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Topic: [OPPORTUNITY] Invest in a working mining operation - page 2. (Read 3667 times)

legendary
Activity: 1099
Merit: 1000
I like the idea, but not the terms.  Even at a 3% ROI, Bitcoin is still inflating at about 40% APR.  There is still room for great losses.

I'm not sure if I understand your concerns.  Wink
I will expand mining with loan. I will repay with BTC.

So, you will benefit if BTC revalue.
Would you prefer a fixed USD repayment, a mix ?

What you are proposing is essentially a one year business bond.  The problem is that it's unsecured and includes currency risks.  3% isn't enough interest.  However, I also understand the concern for yourself, because if the difficulty shoots to the moon, you might not be able to pay back the installments.  But I think that I have a solution.

Start by bumping up the APR to something more in line with a high risk bond, say 12%; but include an escape clause.  For example, an agreement to the monthly payment, but if the difficulty is set to a number higher than a certain limit, all future payments are waived.  This protects you from a spike in the difficulty, while also permitting the investor (myself) assurances of a reasonable profit margin.  It works because there is a strong corollary between the difficulty and the market price trendline.  So if the limit is breached in six months, I only receive half of the bitcoins but it is a fair assumption that the trade value of that half of bitcoins had significantly increased during those six months.  At this time, I'd be willing to set the high difficulty limit to 250K, roughly triple the difficulty at this point.  Run your math, if you are interested, to judge your risks.  On risk to me is that it's possible for the bitcoin price to decouple from the difficulty, but I would say that the odds of that occurring within any one year period are remote. 

I understand now, and your logic is flawless. If difficulty goes too high, it will be hard to repay that 3% mo. in BTC.
Anyway, at the same time as minimizing risks, I wish the investor may benefit also from a BTC value rally.

To make things simpler, I'm thinking on offering a mixed repayment type : capital will be repaid in USD and interest in BTC.
e.g. : for every USD 1000.- you invest, you will be paid 12 x USD 83.33.- and 12 x 40 BTC.

What do you think ?
hero member
Activity: 602
Merit: 513
GLBSE Support [email protected]
You might want to wait about a week and a 1/2 when BitcoinGlobal (my company, with several prominent co-investors and board members) launches the Global Bitcoin Stock Exchange, it's not just for shares but will allow you to monetize(for bitcoin) any contract you can imagine, from bonds, loans, to futures contracts.

We're going to start open testing in the next few days, pm me if you want in.
legendary
Activity: 1708
Merit: 1010
I like the idea, but not the terms.  Even at a 3% ROI, Bitcoin is still inflating at about 40% APR.  There is still room for great losses.

I'm not sure if I understand your concerns.  Wink
I will expand mining with loan. I will repay with BTC.

So, you will benefit if BTC revalue.
Would you prefer a fixed USD repayment, a mix ?

What you are proposing is essentially a one year business bond.  The problem is that it's unsecured and includes currency risks.  3% isn't enough interest.  However, I also understand the concern for yourself, because if the difficulty shoots to the moon, you might not be able to pay back the installments.  But I think that I have a solution.

Start by bumping up the APR to something more in line with a high risk bond, say 12%; but include an escape clause.  For example, an agreement to the monthly payment, but if the difficulty is set to a number higher than a certain limit, all future payments are waived.  This protects you from a spike in the difficulty, while also permitting the investor (myself) assurances of a reasonable profit margin.  It works because there is a strong corollary between the difficulty and the market price trendline.  So if the limit is breached in six months, I only receive half of the bitcoins but it is a fair assumption that the trade value of that half of bitcoins had significantly increased during those six months.  At this time, I'd be willing to set the high difficulty limit to 250K, roughly triple the difficulty at this point.  Run your math, if you are interested, to judge your risks.  On risk to me is that it's possible for the bitcoin price to decouple from the difficulty, but I would say that the odds of that occurring within any one year period are remote. 
full member
Activity: 238
Merit: 100
nvm then wire costs $25 I believe and WU not sure how much but should be at least $8.  I don't do paypal but how in the world is that risky? You don't pay till a month a withdraw to bank account takes like a week if that, any problems just don't pay.

Problem with Paypal, additional with fraud accounts, is that they may freeze your account for no reason.
Also, bank withdrawal not a good option here (Argentina).

Oh ok yet another reason I don't use paypal.
legendary
Activity: 1099
Merit: 1000
nvm then wire costs $25 I believe and WU not sure how much but should be at least $8.  I don't do paypal but how in the world is that risky? You don't pay till a month a withdraw to bank account takes like a week if that, any problems just don't pay.

Problem with Paypal, additional with fraud accounts, is that they may freeze your account for no reason.
Also, bank withdrawal not a good option here (Argentina).
full member
Activity: 238
Merit: 100
nvm then wire costs $25 I believe and WU not sure how much but should be at least $8.  I don't do paypal but how in the world is that risky? You don't pay till a month a withdraw to bank account takes like a week if that, any problems just don't pay.
legendary
Activity: 1099
Merit: 1000
payment via paypal?

Sorry, Paypal not an option, too risky.
I can accept wire or Western Union.
legendary
Activity: 1099
Merit: 1000
How would you receive the money I might be interested.

Wire is the best option, can accept WU too.
legendary
Activity: 1099
Merit: 1000
I like the idea, but not the terms.  Even at a 3% ROI, Bitcoin is still inflating at about 40% APR.  There is still room for great losses.

I'm not sure if I understand your concerns.  Wink
I will expand mining with loan. I will repay with BTC.

So, you will benefit if BTC revalue.
Would you prefer a fixed USD repayment, a mix ?
legendary
Activity: 2058
Merit: 1452
payment via paypal?
full member
Activity: 238
Merit: 100
How would you receive the money I might be interested.
legendary
Activity: 1708
Merit: 1010
I like the idea, but not the terms.  Even at a 3% ROI, Bitcoin is still inflating at about 40% APR.  There is still room for great losses.
legendary
Activity: 1099
Merit: 1000
To expand an already working mining operation, I'm looking for investors.
It can be a loan of USD to be paid in BTC, also open to any association proposal.

Loan example : for every USD 100.- you invest, you get 12 monthly fixed payments of 15.11.- BTC.
That is a direct interest of 3% mo. , plus you can benefit from any BTC revaluation in the meantime.


UPDATED :

For every USD 1000.- you invest, you will be paid one of these 3 options of your choice :

1) 12 x USD 83.33.- and 12 x 40 BTC.
2) 12 x 150 BTC
3) 12 x USD 114.-

Investing is accepted by means of :

- Wire transfer
- WU
- BTC
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