Topic: [GLBSE] BDK -- LIQUIDATING UNDER NEGATIVE EQUITY PROVISION -- - page 4. (Read 21246 times)

Thanks for the big update, Kluge!

Maybe I've been afk too much, but I have a few questions:

1.  Are you still planning to move?  And find a "regular day job"?  If so, will this affect the amount of time spent on BDK (and hence the profitability)?

2.  BDK-BLoC is part of BDK, right? (won't be a separate glbse ticker)

3.  What happened to IOU?

4.  Would you consider publishing a proper Balance Sheet and cash flow statement at least monthly?  The spreadsheet is hard to follow for some of us more used to GAAP-style statements.

Relevant cross-post:

Fwiw, the end goal is to re-release BDK.BND @ .65%/wk (roughly 2.625% monthly, little over 40% per year - assuming you reinvest dividends -- without reinvestment, ~2.6% monthly, 33.8% annually). I intend for this to be the one and only reduction in rates, and in the contract, 6 months will be required to elapse before I recall the bond. 1%/wk is doable for now, but I'd prefer to allow allow investors to "set it and forget it," and this rate should be acceptable for many months, perhaps years. Some extra breathing room makes me happy, too.

The future BTC CD rate is intended to be 3%/32D, 6.75%/63D. The future USD CD rate is intended to be 1.25%/32D, 3%/63D. Bonds and CDs will, in some way, be allowed to convert to each other once everything's sorted out for the re-launch, which probably won't be until early August (+- a month) -- buyback will occur as soon as I get the funds I've requested back, which should have been nearly a week ago....

The BTC prime rate (minimum lending rate, reflects only BDK's opinion) is expected to be set at 3.55% per month, ~0.1267%/day. The USD prime rate (minimum lending rate, reflects only BDK's opinion) is expected to be set at 1.6% per month, ~.057633%/day.

Thus, for USD loans, a most creditworthy business can expect to pay ~51.985% annually for BTC loans. For USD loans, that rate will be ~20.983% annually. For comparison, SMB loans in the US are typically made with the business paying ~6-10% annually in interest. Meanwhile, US credit cards, which are more in line with what BDK-BLoC seeks to compete with, charge ~11-23% annually (avg is 14% or so for business cards). We'll get there eventually.


-----


Additionally, I ended up finding a different dev for BDK-BLoC (due to no fault of the original). The dev costs have not been determined, but will probably be around 150-200BTC. He's expected to start work this Thursday. A designer will not be hired. Maintenance costs will be ~5.5BTC/month total for two VPS servers (through BitVPS) + domain hosting. I believe BDK-BLoC will be worth the costs due to me being able to go on "auto-pilot" for some of the more trivial-but-time-consuming stuff, while helping Bitcoin businesses, and forcing transparency into the Bitcoiniverse. I will feel much more comfortable being able to secure low-risk loans, and pleased the funds are going toward projects which will ultimately benefit every user of Bitcoin. As such, I will resume taking on debt (I've been fairly aggressively buying back debt the past few weeks), which I believe will ultimately result in an increased %RoE. With BDK-BLoC establishing a relatively low "minimal profits" Prime Rate, and forcing the lending market below "natural" rates, I believe BDK will continue to nurture long-term beneficial business relationships with the Producers of the community, as well as foster trust with those businesses enough for them to purchase CDs in times when they have excess funds, even though I do not offer the high yields of many other lenders accepting deposits. The benefits of being a mutually-beneficial business as opposed to a regretted "lender of last resort" far outweigh the cost of operating at reasonable (though ultimately sustainable) profit margins on coin-shuffling. I'm extremely bullish on BDK's mid-term prospects, enough to offer any investor interested July pre-IPO BDK units well above market price @ .22BTC each and feel generous about it. There is a limit of 4k units to be sold by July 2nd, and none of them will be posted on GLBSE. As always, if they don't sell, they don't sell, and I keep the units for a later time.

