A Theory on what pirateat40 is doing - page 6.

smoothie

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Quote from: JoelKatz on July 30, 2012, 03:38:48 PM

Quote from: ArticMine on July 19, 2012, 02:39:19 AM

Now when a buyer comes along he sells the buyer BTC from his inventory and then goes into the market buys back the sold BTC. He needs to generate say 10% a week in commissions in a flat market in order to pay his lenders and make a profit. This is actually not that hard to do. In a bear market July 2011 - December 2011 he makes an additional profit because he is effectively short the market between selling his BTC from inventory and buying them back in the market in order to replenish his inventory.

How does he generate 10% a week exactly? Sure, if you have some magic way to generate 10%/week, you can offer people 7%/week interest. But that's a mighty big if.

Most businesses small and large don't even make 10% a week. Even the best investors of all time don't make returns consistently like that for years.

This house of cards will fall soon. Probably before December 31st, 2012 at 11:59:59pm.

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Quote from: ArticMine on July 19, 2012, 02:39:19 AM

Now when a buyer comes along he sells the buyer BTC from his inventory and then goes into the market buys back the sold BTC. He needs to generate say 10% a week in commissions in a flat market in order to pay his lenders and make a profit. This is actually not that hard to do. In a bear market July 2011 - December 2011 he makes an additional profit because he is effectively short the market between selling his BTC from inventory and buying them back in the market in order to replenish his inventory.

How does he generate 10% a week exactly? Sure, if you have some magic way to generate 10%/week, you can offer people 7%/week interest. But that's a mighty big if.

BoardGameCoin

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Quote from: CoinCidental on July 30, 2012, 03:06:39 PM

theres no way any sensible business person would ... pay... 3400% interest on investments

(Although assuming he has a cap that he actively maintains and thus avoids compounding, the reality is more like 360% interest, but the point still stands, especially these days when you can get capital for < 3%)

notme

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Quote from: CoinCidental on July 30, 2012, 03:06:39 PM

Quote from: jimbobway on July 30, 2012, 02:59:50 PM

Ok, so here some points based partially on ArticMine's theory.

- It is known that pirate is asking for more bitcoins for his fund. Normally when things are going good you don't have to ask for more bitcoins. So I will be assuming pirate did something wrong and needs more bitcoins to be profitable.

- ArticMine says pirate is going short. So if pirate went short recently it means pirate sold some bitcoins and has mostly USD in reserve. pirate wants the price of bitcoins to drop so he can rebuy more bitcoins (and repay his investors the weekly 7%).

- Since the price of bitcoin is stable, and did not drop as pirate expected it put pirate in a very uncomfortable position. he may have to buy back the bitcoins at a loss resulting in a short squeeze.

- sunnakar chimed in and mentioned HNWIs. If pirate has access to a lot of USD from HNWI then it is possible pirate could be slowly accumulating bitcoins. If this is the case it is possible that pirate could still continue to be successful if bitcoin prices go up, and he would not be short squeezed.

theres no way any sensible business person would leave himself open to a "short squeeze" while paying 3400% interest on investments

But everybody's assuming he's a crook Roll Eyes

.

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Quote from: jimbobway on July 30, 2012, 02:59:50 PM

Ok, so here some points based partially on ArticMine's theory.

- It is known that pirate is asking for more bitcoins for his fund. Normally when things are going good you don't have to ask for more bitcoins. So I will be assuming pirate did something wrong and needs more bitcoins to be profitable.

- ArticMine says pirate is going short. So if pirate went short recently it means pirate sold some bitcoins and has mostly USD in reserve. pirate wants the price of bitcoins to drop so he can rebuy more bitcoins (and repay his investors the weekly 7%).

- Since the price of bitcoin is stable, and did not drop as pirate expected it put pirate in a very uncomfortable position. he may have to buy back the bitcoins at a loss resulting in a short squeeze.

