Topic: I have made a 25% return this week trading *against* the pirate (Read 12669 times)
pirate at it again....sell low and buy high LOL
August 03, 2012, 07:10:45 AM
Even if Pirate can make 10.65% per week (up to what amount? These never scale up infinitely. Actually, at that kind of return rate the limit should be reached very quickly.), it makes absolutely no sense to borrow such huge amounts of bitcoins at several-hundred-percent annual interest rate. He should have gotten a loan in fiat. He says he knows rich investors etcetera. He could have borrowed a million dollars and bought at least 250kbtc when they were cheaper.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
Seriously guys, think about the bitcoin ecosystem, and read all the history post of pirate. And think again.
So, Pirate is not motivated by self-interest, but he's a rich kid who's throwing away a fortune to make some gullible bitcoin enthusiasts rich, who would otherwise fall for a get-rich-quick scam? Allow me to not be convinced.
Did I say that?
You did not, but this is what you imply. Not taking a huge profit for oneself and instead distributing it to those who are irresponsible enough to invest in an enterprise that has all the markings of an obvious scam is effectively the same thing as having a shitload of money in the first place and distributing it the same way.
No I did say that if you understand what he does you understand why he need to have such interest rates.
This is bitcoin.
Bitcoin is a very small market/economy.
Bitcoin is an emerging, shoud I say booming economy (GDP likely to be in the hundreds of percents annually, there are signs everywhere that bitcoin is spreading)
Bitcoin a free market, a true one, without any government interference.
All of these make it a scammer paradise (although defenses are emerging), true, but it also make some insane profits possible.
Now I'm not 100% sure (or I would be have all my coins in pirate's), but enough to trust him.
But whatever, time will tell. I'd say that by the end of 2013 we should "for sure"
August 03, 2012, 06:52:33 AM
Even if Pirate can make 10.65% per week (up to what amount? These never scale up infinitely. Actually, at that kind of return rate the limit should be reached very quickly.), it makes absolutely no sense to borrow such huge amounts of bitcoins at several-hundred-percent annual interest rate. He should have gotten a loan in fiat. He says he knows rich investors etcetera. He could have borrowed a million dollars and bought at least 250kbtc when they were cheaper.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
Seriously guys, think about the bitcoin ecosystem, and read all the history post of pirate. And think again.
So, Pirate is not motivated by self-interest, but he's a rich kid who's throwing away a fortune to make some gullible bitcoin enthusiasts rich, who would otherwise fall for a get-rich-quick scam? Allow me to not be convinced.
Did I say that?
You did not, but this is what you imply. Not taking a huge profit for oneself and instead distributing it to those who are irresponsible enough to invest in an enterprise that has all the markings of an obvious scam is effectively the same thing as having a shitload of money in the first place and distributing it the same way.
August 03, 2012, 06:01:39 AM
Even if Pirate can make 10.65% per week (up to what amount? These never scale up infinitely. Actually, at that kind of return rate the limit should be reached very quickly.), it makes absolutely no sense to borrow such huge amounts of bitcoins at several-hundred-percent annual interest rate. He should have gotten a loan in fiat. He says he knows rich investors etcetera. He could have borrowed a million dollars and bought at least 250kbtc when they were cheaper.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
Seriously guys, think about the bitcoin ecosystem, and read all the history post of pirate. And think again.
So, Pirate is not motivated by self-interest, but he's a rich kid who's throwing away a fortune to make some gullible bitcoin enthusiasts rich, who would otherwise fall for a get-rich-quick scam? Allow me to not be convinced.
Did I say that?
August 03, 2012, 03:58:17 AM
Even if Pirate can make 10.65% per week (up to what amount? These never scale up infinitely. Actually, at that kind of return rate the limit should be reached very quickly.), it makes absolutely no sense to borrow such huge amounts of bitcoins at several-hundred-percent annual interest rate. He should have gotten a loan in fiat. He says he knows rich investors etcetera. He could have borrowed a million dollars and bought at least 250kbtc when they were cheaper.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
Seriously guys, think about the bitcoin ecosystem, and read all the history post of pirate. And think again.
So, Pirate is not motivated by self-interest, but he's a rich kid who's throwing away a fortune to make some gullible bitcoin enthusiasts rich, who would otherwise fall for a get-rich-quick scam? Allow me to not be convinced.
August 03, 2012, 03:46:34 AM
Quote
He might have a lot now, but might not have had a lot from the get go.
