Topic: Bitcoin Savings and Trust is probably a Ponzi Scheme: A Petition - page 6. (Read 25616 times)

The previous two posts must be the most stupid and unreflected ones I have read in this whole thread.

bitlane: use all of his huge profits solely to maintain an incredibly expensive lifestyle? Get serious.
psy: An appeal to authority as actual reasoning? So if I have 29381093 ratings, It is impossible for me to scam anyone? Cool story bro.

Congrats, you both have earned yourself the additional ignore. Oh, and for the record, I am betting with my money that he does not run a Ponzi, so this is not even coming from a detractor as you two will surely accuse me of.

edit: I apologize, I just don’t like the hostile tone you guys employ. I think we could and should remain civil here.

It seems all the detractors simply forget that Pirate is the 8th most rated seller at Bitcoin-OTC lol

Morons...

What if the borrowed/invested BTC were actually the widgets in question ?

Profit Breakdown of XY:
x% - buy more BTC to replace member-invested BTC & pay interest.
y% - LIVE OFF THE REST OF THE PROFITS LIKE A NORMAL PERSON WOULD DO ASSUMING BITCOIN IS THEIR PRIMARY SOURCE OF INCOME OR JOB.

Fuck, is it REALLY that difficult for everyone to understand ?

PEOPLE HAVE TO EAT....and NONE of you so-called GENIUSES EVER MENTIONED OR CONSIDERED THAT.....HENCE KEEPING 3RD PARTY BTC 'INVESTED'.

Ponzi, Sky is falling, tin-foil hats....FUCK ME.
Get a life.

I just spent two hours searching the internet trying to figure out his identity.    The best thing I came up with is an IP address from an old bitcoin-otc chat log, and a picture which I don't know if it is real (do a google img search if you want to see it).  People say it is easy to find out his identity, but don't share or tell us how.  What is his identity?

The deal wouldn't have happened if he hadn't borrowed, since he wouldn't have had the funds to purchase the widget. Without borrowing he would have stayed at 0, with borrowing he gained $40. He profited $40 from the borrowing.

Same for the retail customers - without the borrowing they wouldn't have a widget, with the borrowing they have a widget, they paid $150 but it's worth more than that to them.

Again, the whole concept of commerce relies on the possibility of two parties to enter a mutually beneficial agreement where none of them loses. In our example both the lending and the retail sale are such agreements.

Currently MMM does pay out, if you request it. The only question is - how long? It might also be that pirate is "investing" in a different ponzi scheme, but to me personally either money laundering (pay GPUMAX customers your dirty silkroad coins and get freshly mined anonymous ones) and/or ponzi investment makes the most sense.
The MMM scheme is based on "currency conversion" after all, with some russian funny money that is worth more and more USDs per month. This could be called "market arbitrage" or "day trading" in a broad sense and would be consistent with pirate's wordings (he might even sell the one or the other BTC to a friend at a price above MtGox, who knows?) about his operations so far.

The borrower lost $10 of his profits on the bitcoin deal, and you could argue whoever bought or sold the wholesale something lost $50. At least they missed a $50 opportunity. This becomes semantics quickly because you may just as well say reselling those products created $50 of value to the customers, but the question regarding Pirate then remains roughly the same.

You're forgetting that he has to get the "profits" he pays out from somewhere.

There is no "profit" in a Ponzi scheme. Deposits are neutral -- someone gives you $100, you owe them $100. Payouts are neutral -- you pay out $100 to someone, you owe them $100 less. And, of course, accumulated interest is pure loss. If someone deposits $100 and I now owe them $105, that's a $5 loss. Ponzi schemes only accumulate losses. The difference between how much money they hold and how much they owe can only grow, and it grows with every passing day.

I don't think there has to be anybody on the losing end. Say someone has a unique opportunity to turn $100 into $150 (say by buying something wholesale and selling it retail). So they borrow some Bitcoins, sell them for $100, turn the $100 into $150, buy $110 in Bitcoins, give those Bitcoins to the lender and pocket $40 in profit. Who is the loser here?

The economy isn't a zero sum game. Value can be created. Even if someone pays Pirate and "loses" bitcoins, he presumably gets in return something of value to him (which could be a product, a service, money imported from the fiat economy, etc.).

Just thinking about it if he is running the MMM ponzi scheme. If he does he would earn a 20% profit even when paying out 20%. In 5 months all the money someone else invested would be his profit. So if he gets the money out every month and the MMM ponzi scheme collapsed. He will be be able to payout a lot of ppl if he wanted to. All the money who is in longer then 5 months is full profit for him.