Dividends are now expected to be roughly .00031/share, though that may change for the better tomorrow. Securities re-valuation and monthly guesstimates for July will be posted sometime before the end of the week. Additionally, I'll try to remember to clearly state BDK's position in the various securities held when I post the re-valuation. My current sleep schedule allows me to be up while family's asleep, so I can get a fair bit done. First priority is to get BDK-BLoC mock-up and formulas complete, then I will re-vamp the public spreadsheet. After that, there's a lot I need to think about regarding Icehill and 20Mission. I'm extremely excited to be hearing everything in development, and progress being made. For everything "lost" in the ASIC mining bond panic sales, the Icehill equity gift.... well - BDK is undervalued by a fair bit, IMO, though it will be difficult to determine by how much until a few months pass. 

I'm pleased to be meeting so many new people lately. We have added new people to our lending group, including finance professionals and academics, who will surely help us act more efficiently. The more people I know, the more I can do, and the better it can be done. Money's great, but it's easy to squander when not gaining wisdom from co-workers and associates. So - thanks, everyone, and a special thanks to those who call me out and keep me in line.

Cheers!

Probably won't need a home loan at all, which is nice. Someone on the forum even offered me a free house (in need of some fairly large repairs/appliances [like... a furnace], but still crazy-generous). Figured out how to handle some tax issues in a brilliantly simple way... so everything's looking good.


BDK spreadsheets need a massive overhaul. It's not reporting enough information, and too much shit's lumped together when it should be split up, then all come together in the summary sheet. Google Docs is cumbersome and inadequate for complicated work. When I do the spreadsheet overhaul, I'll do my work in Excel, and publish sheets each week. I'm going back and forth from MI to IN to look at various houses, so haven't been around too much the past couple days, and will likely be only sporadically online for the next couple weeks. June 25th dividend guesstimate looks to be right on target ATM. Oh -- just noticed I messed up the last weekly report.... will fix that. ETA: Done.

Yeah - there's fx risk. I'm thinking I should start trying to get more USD CD sales to hedge with, then I could effectively lock rates in -- as my USD debt decreases as BTC price rises, so too do the depositors' CD value in USD - and opposite if BTC decreases in price. The alternative is staying entirely in BTC, but dumping all my securities, because almost all of their BTC value decreases as the exchange rate rises. - and BTC's great, but for startups, USD pays the bills.

Subbed, and interested to see where this might lead to.
Just one thing to add: Be careful that this might only be the start of a rally. 

I'll have ~3.25kBTC coming to me within a week. I want to convert 1kBTC to USD to lend to a project I'm familiar with @ ~2.75%/month. Keep in mind that I paid 2.5%/month for USD deposits a bit over a month ago, and that depositor isn't me, so couldn't trust my intentions or know my situation as much as I can.

The remaining 2.25kBTC are currently uncommitted. I'd like to sell off into this rally and use the USD to loan to myself for the purchase of a house, and I'd like to pay no more than 2% monthly on it to be repaid as soon as our house in PA sells (it's been on the market for ~3 months, now, so I'm not holding out too much hope of it selling within, or otherwise have enough funds to pay it. Partial repayment would reduce interest payments.


Thoughts?

June 18 UPDATE
Dividend/share paid: 0.000406688BTC/share
Total dividend paid: 3.66BTC (I had a tiny amount leftover in the account, now that I've realized so true dividend paid is 3.66002 -- enjoy  )
Running total dividends paid in June: 13.49BTC

June 2012 Net Income Expectations
Optimistic estimate: 175BTC
Reasonable estimate: 75BTC
Pessimistic estimate: -50BTC
(Guesstimated weekly dividend payouts -- June 4th: 0.0BTC/share Actual: 0.0BTC/share, June 11th - .00063BTC/share Actual: 0.00121358BTC/share, June 18th - .00014BTC/share Actual: 0.000406688BTC/share, June 25th - .00036BTC/share)

ETA: Looks like GLBSE refuses to take dividends which aren't large enough to send at least one satoshi to each unit-holder. That explains why I had .00002BTC left in the account, so the actual total dividend was 3.65994BTC. The difference between that and what's owed will be carried over to the next month. Sorry.

Sorry for later-than-usual dividend - took car to mechanic, did some shopping this morning. Waiting on 6 confirmations. Dividend will indeed be .00045/unit.

Cheers!

