Bryan Micon's List of BTC Ponzi Schemes that should not be listed as "Lending"

[drrussellshane]

See, everyone is free to invest with BS&T, no one is forced to do it. The conditions and terms are here. If you don't like it, don't invest.
The great thing about Bitcoin is that it is about personal freedom

I completely agree.

and the last thing we need is to replace government oversight by some Micon/JoelKatz oversight.

Well, that's where you're wrong. *Precisely* what we need to do is replace government oversight with private oversight. Did you see the government doing anything about Madoff? They were practically a co-conspirator. It was private individuals who noticed how perfectly Madoff fit the profile of a Ponzi scheme who sounded the alarm.

Sure, someone that has absolutely no clue about BS&T (ie you) will oversight my decision whether or not I investigate. No way!
I am very thankful that Bitcoin is freedom, I can make my own decisions based on my own due diligence. I don't need no oversight.
Advice? Why not, I am free to ignore it, and still make my own decisions.

In contrast your perfect world:
Government/JoelKatz don't like wikileaks? OK, so I am no longer allowed to donate.
Micon/JoelKatz don't like pirate? OK, so I am no longer allowed to invest.

See, they way you put your arguments, I think you are/where a huge SolidCoin fan, because they had exactly what you desire - central oversight. Mind you, it failed for the very same reason.

I think you are misunderstanding what JoelKatz is saying.

[1713269180]

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[1713269180]

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[Micon]

Micon, why is bitdaytrade on the list. I couldn't care less, but having legit stuff on there kindof invalidates the whole list. At least give reasons.

I thought that one was self-explanatory.

https://bitcointalk.org/index.php?topic=81357.0

Joel is all over it already & gives very clear explanations of this particular scam. 

[mp420]

Hey, you Pirate supporters, could you point me to ONE case in history where someone has paid consistently several thousand percent REAL interest rate for an unlimited number of debtors over extended time where the nature of the business was not disclosed to investors that didn't turn out to be a scam.

'Cause these always are scams in the end.

It's an entirely different thing to invest in SHARES of a company. That might actually generate astronomical revenue, if you're very lucky.

[Micon]

It's pretty hilarious watching the Pirate-folk having their little meltdown and pulling out random poker statistics that have nothing to do with anything.

It will be especially funny seeing which ones will disappear after Pirate defaults. Greed is one helluva drug!

It is an old tactic you can observe here all the time. They are trying to water down or derail the thread, trying to prevent analysis of the Ponzi scheme.

It does not have any effect on intelligent readers.

Yes, the personal attacks are only to derail the actual discussion. 

With Pirate so silent and his thread locked, you can be sure he is still pulling the strings behind the scenes, encouraging the affiliates to mobilize the FUDdettes into fighting this thread. 

TY to the intelligent readers keeping this thread on track.  Keep dropping facts backed up with links and do not use personal insults. 

[labestiol]

Micon, why is bitdaytrade on the list. I couldn't care less, but having legit stuff on there kindof invalidates the whole list. At least give reasons.

I thought that one was self-explanatory.

https://bitcointalk.org/index.php?topic=81357.0

Joel is all over it already & gives very clear explanations of this particular scam. 

bitdaytrade != mybitcointrade

[Clipse]

Micon, why is bitdaytrade on the list. I couldn't care less, but having legit stuff on there kindof invalidates the whole list. At least give reasons.

I thought that one was self-explanatory.

https://bitcointalk.org/index.php?topic=81357.0

Joel is all over it already & gives very clear explanations of this particular scam. 

bitdaytrade != mybitcointrade

They wont know it cause they dont do any research.

[labestiol]

Micon, why is bitdaytrade on the list. I couldn't care less, but having legit stuff on there kindof invalidates the whole list. At least give reasons.

I thought that one was self-explanatory.

https://bitcointalk.org/index.php?topic=81357.0

Joel is all over it already & gives very clear explanations of this particular scam. 

bitdaytrade != mybitcointrade

They wont know it cause they dont do any research.

Who is they ??
I understand that it's a good strategy to associate Micon with anyone having high doubts on pirate and friends (to say the least), but it won't work...

[imsaguy]

Hey, you Pirate supporters, could you point me to ONE case in history where someone has paid consistently several thousand percent REAL interest rate for an unlimited number of debtors over extended time where the nature of the business was not disclosed to investors that didn't turn out to be a scam.

The extended time you speak of is right at a year and its in a brand new/emerging technology.  Look at any brand new, rapidly growing company and their rates will be off the charts and of course if you extrapolate those rates to infinite they look ridiculous. That's part of the point that the 'pirate supporters' are trying to make.. a high interest rate isn't a clear indicator all by itself.

