Topic: A day in the life of a pirate. - page 9. (Read 31770 times)

how to mess with bitcoin if you are say, a bank consortium:

1. amass a large amount of coins (do it cheap by means of a ponzi scheme)
2. get control over a large amount of hashing power (pay more than average pool)
3. screw bitcoin

I am not saying pirate is doing this but I would not know the difference.

do you see something like a lending bubble, have the rates increased since pirate started his business?

You mean the lender....

Now this all suddenly makes a lot of sense!

more than ev'yarrgh

Yes, this is correct. If not, everyone who plans to hold coins long-term would be lending them out. Clearly, they are not. A large fraction of loan requests are complete or partial scams (e.g. the borrower gambles and defaults if the bet fails to pay out). Thus the high interest rate.

While we're brainstorming here, drakahn, and still keeping in mind Occam's razor, he could have invested in steam devices with his pirate booty, and developed the first difference engine rather early. From there it's only a matter of years before he introduces coal-coin mining on distributed steam powered difference engines and corners the market on cryptocurrency. Without the ability to reign in his expanding wealth, he soon controls the world.

You really want to contribute coins to Pirate's quest for world domination?

Id say its primarily because of the huge risk for the borrower to get scammed and never see his coins back.

I guess "somewhere else than 2009" did seem a bit exclusive, but not really what i meant, just that the bitcoin profits wouldn't come from piracy, chances are he's running the same program with pirate booty, the original guy fawkes was him in a v for vendetta mask(just to claim 'first') and he was there the night satoshi drowned

And with his sister added, you'll be begging for them to take your money. 

Well, I agree that that would be logical, but not if you're "a pirate 200 years late". In 2009, opprtunities to make people walk the plank and say things like "Argh! Ye lubber etc" were severely limited.

lol, someone in a time machine going somewhere else than 2009 with future mining technology and constantly keeping just under most users radar (zomg, mysteryminer is a time travelling pirate manipulator?)

ObPlug: http://bitcoin-otc.com/

I think the most likely and simplest explanation, given pirate's know proclivities, is that he has a time machine, goes back in time to the 18th Century and captains a privateer. He needs investor money not just to to enable the purchase and maintenance of the privateer and the hideous expense of time travel, but also when he and his crew face life and death every day he'll want to have been prepared as much as possible, using as much money as he could.

However, he can afford to repay at such a high interest rate because he can attack the same Spanish Galleons again and again, and sell the same gold over and over. Such is the beauty of time travel.

I think others have brought up similar reasons for the necessity of investors when the profits are so large; I think mine is the simplest and most realistic by far.

I can answer that one too: I don't care.  I transact in bitcoins independent of other currencies.  I gave up worrying about price movements long ago, because 10%/day wasn't high enough for me to worry about.  (I used to trade electricity on my own account as a commodity and have yet to find anything as volatile.)

I have done some large loans and seen the price increase/fall 50% - I tended not to notice.

That special low rate involved escrowed equipment with high resale value - if you want me to fund your purchase, I'll have it held until fully paid off - and yes, that's 2%/week.  If you default, I resell it for full price. 

I dunno what Pirate is doing. I have formed my opinion from a question I asked in public a long time ago, knowing what I know about markets and his overall idea. Basically, I have formed my own opinion and believe I know exactly what he is doing.

Here is my problem: If you figure out a correlation, you don't tell anybody otherwise it doesn't work anymore. Or if it does, it does so less profitably.

I propose 'what ifs' that are not negative or nefarious in nature where others simply go to the negative. Sometimes, if it walks like a Duck, quacks like a Duck, it's a Goose.

I try to defend those that are getting attacked without evidence. Lynch Mobs run rampant around here. Sometimes it turns out they were right so people use that to squash others.

Why is Pirate being attacked? Because he is making an impact on the market and the way it operates and people can't figure out how it is being done. They are not attacking the HYIP guy that stopped paying people because he didn't affect the market in a big way so they don't care.

Vlad brought up Occam's Razor which most take to mean: "other things being equal, a simpler explanation is better than a more complex one." not only is this incorrect it definitely wouldn't apply to finance if it was correct. Imagine apply it to CDS', etc...

In practice, the application of the principle often shifts the burden of proof in a discussion.[1] The razor asserts that one should proceed to simpler theories until simplicity can be traded for greater explanatory power. The simplest available theory need not be most accurate. Philosophers point out also that the exact meaning of simplest may be nuanced. ~wikipedia

BTW: IF I was to set up a business model, I would design it so 'others' would come to false conclusions by utilizing reliance on the above in order to protect the model and market share.

Any idea when this spike will happen ?

If you were running pirate's business, where would you go to mitigate exchange rate risk cost effectively?

As far as I know, they would all involve counterparty risk. How would pirate be feeling right now if he had used solely Bitcoinica to hedge? Pirate has absolutely no counterparty risk. Investors need to trust him. He doesn't need to trust anyone else to make good on an option contract.

Now, I'm not saying whether the avoidance of this counterparty risk is worth the amount pirate is paying. In fact, I have said before he could easily lower his rates and still get a good deal of funds.

Another question. Does anyone know now many BTC denominated loans that were made slightly more than one year ago below 1$ have not been defaulted on (or restructured to be USD denominated)? Care to guess? 100%?  50%? 10% maybe.

What will happen with all these loan portfolios if (when actually) BTC exchange rate jumps 40-50% in one month?