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kimmel

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #20 on: December 12, 2014, 01:22:34 am »

Ok thanks for your answers; there are different ways of doing business and this is yours; and it's nice you can tell us about your way. If it is succesful or not, or appropiate for each investors' taste; it's up to every of us but it's really important and useful to have this information here to help us decide. So thanks again for your patience.

Quote

Actually... Not that much. Open to suggestions, yes. To transparency as you describe it, clearly not.
Once a month, as said in the fund's presentation, we will show charts and numbers.
The remaining data has to remain confidential, like all other funds do in the world.

No more transparency than your bank gives you.

Sorry, I don't want to sound harsh. But what you are asking is for us to work for free, to kill the market, and to spend time and money in that process.

don't missunderstand me, I'm not asking you to work for free; i'm just asking you to show you own your investors' money; not showing us your methods from which you plan to earn money.

U know, accountancy by its definition gives you "a clear image of the company financial status at one exact moment in time" and all the companies around the world do that; they can run away with the money whenever they want; but from time to time they have to show up they accounts to their shareholders and to the government; and also declare their gains. Showing wallets it's just quite the same in crypto world.

How are you going to account (financially speaking) all your crypto-trades and all your gains and losses? and to declare them to the government? where are you based? which taxes apply to net gains on your crypto tradings?

Are you doing it the classic way (accomplishing your accountancy and information obligations stablished by national laws) or creating a trusty crypto way; what model are you following?

Is your way showing us an excell and a powerpoint presentation with whatever you want to show us and...believe it or not it's up to us???

You receive the money, you invest our money, you tell us how our money is doing, and you set the price of the share with a 5%NXT+5%EUR Walls of our money. I am missing something? Maybe your wife will belief you but (I repeat I don't think you want to scam us) please you should sound credible and give something more serious to your investors to believe in...

Quote
The details you are asking for are confidential. We will not show wallets, accounts (and pay the withdrawal and deposit fees), and bank accounts with euros.
No one would ever do that.
We could show that to an auditing firm, but not to the public.

About that; I agree. Which auditing firm do you have in mind for this job?
I guess some financial crypto friendly firm should be verifying that the funds you hold correspond to the shares you have issued and also to it's value.
about your proposal of legal. When are you planning to start the audits you mentioned above?

Thanks & good night :)
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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #21 on: December 12, 2014, 09:00:53 am »

don't missunderstand me, I'm not asking you to work for free; i'm just asking you to show you own your investors' money; not showing us your methods from which you plan to earn money.
Again, I understand your concern. There is, nonetheless, no way we can do what you ask for without giving away our short term strategies (ie work for free), spending a lot of time (for security and technical reasons, we have plenty of accounts on many platforms), and spending our customers' money (withdrawals and deposits are not free).
So, even if your goal is not that, the result will be that.

Quote
U know, accountancy by its definition gives you "a clear image of the company financial status at one exact moment in time" and all the companies around the world do that; they can run away with the money whenever they want; but from time to time they have to show up they accounts to their shareholders and to the government; and also declare their gains. Showing wallets it's just quite the same in crypto world.
1. Giving a clear image doesn't mean the image is proven. The proof may be brought by tax inspectors or independent audits. Please remember Enron and Arthur Andersen nonetheless.
2. No fund that I know of (and I know plenty) ever gives away its accounting. All they do is reporting. And that what we'll do.
3. Don't confuse the fund's accounting (where the money is invested) and the company's accounting (where the money comes from, ie fees, and where it goes, ie expenditures). The second is made public in the case of public companies. The first, never, but that's what you ask for.
3. For public companies which indeed publish their accounting it's done once a year. not once a week.
4. Showing a wallet is not the same as showing the accounting. Once shown, a wallet is known and public forever. We'd have to change wallets all the time to keep confidentiality.

Quote
How are you going to account (financially speaking) all your crypto-trades and all your gains and losses? and to declare them to the government? where are you based? which taxes apply to net gains on your crypto tradings?

