Topic: btc-arbs.com - Update: dead HYIP, Refund progress: BTC-arbs still doing refunds - page 175. (Read 276958 times)

The analysis was good on the Ponzi scheme up to a point, but the thinking was too limited. The assumptions in that post are based on the idea that you musst be exchanging BTC for fiat in order to be doing the arbitrage. Certainly that is possible, and since BTC arbs has account slots for BTC and $, a good assumption that this is being done. It isn't necessary or even likely in my mind that that is all thats being done.

As far as BTC itself is concerned, all thats necessary is a means of transport between 1 exchange and another. To most of us, in most markets that means would be the $, but in a world where nearly a hundred different coins exist on different exchanges, its certainly not the only possibility.

Ive often used the features of 1 currency, usually faster transaction times, to transport BTC from one exchange to another. I have at times used that transaction to make money. If that were automated through scripts to work at the push of a button instead of manually calculating and entering the actions as I have done, it would be even more effective.

At this moment there is a spread of $616.94 $618.999 and $624.42 between the main exchanges on BTCwisdom. In this 1 instant today we're looking at an almost 1% difference. Given 50% for overhead as an easy guess for general business practices were talking about a need for BTCarbs to produce 3-4% per day in positive margins to be able to give out that .5-2% gain we see in the accounts. With transport fees figured in they could likely make this happen in perhaps 12 transactions. Smaller would be easier on the markets themselves, while larger would be more efficient for dealing with fees. There again I think the use of alternative coins for transport seems more likely as some of those transaction costs are quite small compared to BTC or converting to fiat.

The use of multiple currencies, and multiple coins also greatly blunts the argument that any use of arbitrage would tank the market from huge transactions. Split that transaction set up 100 different ways, across multiple exchanges, and across multiple coins. You could easily 'hide' quite a large volume of movement that way. I'm not inferring they hide them to avoid detection here, but rather use hide to indicate a lack of disruption at the exchanges used.

How they're doing it on the $ side.. I dont really care to think about that much, as I don't do that myself. On the BTC side though getting a 1% gain would be quite feasible. Getting multiples more then that would be feasible even for me, but the time necessary to develop that automation would not be insignificant. I'm happy to pay them to do it for me.

Now with that said, I don't have a lot of BTC tied up there either. About .5 BTC. I wouldn't even have that much there if I hadnt done my own calculations to see that its doable though.

You are welcome.




:X

The writing style is fairly different from Adam on the BTC-Arbs site. Don't think they're the same guy.

It is interesting that the reply from SUPPORT had a name of "Adam".

Adam Lyons from notnull.org pool has been pushing this site to its miners via e-mail twice last week. Perhaps he has an investment in this scheme?

Email1: http://i.imgur.com/cK0GIoV.png
Email2: http://i.imgur.com/YB1htGb.png

Me mentions this thread in the second mail. It may be innocent, but I hold back in caution.

yep, I finally could login too. Don't know what was that

It's working for me.

http://ex-admin.com/btc-arbs-com-review-update/

Well, as you can see here, BTC-Arbs.com was reviewed and it has already grabbed a lot of attention and who have joined early are already in profit mostly, but a disturbing news came to my attention today. As I told in the review, accepting STP may create a problem but the news I received will change who might be at fault!!

The BTC-Arbs.com STP account is UNVERIFIED! A friend of mine tried to invest a couple of hundreds and he received this error from STP: Recipient is over daily limit. Which means, the account has a daily limit of $250 and it is unverified.

It shows either the admin is a newbie (doesn’t know where and how to get a verified account) or the admin is there to get cash as fast as possible or he runs until STP freezes the account.

Bear this in mind and play carefully. This is just a warning!

Remember, this is a HYIP and will close sooner or later, no matter what the admin says or shows!

Do NOT invest more than you can afford to lose.

Good Luck.

lol they closed any logins
Can't login with my account. Password recovery doesn't work too.
I'm very happy I withdrawed my funds yesterday (initially 0.05btc + bonus 0.001btc which covered transfer fee for btc-arbs)

LOL ferguson, I'm not sure if that's a good thing or not. That my post made you crave Oreos & Milk.