Exactly. So what's his profit model now?Grow Bitcoin itself.
sssshhh
We're all in it for that. Some are better than others
August 03, 2012, 03:39:25 AM
Even if Pirate can make 10.65% per week (up to what amount? These never scale up infinitely. Actually, at that kind of return rate the limit should be reached very quickly.), it makes absolutely no sense to borrow such huge amounts of bitcoins at several-hundred-percent annual interest rate. He should have gotten a loan in fiat. He says he knows rich investors etcetera. He could have borrowed a million dollars and bought at least 250kbtc when they were cheaper.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
And the argument that he can't buy bitcoins because he'd move the market is ridiculous. As if other people acquiring and tying up bitcoins in his scheme doesn't move the market exactly the same way.
Seriously guys, think about the bitcoin ecosystem, and read all the history post of pirate. And think again.
August 02, 2012, 10:36:54 PM
Quote
He might have a lot now, but might not have had a lot from the get go.
Exactly. So what's his profit model now?Grow Bitcoin itself.
August 02, 2012, 08:34:32 PM
It's not easy if you don't have a bunch of bitcoins to begin with.
Yes, it is. You borrow some bitcoins at slightly above market and pay them back as soon as possible.Quote
He might have a lot now, but might not have had a lot from the get go.
Exactly. So what's his profit model now?Quote
As long as the profits are bigger than the interests, it makes sense to borrow.
No, it makes sense to do the deals even if that means you need to borrow. But also, it makes no sense to borrow if you don't need to -- unless you have no intention of paying back. With your model, he'd have no need to borrow. Thus, either he doesn't make sense or he doesn't intend to pay back.Quote
If he's making X% (given X is higher than btcst avg rates), it doesn't make sense to buy back his debt which yields less. Not until he sees profit margins dwindle (at which point he can buy back debt or lower rates).
It absolutely does make sense to buy back debt which yields less because buying back that debt in no way affects his profit margins. It is comically absurd to argue that his business volume is limited by his capital. August 02, 2012, 08:31:11 PM
Pirate has never promised 7% forever.
He also never promised to provide his service forever either...
I'm not expecting either.
Then if you are invested with him and know this you are taking a huge risk because he could run with your bitcoins.
Why, because we all know 7% isn't sustainable forever (exponentially especially) and Pirate has already stated he will be adjusting interest rates for savings accounts? Or because he's currently operating under a certain model that allows him to profit off of the current situation bitcoins and the bitcoin economy are in? He might be able to offer interest rates at any amount down to 0%, but I doubt to see him operating past then. He could turn around and become a more typical bank at that point I suppose.
Just because 7% isn't sustainable and because he's playing off of the economy and currency, doesn't mean that he will default or run. Him ending services wouldn't mean that he is defaulting or running either.
I'm taking a huge risk anyways, the two observations above are inconsequential.
Hey do what you want with your money. I'll stop there...
August 02, 2012, 08:22:35 PM
Pirate has never promised 7% forever.
He also never promised to provide his service forever either...
I'm not expecting either.
Then if you are invested with him and know this you are taking a huge risk because he could run with your bitcoins.
Why, because we all know 7% isn't sustainable forever (exponentially especially) and Pirate has already stated he will be adjusting interest rates for savings accounts? Or because he's currently operating under a certain model that allows him to profit off of the current situation bitcoins and the bitcoin economy are in? He might be able to offer interest rates at any amount down to 0%, but I doubt to see him operating past then. He could turn around and become a more typical bank at that point I suppose.
Just because 7% isn't sustainable and because he's playing off of the economy and currency, doesn't mean that he will default or run. Him ending services wouldn't mean that he is defaulting or running either.
I'm taking a huge risk anyways, the two observations above are inconsequential.
August 02, 2012, 08:12:04 PM
Pirate has never promised 7% forever.
He also never promised to provide his service forever either...
I'm not expecting either.
Then if you are invested with him and know this you are taking a huge risk because he could run with your bitcoins.
August 02, 2012, 07:45:41 PM
Pirate has never promised 7% forever.
He also never promised to provide his service forever either...
I'm not expecting either.
August 02, 2012, 07:31:02 PM
Pirate has never promised 7% forever.
He also never promised to provide his service forever either...
August 02, 2012, 07:26:15 PM
Pirate has never promised 7% forever.
August 02, 2012, 06:33:39 PM
The thing is, this whole thing is much easier to do without using any lenders (except perhaps for the first few transactions). Just keep your profits in Bitcoins, pay off the lenders, and then keep all the profits.