[makomk]

If BS&T is somehow a ponzi, why would Pirate encourage stable balances?  He's offering people running the trust accounts a .5% bonus if they can keep their total trust account balance stable within 5%.  Interest payments don't count, but deposits and withdrawals do.  If he is indeed a ponzi, why would he be discouraging deposits >5%?  Obviously paying out 7% would rapidly overtake deposits <5%, so what's the game plan with that.  I'm not convinced Pirate is a ponzi, although I cannot 100% say he isn't since I'm not actually him so I'm hoping someone from the 'other side' can help with this.

OK, so if I'm understanding this correctly, if someone chooses to have their interest paid out and manually reinvests it by sending them back to their deposit address that'd put them over the 5% limit pretty quickly and they wouldn't get the bonus, but if they automatically reinvest the same amount of interest they can increase their account balance by far more than the 5% limit each month. That's quite interesting - it effectively gives an incentive for people who want to reinvest to keep the interest money within the scheme, which means that if it is a ponzi it can keep going for longer because pirateat40 no longer needs to keep as many cold hard bitcoins around for the weekly interest payments. (Plus, presumably if they then decide to manually withdraw a substantial portion of the interest they'd be penalized fot that too.)

Also, remember that he's doing this at the same time as opening up BS&T to new deposits, so that he's no longer going to be dependant on pass-through funds to bring new money into BS&T. What's more, whilst the interest rates on direct investments are still high enough to get people interested they're much cheaper for him than the same amounts of new deposits through passthroughs which are paid the top interest rate. Plus, his incentives for investing more money initially and for automatically reinvesting your interest work much better on individual investors than they do on investors who're going through pass-through funds.

Come to think of it, this doesn't even sound like a very effective way to discourage depositing more money unless you're a PPT or not depositing that much. How much do you have to deposit before the extra interest on the additional deposit far outweighs the reward lost?

[memvola]

Anyway, the pirate investment works in weeks, hence 7% a week. BS&T pays the interest every week, not every year. So you can withdraw after a single week, and still have those 7%.

Regardless of the frequency with which interest is paid, the rate should be quoted on a yearly basis. Annualized rates permit apples-to-apple comparisons both to interest rates on other instruments and to inflation rates. Many countries require interest rates to be specified in this forum to prevent precisely this type of deceptive description.

I've been investing money on and off for a couple decades now (not in US though), and I've never heard compounded interest noted in the standard text. With correct notation, if you have your money in 6% nightly interest, that means you get (6/365)% per day, which gives you around 6.2% compounded yearly.

I'm often wrong about these things, so I just asked a bank manager about it. She confirmed that rates are quoted yearly but as simple interest, with the compounding frequency specified. So the correct notation for BTCS&T's 7% weekly deposit should be "365% weekly interest". Which gives you around 3405% compounded (yearly).

3405% by itself, besides being the wrong (deceptive?) notation, lacks the compounding frequency information. There are many investment vehicles that don't compound yearly. Daily and monthly are often quoted. Having said that, 7% weekly is also wrong (but probably less deceptive).

[mp420]

Hey, you Pirate supporters, could you point me to ONE case in history where someone has paid consistently several thousand percent REAL interest rate for an unlimited number of debtors over extended time where the nature of the business was not disclosed to investors that didn't turn out to be a scam.

The extended time you speak of is right at a year and its in a brand new/emerging technology.  Look at any brand new, rapidly growing company and their rates will be off the charts and of course if you extrapolate those rates to infinite they look ridiculous. That's part of the point that the 'pirate supporters' are trying to make.. a high interest rate isn't a clear indicator all by itself.

Investing in stocks or shares is one thing. A startup company is telling you "give me money so our business may succeed and we'll all earn good money". You make the decision to invest or not invest based on your judgment whether the expected returns on the investment is positive in the light of the viability of the business model, the state of the market, etc.

Lending money to someone who promises to pay 3000% interest to everyone and doesn't disclose their business model is just stupid. If you've done that you're an idiot. Even if everyone was completely honest and no fraud existed in the universe, that kind of interest rate amounts to gambling. Unfortunately for you, fraud does exist. 3000% interest rate is fraud.

(Since BTC has gained in value against everything, the real interest rate is actually much higher than 3000%)

[aq]

Since BTC has gained in value against everything, the real interest rate is actually much higher than 3000%

I agree, both combined is the best deal one could get

[Clipse]

Hey, you Pirate supporters, could you point me to ONE case in history where someone has paid consistently several thousand percent REAL interest rate for an unlimited number of debtors over extended time where the nature of the business was not disclosed to investors that didn't turn out to be a scam.

The extended time you speak of is right at a year and its in a brand new/emerging technology.  Look at any brand new, rapidly growing company and their rates will be off the charts and of course if you extrapolate those rates to infinite they look ridiculous. That's part of the point that the 'pirate supporters' are trying to make.. a high interest rate isn't a clear indicator all by itself.

