Old story

Since we were talking about history in #bitcoin-assets (and Apple, and the Chinese scam, and everything else), here's an old log :

**** BEGIN LOGGING AT Wed Sep 12 00:09:29 2012

gigavps ping
mircea_popescu hey

gigavps what do i need to do to get a listing ready for mpex
gigavps I would like to tighten the contract up
mircea_popescu well, we need to talk things through, hammer a definitive contract, we publish it
mircea_popescu and then that's about it.

gigavps there will be no more issuing after the upgrade
gigavps i'm done playing that game
mircea_popescu ok so run me through this entire story end to end so that i get a fresh page in my head
mircea_popescu then i ask some q's then i send you a draft

gigavps i am setting up a new contract that Gigamining owners can upgrade to
gigavps in turn, they reliquinish all rights to the Gigamining bond
mircea_popescu so it'd be a straight swap then

gigavps only people who own gigamining can upgrade to teramining
gigavps there are two "paths" for upgrading
gigavps 1. a free path
gigavps which is a 1-1 swap from gigamining to teramining
gigavps 2. a paid path
gigavps which would get the bond holder 4 teramining bonds for every 1 gigamining bond + a .3 BTC fee per bond
mircea_popescu ok. one second here.

gigavps sure
gigavps shoot
mircea_popescu basically the thing is : once you have the terra asset, you can distribute the shares any way you want to anyone you wish. be it as a straight swap for a glbse asset
mircea_popescu or a mix with some money etc. neither of these are problems.

gigavps ok
gigavps i was assuming no problems
mircea_popescu the things that can be problems are the things that have already turned to be sort-of problems to you.
mircea_popescu so. traditionally mpex assets have a minimum value.
mircea_popescu actually, you ever read a mpex contract ?

gigavps i've glossed them over
mircea_popescu ok so let's go over main points.
mircea_popescu you can set an arbitrary minimal value.
mircea_popescu this is a value you guarantee you will pay if the opperation folds up.
mircea_popescu it can be as low as you want, but it's not a good ideea to make it unreasonably low
mircea_popescu it's also a bad ideea to make it too high, as it will choke you.

gigavps ok
mircea_popescu so this is one point to consider, where to fix that.
mircea_popescu another thing, how do yo usell them ? till now i've been doing rolling blocks
mircea_popescu such as, a block at x price, another a little more expensive etc.
mircea_popescu would you prefer equal price, one block ?

gigavps i will not be selling them per se
mircea_popescu aha, so it will be fully allocated.

gigavps as in, i am not selling to the general public
mircea_popescu right. ok, no problem here then.
mircea_popescu the other thing is, up till this point i've been doing non voting shares, on the rule that owner always keeps 50%.
mircea_popescu you don't want these to be shares, do you ?

gigavps nope
gigavps debt only
mircea_popescu right. so your statement to the buyer is :
mircea_popescu i will deliver the output of this much mh/s for as long as you hold this security, in monthly installments.
mircea_popescu that about right ?

gigavps weekly, but yes
mircea_popescu so weekly, sure. in general it's monthly to let management focus on managing
mircea_popescu you sure you're happy with weekly ?

gigavps weekly is reasonable
mircea_popescu alright. in truth you don;t have THART much math to do for it.
mircea_popescu how many of these you issuing ?

gigavps well, there will be 160k bonds equaling 3.6Th
gigavps but not all will be issued
mircea_popescu what do you mean ?

gigavps because if they take the free path, i keep 3/4
gigavps currently, there are 40k bonds
mircea_popescu makes no difference in this discussion who OWNS them,.
mircea_popescu they're issued tho. you just own them.

gigavps right
gigavps so 160k
mircea_popescu ok. so you plan on 160k and they're 25Mh/s each

gigavps at 22.5Mh/s each
mircea_popescu 22.5 ?

gigavps they are 22.5Mh/s each because I am really going to be doing 90% PPS on 25Mh/s
mircea_popescu so then forget that, just do 100% on22.5 mh/s
mircea_popescu it's clear.
mircea_popescu clear-er.

gigavps exactly
mircea_popescu right. ok.
mircea_popescu you understand the value of these will necessarily slowly float down, as the diff goes up (if it does)

gigavps correct
mircea_popescu however, do yo actually currently hold the hashes ?

gigavps dividend will also drop along the way
gigavps i have 165Gh at the moment with another 25Gh on the way
gigavps and i usually run about 110% PPS
mircea_popescu you need 3.6th if my math isn't off ?

gigavps right
gigavps you cannot repeat this please
mircea_popescu so you're in effect leveraging yourself 20:1 on hash here. do you understand finance ?
mircea_popescu im not repeating anything, im like the pope.

gigavps i will be running 6Th when asic arrives
mircea_popescu suppose bfl pulls a runner and nobody gets asics.
mircea_popescu diff drops to 1mn
mircea_popescu you are royally fucked.

gigavps possibly
mircea_popescu what's your plan for that scenario ?

gigavps i have been to BFLs offices multiple times in the last couple of months
mircea_popescu man. understand me here. i don't care if bfl is your sister.

gigavps i am highly confident in their ability to deliver
mircea_popescu we plan all contingencies. you see ?

gigavps yes
mircea_popescu this way we know wtf to do.
mircea_popescu there's not much that can be done here, is there. nobody has the capital to insure it credibly.
mircea_popescu do you see any solution ?

gigavps yes
mircea_popescu im all ears.

gigavps BFL is getting insurance
mircea_popescu from whom ?