It's not easy if you don't have a bunch of bitcoins to begin with. He might have a lot now, but might not have had a lot from the get go.As long as the profits are bigger than the interests, it makes sense to borrow. If he's making X% (given X is higher than btcst avg rates), it doesn't make sense to buy back his debt which yields less. Not until he sees profit margins dwindle (at which point he can buy back debt or lower rates).
While this is true qualitatively, it's insane quantitatively. Even if 7% were explicable, which they aren't IMO, he should be long past the point where he scales down. With 400k BTC, you can shuffle the entire Bitcoin market cap around many times in a single day. There exists no fund flow in Bitcoin that could require such giant size of transaction/escrow/whatever.
August 02, 2012, 05:33:59 PM
The thing is, this whole thing is much easier to do without using any lenders (except perhaps for the first few transactions). Just keep your profits in Bitcoins, pay off the lenders, and then keep all the profits.
It's not easy if you don't have a bunch of bitcoins to begin with. He might have a lot now, but might not have had a lot from the get go.As long as the profits are bigger than the interests, it makes sense to borrow. If he's making X% (given X is higher than btcst avg rates), it doesn't make sense to buy back his debt which yields less. Not until he sees profit margins dwindle (at which point he can buy back debt or lower rates).
Also, there's no evidence that the constant, large Bitcoin transactions necessary for this to work (from A to B in your example) are actually happening. And it makes sense that they wouldn't be happening. There's advantages to dealing with Bitcoins, but not enough to justify a 10% cost on the buy side followed by selling on an exchange and withdrawing fiat to buy more Bitcoins.
Remittance, tax evasion, international trade, weapons, terrorism, drugs are a few examples where moving money across borders anonymously might be worth a lot. And whether the transactions are large or split into many small ones does not change alter the business model at all. Neither does it matter whether A is 1 or 100 people, or whether B is 1 or 1000. Or whether B sells their bitcoins on an exchange directly or through N number of middlemen. August 02, 2012, 05:09:50 PM
Pirate takes in 100k (or whatever) btc from lenders. Sells them to client A at 10% (or more) markup. Because client A needs to be anon (thus off exchange) and needs to send large sums across borders to person B. This does not affect price.
Person B receives btc, but needs fiat, and sells it on exchange. Pushing price down. Pirate buys back cheaply.
Or pirate puts up bid wall, and B sells into it, because they want to cash out fast.
So I don't see why him buying it back needs to push the price up.
And it seems this money can be made because of bitcoins unique nature.
The thing is, this whole thing is much easier to do without using any lenders (except perhaps for the first few transactions). Just keep your profits in Bitcoins, pay off the lenders, and then keep all the profits.Person B receives btc, but needs fiat, and sells it on exchange. Pushing price down. Pirate buys back cheaply.
Or pirate puts up bid wall, and B sells into it, because they want to cash out fast.
So I don't see why him buying it back needs to push the price up.
And it seems this money can be made because of bitcoins unique nature.
Also, there's no evidence that the constant, large Bitcoin transactions necessary for this to work (from A to B in your example) are actually happening. And it makes sense that they wouldn't be happening. There's advantages to dealing with Bitcoins, but not enough to justify a 10% cost on the buy side followed by selling on an exchange and withdrawing fiat to buy more Bitcoins.
This is really just a variation on "Pirate is so rich he can afford to borrow at a huge loss even in the absence of a business reason for doing so".
August 02, 2012, 03:08:50 PM
Pirate takes in 100k (or whatever) btc from lenders. Sells them to client A at 10% (or more) markup. Because client A needs to be anon (thus off exchange) and needs to send large sums across borders to person B. This does not affect price.
Person B receives btc, but needs fiat, and sells it on exchange. Pushing price down. Pirate buys back cheaply.
Or pirate puts up bid wall, and B sells into it, because they want to cash out fast.
So I don't see why him buying it back needs to push the price up.
And it seems this money can be made because of bitcoins unique nature.
Person B receives btc, but needs fiat, and sells it on exchange. Pushing price down. Pirate buys back cheaply.
Or pirate puts up bid wall, and B sells into it, because they want to cash out fast.
So I don't see why him buying it back needs to push the price up.
And it seems this money can be made because of bitcoins unique nature.
August 02, 2012, 01:03:34 PM
And of course I had to make the simplest possible error in the calculation in my thought experiment. At $5, $800k gets you BTC160k, not 200k. The point still stands, just get a bigger loan.
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