- sunnakar chimed in and mentioned HNWIs. If pirate has access to a lot of USD from HNWI then it is possible pirate could be slowly accumulating bitcoins. If this is the case it is possible that pirate could still continue to be successful if bitcoin prices go up, and he would not be short squeezed.

theres no way any sensible business person would leave himself open to a "short squeeze" while paying 3400% interest on investments

jimbobway

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Ok, so here some points based partially on ArticMine's theory.

- It is known that pirate is asking for more bitcoins for his fund. Normally when things are going good you don't have to ask for more bitcoins. So I will be assuming pirate did something wrong and needs more bitcoins to be profitable.

- ArticMine says pirate is going short. So if pirate went short recently it means pirate sold some bitcoins and has mostly USD in reserve. pirate wants the price of bitcoins to drop so he can rebuy more bitcoins (and repay his investors the weekly 7%).

- Since the price of bitcoin is stable, and did not drop as pirate expected it put pirate in a very uncomfortable position. he may have to buy back the bitcoins at a loss resulting in a short squeeze.

- sunnakar chimed in and mentioned HNWIs. If pirate has access to a lot of USD from HNWI then it is possible pirate could be slowly accumulating bitcoins. If this is the case it is possible that pirate could still continue to be successful if bitcoin prices go up, and he would not be short squeezed.

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Quote from: jimbobway on July 30, 2012, 12:13:56 PM

But, can you connect the dots for us and tell us exactly what you think is going on?

No.

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Quote from: sunnankar on July 30, 2012, 03:40:35 AM

Quote from: Serge on July 19, 2012, 03:43:30 AM

Quote from: ArticMine on July 19, 2012, 02:39:19 AM

There is a serious risk here. A long term well capitalized investor who does not mind paying a small premium say 10% - 15% over market comes is out of the blue and buys out his ask wall. Now he is effectively short not only the BTC sold to the client but also the BTC from the now sold ask wall in a rising market. This is when the fun and the real risk of a short squeeze starts.

There is no need here for a ponzi or any kind of money laundering to explain this theory.

By the way I have deduced all of this from pirateat40's own comments, the comments of both his supporters and detractors and correlating these comments with the historical market behavior, as part of my own due diligence on Bitcoin.

Very plausible explanation how it could be done without it being a ponzi.

For those who did not see my 9 June 2012 post, when BTC was around $5.50, then I would recommend it in light of these two comments.

Thanks for pointing back to your posts. But, can you connect the dots for us and tell us exactly what you think is going on? I imagine you believe some HNWIs are investing in Bitcoin through a middleman you know. And you are suggesting that perhaps this will take out pirate?

sunnankar

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Quote from: Serge on July 19, 2012, 03:43:30 AM

Quote from: ArticMine on July 19, 2012, 02:39:19 AM

There is a serious risk here. A long term well capitalized investor who does not mind paying a small premium say 10% - 15% over market comes is out of the blue and buys out his ask wall. Now he is effectively short not only the BTC sold to the client but also the BTC from the now sold ask wall in a rising market. This is when the fun and the real risk of a short squeeze starts.

There is no need here for a ponzi or any kind of money laundering to explain this theory.

By the way I have deduced all of this from pirateat40's own comments, the comments of both his supporters and detractors and correlating these comments with the historical market behavior, as part of my own due diligence on Bitcoin.

Very plausible explanation how it could be done without it being a ponzi.

For those who did not see my 9 June 2012 post, when BTC was around $5.50, then I would recommend it in light of these two comments.

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Quote from: bulanula on July 19, 2012, 09:45:17 AM

No way this is a ponzi guys.

He would not want to do anything illegal since his identity is public.

Oh wait ... "but Bitcoin".

Just hope GPUMAX coins won't be blacklisted or some other crap after this folds.

Carry on pirate !

And we should listen you because you have a scammer tag? LOL!

ArticMine

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Quote from: zyk on July 19, 2012, 01:30:39 PM

what should fold then?