This.
Although, a ponzi can collapse at any moment, and not necessarily when Pirate would have planned it. If too many people start worrying and demand their money back, it could unwind very quickly.

Anyway, more thinking out loud; if this is not a ponzi sensu stricto, and pirate is actually earning as many or more bitcoins as he is paying out, its more than likely someone else is losing out, bitcoin being a zero sum game. So I keep wondering, who is losing? I dont see an obvious answer, but perhaps we are all losing if Pirate manages to manipulate either mining difficulty or bitcoin exchange rates somehow. The former would almost certainly be related to gpumax, though I fail to connect the dots. The latter could be related to bitcoinica, although once again, someone smarter than me will have to connect the dots.

It hasn't been shown to be a hoax yet but the spergy bitcoiner party is eating it up like pancakes without a single verifiable clue afaik.

Such a depressing community we have here. Hey guys! The president just emailed me and he said Bitcoin is the new currency! Trust me! He read it in an anonymous PDF!

What this means is that if it is a Ponzi scheme, most likely we're still very early in the scheme. If that's true, people who are in now are pretty safe and will likely have plenty of warning when it's time to get out. This is one of the main reasons I'm *not* one of the people screaming "Get your money out now, it's a Ponzi scheme!". I don't really see how it could be a Ponzi scheme that's about to bust, because if so, it was very badly run and didn't achieve anywhere nears its potential for the effort expended.

Care to send me the hashes of a few transactions to or from pirate addresses? Doesn't even have to be public. It would be nice if you could label them like "to GPUMAX" "from GPUMAX" or "to BTCS&T" etc.
This goes of course for anyone here who wants to know more about pirate's operations - just collect transactions + public addresses of him and then do the research in the chain.
One could also start to do research about the payouts of dividends each monday (just link forum posts and donation addresses in signatures here with users and check who sent them BTC on monday morning) to find more accounts even without getting any data from his "investors".

Also please give an estimate of "pretty small"...

I personally believe he just invests in the MMM Ponzi. Payouts there should be enough to leave him with even some profit after the crazy rates he gets here, and as long as they pay (which they currenty do) he'll pay as well.

I expect that if the FBI are treating bitcoin thefts, scams & frauds seriously then judges would do so too

http://www.scribd.com/doc/92797476/FBI-Bitcoin-Report-April-2012

While people are trying to guess his business model, here's my 2 satoshis - he has a/multiple clients who wish to amass a fat stash of bitcoins & don't mind paying through the nose in fiat $ for it, guessing 10 - 15 - 20% over spot & they buy regularly like say once a week or 2, this is because they have a big constant inflow of cash that they wish to move around the world outside of the banking system, where every they move it they have the means to change back from bitcoins to their preferred fiat or merchandise, quite a few enterprizes could fit this bill (hi Wal-Mart.mx)

Lets say that after Gavin's presentation to the CIA they saw the advantages of a company fund, maybe to use for entrapment, to pay anon informers, bribes, prepagardo 'ho/s for the president's security detail, wanted dead or alive rewards (Fahd al-Quso hello, well that's goodbye actually*), a host of other nefarious purposes spring to mind & being spooks they wish to have no paper trail & plausible denialability so they dip in to their black ops cash slush fund & head to downtown Texas, or it's virtual equivelent, where Pirate is happy to oblige them & becomes untouchable to LE in the process, just one small op could account for this 6 months past funding - it could even be LEO themselves getting a healthy float in an off the books manner for whatever they would like to mess with, I mean people do buy, sell & do illegal stuff with this currency so if they're going to sit at the table & act like a player then they need a stack of chips first

disclaimer, I have an active imagination but also a lot of coins with Pirate - I'm so patriotic  

* edit: that's 1,000,000 bitcoins fiat equivalent was offered just for Quso's GPS loc & you can bet that if their Brit mole had demanded payment in small denomination, used bitcoins then that's what he would have got - who'd want to trust those leaky old Useless Banks of Switzerland nowadays anyway, so last century

Judge, judge! This man stole my virtual internet monies!!!

Yes.  I have done some of that.  What I found is that the total (realistic) maximum of all coins sent to Pirate (based on some non-public information) is actually pretty small.

If you look through the blockchain, you regularly come across 10,000 coin wallets, and of the two largest active wallets I noticed one had over 300,000 coins sitting in it, and the other I suspect was an exchange wallet that had turned over more than 4M coins.

Or an echo subforum. When it's all been said before, but you just want to hear yourself say it over, and over, and over...