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Topic: . - page 28. (Read 67488 times)

vip
Activity: 574
Merit: 500
Don't send me a pm unless you gpg encrypt it.
May 03, 2012, 10:23:39 PM
The board of directors meeting ran a bit long tonight.  There are a lot of exciting things in the works to be announced shortly.

The sale tomorrow will be for the full 2000 bonds.

Thank you for all of your support - and see you at the auction tomorrow in less than 24 hours.

woohoo!
hero member
Activity: 896
Merit: 1000
Seal Cub Clubbing Club
May 03, 2012, 04:36:40 PM
In for this...
hero member
Activity: 784
Merit: 1000
bitcoin hundred-aire
May 03, 2012, 09:51:27 AM
bump!
hero member
Activity: 518
Merit: 500
May 01, 2012, 06:01:43 PM

However, it gets complicated if you include the fact that a Pirate default could trigger additional defaults.  So the guaranteed 0.32 value might not hold up.  Also for these bonds to be valuable, you have to trust two sets of people as either could run away with the money. 



The 0.32 exists and is sitting separately, not affected by a pirate default.  further, the six people standing behind the PPT offering have more at stake than just a few thousand coins.
legendary
Activity: 1868
Merit: 1023
May 01, 2012, 04:39:40 PM
Pirate offers 33.6% in 30 days  (1.07 ^ (30/7)).

The market interest rate in the US (and most other countries) is practically 0% per month  (even if it were 1% it wouldn't make much difference in this case).

So Pirate investors have a 25% expectation of a default per month - assuming the 1.00 BTC value for the 1.00 of BTC Pirate investment is a *market* value (hmm - that is a total leap of faith - so the rest of this analysis is highly debatable).
0.75 (probability of non-default) * 1.336 (expected return after 30 days) = 1.00

(Or to be more precise it is 74.8%, but 75% is a great approximation.)


If we apply this expected default rate to the bond pricing we get the expected value of the bonds:

Default:  0.25 * 0.32 = 0.08
Non-Default: 0.75 * 1.28 = 0.96
Total bond value: 1.04

This could explain why the bonds are selling for > 1.

However, it gets complicated if you include the fact that a Pirate default could trigger additional defaults.  So the guaranteed 0.32 value might not hold up.  Also for these bonds to be valuable, you have to trust two sets of people as either could run away with the money. 



Bets of Bitcoin has more bets on Pirate not defaulting by July 4.  If you think there is a 25% chance of default per 30 days, there is a 43.75% chance of default in 60 days (and as of today a 45% chance by July 4th).  So Bets of Bitcoin seems to be predicting a lower than 25%/30 day default rate.
http://betsofbitco.in/item?id=349
donator
Activity: 3108
Merit: 1166
May 01, 2012, 06:41:41 AM
Oh nice, GLBSE now has significantly more attractive graphics than before
hero member
Activity: 697
Merit: 500
April 29, 2012, 09:30:40 PM
It'll be interesting to see if the market has the capital to absorb another 4k PPT shares. I suspect it does, given the great rates  Grin
hero member
Activity: 518
Merit: 500
April 28, 2012, 11:35:52 PM
I'm not questioning the investment, I've bought into both issues and have been quite happy so far. If the passthroughs were all selling for 1.00, you'd still make enough to cover the fee and make about 50BTC on the compounding, but as you said it wouldn't be the best return on 640BTC for a month considering you could all just invest in BS&T directly with it and earn more. Having PPT earn a good return is good for everyone, since if there wasn't an incentive to do it over just investing in BS&T it wouldn't get done.

If you are actually investing the entirety of the 2154BTC you brought in after fees you'll stand to make 264BTC after four weeks on a 640BTC investment, a 40% return with no more risk than you'd face just investing in BS&T directly. If you don't invest overage in BS&T, keeping the extra outside of Pirate's fund helps reduce how much you'd lose if he did default. Either is great. Hopefully it convinces you guys to keep issuing 2000 shares. I made 8.5% in a week on the first round, so I'm happy to keep buying them. Smiley

I'm glad you're enjoying this - it is a good deal.

From my side of things, it's a part of portfolio diversification and as such I don't need to make the absolute maximum from every coin.  So, on that basis, after the huge amount of work that went into round one we were pretty happy, round two was a lot smoother.  And, the return does help compensate.
hero member
Activity: 697
Merit: 500
April 28, 2012, 10:49:23 PM
I made 8.5% in a week on the first round, so I'm happy to keep buying them. Smiley

Buy MOAR! Wink

Working on it but sadly I don't have enough Bitcoin trees. Need moar trees!
vip
Activity: 574
Merit: 500
Don't send me a pm unless you gpg encrypt it.
April 28, 2012, 10:08:41 PM
I made 8.5% in a week on the first round, so I'm happy to keep buying them. Smiley

Buy MOAR! Wink
legendary
Activity: 1274
Merit: 1004
April 28, 2012, 09:57:06 PM
Sure, only down 478 coins for this week's bond.  At US$5 that's not even 2 1/2 grand.  Paying out 640 coins is $3k something, and when 8000 bonds are rolling around, and we have the full complement of 2560 coins going down the toilet is . . .

small change, or serious money

Don't kid yourself, the potential for the backers of this bond to lose serious cash is definitely there.  And given the backing funds could be invested in something else, the returns are probably not as high as you think.  However, it gives some people access to decent returns that they might not otherwise be able to access.

