Silk Road forums
Discussion => Silk Road discussion => Topic started by: buckaroo0987 on September 06, 2013, 03:52 am
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Someone was saying in a different thread that SR takes 10% of sales for their commission.
I'm not knocking or complaining about the SR taking their cut... That makes total sense.
Normally that's not an issue, I'd guess most products here have a 20%+ profit margin....
But I'm thinking about the guys in the money section who are taking MP for BTC or selling BTC for cash in the mail and only making 5 or 10% themselves.
How are they making any profit?
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http://dkn255hz262ypmii.onion/wiki/index.php?title=Seller%27s_Guide#Pricing_and_commission
The first $100 of an order is charged 10% commission, and amounts thereafter fall into smaller and smaller percent brackets.
As for the profit margins on here, I'd guess most are getting a good average of 50-100% in profit margins.
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They have to do nothing and become stinking rich.
Awesome!
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http://dkn255hz262ypmii.onion/wiki/index.php?title=Seller%27s_Guide#Pricing_and_commission
The first $100 of an order is charged 10% commission, and amounts thereafter fall into smaller and smaller percent brackets.
As for the profit margins on here, I'd guess most are getting a good average of 50-100% in profit margins.
That was the old fee structure. The current fee is (6.7) e^(-p/6) + 4, where p is the price in bitcoins.
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"They have to do nothing and become stinking rich."
Yeah, they do nothing. Coming from a vendor, this ignorance surprises me.
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"They have to do nothing and become stinking rich."
Yeah, they do nothing. Coming from a vendor, this ignorance surprises me.
I agree. But i believe he was talking about SR. Which i also believe is an ignorant statement. Is this guy seriously complaining about SR making money? Would he rather there be no SR at all? Seriously. People need to focus more on the benefits offered rather than how much everyone else is making. It really is none of our concern.
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They have to do nothing and become stinking rich.
Awesome!
Yeah ok. I don't think you guys realize that vendors usually come out 20%-25% less when needing to turn BTC into real world BILL money. This does, of course, include the 10% fee.
I don't complain about the SR fee. SR deserves it. I'm willing to pay 10% so I don't have to meet sketched out dudes in a parking lot at 3am.
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"They have to do nothing and become stinking rich."
Yeah, they do nothing. Coming from a vendor, this ignorance surprises me.
Ouch!!
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They have to do nothing and become stinking rich.
Awesome!
Yeah ok. I don't think you guys realize that vendors usually come out 20%-25% less when needing to turn BTC into real world BILL money. This does, of course, include the 10% fee.
I don't complain about the SR fee. SR deserves it. I'm willing to pay 10% so I don't have to meet sketched out dudes in a parking lot at 3am.
But it only goes up...not down.
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They have to do nothing and become stinking rich.
Awesome!
Yeah ok. I don't think you guys realize that vendors usually come out 20%-25% less when needing to turn BTC into real world BILL money. This does, of course, include the 10% fee.
I don't complain about the SR fee. SR deserves it. I'm willing to pay 10% so I don't have to meet sketched out dudes in a parking lot at 3am.
But it only goes up...not down.
What goes up?
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Still a better deal than Amazon's seller fees: 15% of selling price plus flat fee of USD1.35 per sale plus monthly fee of USD39.99 regardless of sales volume. Even if you could sell drugs on Amazon, you'd still get a better deal on SR.
O, and Amazon also reports your earnings to the IRS.
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They have to do nothing and become stinking rich.
Awesome!
Yeah ok. I don't think you guys realize that vendors usually come out 20%-25% less when needing to turn BTC into real world BILL money. This does, of course, include the 10% fee.
I don't complain about the SR fee. SR deserves it. I'm willing to pay 10% so I don't have to meet sketched out dudes in a parking lot at 3am.
But it only goes up...not down.
What goes up?
Why the fee of course what else??? It will be 11% next year...and so on
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I'd guess most products here have a 20%+ profit margin....
I'd keep guessing, mate.
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There is also a ~4% fee for using the 'hedge escrow' future...
That was the old fee structure. The current fee is (6.7) e^(-p/6) + 4, where p is the price in bitcoins.
Have you got a source for this?
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http://dkn255hz262ypmii.onion/wiki/index.php?title=Seller%27s_Guide#Pricing_and_commission
The first $100 of an order is charged 10% commission, and amounts thereafter fall into smaller and smaller percent brackets.
As for the profit margins on here, I'd guess most are getting a good average of 50-100% in profit margins.
That was the old fee structure. The current fee is (6.7) e^(-p/6) + 4, where p is the price in bitcoins.
And what does e represent in the equation?
