Quote from: Deprived on June 27, 2013, 06:44:28 PM

I'm by no means convinced allowing investors to take on more than 1% risk is a good thing.

The problem I see is that if they can take on significant risk per bet then it removes all incentive for anyone to actually play the game. Why would someone take on the role of player (with the odds against them) if they can expose their capital rapidly but with the odds in their favour?

Investment MUST be slow and steady profit - to force gamblers into taking on the player role and accepting the bad odds.

This was discussed in the local chat. The situation where MP risks 1k BTC confronting the players + 99k BTC on CP for a total of 100k at 1% is overall worse (for everyone) than the situation where MP risks 1k BTC confronting the players at 100% while holding on to the rest in safety.

The alternative implementation where this is only allowed to large investors is probably safer for the minnows, but it will probably be strongly protested as "unfair" and "fiat-like". The implementation where any minnow is allowed to act as a big fish with a stern warning is probably more in the spirit of Bitcoin. There will certainly be nuts risking 100% of their balance at 100%, but they won't likely last.

In general "forcing" and derived arguments don't mix with Bitcoin. For that matter, investment will be profit no matter what, but it won't be steady. The site went from 250 to 80 to 330 back down to 200 within the space of about a day, putting plenty of investors at least temporarily in the red at least twice in that time. It will probably continue going under and over its EV back and forth forever.

Quote from: trout on June 27, 2013, 06:23:27 PM

If you only consider *largest* bets, you, as a house, will be losing money in the long run
if you allow bets over 2%.

Your modeling is completely broken in that it imagines capital available as a fixed numeric value. This is now how it works (but your edit saved you from much stronger words).

Capital availability is limited by the cost of opportunity and the profile of risks involved. With the current arrangement the dampening derived from dooglus' own CP risk is the largest factor in that equation. This has to be diminished so as to allow the site to grow. In another perspective, the site is only realizing a fraction of the investment it could be realizing currently, which is not so different from an engine only burning part of the fuel it's being fed: it won't go quite as far.

In any case removing the arbitrary limit actually protects the house, in that it allows it to raise maximums past where even the larger whales can afford to play down towards the maximum. Currently the house is running with a 1/100 dampener, and MP (among others) leeched it pretty seriously - it's easy to do if you can afford to risk the sort of BTC it takes to hammer the max out of it.

Quote from: dooglus on June 27, 2013, 05:57:17 PM

Quote from: davout on June 27, 2013, 05:42:27 PM

Planning on a GPG-signed investor contract ?
That would be nice, you're on OTC, you have a key, use it, that's what it's for.

I was just going to point you to my previous answer to that question, but I can't find it!

I'm sure I replied to you asking on the other thread, saying that I'm happy to sign a reasonable contract, but don't have the skills required to draft it, or the time to contract someone qualified to do so. But I don't see the post anywhere, so I guess I clicked 'Post', it timed out, and I didn't notice.

Can you (or anyone) suggest something simple and reasonable that you would like me to GPG sign?

A strange case of feedback at work here: once you implement the variable %s this isn't particularly needed as the investors hold most of their balance in their own hands anyway, and the economic interests are so aligned to keep everyone honest, much in the way the cold war didn't culminate in a nuclear winter for other reasons than because all parties gpg-signed contracts. For the interim until you implement variable %s it doesn't seem this will help enough to justify the hassle.

That aside, once you have it pretty clear in your head enough to be able to make absolute, definitive statements as to your projected handling of the site it's probably a good idea to draft, review and sign a declaratory statement of some sort.

Quote from: radiumsoup on June 27, 2013, 07:42:23 PM

Quote from: MPOE-PR on June 27, 2013, 05:50:56 PM

Quote from: radiumsoup on June 27, 2013, 03:31:50 PM

(like how AM IPO holders have an enormous advantage due to 35x rise in share price making a larger barrier to entry for new investors on an absolute basis)

This statement is just another way to say "AM is a bubble and the shares aren't worth what they go for". That this realization is slowly percolating even through the investors that'd be much better served thus should be perhaps a little worrying

What the hell are you talking about? This is a clear-cut, textbook example of a strawman failure of logic. I in no way implied anything of the sort. The fact that you think it's even remotely logical to infer what you did would frankly be hilarious if it weren't so abjectly sad.

Let's try and think together.

If the actual value of AM is above its trading price, then the original buyers hold no advantage over later buyers. Stating that the price going up constitutes a "barrier to entry" is exactly equivalent to stating that the current price exceeds the fair value, as that excess and that excess only could in fact be constituting a barrier to entry. This is all.

Perhaps a revisiting of what "strawman fallacy" means is in order, seeing how you fail to correctly identify it in the field.