Are you doing it the classic way (accomplishing your accountancy and information obligations stablished by national laws) or creating a trusty crypto way; what model are you following?

I developed a large Excel sheet with macros downloading all the current values, so we precisely know what we have and how much it's worth.
It's also our reporting tool: it automatically creates charts that we'll publish once a month (first week of the month)
We are registering the company in RAK. This state doesn't require accounting nor taxes. That's important to us, because there is no accounting regulation about the work we do, anywhere in the world, yet.
So we don't want to be taken aback when it suddenly falls in.
We'll register the company back to Switzerland (where we live) once this has changes, hopefully the coming year.

Quote
Is your way showing us an excell and a powerpoint presentation with whatever you want to show us and...believe it or not it's up to us???

Yes, just like any fund manager does. Look around.
Furthermore, regulation and official constraints have never stopped anyone from scamming.
Think Madoff.

That's the kind of chart we'll publish (data made up in this case):



Quote
About that; I agree. Which auditing firm do you have in mind for this job?
I guess some financial crypto friendly firm should be verifying that the funds you hold correspond to the shares you have issued and also to it's value.
about your proposal of legal. When are you planning to start the audits you mentioned above?
:D
We don't plan on auditing the first week after launch, that's for sure.
Auditing is expensive. So my question to you would be: As a customer, how much would you be willing to pay for that service, and how often?
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kimmel

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #22 on: December 12, 2014, 07:47:52 pm »

Ok, interesting info about how are you going to operate in RAK, in United Arab Emirates.

Quote
We don't plan on auditing the first week after launch, that's for sure.
Auditing is expensive. So my question to you would be: As a customer, how much would you be willing to pay for that service, and how often?

Well that's a good question, as a costumer how much I will be willing to pay up to of the fund profitability (%) to prove you are performing correctly and for that proof-of-solvency + proof-of-investments.

It doesn't have sense to ask a third party to prove you are not scamming me with as my funds would be already invested.

So, what % of the fund profitability are you proposing for this audits? I guess depending of the frequency and in-depth analisis of this audits the amount should vary. Could you make some serious proposal of external control to your investors??

Could we develop a white paper on the concepts (indicators) that might be taken in this analysis? Example:
- proof-of-existance: that your company on RAK exists, that all your bank accounts to manage the funds exist and are under your company name.
- proof-of-reserves (5% + 5%) - that they exist and you are holding them
- proof-of-investments (that you effectively own the assets/coins you say you own)
- proof-of-security -  a list of best practices on controlling your costumers funds, and if you are applying this Best practices or not (2FA, cold wallets...)
- proof-of-shares - independent calculation in order to check the value of the assets and that the nº of existing shares are correct
....

So, the interesting thing might be what will you be offering to your costumers?
 Iam sure most investors will agree to rennounce to a % of the value rising of the shares in order to achieve this 3rd partiy auditing.

For me as an investor I would pay as much as 30% of price rising in shares in order to achieve this. I guess that, when you start I operating it would be really necessary that you have someone assuring investors your proof-of-existance

Well I would love to see what you Cryptocoin can offer us Audinting options for it's investors.

Thanks!
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DoM P

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #23 on: December 13, 2014, 04:26:32 pm »

Well that's a good question, as a costumer how much I will be willing to pay up to of the fund profitability (%) to prove you are performing correctly and for that proof-of-solvency + proof-of-investments.

It doesn't have sense to ask a third party to prove you are not scamming me with as my funds would be already invested.

So, what % of the fund profitability are you proposing for this audits?
Well, nothing's free, my friend.
So, in the end, the customer is the one paying. Every time, everywhere.
Basically, you're identifying a risk, and I agree with you on that point: technically, we could run away with the money.
As an investor, you should measure this risk, somehow putting a value on it, depending on what you know and how you feel about it.
Once you know how much this risk costs to your eyes, you either know the price you'd be willing to pay to decrease this risk, or you know you just won't invest.