ETA: Derp. They would have been .00045 if there were 8100 shares, not 9000. My bad 

Hey, everyone. A small update. I've been neglecting the public spreadsheet a fair bit. "Keeping up with it" will largely be a problem of the past once BDK-BLoC is launched. BDK-BLoC will take on a larger scope than I originally imagined, effectively becoming the "me" most people talk to when they have business to discuss, and will handle CD sales and repays. Additionally, because I am able to separate access/edit privileges, I may soon hire and permit an employee to do some of the more time-intensive parts of maintaining that website (scoping out companies, ID verification, filing an internal evaluation with me, and calculating their credit score using banks' template Starfish generously posted which I altered a bit, as well as reviewing new financial reports the company submits and updating the credit scores as necessary). Additionally, I can give that employee my GLBSE .csv, BDK-BLoC .csv files, and have him fill out the I/O reports as appropriate. I do enjoy the accounting, but I don't have the time, and the spreadsheet's wildly out of date, with inaccuracies accumulating.


Hiring an employee allows me to spend my time talking with the Movers/Shakers, working on deals, and concerning myself more with meta, big-picture stuff, including fundraising for BDK and revisiting doing securities offerings for Producers. I've decided to remove my coins from Hermes/Icehill, which I got a green-light on yesterday, and will instead issue a lesser USD loan to Icehill's 20Mission Project at more reasonable rates. I also learned last night that I will be gifted a 5% equity stake in Icehill upon its public registration, which was very surprising, very pleasing, and very much appreciated. This asset will be considered a part of "BDK." I'm excited to continue working with Icehill and the associated players.

BDK dividends tomorrow will be ~.00045/share after I receive 18BTC from imsaguy, pay 36BTC interest to a CD-holder and 16BTC to BDK.BND-holders. There was another potential default on ~60BTC, which will be counted in next month's report (principal - bad-debt-sale) after I'm certain it's an intentional default.


Cheers!


ETA: If someone's interested in doing the tasks I outlined in the first paragraph, it should take 5m-90m per day (excluding additional workload upon BDK-BLoC launching) to reconcile GLBSE .csv & BDK Google Doc, and account for the daily transactions I'll email/Skype to you. Once BDK-BLoC launches, workload will increase quite a bit. Initially, I'll be willing to pay 1BTC/day (paid on Mondays when I do the rest of the dividends) - work on your own terms, just get everything in there and updated by the end of the day. Once BDK-BLoC launches, I'll probably be willing to move up to 2BTC/day, and give raises as workload increases if performance doesn't deteriorate. You must be fairly competent at spreadsheet software (incl. Google Docs), be willing to use Skype, and have the initiative/generosity to prettify & prune the sheets, adding new statistical calculations as would be helpful.

ETA2: Updated spreadsheet. The ~60BTC loan I talked about maybe being a default likely will not be. Lendee just contacted me. Cheers!

*straightens tie, exhales slowly, keeping in mind that BTC was worth ~$5.20 at the last valuation*

Last Valuation on 5/28 -- today is 6/13

GLBSE Securities Re-valuation (reconciliation between BDK sheets & GLBSE 5dayavg):
Cognitive: BDK - .611BTC/share, GLBSE - .599BTC/share -- total loss of 12.672BTC on paper
BitcoinTorrentz: BDK - 1.01BTC/share, GLBSE - .74BTC/share -- total loss of 1.08BTC on paper
YABMC: BDK - .3BTC/share, GLBSE - .258BTC/share -- total loss of 675.444BTC on paper
REBATE: BDK - .201BTC/share, GLBSE - .172BTC/share -- total loss of 27.356BTC on paper
BitVPS -- new purchase: 0.003125BTC/share (27.68k purchased)


Total securities FMV change since last valuation -- loss of 716.552BTC.


ETA: Contract on GLBSE has been updated. Thanks, Nef.

Finally got around to finding the email I sent to GLBSE about the contract change:

From: "B.R." <[email protected]>
To: "GLBSE Support" <[email protected]>
Subject: Re: Contract Changes
Date: Wednesday, May 09, 2012 4:00 PM

Oh. While you're poking around in the DB - any chance I could have BDK.BND
launch ASAP? I think it's supposed to go live in ~6 hours, but I'd like to
get to barking for it before going to sleep.

Cheers & thanks always for the help.