The problem with the other alt-coins is the same as with BTC. + they have an even smaller volume of trade at the moment. If in the future that changes, then all opportunities arise from those situations. However as with all alt-coins arbitrage can let you profit with a compounded interest effect up until you reach the ceiling i was talking about in the other post. Then once you reach that ceiling, you will see a fixed return from arbitrage.

LTC has a good trading volume also. On coinmarketcap.com it's 24hr volume is $5,949,358 and its price is $15.38 meaning that 387,000 LTC are traded back & forth every 24 hr period between all exchanges combined.

Bitcoin manages to trade around 30,500 coins across all exchanges every day. But that's because of the difference in price (there's a markup of more than 4000% between LTC & BTC) so you could effectively say that BTC is currently 3.15 times more popular to trade than LTC. However recently LTC started getting some momentum probably cause of the hype that some exchanges adding LTC to their repertoire. The trading we're seeing right now in LTC could well go down in a couple of weeks when things stabilize again.

Also NMC, PPC, DOGE have good volumes but for DOGE in order to make a decent sized profit you'd need to look into trading 1,000,000's of doges at least, and still you'd be making only a few dollars on the arbitrage. For NMC & PPC you're looking at buying big batches of 100's of them at a time to make some profit in the region of $10's of dollars after deducting the fees of the exchanges.

My opinion is that LTC has the volume to be a viable alternative for arbitrage at the moment, however you'll need to find the two or three biggest exchanges for LTC and see how their volume per 24hrs is on their own, not as an aggregate across all exchanges (like coinmarketcap.com). But then again, don't take my word for it. I'm by no means a financial adviser and would never claim to be one (at least not on a forum anyway ;P). Trading is all about your own creativity. If you find a good opportunity, take it.

acid_rain, what a post, made me hungry for some MilK & Oreo's after reading it all. What are your thoughts about arbitrage opportunities with the other more than 100 coins coming on stage?
http://coinmarketcap.com/

Thanks Qwiner. It's a great thread you've started here, and it's always had a healthy discussion.

I guess as FreeJack2k2 said, we'll have to bide our time and see. I hope you can all withdraw your profits eventually. Time will tell, and certainly arbitrage at the smaller levels is still doable. I agree that 0.05 is not much of a risk.

I just get my blood boiling when scammers end up destroying the trust in a viable business + also manage to make coin so easily by preying on other people and to top it all off, get away with it. That's the harsh part!

After that rant I went on about earlier, I'm thinking of putting the minimum there too lol. I like how my hands and my head can never seem to listen to each other. Oh well, Feed the Monster I guess.

So do I, and I hadn't seen any yet. Only reason I found out about it is because someone I know referred me to it.

I guess it's a little funny to me that people won't bat an eyelash about sending the majority of their Bitcoin to BTC-e for trading, and the same lack of information and transparency exists there that exists with BTC-Arbs. The difference is longevity - BTC-e has been around for a long time and has not run off with anyone's Bitcoin, so people trust them. This site just started a month ago. I guess only time will tell, whether they become trusted. I'm willing to take a little bit of a risk on them, so far they've delivered and somehow, I find their relative lack of concern about whether people use them or not to be somewhat reassuring. I did some research on that PokerByProxy site and they had gone to GREAT lengths to give the appearance of legitimacy, including hiring actors to be in videos (claiming to be the site operators) talking up the site, doing interviews and really pumping it hard. I haven't really seen these guys doing that. They seem to take the opposite tact and just quietly go about their business, and if you want a piece of it, fine...if not, that's fine too.

A healthy amount of skepticism is good, if you are risk-averse, don't put a significant amount of money there...but I've got some appetite for risk, so I'm sticking with it.

How can you say they don't advertise? I regularly visit a lot of bitcoin-related sites, and trust me, their banner ad is everywhere. This was also the impression that got me think twice about it. Anyways, I still have the minimum invest in their pot, and I wish everyone the best (but: prepare for the worst). Also, I have a bet running on when they will take the money and leave, so either way there's a fun part in it I enjoy.