A sharp rise in the BTC / USD price particularly if his ask walls are bought out and the price rise is driven by well capitalized long term investors as opposed to short term high risk speculators. This can set up pirateat40 for a brutal Bitcoin short squeeze.

zyk

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what should fold then?

bulanula

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No way this is a ponzi guys.

He would not want to do anything illegal since his identity is public.

Oh wait ... "but Bitcoin".

Just hope GPUMAX coins won't be blacklisted or some other crap after this folds.

Carry on pirate !

Vladimir

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-

As I said, paying 3000$ to mitigate some risk of loss of 100$ is just plain insane. Whoever thinks that this is a genius plan needs to think again.

hazek

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Exactly, hardly any amount of risk is worth sacrificing 3300% per annum of profit as he claims he does by using other people's money as a hedge against risk.

mp420

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The reason I'm certain he's a scammer is that if he's the genius enterpreneur he's implying he is, he would not borrow bitcoins at 3000% annual rate but he'd get a loan in fiat from a bank with far less than 10% annual interest rate. Even if his business is not legitimate if he's as resourceful as he lets on, he can work around that and get the loan papers signed.

And voilà; he can keep all the insane returns. He borrows $1M and in a year he has $50M or more. (With $1M he could have bought at least 250kBTC. In retrospect, that would have been a succesful strategy even if he did not have any kind of business plan; by now he could have paid off all of the initial loan and still have $1M worth of bitcoins.)

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Quote from: CoinCidental on July 19, 2012, 05:41:56 AM

Quote from: Mageant on July 19, 2012, 05:12:09 AM

Quote from: smoothie on July 19, 2012, 04:01:49 AM

Quote from: Cluster2k on July 19, 2012, 03:55:24 AM

Quote from: CoinCidental on July 19, 2012, 03:40:28 AM

Quote from: Cluster2k on July 19, 2012, 03:17:33 AM

You're assuming his scheme will last 4 months... Are people seriously expecting a 7% return on their investment per week? LOL

the fact is ,he is paying these rates at the moment and you are still free to walk at anytime with you coins + interest

how long it can last is anyones guess ,i believe market manipulation is a major factor and as long as pirate has an enormous share of BTC then he can continue to apply the scheme for a while yet

(that doesnt mean im saying he wont run with all the coin at some stage ,just not yet

)

If history is any guide then one of three things is likely to happen:

1) Interest decreases to a sustainable level as the market adjusts and reacts to the trader with all the coins. This is the best case scenario.

2) The market moves against the trader in a way the trader didn't anticipate, realising a large loss of customer bitcoins. Not everyone can be paid out.

3) The trader disappears / gets hacked / whatever and the customers lose their bitcoins.

If it sounds too good to be true, it probably is. It's not really different this time. It's not a new paradigm where all the old rules no longer apply.

Watching the market action with interest.

+1

Pirates operation will have to end sooner rather than later. Just like Vladimir said once...you could in fact get all the bitcoins (21million) in three years with just starting with...i think it was 1000BTC and compound that for 3 years at 7.5%....

yeah yeah yeah his interest rate will go down soon...and will likely go down again 1, 2, or 3 months after that again.

Another possibility is that he stops accepting new deposits and pays out all interest. Then he can go on indefinitely.

I dont know if i follow this correctly .........
everyone gets bought out of the pyramid with their stake + interest but pirate stays in alone to reap further benefits ?

No, he just keeps the size of his deposits stable.

Let's say he has 300k BTC in deposits. Then he just keeps that amount constant and pays out 18k BTC interest (or whatever) per month to the lenders.

The interest does not get reinvested *and* he doesn't accept any *new* deposits.

Then he can go on forever.

CoinCidental

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Quote from: hazek on July 19, 2012, 06:50:35 AM

Nice of you to cut out the most important part of my post, but just so that we can keep the context of my post you quoted I'll post it again.

Quote from: hazek on July 19, 2012, 06:25:18 AM

Quote from: adamstgBit on July 18, 2012, 10:53:31 PM

I have a new theory!

