1005500+ entries in 0.774s
rg: i just want
to make sure when i pay out 60 btc in divs
rg: no offense
to brendio but
rg: technically i just pay divs
to him and he dulls
them out
BTC-Mining: Which
totals
to what my 3 subaccounts should have had
rg: or perhaps you can let him know its ok if he sends your BTC
to someone else
rg: uh its a huge
task
to pay out
thousands of btc
asa1024: uh sure - what about
the stock holdings?
rg: hes come
through and paid out
rg: saying he was going
to rip
them off
asa1024: what about
the stock holdings?
BTC-Mining: Well, I'm glad
to report GLBSE paid me out
too
BTC-Mining: Going
to eat something and will report back afterward if I got paid already
BTC-Mining: Seems my firewall decided
to block it...
BTC-Mining: Otherwise, you can keep
them valuating safely
BTC-Mining: No, I'd recommend investing
the coins if possible.
BTC-Mining: But if you have nothing
to do with your bitcoins, seems like something I'd suggest.
mircea_popescu: but anyway, a conversation we should continue at a later
time, i gtg now.
mircea_popescu: keep btc locked up in
the hopes
that maybe price collapses and you get a lot more of
the collapsed currency
BTC-Mining: Well
that's assuming bitcoins wouldn't keep up
the deflationary curve...
mircea_popescu: well what can i say, i'm guessing you should
try
this ?
BTC-Mining: Until
there's a large drop, at which point 1st account lose escrow and 2nd account makes a profit.
BTC-Mining: price movement loss/win evens out
the execution of said contracts
BTC-Mining: I only sold 333k + gave 1.66mn in esscrow and you have
to give 4 mn
BTC-Mining: But even so, you paid a lot for
them and have
to give
them
to
the market manipulator along with his own escrow + extra.
mircea_popescu: well yes my dear BTC-Mining, in
this game where you're
the only one
that has any btc and any usd you can ofcourse do whatever you like lol
BTC-Mining: No, because
there was no USD in escrow and you have
to buy
those
to pay me. I'd like
to see
that not switching
the price back far over it's original value.
mircea_popescu: this all notwithstanding
that i wouldn't allow
the insanity in
the first place, just for
the sake of argument.
mircea_popescu: so you cash 4.15mn btc on
the options, lose
the escrow. you now have 4.15mn btc worth 4 each and 1.66mn usd
BTC-Mining: +209k I have
to sell at a loss, let's round it up
to 1.9 mn
mircea_popescu: say 333k btc sold at ~5 or so on avg
to crash it all
to 4.
gribble: There are currently 209213.01 bitcoins demanded at or over 4.0 USD, worth 1651453.94475 USD in
total.
BTC-Mining: I'll strike
them at 20 for 1.66 million, crash price
to 4 BTC with a few 100Ks, redeem 1 million x 4 BTC. I get 4 million BTC, lose 1.66 collateral and a few 100Ks
mircea_popescu: i mean... it's
the nature of options,
they lend
themselves
to daydreaming.
mircea_popescu: but i mean, if you're daydreaming it'd be cheaper
to buy a buncha calls and push
the price up lol
BTC-Mining: I know, I don't have
the funds. Just daydreaming
mircea_popescu: you crash
the price with your other million. since we now have superpowers, i buy your other million.
BTC-Mining: Let me make 1 million such contract
then crash
the market price
BTC-Mining: Since
there's no fee for splits and assuming I have 2 account
BTC-Mining: Because I can't lose more
than escrow but can gain more
than escrow
BTC-Mining: So basically, I could just make splits safely and indefinitly and any
time BTC price would crash, I'd profit.
BTC-Mining: Yeah, but it basically means every
time bitcoins value go down by a lot, MPEx has
to pay for it because
the escrow is not USD
mircea_popescu: sex has also flaws. it is pleasurable and makes
time zip by!
mircea_popescu: god i love
the opinions of
the incompetent on matters
they don't understand
mircea_popescu: "Even if
they had every regulation in place, it still has other flaws, like being deflationary and non-reversible.