Yeah, didnt know about that part of the internet either, these hyip ponzis. A little dark alley with all kinds of weird shit going on lolz.
Seems profitable if you know how to play the system. But risky as hell, cant trust anyone..

This thread has been great. It's introduced me to the murky world of HYIP... I always like finding an obscure area of the internet.

I still have no idea if the site is legit, but so far I've had no problems withdrawing.

I did have the link in my sig, but after some thought removed it as I couldnt be responsible for other people losing their money if the worse were to occur.

Dude, look at the bigger picture. This is a very legitimate finance business with 10 employees and an office in Geneva (one of the world cities in the finance world - very expensive offices) and their website is an exact copy of a ponzi site.

Still no alarm bells?


But great you add some reasons why this is a ponzi from a trading aspect.

Wow, someone signing up @ bitcointalk.org, because of my thread,  . I think this forum owe me a thank you, for getting one new member.
Welcome, acid_rain, I must admit, this is the greatest forum, I have ever signed up.

Here's my opinion about your post:

"Basing your assumptions on a couple of commercially available scripts & design is not gonna cut it. The owner could be very well genuine and in that case you would be creating mass panic for nothing i.e. making people withdraw their investments without real reason. It's best to reason it out in a logical fashion and understand the underlying concepts as to why it cannot work forever instead of just putting it on a feeling that you have that it's somehow a ponzi scheme. "

OK, I must admit I am lazy, & I am looking for a quick way to judge whether something is reliable or not. Besides, I was only making a small investment, $50-100 max.. I am not planning to invest pass the $100 mark.


Yes, Thank you so much acid_rain. I am not a trader myself, I don't know how trading really works. U seemed to be a really good & experienced trader for stocks/securites

I certainly don't how to trade securities or stocks. I only start this buying/selling thing with BTC. Eventhough I closely watched the stock exchange prices constantly, I am still so bad at trading, I just don't know when is the best price to sell or buy. I often buy at the relatively high price & sell @ the low price, for a particular time period

Ok..this being my first post on here. I hope I don't get banned for the long post. Even though that would be epic! I haven't had time to even set the signature yet. I just rushed in & joined so I could post on this particular thread. I'll post a summary of what I'm gonna say for those who don't want to go into the gory details & math of why it cannot keep on compounding indefinitely.

-----------------------------------------------------------------------------------------------------------------------------------
SUMMARY:

Basing your assumptions on a couple of commercially available scripts & design is not gonna cut it. The owner could be very well genuine and in that case you would be creating mass panic for nothing i.e. making people withdraw their investments without real reason. It's best to reason it out in a logical fashion and understand the underlying concepts as to why it cannot work forever instead of just putting it on a feeling that you have that it's somehow a ponzi scheme.

The simple reason why it cannot keep compounding is simple. There is a ceiling and that ceiling is in the design of ฿ itself. ฿ is finite: 21 million coins of which only around 12m are in circulation. Let's forget the 12m for now. Since there is a capping of 21m coins the arbitrage system is invariably flawed in the sense that it cannot keep on growing indefinitely.

Having said that... arbitrage can be applied on the ฿/USD market only up unto the point where there isn't enough trading volume to buy what you're selling and to sell what you're buying (The good ol' concept of demand & supply).

So for example let's say you want to be able to buy $666,000 worth of bitcoins on a lower-priced exchange to be able to sell them instantaneously on the other one right? (approx 1,000฿). Assuming you already have the 1,000฿ on the higher priced exchange ready to be sold. Inevitably you will run into a couple of problems. One is that would become so big that you would be driving the market price of ฿ upwards/downwards on your own by buying all available coins for trading in that 24hr volume thus on the lower-priced exchange you would be driving the price up, whilst on the higher-priced one where you intend to sell them you would be driving it down thus killing the spread that your hoping to arbitrate and make profit off-of. In real terms only around 4,000 coins are traded in a 24hr volume on any of the biggest exchanges. So you are limited by the capping which is dictated by the volume of trade. You could not possibly overcome that. By the time you manage to buy all 1,000฿ you will face 2 problems.