So, that price you'd be willing to pay, you, as an investor, will have to pay it. Either through the risk itself, through a high entry fee (the share would be worth 100, but we sell it 100 + x%. Right now, x=1%), through a high exit fee (the buy wall is now set to -5%, it could become -x%), through management fees (today, they are 0%, the market average is around 1.5%), or through higher performance fees.

In the end, the customer pays. And if the price is higher than the perceived risk, the fund loses customers, because they want performance with low fees.

Quote
I guess depending of the frequency and in-depth analysis of this audits the amount should vary. Could you make some serious proposal of external control to your investors??

No. For one good reason: This kind of audit is expensive. Talking about 5 to 6 digit numbers here.
Right now, 90% of the fund's value was brought by... us. This means we'd be using all the investors' funds to pay for that.


Quote
Could we develop a white paper on the concepts (indicators) that might be taken in this analysis? Example:
- proof-of-existance: that your company on RAK exists, that all your bank accounts to manage the funds exist and are under your company name.
That can be done, yes.

Quote
- proof-of-reserves (5% + 5%) - that they exist and you are holding them
That is already done: These are the buy walls. You can see one on the AE, the other one soon on CCEDK.

Quote
- proof-of-investments (that you effectively own the assets/coins you say you own)
That would require an independent audit. --> expensive.

Quote
- proof-of-security -  a list of best practices on controlling your costumers funds, and if you are applying this Best practices or not (2FA, cold wallets...)
I can tell you I have 20 years of experience in IT (I am easily found on LinkedIn if you want to check), I'm an expert at desktop security, I'm also the one who managed the BTer hack crisis directly with the hacker and BTer "CEO", and you can check the AE and CCEDK procedure I put on line to see how far we go for securing other people's computers.
So yes, obviously, we use secure machines, with 2FA.
But I can say that, it's not a proof.
Proof requires an audit, again.

Quote
- proof-of-shares - independent calculation in order to check the value of the assets and that the nº of existing shares are correct
Audit again.

Quote
So, the interesting thing might be what will you be offering to your costumers?
 Iam sure most investors will agree to rennounce to a % of the value rising of the shares in order to achieve this 3rd partiy auditing.

For me as an investor I would pay as much as 30% of price rising in shares in order to achieve this. I guess that, when you start I operating it would be really necessary that you have someone assuring investors your proof-of-existance
This means that, added to our own cut, as an investor, you would only be getting half of the performance.
Let's suppose every one agrees with that number. To cover for the costs, and assuming we're doing 20% in a month (which would be damn good), I'd need at least $600,000 invested in the fund. At least.

So now the question now is: How much would you invest with us?


Something is strange here, though...
As you can see, I'm being as open as possible. But it looks to me that I'm the first one around to whom so many question were asked.
Don't misunderstand me: these questions are legitimate. But it is weird so many people managed to get their shit assets out with no question and I'm getting so much scrutiny here...

Is there a specific reason?
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Sebastien256

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #24 on: December 13, 2014, 09:34:23 pm »

Is there a specific reason?

Probably because your asset is interesting and is worth the time it take to ask question.  :)
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buybitcoinscanada

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #25 on: December 13, 2014, 10:08:16 pm »

a
« Last Edit: December 23, 2014, 04:42:43 am by buybitcoinscanada »
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DoM P

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #26 on: December 13, 2014, 10:31:05 pm »

Is there a specific reason?

Probably because your asset is interesting and is worth the time it take to ask question.  :)

Is there a specific reason?

Probably because your asset is interesting and is worth the time it take to ask question.  :)

Bingo.

Oh...

Well, then, I'm flattered... ;)
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jl777

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #27 on: December 13, 2014, 10:45:39 pm »

Is there a specific reason?

Probably because your asset is interesting and is worth the time it take to ask question.  :)

Is there a specific reason?

Probably because your asset is interesting and is worth the time it take to ask question.  :)

Bingo.

Oh...