On Wed, May 9, 2012 at 3:55 PM, B.R. <[email protected]> wrote:

> Howdy. I'd like to have two contract changes committed. First, the BDK.BND
> contract should be updated to read as follows:
>
>
> ----
> BDK.BND pays 1% of face value every week (Monday). Percentage will remain
> at 1%/week until the bond is bought back by the bond-issuer ("Ben Malec").
> Bonds will be issued @ .1 BTC each. Thus, each share will pay .001BTC every
> week. There is no limit on how many bonds may be issued nor when they may
> be issued. Bonds can be issued and sold without warning by the bond-issuer
> at any price he wills. Bonds cannot be sold back to the bond-holder except
> in case of a buyback. BDK.Bond does not have a set date of maturity.
>
> "Buyback" -- The bond-issuer may buy back all bonds at a price of
> .101BTC/share at any time he wills, without warning. In this case, the
> bond-issuer will use GLBSE's forced buyback feature to pay .101BTC/share.
>
> "Contract Changes" -- The bond-issuer is not permitted to change this
> contract at any time under any circumstance. To "change the contract," a
> buyback must be placed and a new bond asset listed on GLBSE.
> ----
>
>
>
> While it states there should be no contract change, the IPO has not yet
> occurred. No pre-IPO shares have been issued, and potential bond-purchasers
> have been alerted to the change on the forum (yesterday, I believe). The
> only change was made to the "Buyback" provision to account for the new
> forced buyback feature. If you really need a (meaningless, since it can be
> postponed) date for it to mature, it can be set to 5/10/12. It's so soon
> because IIRC, I can't do a forced buyback until the present is beyond the
> set date of maturity.
>
>
> The second contract change I'd like is for BDK. Since the contract was
> issued, multiple changes to values (all beneficial to shareholders) and
> some clarifications were made. While I state in the contract that 60 days
> must elapse after I've made the change public, since the changes are all
> beneficial for share-holders and nobody has objected to the changes being
> committed immediately. Understand if you insist on waiting for these
> changes to be committed to GLBSE. However, I will be honoring the
> shareholder-favorable changes whether the GLBSE contract is updated or not.
> The modified contract is as follows:
>
> ----
> Ben Malec (referred to within this contract as "me," "myself," "I," and
> "operator") will issue 100,000 shares of "BDK Hybrid Instrument." Each
> share not controlled by the operator represents .0009% of BDK's monthly
> profit.  Dividends will be paid every Monday, starting May 7th, 2012.
> Dividends will not be paid on the first of the month unless that happens to
> be on a Monday. 100,000 shares will be issued. Up to 5,000 shares are to be
> sold on the second day of each month for four months, starting on the month
> of May, 2012. After that time, shares may be issued at will of the operator.
>
> Additional provisions
> "Operator Equity" - The operator holds all equity of BDK. Shares are not
> tied to equity, and represent only .0009% of BDK monthly profits.
>
> "Shareholder Votes, Non-binding Motions" - While motions may be
> introduced, they are non-binding. They exist only so the operator may gauge
> opinion of those invested in BDK's success.
>
> "Change of Contract" - The operator is fully permitted to change the
> contract at will, without consent of shareholders. However, the modified
> contract is not permitted to go into effect until sixty days after the
> changes are made public. When the contract is changed, the operator will
> honor the ability for shareholders to sell shares back to him at a price of
> .125 Bitcoins per share between the time a change is made and the time 60
> days have elapsed since the change was made public.
>
> "Buyback" - At any time, the operator is permitted to buy back shares
> issued. The operator will pay .64 Bitcoins per share if the operator buys
> back BDK shares prior to August 3rd, 2012. If August 3rd, 2012 or later,
> the operator will pay ((.32 Bitcoins + GLBSE 5 day weighted average of
> trade transaction amount per share of BDK shares)/2)
>
> "Share Value Protection" - If shares trade for less than ?.01 on GLBSE for
> at least 168 hours continuously, the operator MUST issue a bid order of
> ?.05 in an amount which equals 50% of shares issued not controlled by the
> operator. The "168-hour timer" does not again reset for 26 weeks after the
> "Share Value Protection" provision was last called to action.
>
> "Negative Equity and Operator Liability" - BDK is permitted to operate
> while having negative equity so long as BDK has not had negative equity for
> 90 consecutive days. On the 90th day of having negative equity, the
> operator will be held personally liable to pay shareholders $.10/share (or
> ?.02/share, whichever value is lesser). In cases where BDK is unable to
> achieve due to reasons unrelated to BDK experiencing prolonged negative
> equity (operator experiencing imprisonment, debilitating illness, GLBSE
> being hacked and made unusable, EMP strikes, police raid, or death, for
> example), the operator is not liable.
>
> "IPO Value Preservation, Operator Trading" - The operator is not permitted
> to ever sell shares for less than he previously sold them for. However, he
> may sell shares for an amount equal to or greater than the amount he
> previously sold them for at will.
> ----
>
>
> Cheers,
>
> Ben
>