1) Time has passed so prices have begun to change i.e. leg risk
2) Now that you've acquired 1,000฿. Let's assume the prices haven't varied much and you can still make a profit. how on earth are you going to sell them all at once? There isn't that much demand either on the other exchanges, at least not at one go. Thus meaning that you're taking a very high risk in your trading, which completely defeats the purpose of arbitrage

This type of arbitrage would work on an inefficient slow-moving market which its currency pair that it is trading ideally has infinite reserves (not a finite one like ฿) be it virtual or fiat, because theoretically or on paper at least you could go on arbitrating with a compound interest effect forever and capitalizing on the spread.

That is the theory behind it, however below I ask some fundamental questions about the btc-arbs accountability issues & banking practices.

END OF SUMMARY
-----------------------------------------------------------------------------------------------------------------------------------
THE NITTY GRITTY

I'm going to present my own thought process, the math of it and also ask some very basic questions that are at the foundations of this venture (which is interesting, yet shady). I haven't seen anyone talking about it so I thought I should highlight the math of it and please correct me if and where I'm wrong.

At first, if you think about it, it seems like a clever idea/investment opportunity and thus the arbitration itself seems viable due to the inefficiencies of a slow-moving market.......well yes.......only up until a certain point though. The point where the volume of bitcoin being traded on the markets is saturated and thus you cannot sell and/or buy anymore. At that point it becomes almost impossible to make a profit. Also having a limited amount of ฿ in circulation you cannot expect that this system can go on forever. This type of arbitration can only happen in an inefficient market with new moneyflow pumping in the system at both ends of the trading currency pair i.e. like for example Forex markets where fiat reserves are infinite (even though FOREX has achieved high levels of efficiency due to technology).

However what btc-arbs is doing here is just moving coin from one exchange to sell it to a higher priced one. At some point it has to become saturated and it won't be easy anymore to move more coins than the volume of trading per se' unless there is a pendulum effect reversal of the exchanges i.e one of the currency pairs gets devaluated rapidly on one exchange (like what happened on Mt.Gox. That was an arbitrageur's dream if only Mt.Gox were processing their bitcoin withdrawals quickly enough). There arbitrageurs get to profit due to the spread. This means that the system will indeed slow down and cap itself. More so if this process could go on indefinitely, btc-arbs would end up buying most of the bitcoin in circulation and as such there would be no market left for bitcoin anymore because it would have been all bought & resold progressively by btc-arbs and its investors. The volume of daily trade is surely not that big enough to be able to handle those amounts. Thus there is a ceiling you can reach, and then you would be such a big of a whale that you could move entire markets with just a click of a button if you just want to. LOL I jest and I'm also digressing. Apologies!

Having said that though, the idea has its own merits for a short while obviously. In fact what will happen is that the percentage of profit will start becoming so low that it's hardly noticeable whilst still the threshold of how much you can arbitrate depends on the volume of trade in that 24hrs. You can't force people to buy and You also can't force people to sell if they don't want to.

Few things to consider when investing with btc-arbs are, how trusthworty is the guy/team running btc-arbs. Let's say you invest 1 bitcoin and after patiently waiting 6 months without withdrawing (with a rough estimation over February's data/results, the average compounded interest is at 1.8%. It will probably change as we get more data to work out statistics on), you would have a nice 24.8 bitcoins on your btc-arbs account. The workings for this is simple i.e. 1฿ * 1.018 ^ 180 = 24.808฿. Note the 180=6months in days since the interest is compounded and paid daily. Are you sure he's not gonna run away with the coin once he/they start seeing some big transactions?

Another really basic point to consider is that once he sells his coin on the higher priced exchange, he has to use his bank account as an intermediary and to move fiat to other exchange/s. This of course takes time and thus to be able to produce a daily profit he cannot spend all the money at one go. You have to divide the spending of fiat by the days that the money transfers from one bank account to his, and then from his account to the other exchange. This is the only way to keep a daily profit going. (I'm assuming here that he probably can't just send it directly to the other exchange due to policies of exchanges not allowing you to withdraw unless the bank account you're withdrawing to has your name.).

More importantly (the next part more as a question rather than a fact) if he doesn't have a corporate banking account, his bank might start investigating what type of transactions he's doing back and forth on his own personal accounts. They might even freeze it for a while (either temporarily or permanently), cause you are not supposed to use your own personal banking account as an exchange medium of monetary value. That's why exchanges exist in the first place...for trading.