Well, then, I'm flattered... ;)
I bought a small amount, this has very good potential. Just dont put too much weight on any backtests, unless your algo is made sure to avoid ANY overfitting of the historical dataset

James
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DoM P

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #28 on: December 13, 2014, 10:54:34 pm »


I bought a small amount, this has very good potential. Just dont put too much weight on any backtests, unless your algo is made sure to avoid ANY overfitting of the historical dataset

James

Thanks for the advice, James.

I'm not very good at trading myself. That's why there are 2 guys with me on this:
One with a master degree in finance and another in trading.
The other with one in finance and another in risk management.

They use several predicting techniques. When all of them go toward the same direction, we invest or desinvest heavily, otherwise, we do some small trading or just hold our position.

On top of that, we also have some long term investments, like Sharkfund0 or jl777hodl.
You may have heard of those... ;)
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kimmel

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #29 on: December 14, 2014, 11:48:00 am »


Useful information just keeps poping out of you DoM P (I don't know if this expression exists - to pop out hehe, but anyway)

that info wasn't there on the first post, and yeah, sounds interesting that's why I'm asking :)

I have invested also a bit, I need to diversify on my investments too, exactly because I don't wanna be caught with all the eggs in the same basket. I have already lost enough money around  :( by now about 15 BTC in around 2 years, but that's the price of learning  :-\ ; probably investing not the same "bit" as James by the way :P
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printshop

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #31 on: December 15, 2014, 10:24:46 am »

Now, why NOT being transparent?
  • Being transparent is a really hard thing to do. We could say we have something, but how do we prove it? We are certainly not giving you access to our Kraken, Bitstamp, BTer, CCEDK, and other platforms' accounts, right?
  • The choices we make are the results of months of work and years of studying. We are not going to give this up for free so people can just replicate us
  • We intend for this fund to become quite large. If we succeed, saying what we do will actually change the market data. And that would be very bad. We are not market makers

The way this is traditionally done (and you mention banks as a bar of transparency) is to hire a third party accountant or auditor and have them sign an NDA. Would you consider that?

Edit: I see the subject of auditing has been brought up, but I can't see why it would cost 5 or 6 figures. Why not have a community member do it? Like how Damelon has audited some of the securities around here? It actually sounds exactly like the kind of thing NXTinspect or KNS should be doing. Why not contact NXTinspect about doing this?
« Last Edit: December 15, 2014, 10:28:32 am by printshop »
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DoM P

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #32 on: December 15, 2014, 11:27:47 am »

Now, why NOT being transparent?
  • Being transparent is a really hard thing to do. We could say we have something, but how do we prove it? We are certainly not giving you access to our Kraken, Bitstamp, BTer, CCEDK, and other platforms' accounts, right?
  • The choices we make are the results of months of work and years of studying. We are not going to give this up for free so people can just replicate us
  • We intend for this fund to become quite large. If we succeed, saying what we do will actually change the market data. And that would be very bad. We are not market makers

The way this is traditionally done (and you mention banks as a bar of transparency) is to hire a third party accountant or auditor and have them sign an NDA. Would you consider that?
Not for now, because of the costs.
I spent weeks working on our accounting, developing a custom made Excel accounting book. I am 100% sure it doesn't follow the official account regulations.
A professional accountant would also need days, if not weeks, digging into all the macros and formulas this book includes.

But I see no problem in doing that if we get bigger.
Actually, it is planned to get the fund officially registered in Switzerland or Luxemburg in that case, and that would required all of what you ask for.
The price? $80,000 to $100,000.

That's why it's not being done yet.
We'll be saving 100% of the fees to pay for that, actually.

Quote
Edit: I see the subject of auditing has been brought up, but I can't see why it would cost 5 or 6 figures. Why not have a community member do it? Like how Damelon has audited some of the securities around here? It actually sounds exactly like the kind of thing NXTinspect or KNS should be doing. Why not contact NXTinspect about doing this?
Because -no pun intended, really- we are far more professional than they are.
5000 Nxt for an audit cannot give any interesting result, at least in our case.
They'd be working at less than $1 an hour...