Nef PMd me on IRC after I sent those, but I don't have logs of what he said (I don't remember, either, except that he said he's uncomfortable having the BDK.BND IPO launched before schedule). Sent another email to GLBSE about it. Fwiw, 60 days hasn't elapsed from when I stated that change would take effect, which may be why Nef didn't change it. It was stated on April 28th, so 60 days would be June 27th.

It's a moot point now that the satellite fund model is off the table, but I would like to clarify my above post. The Macquarie model was highly profitable for Macquarie during the boom and the reasoning behind it is similar to Ben's thoughts using it with BDK. It segregates the risk, while still benefiting from some of the upside. The ones getting the rawer deal is the investors in the satellite funds, but Macquarie found plenty of takers for their funds and I think there are plenty of suckers willing investors in the bitcoin world to fuel the model here for a while yet. 

For the sake of clarity, the price I'll pay when I initiate a buyback (assuming it's after August 2nd, which it almost certainly will be) is ((.32+5daywtdavg)/2), so even if the 5-day weighted average trade price of BDK some time in October were .1, I'd be buying back @ .21BTC/share. I wouldn't be too willing to listen to unitholders' complaints at that price given I've earned ~.11BTC/share from issuing and selling BDK so far. 


With that in mind, I'd like to state it's very possible I will not be issuing an IPO on July - possibly August, too, and want to point out that I'm not contractually obligated to actually issue and sell shares on the 2nd day of each month until August 2nd. There will be an IPO when I believe the price justifies the time and buyback liability (noting an offering can only occur on July 2nd or August 2nd, until August 3rd, when I can issue & sell whenever I please). I have also reconsidered the multiple funds idea, and will not be going forward with it. I doubt, even with a 10% fee off the top, there's enough potential profit to justify the time.

I will be a bit less talkative in this thread and with unit-holders. I'm at my peak workload right now and have a backlog of PMs I need to get to again. I will not be reducing my commitment to BDK operations, but I promise to spend much less time thinking about new securities to issue. 

OK. Thanks for clarifying all that I definitely noted the better than expected earnings this week.

I'm personally not really wild about the way the contract situation works @ GLBSE, so I'm only concerned really about the potential effect it has on people who read nothing but that. (the numbers on the contract do not support the current market price)

I also am not hugely in favor of weekly dividends - it lessens the degree of trust needed by the investor, thus decreases the investors risk, and therefore decreases the potential reward in the long run. But - this is what the market has chosen in the short term

Knowing that, indeed, BDK will hold some of those newly created securities is good, however, I do share some of the concern expressed by brendio, above. It's a lot of debt, with not a lot of tangible equity. While most investors are shying away from equity deals, IMO, any one entity with too many debt deals, and no equity offering is starting to look  more risky. Even more concerning if you continue to release additional shares of existing offerings also. In reality, if done correctly,

From other discussions, it seems like a 10% management fee for the funds is a little high. YMMV, of course


There are several paths this could take - currently this looks like a pretty significant liability (at the august buyback price) or, really, significant risk for shareholders at later prices if share prices do not significantly increase. So - the date of the buyback is probably very significant.

Sounds like BDK is thinking about adopting the Macquarie model.

