Market Discussions

It's been an open secret now for a few months that I am seriously considering starting a bank and/or hedge fund.
Since I have established a trustworthy reputation, it seems to make sense to leverage that with the new character and banking corp. What I need though are some suggestions.

1. Provide bank api and/or reports from Eve Mogul or something similar? I want to ensure I can protect clients' anonymity who request it and protect trading data, yet I want to provide as much disclosure as possible. Put Chribba or someone else in corp for auditing purposes?

2. For a bank, what sounds like a reasonable interest rate to offer for unsecured deposits of various time periods? I am thinking savings accounts at 0.25% a week, 1/3/6/9/12 month CD's with slightly higher rates for longer time periods.

3. For clients with an appetite for higher risk and hopefully higher return, I would offer a hedge fund. I'm thinking 90 day holding periods with a 14 day minimum withdrawal notification. What would be a good expense ratio to charge? I'm thinking 5% per quarter plus 25% of profits, possibly with a high water mark feature in case of any quarters that have losses.

4. To ease operational burdens of paying out withdrawals, I would operate under a similar "banker" model to other trusted organizations. Bankers would put up some deposit, such as 10b each or use their own funds. Bankers would process withdrawals up to their limit (or using their own funds) and in return collect any withdrawal fees charged to customers. This reduces risk of theft like Somer and others have experienced in the past.

5. What would be a fair referral payout for clients to receive for sending friends to the bank? Maybe first week's interest, or 1% after 90 days, or perhaps a smaller lifetime percentage?

I have a lot more ideas but these are the main ones. Long term, I'd like to see my bank exceed deposits of any other bank in EVE's history yet avoid the failures others have experienced. Also, a success of this would make it much easier to launch my dream, which would include bringing index funds (both long and short), options, futures, etc to EVE.

Anyway, please offer your suggestions so I can get this launched with the maximum chance of success.

Thanks

I was thinking I would hire a paid board of directors to offer additional security and to vote on important matters. I'm thinking 1b per quarter may be a fair salary for such a role (with stock options possible), and maybe we would have 4 or 5 on the board including myself. Each board member would be provided corp shares and an auditing role for a character to be in corp. That way, if I go missing from EVE for an extended period of time, the board can vote in a replacement CEO to protect the bank and its clients.

Also, there may be an IPO for common shares and convertible bonds. I want to ensure there is a firm foundation of capital to support the bank. I may look to the Basel Accords for guidance.

I don't know whether to laugh, or cry. Everytime I see someone talk about trust in here, and financial instruments, it's a mixture of facepalm, and worry that I'm going to read about another article coming out about some poor illiterate who loses $1,000 somehow.

I know VV doesn't like how the market threads are pretty dead, but these uncollaterized loans with dilusions of grandeur are probably why no one comes here

Tell you what, I'll bite, just answer this to my satisfaction and I'll put a billion in...

What mechanic is in place to prevent someone from taking the wallet and biomassing, after a wonderful donation to your main?

And for extra points, what could you possibly do with the money that I couldn't do for myself, avoiding having to pay your cut?

Yeah, great non answer. Every corp has a CEO with full access. Again, what prevents someone from just walking away with the wallet? I wouldn't mind running a wallet 10x the size of the ponzi scheme you talked about, because like the hundreds of examples in EVE. I would walk away once it became profitable to do so. So because you don't want to, we should invest? Why are you? Why does your word carry any weight? Because you get likes in these forums? What happens when you get bored of it next week? Deside to let the game lapse because you have a job? I don't feel like scamming, can I have 100bn to invest in my venture?

When you can lay out a way for a board of directors, made purely out of sociopaths, be unable to take all the ISK and run off, then you have a bank

until then, it's a scam, whether you want to admit it or not

If only EVE would allow you to take out a mortgage on your characters... then your bank could provide credit to bonus room customers allowing them to take full advantage of the opportunity (instead of being limited by the assets they have at hand).

Such a great potential for synergy ruined by CCP's inability to implement a proper mortgage & debt collection process.

I'm sorry, Ero, but in the game as it is, a bank won't work.

And that is regardless whether you intend to scam or not and regardless who you get to support you to bring in trust (unless you get CCP to back you in a way similar to the policy in place for the character bazaar, which is very unlikely).

Considering the number of recent "bank" posts I'm tempted to write a longish post and explain it in detail (maybe I'll do it, if I find the time). Basically it won't work because the game leaves no room for the most basic functions of a bank, which is the collection of funds in the form of deposits and the redistribution of these funds in the form of loans. And with no need for a bank you'll have problems with your business model and with risk management. Plus it gets very complex very fast.

I really don't want to spoil your fun. But especially if you are serious about this idea I'd suggest to let it be. It's not worth your time and effort.

A blog/shareholder reports, actual board meetings, investment clubs, investing classes... there are many things I think the bank can offer to make banking and investing fun for both the insiders and the public.

So you don't want to be on the board?

That's a very good idea. EVE-bet or Chribba holding bets sounds good to me. I'm willing to extend the term past one year. This is a long term vision.

I suspect that this sadly may not be the case.

Edit - Counting up how many people are missing the (not very good) joke is starting to alarm me.