But, I would agree to the following:
If a well known Nxt or Bitcoin user happened to live not too far from Lausanne, Switzerland, I would agree to see him and show him our accounting, our wallets, and our exchange platforms accounts, once an NDA would be signed.

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Nexxie

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #33 on: December 15, 2014, 07:53:50 pm »

What are the projected/predicted profits for shareholders?
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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #34 on: December 15, 2014, 08:13:17 pm »

What are the projected/predicted profits for shareholders?
I wouldn't predict anything.

The only thing I can say is that if we had started that fund on October 1st, 2013, and managed it with our current strategy, we would have made +722% by October 31st, 2014.
Which doesn't mean we'll do that for the coming year: It all depends on the market.

We're trying to beat Bitcoin, and there's a reasonable chance we will.
Apart from that, can't say...
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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #35 on: December 17, 2014, 11:50:45 am »

Is CFA Consulting a registered company? Couldn't find anything on the website.
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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #36 on: December 17, 2014, 01:42:24 pm »

Is CFA Consulting a registered company? Couldn't find anything on the website.
Ongoing process.
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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #37 on: December 17, 2014, 02:35:17 pm »

Some asked me the following question through PM, and I feel I should share the answer:

Quote
Why has the price increased lately?
I can not find the price increase rules anywhere in the description of the asset?

Answer:

The price of the share depends on the total value of the assets held by the fund (cash, bitcoins, altcoins, assets from AE or others) divided by the number of shares sold.
Every day we calculate this value and if there is a significant change from the day before, we adapt the price.

What happened here is that we sold most of our bitcoins before the crash. Therefore, even if the value in euros is decreasing (because of the remaining bitcoins, altcoins, and assets we hold), the value in Nxt increases.

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manfromaus

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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #38 on: December 18, 2014, 03:10:16 am »

Some asked me the following question through PM, and I feel I should share the answer:

Quote
Why has the price increased lately?
I can not find the price increase rules anywhere in the description of the asset?

Answer:

The price of the share depends on the total value of the assets held by the fund (cash, bitcoins, altcoins, assets from AE or others) divided by the number of shares sold.
Every day we calculate this value and if there is a significant change from the day before, we adapt the price.

What happened here is that we sold most of our bitcoins before the crash. Therefore, even if the value in euros is decreasing (because of the remaining bitcoins, altcoins, and assets we hold), the value in Nxt increases.


Dom, you say "The price of the share depends on the total value of the assets held by the fund (cash, bitcoins, altcoins, assets from AE or others) divided by the number of shares sold."

Does this mean that per-share price could plummet if a whale eats up a large percentage from your sell walls, or did you mean divided by the full number of assets/shares created?
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Re: Cryptocoins, the first crypto hedge fund bridging euro and Asset Exchange
« Reply #39 on: December 18, 2014, 05:46:11 am »

Some asked me the following question through PM, and I feel I should share the answer:

Quote
Why has the price increased lately?
I can not find the price increase rules anywhere in the description of the asset?

Answer:

The price of the share depends on the total value of the assets held by the fund (cash, bitcoins, altcoins, assets from AE or others) divided by the number of shares sold.
Every day we calculate this value and if there is a significant change from the day before, we adapt the price.

What happened here is that we sold most of our bitcoins before the crash. Therefore, even if the value in euros is decreasing (because of the remaining bitcoins, altcoins, and assets we hold), the value in Nxt increases.


Dom, you say "The price of the share depends on the total value of the assets held by the fund (cash, bitcoins, altcoins, assets from AE or others) divided by the number of shares sold."

Does this mean that per-share price could plummet if a whale eats up a large percentage from your sell walls, or did you mean divided by the full number of assets/shares created?
Neither.
If a whale buys a load of shares, there are more shares sold AND there is more value in the fund.
--> The price doesn't bulge.

The total number of shares available is only a technical parameter, and has nothing to do with the price. What's important is the number of shares sold and the amount of money we manage in the fund.
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