The only
time bitcoins will be "stable" is when
the number of users drops very low"
mircea_popescu: except mpex works in bitcoin. why should i bother
the customer with filthy fiat ?
BTC-Mining: It seems
tho
that logically,
that's how
they should be. Because unexercised contracts returns
the escrow and a PUT
technically is going long with USD, so if
that contract makes a profit, it makes it on USD valuating, so escrow should be in USD
BTC-Mining: Shouldn't calls require BTC collateral (like
they do) and put require USD collateral?
BTC-Mining: Sounds messed up. Basically
the exchange has absorbs
the losses from unexercised contracts which goes over
the collateral.
BTC-Mining: Aye... but now let's assume
the opposite in
the extreme. Price goes down
to 0.01 USD...
The calls are worth nothing so are not exercised. So you get back 100 BTC. However... Puts are worth 1199 BTC and are exercised, so you need 119900 BTC
to pay out with 100 BTC only in collateral.
mircea_popescu: you'd lose nothing on
the calls and .2 on
the puts, coming out
to 180 btc.
mircea_popescu: <mircea_popescu> but for simplicity's sake all
those
things happen behind
the scenes.
BTC-Mining: But
the 100 BTC for
the PUT should have been converted
to USD.
BTC-Mining: ok, but let's say BTC price is 12 USD and I make a split at strike 12 for 100 contracts. I put 200 in collateral. Now let's say price goes
to 20.
mircea_popescu: but for simplicity's sake all
those
things happen behind
the scenes.
BTC-Mining: Which means even if
the contract is not exercised,
there could be a loss in BTC if
the price increase instead for
the contract maker.
BTC-Mining: but... it would have
to be converted
to dollars
to work.
mircea_popescu: well, it'd work cause at
the
time you posted
the collateral it was in fact worth enough
to cover in dollahs.
BTC-Mining: Wouldn't
the exercising value for
the put @ 20 strike be 19 BTC?
mircea_popescu: it rounds issuance down, so you could end up with 0 puts if
the strike is high
mircea_popescu: split works automatically, you declare
the capital and
the option
BTC-Mining: Last question. We need
to put strike/spot BTC for a put option.
BTC-Mining: Slightly confusing at first but very interesting. I should
try and start playing with
those.
mircea_popescu: that's why
they are called options.
they convey
the right but not
the obligation.
BTC-Mining: So if it's negative,
the exercising party gains zero and
the BTC is returned instead.
BTC-Mining: hmm... right. Because you only lose from escrow what
the other party exercises.
BTC-Mining: Technically
the call has a negative value of -0.6666666
mircea_popescu: i'm kinda proud of
the fact
that mpex allows not only option buying, but also option writing, without any unbound risk.
mircea_popescu: obviously if it goes up you can make a loss. but you can adjust
the % you sell
to suit your expectations
mircea_popescu: you make 5k atm calls/puts, you sell
the calls, keep
the puts. if price goes down in fact you make a decent profit
mircea_popescu: but anyway, consider
the case you have 10k btc and want
to ensure
that
they don't go under 100k usd.
mircea_popescu: mpex doing it's part
to promote financial responsibility.
mircea_popescu: well, yes, it practically boils down
to, a little overescrow.
BTC-Mining: But if you only want
to sell one way,
the 2% fee saved can go a long way
mircea_popescu: and if you sell
the out of
the money side and it stays out of
the money you make
that sale profit
BTC-Mining: So if you make a split, price moves and you don't sell any contract like you wanted, at
the end of
the month, it results in a 0 BTC loss or gain.
BTC-Mining: oh... so by making a split, I get
twice
the BTC put up front in escrow with no fees.
jcpham: ok i made
that up. i admit it
mircea_popescu: and at
the end of
the month he gets something, 0.0x or more possibly if
the price goes down