above inserts the fact that believers can multiply their money with a factor of roughly 33 instead of playing. Of course we can't beat that!

Math fail.

There's no 33x anything since there's no reinvestment. I've updated the post with an example.

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pirateat40
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July 05, 2012, 03:47:26 AM
 #9

The risk is worse on the Pro Pirate side. On the anti Pirate side, much less. Is this what you meant?

For a sane player to take the bet against me, the anti-pirate bond must be 27 times larger than the pro-pirate bond. This is what I meant.

Give it up. You just can't build a logic instrument on bullshit assumptions. Anything involving BS&T and a time-frame of one year or above inserts the fact that believers can multiply their money with a factor of roughly 33 instead of playing. Of course we can't beat that!

But I can.  Find a trusted escrow and Ill bet you anything you put in it.

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July 05, 2012, 04:49:00 AM
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Well, I'm sad. I'm not in either pro or anti camp.

If Pirate is running a Ponzi scheme, I want those taking the time to speak out against him to gain something at the cost of pro Pirate camp. On the other hand, if speaking out against Pirate was completely risk free to the anti camp, then you get trolls who just want to have fun (not looking at you Vandroiy, you seem to be taking this seriously).

So I thought I'd put the two camps toe to toe for a little bond action. The risk is minimal to the anti camp - only losing access to coins for up to a year, with a big gain if they're right. If the pro camp is right, it's just a pass through with no access to interest for a year, if they're wrong these losses will be the least of their worries.

Oh well.

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July 05, 2012, 12:23:12 PM
 #11

But I can.  Find a trusted escrow and Ill bet you anything you put in it.

Hmmmmmm. What are you plotting, I wonder?

You might just be about to run and wager with that option; chances are I'll be too careful since you have a lot more control and inside knowledge. But betting directly with you makes all this obvious.

What time-frame and odds are the best you can do? Edit: oh, and do you guarantee some rate of returns during that time, so you can't just stall for ages?

Edit: hahaha, I think he just read my chatter on IRC and noted he's in a pinch. Expect a pointlessly low max time frame or some other hook to get out. Watch a failed attempt to show how legit he is live, in this thread, it'll be fun.
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July 05, 2012, 12:58:00 PM
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But I can.  Find a trusted escrow and Ill bet you anything you put in it.
http://betsofbitco.in/item?id=433 ?

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July 05, 2012, 01:07:42 PM
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The risk is worse on the Pro Pirate side. On the anti Pirate side, much less. Is this what you meant?

For a sane player to take the bet against me, the anti-pirate bond must be 27 times larger than the pro-pirate bond. This is what I meant.

Give it up. You just can't build a logic instrument on bullshit assumptions. Anything involving BS&T and a time-frame of one year or above inserts the fact that believers can multiply their money with a factor of roughly 33 instead of playing. Of course we can't beat that!

But I can.  Find a trusted escrow and Ill bet you anything you put in it.

If the bet will pay more than pirates bank I will put in too. I think it is silly for me to lose money cuz of trollz. These trolls should set something up where they pay out 7% until pirate defaults then they keep the money. If they default first well, then lulz...

+1

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July 05, 2012, 01:08:44 PM
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Jouke, I'd rather choose myself, just for tail risk that he owns the site. But yea, we're already betting there a little.

But that's beside the point. I'm waiting for info on the three points, Pirateat40. What odds? Can you do times well into next year? Can you give some limit on extreme stalling? The latter only determines how much I can bet -- a fair profit or going mad. Smiley

If the bet will pay more than pirates bank

lol, are you suggesting >33:1 odds for a one-year bet? Don't push it, he'd have to guarantee his rate for the whole time for that to work, which he hasn't yet.

Generally, it should be clear that some odds are just perverse. That's not helping anyone's credibility.
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July 05, 2012, 01:49:04 PM
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I thought about doing something like this in case BFL was a scam. The problem is that you can't find enough "pro" people that want to make less than their investment could make in a potential scam. That's why the BFL Bets of Bitcoin is going no where.

I want to bet 100 Bitcoin that BFL won't deliver within 20% of their specs within the month of October on any single BC device, but it would only work if BFL itself took the opposing end, because everyone else wants to spend their money buying actual BFL devices.

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July 05, 2012, 02:11:11 PM
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you would run out of money in less than 15 weeks... learn to mathz.

Why do you figure I'm so amused at this? I'm putting to display that any bet on this becomes ridiculous. People just have to wonder why. Smiley
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July 05, 2012, 02:17:48 PM
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But I can.  Find a trusted escrow and Ill bet you anything you put in it.

Hmmmmmm. What are you plotting, I wonder?

You might just be about to run and wager with that option; chances are I'll be too careful since you have a lot more control and inside knowledge. But betting directly with you makes all this obvious.

What time-frame and odds are the best you can do? Edit: oh, and do you guarantee some rate of returns during that time, so you can't just stall for ages?

Edit: hahaha, I think he just read my chatter on IRC and noted he's in a pinch. Expect a pointlessly low max time frame or some other hook to get out. Watch a failed attempt to show how legit he is live, in this thread, it'll be fun.

You're the one that doubts me.  Since you're so sure you're right why do you need odds?  1:1 is good with me, you set up the bet.

Pirate will default by X.

Remember, we are taking about default here.  Not closing down BS&T with everyone happy.

Put your money were you're mouth is and I'll match every coin.

EDIT: And no, I know you think you're the grand master chief around these parts but I didn't catch your "chatter" on IRC.  Where was it?

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July 05, 2012, 02:23:28 PM
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Put your month were you're mouth is
I had to.

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July 05, 2012, 02:25:31 PM
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You're the one that doubts me.  Since you're so sure you're right why do you need odds?  1:1 is good with me, you set up the bet.

Pirate will default by X.

Remember, we are taking about default here.  Not closing down BS&T with everyone happy.

Put your month were you're mouth is and I'll match every coin.

EDIT: And no, I know you think you're the grand master chief around these parts but I didn't catch your "chatter" on IRC.  Where was it?

The chatter doesn't matter, let's do it concisely here. Please, what's a valid number for X? Are you saying until next year or some few weeks like otherwise proposed? It's pretty hard to tell whether you have some whale who keeps you alive for a tad longer. And worse, you probably know that better than I, so I need some slack on the timing.
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July 05, 2012, 02:28:04 PM
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Put your month were you're mouth is
I had to.

lol,

*grabs more coffee*

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