This is easily visible from PayPal's recent limiting & permabanning of accounts en mass involved in selling bitcoin over ebay. The reason they were given was simply that PayPal accounts cannot & should not be used as a medium of exchange of monetary value as it is not regulated to perform as an exchange of currencies, be they virtual or not. I think I saw a post somewhere on this forum on this topic.

So once his transactions to and from the bank account start becoming big...the bank will surely start looking into what's happening i.e. start checking for fraud and get their risk-mitigation analysts involved.

I think I saw that he also uses Ego Pay, Perfect Money and STP for fiat transactions. By compliance of law in their hq's jurisdiction, they also have finance laws to abide by. Unless you're some form of business account you have a high risk of being stopped and asked to provide details of what you're using that account for. If like PayPal they just then go on and paste you a paragraph from their Terms & Conditions for account usage...you're basically f'ed. It only takes one of them limiting you and you're out of a good portion of your fiat for a very looong time.

It is very risky indeed, and until the team involved in btc-arbs explain step-by-step about how they're managing other people's finances, and what precautions they're taking so as to NOT put people's finances at risk themselves, then you are all left in the dark wondering if it's just a nice little number you have in a very poor and bare-looking members area or else if it's safe to withdraw it at anytime with peace of mind, even after leaving it compounding for 6 months. Remember compounding makes money only if you let it sit there & do its job i.e. compound.

To say the least it is a good idea, but it btc-arbs is lacking in many areas including accountability & professionalism. I would say they are transparent though since their support seems helpful & genuine enough in their answers. However what's really in question here is their integrity on this thread thus for this reason they should be accountable and show the investors the transaction ledgers. Daily blobs of vague one-paragraphs each, fed uni-directionally to the investor without a chance to check what they're actually doing on a real-time basis is definitely not wise use of your money in my book. (Notice I did not use the term 'bad investment', cause the notion of trading on slow-moving inefficient markets is intrinsically great). If they want to win people's trust they should at least provide a platform where people can see the daily transactions performed and thus the accountability issues would be solved a modo di dire. I'm allowing some room for a learning curve. Everything can be improved upon with time.

Also how would you know if for example they're making more then they're claiming and just giving you a smaller piece of the pie i.e. 1.8% on average daily interest. You don't even know at what times the transactions were made. Was it when there was the biggest spread or not? The arbitrage opportunities of today (06/03/14) were around 3.5% at best and after reducing the fees from the profit it would be around 2.5% considering he's trading such a small volume of trades for now compared to the market, and yet they claim 1.00% turnaround on the results page? If you people are investors you're always trying to mitigate risk. I don't know how in this case after a careful analysis your spidy-sense on risk factor is not bleeping red with car alarms going off in the background.

Until we get some accountability on transactions made from btc-arbs which can be verified, it's not worth handing over your coin to an unknown variable....literally! This is not a question of btc-arbs wanting to remain anonymous. It's a question of investors being able to see what btc-arbs is doing with their coin and fiat.

Also...to the guy who said that you should only invest what you're prepared to lose, I say this. YES but only in an accountable and well-trusted environment. Which apparently the latter seems to be unachievable these days.

Fraudsters can capitalize by getting the minimum 0.05฿ deposit from thousands of people & then run away with the coin. 0.05฿ * 3000 people = 150 coin. And that's only the minimum deposit. Where is this guy from btc-arbs? They should be posting here and to their investors explaining themselves, if they really want to arbitrate in a professional manner.

I say let them show accountability of which bitcoin addresses they are depositing to, to their investors, so that this can be all verified on the blockchain & for the fiat transfers investors should be able to see the screenshots with dates & amounts & to which exchange the money went to clearly visible. Until then it only remains just a good idea. I say if they don't implement accountability then don't invest in them, and let's create something like it ourselves which offers more professionalism instead of daily blobs of 1-sentenced paragraphs.
 
What say you?

Thanks for taking the time to read this

They have an ad running on bittit.info, just FYI.  Not that Bittit is a big site, but it's something.