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Bond Market
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Jake2555
Noob Inc
#1 - 2012-01-01 19:46:21 UTC
Hi Everyone
This is my first post on the forums, but i wanted to see if there was any interest in improving the way bonds and loans are handled

i propose creating a system similar to real life websites www.zopa.com, www.lendingclub.com and www.fundingcircle.com
so borrowers could ask for loans (a bond auction) and the investors would offer money at a particular rate (bid)
once either the target sum or a time has elapsed we could take the lowest bids and create bonds which would be issued to the investors and could be sold on a secondary market

the concept is to add accountability liquidity and relative security but most importantly allow the market to decide bond yields (not borrowers) since that would more accurately reflect and help mitigate the risk for investors

if you have and questions or suggestion id love to hear from you
i would like to see this work if there is demand for it

p.s. im writing this very tired, il proof read it (and probably shoot myself) in the morning Big smile
Akrasjel Lanate
Immemorial Coalescence Administration
Immemorial Coalescence
#2 - 2012-01-01 20:05:11 UTC
Trust TM

CEO of Lanate Industries

Citizen of Solitude
Jake2555
Noob Inc
#3 - 2012-01-01 20:16:17 UTC
Akrasjel Lanate wrote:
Trust TM


i think you've hit the nail on the head, but that is what i would want to address.

firstly there would be allot of accountability between investors and borrowers (since i would keep records of payments ect.)
but what i think your really getting at is me, how can you trust me?

i would create a corp so that there would be a separate wallet for all transactions to pass through which would incidentally help fight people using alts since the money would at some point have to be in escrow.

and i would provide public access to that corp wallets info and guarantee 100% that all deposits are held and not like those ponzi fractional reserve banks that only really have some percentage on hand for withdrawals

so i would put alot of effort into making sure you wouldnt need to trust me
and make it easier to know who to trust when they ask for your cash
Tanith YarnDemon
Hypernet Inc.
Umbrella Chemical Inc
#4 - 2012-01-01 20:17:05 UTC  |  Edited by: Tanith YarnDemon
I don't see it happening, simply because trust is soo much harder to handle in eve than in real life. As any given bond must be explained and discussed in detail to have much of a hope of success it'd be very hard to simplify it to the point where a site like the ones you linked would work. Eve has no laws and rules to rely on(well... not for this)

If a site like this were to be made, the only ones actually using it would be the same old MD-regulars(at best), whom already have the trust established, and it would most likely revolve around small quick loans rather than bonds and investment - which I fear has no real use of a site like it as they're typically handled directly between loanders and lenders whom feel comfortable with eachother.

EDIT:

Jake2555 wrote:

i would create a corp so that there would be a separate wallet for all transactions to pass through which would incidentally help fight people using alts since the money would at some point have to be in escrow.

and i would provide public access to that corp wallets info and guarantee 100% that all deposits are held and not like those ponzi fractional reserve banks that only really have some percentage on hand for withdrawals

so i would put alot of effort into making sure you wouldnt need to trust me
and make it easier to know who to trust when they ask for your cash


Not sure I understand this part. How does this make it any safer? Yes, it can be monitored, but you're still the one and only holder of all isk and can snatch it as you see fit. Well, other than that you can have no more than 7 loans going at once.

I'm also not sure why this corp-in-the-middle is at all needed or even beneficial?
Jake2555
Noob Inc
#5 - 2012-01-01 20:58:53 UTC
the reasoning behind the "corp-in-the-middle" wallet was for transparency but primarily so that payments can be directed to the bondholder which can be fairly dynamic if they are easily tradeable
Tanith YarnDemon
Hypernet Inc.
Umbrella Chemical Inc
#6 - 2012-01-01 22:35:52 UTC
Jake2555 wrote:
the reasoning behind the "corp-in-the-middle" wallet was for transparency but primarily so that payments can be directed to the bondholder which can be fairly dynamic if they are easily tradeable


My question is why loantaker and lender wouldn't deal with eachother directly? The added step adds transperancy over nothing but the added step.

While I like the idea of interest auctions, the webpage, corp and everything such adds nothing but obfuscation, there's no practical use for it(well, atleast not anymore). My question is not as much why should we trust you, as how do we benefit from trusting you(assuming you are trustworthy).
Jake2555
Noob Inc
#7 - 2012-01-02 00:02:37 UTC
yeh i can see where you are coming from with the peace of mind of as few possible people in the loop as possible keeps it as safe as possible, what i am trying to do is gauge the appeal, there is no reason that the lender and borrower couldn't deal with each other directly i guess.

but to answer about the added step only adding transparency over the added step, it also confirms that the isk has actually been transferred and it isn't a load of nonsense from forum alts, which would discourage scammers

i do think i have come at it from the wrong angle, i of course assumed myself trustworthy (i would be pretty messed up if i couldnt trust myself) but i can see that it might be too much of leap and would discourage many people especially if billions or more are involved and there is definitely no reason that somethings can't be dropped

i am looking at this purely academically at the moment but if any features do sound appealing i would develop them further
Vaerah Vahrokha
Vahrokh Consulting
#8 - 2012-01-02 00:20:11 UTC
What you propose has been more or less implemented in EvE with 3rd party services, collateral holding services, auditors. Some like me do / did all 3 (and other).

But it's not easy, because first you have to prove you "trusted 3rd party" won't flee with 2-3 puny billions, then with 20-30, then with 90-100...


What I noticed is that most trusted 3rd party seem to have disappeared, except of course the immortal Chribba King Of Veldspar (ticker: ICKOV Lol).


If anyone needs those services I can put my old 3rd party / insurance / collateral holding / auditing hat back up again.

Collateral holder / 3rd party + periodic reports are what's been done in EvE and it works, without websites and tralala.

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Gatan Hahran
Brukterer
#9 - 2012-01-02 00:46:43 UTC
Akrasjel Lanate wrote:
Trust TM


Trust™

The ™ can be written by holding ALT down and writing 0153 on your numpad, then releasing ALT again and ™ appears.
Tanith YarnDemon
Hypernet Inc.
Umbrella Chemical Inc
#10 - 2012-01-02 00:57:41 UTC
VV: If you're ever bored and find yourself with a tad to much time on your hands, I'd still like an audit. ;)
Ave Volta
Perkone
Caldari State
#11 - 2012-01-02 01:58:06 UTC
I haven't been following this forum as much as I used to but it seems like the overall number of bonds and investment offerings has fallen off quite a bit.

I know there were individuals in the past that tracked bond performance on MD but I haven't seen any such statistics in a while. I would be interested to see an update.

IMO it seems like a good time for solid offerings. I have a feeling there may be some pent up demand.

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