June 11 UPDATE
Dividend/share paid: 0.00121358BTC/share
Total dividend paid: 9.83BTC
Running total dividends paid in June: 9.83BTC

June2012 Net Income Expectations
Optimistic estimate: 300BTC
Reasonable estimate: 125BTC
Pessimistic estimate: -75BTC
(Guesstimated weekly dividend payouts -- June 4th: 0.0BTC/share Actual: 0.0BTC/share, June 11th - .00063BTC/share Actual: 0.00121358BTC/share, June 18th - .00014BTC/share, June 25th - .00036BTC/share)

Just throwing stuff out, seeing if anyone has any opinions/ideas. I can get my head in the clouds sometimes, waste time on pointless hypotheticals. Obviously, I have no intent to declare bankruptcy, and am not at any risk of it. There have been decent revenues this month (~160BTC after I account for securities sold for a gain today), but losses have been pretty hefty, too, due to having to account for 130BTC in losses to pay interest on CDs and bonds due within the first week of the month. Additionally, $20k of BDK funds are still tied up in Hermes, largely sitting there at the moment. That's being sorted out within a few hours, so they can find a nice, productive home, and start earning money instead of just costing money to maintain. It's not reasonable to look at week-to-week performance, and is why I initially did not want to have BDK dividends paid every week, but I worried there wasn't enough trust for me to pull that off. Ironically, it turns out having a week without dividends has created its own dent in trust, even if only temporary. I have the formula ready to have loan/deposit interest spread out over time, but this will only affect loans/deposits made after I made the change this morning.

I'm pretty certain I asked for the contract on GLBSE to be changed many weeks ago and was told it was. I'll prod people to get that corrected (Issuers aren't allowed to change the contract on GLBSE -- Nefario has to do it manually, and that's why I frankly don't consider it valid). I know I talked about that with Nef in IRC, but I believe I have email logs about the contract changes. I'll post it if I find it when I get to main PC. The contract in the OP of this thread is *the* contract, and the contract I will abide by. I'd send a message to shareholders through GLBSE were it possible.

The funds would be targeted at providing investors options instead of just getting the current two options - one a bit bland (BDK.BND), and one with pretty broad involvement in various sectors (BDK). BDK would effectively be the parent company of these "funds" - and these funds aren't something concrete - just probing for comments. As I posted, BDK would receive dividends from these subsidiary funds just like any other security-holder, so BDK profits on what it contributes to these funds would earn revenues as they currently do. Rather, BDK would receive exactly what it currently does on investments, plus take 10% of net profits from non-BDK investors in these subsidiary funds as a management fee. However, I think BDK would benefit beyond that 10% in that I'd be willing to take on liabilities if BDK is not liable for more than it puts in were, say, "BDK.FND.ABNORMAL" to invest in an alpaca farm that goes bust. Having more OPM (Other Peoples' Money) is extremely important because that's how I get access to the backroom deals, where huge chunks of securities can be bought at dramatically reduced rates. I'm struggling a bit to do this now with so many funds committed. There's a bit of a scaling issue going on. I have access to the deals now, but I'm uncomfortable having BDK directly take on more liabilities than there is equity (which is why I bought back 1kBTC worth of BDK.BND and turned down some interested in buying CDs).

Long-term, I believe the best way to go forward (again, not set in stone) is to do a forced buyback toward the end of the year, own all of BDK without buyback liability (I think creating "BDK" may've been a mistake on my part thinking now of all the other ways I could've gone about this), then have anyone with interest in investing with me either buy BDK.BND or one of the "funds."


Any other questions - throw 'em at me while I'm up. Cheers!

ETA: And now I'm down. See y'all tomorrow.

So - in all this rambling, I'm really kind of not sure where BDK stands.

I understood above that the GLBSE contract for BDK was to be changed - it's not changed on GLBSE.
(changing the buyback numbers, in particular) - so this is not very clear - and certainly affects traders who are not present in this thread.

It seems confusing what the plans are above. It's not very clear if these funds are supposed to produce revenue for BDK holders or not.

It's especially disturbing to see some comment about your bankruptcy? What's going on? Comments like that are very discouraging on top of news that there is essentially no revenue.

Very likely default of 110BTC. I won't count this loss immediately, but space it out throughout next month assuming I don't receive payment. Loss = principal - amt. recovered selling to debt-collector.

Spreadsheet has been prettied up a bit. I'm still debating how to handle accounting for the "liability" of BDK in the event of a forced buyback. It's really "my" liability, not BDK's, but these two entities are so much connected, it takes some thought... I mean... if I file for bankruptcy, I wouldn't cede my BTC holdings. BDK would still operate. OTOH, if BDK had negative equity, I would not bail it out by further increasing my BTC holdings.


