Topic: How protected is the GLBSE from a pirate default? (Read 4086 times)

I love fair markets, and they will NOT previal.

Yes, you are right. The "pirate default" expression triggered it. I will stand back.

You are digressing from this thread to try and take it over with your point while totally missing mine.  Blacklist/Ignore here you come.

Do you have OCD or something?  Seriously.

Ah, we have a new concept here—the tainted bitcoin.

Please explain why exactly you think somebody needs to borrow bitcoins to launder money. Who came up with this ridiculous money laundering explanation anyway?

Um, you exchange tainted coins for clean ones and you take a large commission.  You pay a smaller commission out to your lenders.  That's how it works.  Is it out of the realm of possibility?  Certainly not.

Could it also be a giant ponzi?  Sure.  

Thing is, I really don't care how he's doing it as I'm not invested.  I've already stated what my concerns are.

Everyone? Mystery and confusion?

Ask some uninvolved people what they think of somebody who anonymously offers 7% per week (3,300% per year) interest on the amount you give him.

So much for everyone and for mystery and confusion. You will get a certain laugh and no trace of mystery.

Money laundering? Why do you need to borrow money to do money laundering? The people who want their money laundered will give you their money anyway. And if you try to pinch it, they will shoot you.

In fact, there is some truth to the money laundering claim. He launders your money on its way into his pocket.

There's always something to speculate on dude.  I don't think the GLBSE is a bad thing.  In fact, I think it's a great thing for Bitcoin.  It allows people to invest their bitcoins in anything, which is awesome!  People will make money.  People will lose money.  Just like in any money market.

As long as Pirate ≠ Nefario and Nefario isn't leveraged to his eyeballs in Pirate.  I'm all good, personally.

It's not odd because I'm not calling it a Ponzi.  You are.  

I'm neither defending nor attacking Pirate.  I honestly have no idea what the hell he's doing.  It could be silk road coin laundering for all I know (in which case I don't want to be involved either).  I'm not getting involved because of the mystery and confusion everyone has about who this person is and what this person is doing.

All I'm concerned about is whether GLBSE can weather the storm should something happen.


I think so too.

By the way, he may not be able to "disappear without damage". He will have to be a bit careful. Since the law may not reach him, some of the betrayed "investors" may well take the law in their own hands and gun him down.

In fact, he has to be extremely careful. To be safe, he would have to have made no mistake in many years. If his identity could be found out, I would not like to wear his skin.

Well, of course the fact that he could fly away with a great quantity of money does not mean he will be the richest man on earth... he will not pose a bigger threat, and possibly a much little one, than a corporation or hedge fund discovering bitcoin, and some way to make money toying with its markets.

It would be really intresting to see how many bitcoins Pirate he controls, however; at least a very rough esteem, to understand the impact it will have on the whole.

The problem is not how GLBSE is protected from Pirate, in my view; is how the Bitcoin economy is protected by GLBSE. Not that it is a problem in itself, but if you take down Ponzi pass-thoughs ...and miners soon to follow maybe, if you count ASIC + halving of reward, then there would remain very little. So, is there a "real" Bitcoin economy that will do with or without Pirate's 7% per week? Or are we all (or nearly) here to speculate, and will run to sell everything if financial speculation is no more profitable? Would the price of bitcoin be affected, or stay the same?

One conforting aspect I didn't consider before, at least


so yes, the pression of people buying bitcoins to invest them with him and of him selling them to buy tropical islands could have balanced all along, so that they can disappear without damage. After all it could be that if you invested in Bitcointorrentz, after the dust settles you will go almost unchanged. But for some kind of reason I can not get myself to be convinced of that...

I think the thread subject is odd. Ponzi scheme operators do not default. They take the money and disappear.

The effect will not be very strong, because he will not suddenly sell off all the bitcoins. He has done that already for the most part. There will be some loss of trust in bitcoin whenever a bigger Ponzi scheme bursts, but I don't think this will kill bitcoin.

It will be a catastrophe only for any idiots who put their pension savings into a Ponzi scheme.

An interesting question is when a Ponzi scheme bursts. The Ponzi operator takes new "investments" and has to pay out those who withdraw bitcoins. Pretty obviously the operator will shut down the scheme when the payouts outweigh the new "investments", i.e. when his take is at the maximum.

This depends a lot on the trust and belief of his followers. As long as he can convince enough people that he will keep and multiply their money, they will hand it over to him. How anybody in his right mind can possibly believe in interest payments of several percent PER WEEK escapes me. But then we all know that the two most prevalent elements in the universe are hydrogen and stupidity.

^not good short term, better for us long term

edit: unless having that many btc allows pirate to manipulate the market behind the scenes forever

looks like we are about to find out.

In order to know that what he does in unproductive wouldn't you need to know what he does?

Thanks for your reply.  I feel a little better having funds on the GLBSE but that quote is scary.  

Come on some random dude on the internet!  Don't mess this up!

^^^^^^^^ - Nefario, I really am warming to you.  Well put, you are well read I see as well.   I can't wait to do business with the GBSLE.   Just getting our ducks in a row.


Dakore

Don't tell me you never heard that the best way to get many friends is to pay for them?

I agree and I have no quarrel with that but I am just very much confused with why there is so much trust flying around for this person when I've yet to see what he's done to deserve any of it.

I personally don't invest in any assets on GLBSE or outside GLBSE apart from GLBSE itself (this has been my only investment in terms of time and money).

GLBSE as a whole does not invest in anything except GLBSE.

I and GLBSE are not invested in any way with BS&T or any of it's pass through bonds,shares whatever.

Is your BTC that is held in GLBSE safe?

Whatever the BTC balance is of your account is what we have in cold storage (of course, this number is the sum of all BTC account balances on GLBSE).

If there is a "run", i.e. if EVERYONE on GLBSE wished to withdraw all their BTC at the same time there would be a delay of one or two hours, as large withdrawal requests are checked and funds dropped into the hot wallet to fund these. Every bitcent and satoishi would be returned.

Regarding the effect of a complete default of BS&T, I believe it would have a negative knockon effect on the entire bitcoin economy in the same way the sub-prime mortgages fiasco effected stock markets around the world.

There would be something of a recession on GLBSE, and I think as a result trade volume would probably reduce(which means that GLBSE's revenue would also reduce).

The upside to all this is that uncompetitive businesses (that are involved) would probably close and capital would begin to be more effectively allocated to the productive parts of the bitcoin economy.

It would mean that there would be more funds available for new ideas and technologies instead of being wasted or tied up in an unproductive area of the economy.

I love markets, and they will previal.

Will GLBSE be able to handle the traffic/server load caused by panic selling and people watching the panic selling?