I'm not questioning the investment, I've bought into both issues and have been quite happy so far. If the passthroughs were all selling for 1.00, you'd still make enough to cover the fee and make about 50BTC on the compounding, but as you said it wouldn't be the best return on 640BTC for a month considering you could all just invest in BS&T directly with it and earn more. Having PPT earn a good return is good for everyone, since if there wasn't an incentive to do it over just investing in BS&T it wouldn't get done.

If you are actually investing the entirety of the 2154BTC you brought in after fees you'll stand to make 264BTC after four weeks on a 640BTC investment, a 40% return with no more risk than you'd face just investing in BS&T directly. If you don't invest overage in BS&T, keeping the extra outside of Pirate's fund helps reduce how much you'd lose if he did default. Either is great. Hopefully it convinces you guys to keep issuing 2000 shares. I made 8.5% in a week on the first round, so I'm happy to keep buying them. Smiley
hero member
Activity: 518
Merit: 500
April 28, 2012, 09:37:02 PM
Sure, only down 478 coins for this week's bond.  At US$5 that's not even 2 1/2 grand.  Paying out 640 coins is $3k something, and when 8000 bonds are rolling around, and we have the full complement of 2560 coins going down the toilet is . . .

small change, or serious money

Don't kid yourself, the potential for the backers of this bond to lose serious cash is definitely there.  And given the backing funds could be invested in something else, the returns are probably not as high as you think.  However, it gives some people access to decent returns that they might not otherwise be able to access.
legendary
Activity: 1274
Merit: 1004
April 28, 2012, 06:39:20 PM
Great operation. Even if Pirate defaults they're only out 478BTC.
Thanks!  Just a note on default, just to be clear, if BS&T were to default today we would be out:

Code:
PPT.A   1,500 x 1.28 = 1,920 and 1,920 * 0.25 = 480
PPT.B   2,000 x 1.28 = 2,560 and 2,560 * 0.25 = 640

        480 + 640 = 1,120 BTC

Interesting. I was basing it on you pulling in 2162BTC from the bond sale, and having to invest 2000 in BS&T to cover those shares. If BS&T goes under you would be responsible for 640 as you say, but since you made an immediate profit of 162BTC you would only be down 478BTC.

I assume that means you're investing the entire proceeds in BS&T now, but really you could keep the 162BTC (154 after fees, if you're paying an 8BTC fee) so that's kind of your money to invest in BS&T, keep or do whatever you want with. Smiley
legendary
Activity: 1274
Merit: 1004
April 28, 2012, 05:59:58 PM
Wow, looks like the average price went from 1.0725 for PPT.A to 1.0812 for PPT.B. Before listing fees PPT has cleared 162 BTC just from the higher IPO sale price, in addition to the extra 62 they'll make from 7% interest on 2000 BTC compounded four times as opposed to the 1.28BTC face value.

Great operation. Even if Pirate defaults they're only out 478BTC and if he doesn't they make 162BTC now and another 62BTC in four weeks.
hero member
Activity: 518
Merit: 500
April 27, 2012, 10:08:10 PM
A little less than 2 hours to go until this week's auction.

And it's over!  Grin Woke and saw I managed to grab some coins @ 1.08~!

Well, it all seemed to happen in the last few minutes again with volume spiking from around 2000 into the mid 3000's (not sure because of the refresh timing).  The timing for the European buyers is an issue (as mentioned, and it will be discussed some more), but we haven't even been through one whole cycle yet.
legendary
Activity: 1288
Merit: 1227
Away on an extended break
April 27, 2012, 09:33:05 PM
A little less than 2 hours to go until this week's auction.

And it's over!  Grin Woke and saw I managed to grab some *shares* @ 1.08~!

*edit:shares not coins
donator
Activity: 3108
Merit: 1166
April 27, 2012, 03:08:33 PM
I agree, 3 AM CET is not really "funny" just to earn something like a handful of Euros in most cases...

I think that it's 4am CET close atm (which I'm on) & @Burt thanks for looking in to a possible move

edit: you're right it's 3am as we're on CEST atm apparently http://www.timeanddate.com/library/abbreviations/timezones/eu/cet.html

edit edit: nope, I'm still confused, if it closes at 2am UTC, seems to be in just under 6 hours time, which for Spain makes 4am  Huh whatever I hate to try sniping drunk - which I would be if I stayed up until then

legendary
Activity: 2618
Merit: 1007
April 27, 2012, 01:42:09 PM
I agree, 3 AM CET is not really "funny" just to earn something like a handful of Euros in most cases...
donator
Activity: 3108
Merit: 1166
April 27, 2012, 01:38:38 PM
how about moving the end time forward 3 or better still 4 hours in the future to make it more Europe friendly, it would still work OK for the States &/or put it on a Sunday or something if it clashes with US work hours, say finish UTC @ 10pm Fri = 6pm Fri NY, 3pm LA & 11pm Fri UK, Midnight Fri CET
sr. member
Activity: 266
Merit: 250
April 25, 2012, 10:44:14 AM
Wow, somebody _really_ needed these PPT.A shares! They sold up to 1.24! Shocked
https://glbse.com/asset/view/PPT.A

More money for me to invest in PPT.B... Grin

So far I've made more than 7 bitcents per share per week, can't complain. Cool
Bought 10 for 1.079 when they came out, sold them last night all for 1.179 Cheesy
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