Topic: [BTC-TC] BitVPS - page 3. (Read 33021 times)

I think I can summarize as follows.

arij bought the whole operation from RG, and was informed, after buying, of some essential information, which indicates that the business comes with more liability than profitability. So basically, RG screwed arij. If arij was a reasonable person, he would go to the law to have RG pay for his actions.

However, arij decided not to, for some reason I don't understand. Then he thought that he could ask every investors to just forget about their investment, while at the same time insulting their intelligence by disguising a "here's a penny, go fuck yourself" as a fair proposition.

Of course everybody is protesting, and hoping for arij to come back to reason and turn against RG, rather than against an angry crowd of random people.

Wait, wait, I'm more than a little confused here.

So we're being told we're getting 0.025 USD per share? As in, two and a half cents?
Not 0.025 BTC per share?

Either I'm reading this incorrectly, or something very wrong is going on here.

At 0.025 USD per share, someone with 10,000 shares--one percent of the company--will walk with 250 USD.
That's a lot less than a single bitcoin is worth now.
So we're to accept that we're basically being stiffed and given pocket change?

I've got to be reading this wrong, because I have about 2,000 shares in the company and spent quite a few on BTCT to get them.
If my count is right, actually, my initial investment runs in the several thousand dollar range now.

What's going on here?

The difference between assets and expenses: if you had two cars, bought two more for 25'000$ each, one is stolen, and you find that the the three remaining cars are worth 10'000$ each in the market,  your expenses are "50'000$ to buy two cars" but you assets are "three cars worth 30'000$".

"Assets" are company property, money in the bank, money owed to the company. All that the company has now, not just what come in and went out last month.  Assets and debts are essential to figure out how much the company (and its shares) are worth.

Any assets purchased would be listed under expenses. We did not list the debt.

BitVPS does not hold any Bitcoin as all of our expenses are in USD.

The December 213 statement posted here earlier only lists income and expenses. What about the assets and debts?  Didn't the company own some bitcoins?

In that case, you were also victimized by rg, and whatever contract you negotiated with him is meaningless.  I get the "Wild West Cowboy" approach to business here, but horse thieves were shot then, and so were the guys who knowingly bought those stolen horses.
And now you know.

I suspect that @arij does not understand the distinction between "non-voting share" and "profit-only share".   Or perhaps I do not understand it.  AFAIK the owner of a non-voting share is still the owner of a slice of the company, not just of its profits.  Am I wrong?

However, since these bitcoin companies are intentionally created and operated outside any legal framework, perhaps any word intheir contracts and prospectuses means anything that anyone likes it to mean... 

We did not purchase knowing that the shareholders were "defrauded" or that the contract had been breached. We came to this realization a while after the purchase was made. Once we finally were able to get a true understanding of how bitvps was operating, looking through past financial statements, and seeking legal advice it was determined that the original contract set forth by rg had been breached long ago.

In other words, you went into this sale knowing the shareholders were defrauded?  And now you chose to argue that the shares, by virtue of being non-voting stock, could be simply annulled?  Am I understanding you correctly?

RG was well within his rights to sell BitVPS. As non-voting shares, these shares have no rights to any decisions which are made within the company. These rights were reserved explicitly for the managers or directors of the company, in this case RG. RG was the only member who had the right to make the final decision regardless what any of his shareholders wanted.

Every shareholder here invested into the companies profitability at the expense of any and all voting rights. This is a profit share of BitVPS and nothing else.

I'm not arguing that rg didn't fail in his obligations to his shareholders.  He did.
What you are failing to acknowledge is he had no right to sell you BitVPS, BitVPS was co-owned by the shareholders.  It simply was not his to sell unless he did a full buyback, which was not the case.  As I pointed out above,

These shares explicitly represent BitVPS, not "profits of BitVPS" as your colleague suggested.  To acquire BitVPS you had to acquire those shares.  As I understand it, you did not.

*I'm not accusing you of any intentional wrongdoing.  If you didn't realize that rg defrauded his investors, he also defrauded you by selling you something he had no right to sell.  If, OTOH, you went into this deal knowing that shareholders were defrauded, you are complicit in rg's wrongdoing.

This does not change anything for us. It was his duty and obligation to share the proceeds with his investors.
Once again, he failed to do so. If you look back you will see many instances where his original contract was in fact breached by him.

