Topic: Closed Loop ATM (Read 2673 times)

Yes agree perfectly feasible. What about the risk of the machine accepting counterfeit notes and issuing counterfeit notes to the public?

Market linked with a premium, which changes depending on the local supply/demand. It's not that hard to imagine.

Make up your mind.  Is the ATM market linked or not?  Only if it is market linked with a premium then yes it will work.  If it is running off a pure internal demand and supply algorithm then it will fail. 

You're still not getting it. The ATMs don't JUST use the market price, it also uses the amount of cash it has left. Hence the 'closed loop' part. So the last $10 it has, might, for instance, cost you 200% market value. Add to that a 3% service charge there won't be much, if any, scope for arbitrage.

You're still not getting it. The ATMs don't JUST use the market price, it also uses the amount of cash it has left. Hence the 'closed loop' part. So the last $10 it has, might, for instance, cost you 200% market value. Add to that a 3% service charge there won't be much, if any, scope for arbitrage.

Look you can play this game in your own bedroom.  Put a pile of bitcoin (monopoly money) on your bed along with your spare change and pretend that is the ATM.  Pick the current market price as the starting point.  Then flip a coin and if it's heads increase the price of bitcoin by 10 USD and if tails reduce the price by 10 USD.

Every coin flip do an arbitrage trade against the machine (your bed).  The machine plays catch up and sets it's new price to match  the "market price" after the trade.  You will quickly find that the machine (your bed) runs out of money OR bitcoin and becomes stranded on the wrong side of the market price unless you run a huge spread which makes it unprofitable to trade.  

         BitcoinATM      (For sale in its entirety)
 
California 'C' corp
Authorized Capital:  10 million shares, with 8 million shares of Series A Common Stock (voting) and 2 million shares of Series B Common Stock (non-voting)
 
Price: BTC2000  BTC1500 (negotiable terms)
 
Also included:
1.   One beta machine: Genmega GK1000 Kiosk (in good condition) running windows xp pro with ActiveX drivers for the bill acceptor, printer, card reader etc.
2.   Domain: www.BitcoinATM.com
3.   The brand: logo, miscellaneous artwork and decals designed in Adobe Illustrator, 2 commercials and extra unused video footage done by Digivid Media… pictures taken at the Vegas Consumer Electronics Show in MtGox booth.
4.   Business Plan: (Rough draft)
5.   Code: Client/Server both running on the machine for development purposes. Administrator’s password (control) for the code which was placed on Github as open source.
Version 1 is an executable but I am not sure what tools were used to create it because the source code has been lost, so it will need to be decompiled.
Version 2 is php, a bit more functional and easier on the eyes but needs some patching.
6.   Contact information for:

• Original programmers C++ and PHP.
• India based programmers who assisted.
• Alternate programming options who are well established in the ATM business but were not used due to lack of funds.
• Everyone who expressed interest as investor, collaborator or customer.

•   Buyer bears all shipping and legal transfer cost.
•   Buyer may request seller to file papers to dissolve, surrender, or cancel this corporation. This may be preferable in some situations.
•   Buyer should be aware of the minimum annual tax in California for corporations with no revenue is $800.
•   Third party escrow may be used if mutually agreed upon.
 
Contact:

Todd Bethell, CFM, MBA
[email protected]
[email protected]
[email protected]
Work: (949) 340-5438
Cell:949-394-5932

You are not an economist either!

You have just demonstrated why it would work! Imagine an urban area with real time info online on the price of all the machines. There would be apps to win form interested people when they were close to a machine that had deviated from the mean exchange rate. The would then sell or buy bitcoins, thus restocking the machine.
This arbitrage is not zero sum. It is actually a more opportunistic and decentralised way to replace a network of security vans who periodically withdraw and deposit money from banks, with all parties taking a cut on the way.

So you could do your arbitraging and be happy you are providing a useful service to the community!

You are not an economist either!

You have just demonstrated why it would work! Imagine an urban area with real time info online on the price of all the machines. There would be apps to win form interested people when they were close to a machine that had deviated from the mean exchange rate. The would then sell or buy bitcoins, thus restocking the machine.
This arbitrage is not zero sum. It is actually a more opportunistic and decentralised way to replace a network of security vans who periodically withdraw and deposit money from banks, with all parties taking a cut on the way.

So you could do your arbitraging and be happy you are providing a useful service to the community!

I am most definitely not a mathematician. But I don't think it would work.

I would stand in front of the ATM all day and arbitrage it. 

That means I would make a profit on every trade.  Trading is a zero sum game so the machine would make a loss on every trade.  Eventually all value in the machine would be destroyed.
 

It cannot be any other way.  There is no such thing as a perpetual motion machine or magic sausage machine. 

Maybe someone more skilled than I can show this mathematically. 

I don't think the original proposal was for the algorithm to be market linked. If so, then that changes things.

yeah right, with a 3% operator fee on every trade you would do well! also remember, that machine's operator can hedge large trades on an exchange, in real-time.

I am most definitely not a mathematician. But I don't think it would work.

I would stand in front of the ATM all day and arbitrage it.  

I am most definitely not a mathematician. But I don't think it would work.

I would stand in front of the ATM all day and arbitrage it. 

That means I would make a profit on every trade.  Trading is a zero sum game so the machine would make a loss on every trade.  Eventually all value in the machine would be destroyed.
 

It cannot be any other way.  There is no such thing as a perpetual motion machine or magic sausage machine. 

Maybe someone more skilled than I can show this mathematically. 

What? http://www.coindesk.com/robocoin-bitcoin-atm-cad1m-29-days/

If the offer is good enough the ATM will provide a chance for buyers or sellers who would ordinarily use localbitcoins to either buy or sell at the machine. It's the same mechanism that keeps the prices of the various exchanges relatively in line: arbitrage.