Pirate is allowing ovr X million dollars of new money to enter the market below 10$ ( by keeping the price down as much as possible as he buys over 1 million coins )

once he's done his investors (wtv you wana cal them) will simply hold on to over 1million coins and watch the market naturally rise to over 50$ each!

I'm sorry to be this blunt but your theory is down right stupid.

Not only is he borrowing BTC that could be on an exchange sitting in an ask wall, suppressing the price but he is borrowing to pay back interest at a rate of double what he borrowed in just 10 weeks. So not only is there less supply available for exchange then there could be otherwise but there's even more demand because he needs to buy BTC to pay interest.

And now under these circumstances you think that his tiny little wall of 30kBTC is going to stop the price from rising? Is that why we went from $5 to $9.2 in the last month and a half? Is this him being successful?? Roll Eyes

Please, give it a rest already, whether money laundering or buying in at a certain price NO THEORY MAKES SENSE ANYMORE GIVEN THE RECENT PRICE CHANGE.

As for your question, I think it's pretty simple: have you ever seen a bigger ask wall that could possibly be his? Remember that the theory says that he doesn't actually sell these coins, just display them as a threat in order to suppress the price.

the way i see it ,if you have the most of anything you can manipulate its market value
nobody knows how many coins pirate is effectively in control off so he could easily
create highs and lows to buy and sell at his own advantage (if he has shitloads of btc )

I dont have his accounts so i dont know but i know the money/btc i get every week is real

the only thing i dont know is where its coming from /ponzi new investors /trading stock markets ,money laundering for drug cartels etc etc or how long he can keep doing it

its interesting to watch anyway, but dont bet what you cant lose

hazek

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Nice of you to cut out the most important part of my post, but just so that we can keep the context of my post you quoted I'll post it again.

Quote from: hazek on July 19, 2012, 06:25:18 AM

Quote from: adamstgBit on July 18, 2012, 10:53:31 PM

I have a new theory!

Pirate is allowing ovr X million dollars of new money to enter the market below 10$ ( by keeping the price down as much as possible as he buys over 1 million coins )

once he's done his investors (wtv you wana cal them) will simply hold on to over 1million coins and watch the market naturally rise to over 50$ each!

I'm sorry to be this blunt but your theory is down right stupid.

Not only is he borrowing BTC that could be on an exchange sitting in an ask wall, suppressing the price but he is borrowing to pay back interest at a rate of double what he borrowed in just 10 weeks. So not only is there less supply available for exchange then there could be otherwise but there's even more demand because he needs to buy BTC to pay interest.

And now under these circumstances you think that his tiny little wall of 30kBTC is going to stop the price from rising? Is that why we went from $5 to $9.2 in the last month and a half? Is this him being successful?? Roll Eyes

Please, give it a rest already, whether money laundering or buying in at a certain price NO THEORY MAKES SENSE ANYMORE GIVEN THE RECENT PRICE CHANGE.

As for your question, I think it's pretty simple: have you ever seen a bigger ask wall that could possibly be his? Remember that the theory says that he doesn't actually sell these coins, just display them as a threat in order to suppress the price.

CoinCidental

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Quote from: hazek on July 19, 2012, 06:25:18 AM

Quote from: adamstgBit on July 18, 2012, 10:53:31 PM

I have a new theory!

Pirate is allowing ovr X million dollars of new money to enter the market below 10$ ( by keeping the price down as much as possible as he buys over 1 million coins )

once he's done his investors (wtv you wana cal them) will simply hold on to over 1million coins and watch the market naturally rise to over 50$ each!

And now under these circumstances you think that his tiny little wall of 30kBTC is going to stop the price from rising?

how do we know exactly how many coins he has to manipulate the market/force trends and make walls ? I would imagine its waaay higher than 30k btc

Topic: A Theory on what pirateat40 is doing - page 6. (Read 39920 times)