Perhaps a suggestion to Pirate --just to shut the critics up:

Very simply, why not just return all the principal and interest to all of your clientele? It's likely that all the investors you have now will reinvest and/or return to you even after the interim closure. It might temporarily disrupt your business for a few days, but it's probably nothing you couldn't cure over the short term with your profits.

I'm not sure how this could be proven without full disclosure from all of the participants, and it does expose some of the privacy from each of the account holders, but I'm sure it could be arranged with nanotube for him to make the final determination. Additionally, it shouldn't be considered a trick either, since if it were a true Ponzi, the interest and principal could not be returned, thus incurring a default. The only other possibility is Pirate's deep pockets and infinite altruism.

All things being equal, I think it would be a hassle, but it would make for some really interesting newsworthiness. Events such as these could very well prove that the less the regulatory friction, the better returns on the average, are available to market participants. I hate the cost of overhead...

Personally, I don't care whether or not it's a Ponzi, I like the game. It is what it is. I can live with that.

EDIT: Scratch that. I just remembered that Mt.Gox limits outflows. That would suck for me until I became qualified. I guess I better get on that, eh?