gigavps per contracts i am having them sign
gigavps professional liability insurance
mircea_popescu that's good. will you be able to show contracts ?

gigavps NO
mircea_popescu ok, that doesn't help us.
mircea_popescu are you concerned if i ask in -onepercent if anyone wants to take the insurance end this mgiht ammount to a leak of information ?

gigavps you cannot repeat what i have told you
mircea_popescu i'm not going to.
mircea_popescu i was going to ask "hey, does anyone want to sell me a 3 month hash based put option".

gigavps let's finish our discussion first
mircea_popescu (it was 3 months for bfl, or when is the term ? october ?)
mircea_popescu alright.

gigavps they should be delivering in early november
gigavps i'll know more at the end of the month
mircea_popescu thing is this : your propostion as quoted, "i'll deliver 22.5mh/s per share" does not work
mircea_popescu we'll have to either introduce verbiage "provided bfl delivers so and so" or else buy insurance.

gigavps i will not issue the bonds until BFL has delivered
mircea_popescu aha
mircea_popescu delivered fully, delivered some, delivered one unit ?ⁱ

gigavps i am the first to be delivered to
gigavps in full
mircea_popescu ok, then under that arrangement this is no problem whatsoever.
mircea_popescu any concerns you want to raise ?

gigavps good
gigavps i'll look over the contracts on your site
gigavps what's the link?
mircea_popescu actually, i'll send you a draft for your own thing
mircea_popescu it'd be a lot better to look over that, neh ?

gigavps awesome
mircea_popescu think it through, we have plenty of time till november.

gigavps how do i get to mpex
mircea_popescu http://trilema.com//bitcoin/mpex.php?mpsic=S.DICE
mircea_popescu or else http://trilema.com//bitcoin/mpex.php for main site
mircea_popescu or mpex.us

gigavps sweet
gigavps thanks
mircea_popescu np.
mircea_popescu your email ?

gigavps me@iamjamesgibson.com
mircea_popescu haha nice domain there.

gigavps thanks
mircea_popescu what do you see as a name ?

gigavps for the bond
mircea_popescu yes

gigavps ?
gigavps teramining
mircea_popescu well technically it will be a fund, so F.
mircea_popescu hmm... you lose your name tho.

gigavps f.tera
gigavps f.teramining
mircea_popescu you're giga to everyone
mircea_popescu this is valuable

gigavps that's fine
gigavps i don't want everyone to know who i am anymore
mircea_popescu haha bruised a little huh ?

gigavps most people think if you are famous, you are rich
mircea_popescu F.TERA then, it's better than longer variant.
mircea_popescu yeah. tis not true, but they do think so.

gigavps so why a fund?
mircea_popescu and hate you for being rich.

gigavps and not a bond?
mircea_popescu well, it's not shares, it's not options, and a bond pays out, which you don't. so it's a fund
mircea_popescu bond must have set maturity date

gigavps ahhh
gigavps yeah, don't want that
mircea_popescu they all do, expire on 1st of Nov or w/e
mircea_popescu yeah. ok so an hour or two you'll get a draft to look over.

gigavps kk
gigavps thanks for the help
mircea_popescu it's what i'm for.

gigavps if you need some help with the front end of your site, let me know
mircea_popescu hehe there's some teams working on making broker sites
mircea_popescu apparently it's slow going.

gigavps i know a little about web development...
mircea_popescu i saw, really liked your giga farm site.

gigavps :)
mircea_popescu o, one thing... has nothingto do with any of this but

gigavps shoot
mircea_popescu you prolly should drop your pirate rating. it's pissing people the fuck off.

gigavps yeah, i did
gigavps i have no rating for P now
mircea_popescu that's healthier.
mircea_popescu i mean i can appreciate the emotional and other complexitiers, but you're also a business.
mircea_popescu gotta think of the future and of the looks of things.

gigavps yeah
gigavps i tried to stay away from posting too many things in support or against P
gigavps in the forums
mircea_popescu suppose you made a mistake. people make mistakes. it happens.

gigavps yep
gigavps best i can do is learn from them and not repeat them
mircea_popescu something like that.

gigavps well, i'm waiting to hear from P before deciding what is to come next with him
mircea_popescu who knows. reeses has a point on one angle, as in, "i've waited longer than this on overdue accounts, and the ppl paid"
mircea_popescu so have i.
mircea_popescu and for comparable sums, at that.

gigavps right
mircea_popescu yet... i have serious doubts you'll hear anything.
mircea_popescu but timewill tell.

gigavps exactly
Sep 12 01:23:32 * gigavps has quit ()

**** ENDING LOGGING AT Wed Sep 12 02:01:25 2012

The problem with knowing secrets is that in order for them to remain secrets, you have to keep on keeping them secret. This particular guy - originally a well respected member of the community (chiefly on account of being less retarded and less incompetent than what was average for the time) went rogue soon after this exchange, which is, fundamentally, his attempt to stick MPEx investors with the bill for his various GLBSE scams.

At any rate : an unqualified dedication to keeping secrets will, as the years go by, expose you to the unpleasant (and, I'd wager, unforeseen) circumstance where you're keeping secrets for criminals. And not even jolly good likable criminals - just random scum that at some point or other tried to scam you and failed.

Governments resolve this problem historically by delaying publication, some decades. In the age of the Internet, I say a coupla years should be enough for anyone.

1. Talk about prescience, huh ? Strategic superiority, that's that it manifests itself as : prescience. [↩]