... I've also been thinking about splitting BDK up further. Since BDK has transformed dramatically from what it was at the time of the IPO, and become much more an investment bank than a "lending operation," and I'm a bit more comfortable with issuing securities... I think I want to create "subsidiary funds" of BDK. My idea is to create 5 or so securities, each with a specific investment category: BDK.FND.MINING (self-explanatory), BDK.FND.BTCSEC (investment in non-mining industrial and commercial Bitcoin-related ventures such as Kronos, BitVPS, and GPUMoney), BDK.FND.USDSEC (investment in industrial and commercial ventures unrelated to Bitcoin -- there were some interesting loan requests in the business loan form I posted a while back -- I was expecting more stuff along the lines of BitVPS, but instead found requests from people opening "deluxe" massage parlors in Canada, and a fellow doing something with lasers which was way over my head), BDK.FND.INTERESTFREE (gratuity-based loans to reputable individuals, with no gratuity required), and BDK.FND.ABNORMAL (the weird shit. Satoshis Daemon, IMPACT, Bioethanol -- I'm sure I could find odder [and profitable!] investments if someone gave me the funds to do so - though that's certainly not encouragement to do so ).

Anyhoo, BDK would take 10% off the TOP of these funds' net profit. No profit, nothing for BDK from that fund. However, by splitting everything up, BDK also minimizes its potential reportable losses (less the security revaluations I post, and need to do again soon). Additionally, investors are able to invest in the sector they choose, or they may continue to invest directly in BDK so they're exposed (for better or worse) to all the different sectors BDK's currently in. BDK will likely keep interest-bearing loans to itself, and BDK-BLoC is expected to bring a lot of new, safe, profitable business that way. BDK would do equity-swaps with these funds, but this can only be done before the IPO, with the deals posted publicly, to ensure I am not allowed to do any scammy nonsense where BDK receives more than FMV for its holdings. For what BDK invests using securities, it would receive fund units and receive dividends as any other normal unit-holder. From that point on, if BDK wants to invest in one of these funds, it must send that fund BTC. Wallets would be kept totally separated.

To summarize that, BDK would be split up 6 ways. Five "subsidiary funds," with interest-bearing loans staying with BDK, the parent company. BDK will swap securities with these various subsidiary funds, receiving, for example, 500BTC worth of BDK.FND.MINING for 500BTC worth of YABMC. BDK's profits will remain exactly the same, except it will also collect an additional 10% off the top of these various funds' net profits. So... say 50% of total BDK.FND.MINING units are held by BDK, 50% by others. In that scenario, BDK will effectively receive 55% net profits (50% it owns + [10% of 50% others own]). I think, this way, I'd be much more willing to take on liabilities than currently, where I'm turning down potential CD-holders and buying back bonds.

(.... .... If I keep writing like this, I'll develop schizophrenia for sure.)

I'll talk about BDK-BLoC some other time. I have papers written on it as well as on the benefits of setting some general interest rates in collaboration with the lending syndicate. Eventually, we will need credit agencies, too. I think the community's still tight-knit enough where we probably don't need independent audits... though eventually, that will become a necessity - but for now, analysis of company's income statements would be adequate and a huge step up from now.... BDK-BLoC will have an auxiliary objective of prodding BTC businesses to open up their finances to the public. (rambling, again -- sorry)

I'm alive! Kicked caffeine while on "vacation." 8 cups coffee per day -> no caffeine intake. - And I didn't kill myself!

Will place some phone calls today, see how everything's going, roll out the "amortization" update on the spreadsheet (not sure why I thought it'd be "easy" at first -- once everything's updated, it should be easy, though), add fees & profits from GLBSE trades to the spreadsheet (I've been getting lazy with that), then get to the PM backlog tomorrow. Also working on mechanics for "BDK-BLoC." "LoC" may be a giveaway.  

ETA: Noticed some other things I really need to fix on spreadsheet. "Amortization" update may need to be put off until tomorrow.
ETA2: I also bought back 10k BDK.BND units @ face value a day or two ago, so profits will likely be a bit higher than originally estimated.
ETA3: May have a defaulter. Need to check on it. Two weeks without dividends would be pretty shitty.