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http://dkn255hz262ypmii.onion/wiki/index.php?title=Seller%27s_Guide#Pricing_and_commission
The first $100 of an order is charged 10% commission, and amounts thereafter fall into smaller and smaller percent brackets.
As for the profit margins on here, I'd guess most are getting a good average of 50-100% in profit margins.
That was the old fee structure. The current fee is (6.7) e^(-p/6) + 4, where p is the price in bitcoins.
And what does e represent in the equation?
Probably e
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http://dkn255hz262ypmii.onion/wiki/index.php?title=Seller%27s_Guide#Pricing_and_commission
The first $100 of an order is charged 10% commission, and amounts thereafter fall into smaller and smaller percent brackets.
As for the profit margins on here, I'd guess most are getting a good average of 50-100% in profit margins.
That was the old fee structure. The current fee is (6.7) e^(-p/6) + 4, where p is the price in bitcoins.
And what does e represent in the equation?
Probably e
Haha thanks. Back to school (and wikipedia) I go
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There is also a ~4% fee for using the 'hedge escrow' future...
That was the old fee structure. The current fee is (6.7) e^(-p/6) + 4, where p is the price in bitcoins.
Have you got a source for this?
http://dkn255hz262ypmii.onion/index.php?topic=182525.0
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http://dkn255hz262ypmii.onion/wiki/index.php?title=Seller%27s_Guide#Pricing_and_commission
The first $100 of an order is charged 10% commission, and amounts thereafter fall into smaller and smaller percent brackets.
As for the profit margins on here, I'd guess most are getting a good average of 50-100% in profit margins.
That was the old fee structure. The current fee is (6.7) e^(-p/6) + 4, where p is the price in bitcoins.
And what does e represent in the equation?
e is an actual notation in math meaning "constant." Replace e with 2.71828
So e=2.71828
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Can somebody show a step by step example of how to use this formula.
I've tried with limited results in the past and need help.
I'm no potato either just not obviously in DPR's class in school
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Can somebody show a step by step example of how to use this formula.
I've tried with limited results in the past and need help.
I'm no potato either just not obviously in DPR's class in school
Step by step? You can always do it in this format; 0.1 (67 e^(-p/6)+40)
Or a better one is, 4. e^(-p/6) (1.675+e^(p/6))
No? still don't get it?
Ok, ok.
Lets say your selling a item that cost 0.5btc.
DPR's formula is (6.7) e^(-p/6) + 4
Go to google and type this in
(6.7) e^(-0.5/6) + 4
And it will spit out the answer.
The only thing you need to change is P, because P is the price your selling the item for. P=0.5
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Step by step? You can always do it in this format; 0.1 (67 e^(-p/6)+40)
Or a better one is, 4. e^(-p/6) (1.675+e^(p/6))
No? still don't get it?
Ok, ok.
Lets say your selling a item that cost 0.5btc.
DPR's formula is (6.7) e^(-p/6) + 4
Go to google and type this in
(6.7) e^(-0.5/6) + 4
And it will spit out the answer.
The only thing you need to change is P, because P is the price your selling the item for. P=0.5
Dude, Thanks so much.
I was doing it with an online calculator but somehow I didn't remember to use the minus sign in front of the bitcoin figure (-p) and it was throwing off the result every time
So in my short run,
for a 0.01BTC/$1.22 listing commission is 10.6888426337212893% And if you hedge (14.6888426337212893%)
for a 10BTC/1222 listing commission is 5.2654665390116643% And if you hedge (9.2654665390116643%)
I would guess the average sale on the road is in the $50 - $200 range so at todays Bitcoin prices that would mean the commission ranges from 10.25% (14.25% with hedging) to 9.3% (13.3% with hedging)
if you price in local currency rather than BTC this may be even higher due to rate fluctuations so i guess you could say on average yes the SR is really 10%
Thing that bugs me about this method of calculation is that as BTC prices increase so do seller fees :(
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I like the formula (aesthetically, not necessarily business-wise).
You can tell by the constants he chose that the intent is to scale logarithmically from 10.7% (at 0 BTC item price) to 4% (at infinity).
That said, I think (I hope) it was an oversight that, since most listings are pegged to the dollar, the average listing fee will be increasing as BTC goes up over time.
The easy fix would be to replace p with price in dollars and adjust the coefficient of p accordingly. To keep the fee distribution locked at what it currently is, so it doesn't float with the exchange rate, DPR could change the formula to:
(6.7) e^(-d/750) + 4, where d is price in dollars.
(this is based on a USD/BTC rate of 125.00).
DPR, you listening?
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Personally I think -d/600 (the fee structure at USD/BTC of 100) would be a little fairer, but that's a business decision.