1) Failure to publish monthly statements by the 5th of each month -
(e) The Directors solemnly promise and warrant that complete and accurate Statements of Profit and Loss for each calendar month will be published by them no later than by the fifth day of the new month. Under exceptional circumstances and for good cause the publishing of the Statements of Profit and Loss can be deferred no more than once in a calendar year so that the Statement of Profit and Loss of one month is published together with the Statement of Profit and Loss of the next month.

2) Failure to share proceeds with investors -
(g) In the event of the sale of BitVPS or voluntary liquidation thereof, all proceeds will be distributed fairly to all shareholders by proportion to the shares they hold.

3) Failure to use IPO funds to expand business -
(d) The Directors solemnly promise and warrant that all proceeds from this IPO will be used to develop and expand BitVPS and will not be taken out of the company by them. The Directors further solemnly promise and warrant that they will not introduce their own expenses into the expenses of BitVPS, and that all money taken out of BitVPS by them will be in the form of dividends, paid fairly to all shareholders by proportion to the shares they hold.

Finally, I would like to add this:
3.2. Should BitVPS fail to execute this Agreement, as for instance by but not limited to breaching 2.2.e above, MPEX will notify the named individuals of their breach and may, at its sole discretion, suspend BitVPS from trading thus activating the liquidation of BitVPS.

And what should have happened in the case of this contract being breached:
(a) The Directors have elected to divide BitVPS into 1`000`000 (one million) equal non-voting shares with a total equity value of 1`200 BTC (0.0012 BTC each). In the event of liquidation or breach of this Agreement they solemnly promise and warrant to repay all investors holding shares at this minimum value. The Directors through their elected representative solemnly promise and warrant never to issue more shares either on MPEX or any other venue nor in any way to dillute existing shareholders at any point in the future ;

Putting all of this aside, we have stuck with you guys for a while. At this point the need to pay employees a realistic salary is greatly outweighing any of our other needs. Out of respect and sincerity we have decided to take on the responsibility to pay for these shares when we have no obligation to do so.

If you want to track down the previous managers to get your slice of the sale proceeds go ahead. It is your right.

No.  Excerpt from the IPO prospectus:


Shares represent equity, ownership interest, not "share of the profit." 
That said, you are correct in assuming that I'm owed nothing -- I'm not a BitVPS shareholder.

The sale is perfectly legal. The example you gave is incorrect as the original rg contract didn't entitle you to any hardware only net profits. A better example of this would be if one guy bought a 1 terahash miner as a preorder. He later decides to sell all of the hashrate. He sells 1 terahash total, 100ghash to 10 people. The 10 people agree that they get 100ghash and if the unit is sold they will split the sale of the unit evenly among them. The original buyer agrees and hosts it for a for months. He later decides to sell the unit. He sells the unit to bob. He keeps all the money from the sale and the 10 people who bought 100ghash are angry. Now does bob have a obligation to continue to host those 10 people even tho he never agreed to it?In this example RG is the person who bought the unit and didnt share the money gained from the sale with the 10 people.

Not sure how else to put it, but you bought something from rg which he did not fully own.  Such sales are invalid.  If I buy a stolen car, even in good faith, I'll have a hard time registering it.

Maybe that was just badly worded. If you read RG's contract you can clearly see that the investor/shareholder side of the business was to end with the sale.

Odd question:  How did you buy the entirety of BitVPS without buying the shares which represent it?

Being in debt does not equal going bankrupt. We are able to pay the debts which we currently hold.
Now on the other hand, basing the buy back price off of a invalidated contract would put BitVPS into such a large amount of debt that we would not be able to pay employees, operations would seize, and we would be forced into bankruptcy.


The "contract" (rg's contract) was breached by himself.
A quote from the "contract":
(g) In the event of the sale of BitVPS or voluntary liquidation thereof, all proceeds will be distributed fairly to all shareholders by proportion to the shares they hold. -- This was a requirement, as outlined by the previous directors of BitVPS, in the event of the sale of BitVPS. This clearly failed to happen.

We paid, in Bitcoin (100BTC), for BitVPS. Yes, we should have came forward with this earlier, but it is what it is. We are good people and certainly not out to scam anyone.

1. if you buy a company you buy the whole package, including the obligations and liabilities
2. if you allow trading after you buy it, you can't "just stop it" later, unless the contract allows you to do so

They are trying to scam us plain and simple.