Investing in stocks or shares is one thing. A startup company is telling you "give me money so our business may succeed and we'll all earn good money". You make the decision to invest or not invest based on your judgment whether the expected returns on the investment is positive in the light of the viability of the business model, the state of the market, etc.

Lending money to someone who promises to pay 3000% interest to everyone and doesn't disclose their business model is just stupid. If you've done that you're an idiot. Even if everyone was completely honest and no fraud existed in the universe, that kind of interest rate amounts to gambling. Unfortunately for you, fraud does exist. 3000% interest rate is fraud.

(Since BTC has gained in value against everything, the real interest rate is actually much higher than 3000%)

With all your definite facts sucked out of your thumb I think its time to inform all religions that their messiah allready arrived.

[imsaguy]

OK, so if I'm understanding this correctly, if someone chooses to have their interest paid out and manually reinvests it by sending them back to their deposit address that'd put them over the 5% limit pretty quickly and they wouldn't get the bonus, but if they automatically reinvest the same amount of interest they can increase their account balance by far more than the 5% limit each month. That's quite interesting - it effectively gives an incentive for people who want to reinvest to keep the interest money within the scheme, which means that if it is a ponzi it can keep going for longer because pirateat40 no longer needs to keep as many cold hard bitcoins around for the weekly interest payments. (Plus, presumably if they then decide to manually withdraw a substantial portion of the interest they'd be penalized fot that too.)

So if I read what you just said correctly, you're talking about an instance where someone receives their paid out interest, deposit it back in, and then withdraw it again.  Of course he's gonna penalize that!  You're wasting everyone's time with all of this in and out.  He's borrowing coins for the sake of using them, not just to pay you interest.  If he's got to keep a huge slush fund that can't be used for business purposes, but still has to pay interest on that slush, its effectively cutting into his margins. 

BTCST doesn't appear to be setup to be your bitcoin checking account.  It was designed to be a savings account of sorts.  Its called Bitcoin Savings and Trust, not mybitcoin wallet.  Its the same premise with savings accounts at a US Bank.  They limit the number of withdrawals you can do per month in your savings account, because if you need a lot of transaction volume, it should be a checking account.

[imsaguy]

Lending money to someone who promises to pay 3000% interest to everyone and doesn't disclose their business model is just stupid. If you've done that you're an idiot. Even if everyone was completely honest and no fraud existed in the universe, that kind of interest rate amounts to gambling. Unfortunately for you, fraud does exist. 3000% interest rate is fraud.

(Since BTC has gained in value against everything, the real interest rate is actually much higher than 3000%)

Who's the bigger idiot: the one doing as you say or the one trolling the people who you claim to be idiots?  herpderp.

[imsaguy]

Investing in stocks or shares is one thing. A startup company is telling you "give me money so our business may succeed and we'll all earn good money". You make the decision to invest or not invest based on your judgment whether the expected returns on the investment is positive in the light of the viability of the business model, the state of the market, etc.

And now for a reasonable answer:

When I started loaning coins to pirate, it was much smaller, with only a handful of people. He never promised this would continue forever.  Over time, its grown but pirate's not done anything contrary to what he originally said and given me any real cause to not trust him.  Now, there's a bunch of people coming into this late in the game, claiming to have insight that others just can't see because they're "idiots".

Even if it was gambling, that's my right and often times, venture capital is gambling, even with the best of knowledge.  To call me an idiot because I partake is well within your right, but it doesn't make you correct.

[makomk]

So if I read what you just said correctly, you're talking about an instance where someone receives their paid out interest, deposit it back in, and then withdraw it again.  Of course he's gonna penalize that!  You're wasting everyone's time with all of this in and out.  He's borrowing coins for the sake of using them, not just to pay you interest.  If he's got to keep a huge slush fund that can't be used for business purposes, but still has to pay interest on that slush, its effectively cutting into his margins.

For one thing, there's no way for pass-through bonds to handle people who want to reinvest other than asking Pirate to send out interest payments and then redepositing any re-investments at a later date. So given the 5% limit which reduces the amount of new shares that GLBSE bonds can issue if they want to receive the top interest rate, any pass-through bond holder who wants to reinvest any of their interest will have to either get someone else to sell them their shares or invest directly in BS&L - at which point BS&L no longer has to find the Bitcoins to make interest payments to them like they would for the pass-through bonds.

[imsaguy]

For one thing, there's no way for pass-through bonds to handle people who want to reinvest other than asking Pirate to send out interest payments and then redepositing any re-investments at a later date.

That's just wrong and you aren't thinking outside the box.

[bitfoo]

Rate change: https://bitcointalk.org/index.php?topic=50822

Discuss.

[unclescrooge]

OMG ponziiiiiiii