That would scale as follows:$0.00 10.7
$50.00 10.16429758
$100.00 9.671427557
$150.00 9.217965247
$200.00 8.800759781
$250.00 8.416912222
$300.00 8.06375542
$350.00 7.738835477
$400.00 7.439894698
$450.00 7.164855903
$500.00 6.911807997
$550.00 6.678992684
$600.00 6.464792256
$650.00 6.267718348
$700.00 6.0864016
$750.00 5.919582139
$800.00 5.766100825
$850.00 5.6248912
$900.00 5.494972073
$950.00 5.375440706
$1,000.00 5.265466539
$1,050.00 5.164285421
$1,100.00 5.071194299
$1,150.00 4.985546332
$1,200.00 4.906746398
$1,250.00 4.834246959
$1,300.00 4.767544255
$1,350.00 4.706174805
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I like the formula (aesthetically, not necessarily business-wise).
You can tell by the constants he chose that the intent is to scale logarithmically from 10.7% (at 0 BTC item price) to 4% (at infinity).
That said, I think (I hope) it was an oversight that, since most listings are pegged to the dollar, the average listing fee will be increasing as BTC goes up over time.
The easy fix would be to replace p with price in dollars and adjust the coefficient of p accordingly. To keep the fee distribution locked at what it currently is, so it doesn't float with the exchange rate, DPR could change the formula to:
(6.7) e^(-d/750) + 4, where d is price in dollars.
(this is based on a USD/BTC rate of 125.00).
DPR, you listening?
Well if yo're planning to get that nutty with it, why not do a Series representation:
6.7/e^(d/750)+4 = 4+6.7 sum_(k=0)^infinity (-d)^k/(750^k k!)
But keeping it simple would be,
0.1 (67 e^(-d/750)+40)
Or
0.1 (40 + 67/E^(d/750))
You could also possibly derive that from
lim_(d->infinity) (4+6.7/e^(d/750)) = 4.
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LOL you would you trippy ass horse. BTW there's gleaming reviews and discussions of you on reddit's SR subdomain. I like the look of it to from a creative and not financial analysis standpoint.
Regarding Hedging - If you've been in the bitcoin game long enough, you ill likely know that there's more to gain than lose, but never expect speculation to yield guessed results. As of 3 weeks ago I have unhedged my listings and earned 5-20% on most orders. That's around $300 that would never be in my pocket if I didn't unhedge. I didn't do any historical analysis to see what I could've gained because I know it'll piss me off like the fact I was buying BTC for <$5 that went up to $200 a year later. I did gain $3000 profit from the $500 seller bond after 2 months tho :) I was socked. I thought it was gonna be $500 worth of BTC. closest eeling to winning the lottery I've got.
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I like the formula (aesthetically, not necessarily business-wise).
You can tell by the constants he chose that the intent is to scale logarithmically from 10.7% (at 0 BTC item price) to 4% (at infinity).
That said, I think (I hope) it was an oversight that, since most listings are pegged to the dollar, the average listing fee will be increasing as BTC goes up over time.
The easy fix would be to replace p with price in dollars and adjust the coefficient of p accordingly. To keep the fee distribution locked at what it currently is, so it doesn't float with the exchange rate, DPR could change the formula to:
(6.7) e^(-d/750) + 4, where d is price in dollars.
(this is based on a USD/BTC rate of 125.00).
DPR, you listening?
Well if yo're planning to get that nutty with it, why not do a Series representation:
6.7/e^(d/750)+4 = 4+6.7 sum_(k=0)^infinity (-d)^k/(750^k k!)
But keeping it simple would be,
0.1 (67 e^(-d/750)+40)
Or
0.1 (40 + 67/E^(d/750))
You could also possibly derive that from
lim_(d->infinity) (4+6.7/e^(d/750)) = 4.
???
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I like the formula (aesthetically, not necessarily business-wise).
You can tell by the constants he chose that the intent is to scale logarithmically from 10.7% (at 0 BTC item price) to 4% (at infinity).
That said, I think (I hope) it was an oversight that, since most listings are pegged to the dollar, the average listing fee will be increasing as BTC goes up over time.
The easy fix would be to replace p with price in dollars and adjust the coefficient of p accordingly. To keep the fee distribution locked at what it currently is, so it doesn't float with the exchange rate, DPR could change the formula to:
(6.7) e^(-d/750) + 4, where d is price in dollars.
(this is based on a USD/BTC rate of 125.00).
DPR, you listening?
Well if yo're planning to get that nutty with it, why not do a Series representation:
6.7/e^(d/750)+4 = 4+6.7 sum_(k=0)^infinity (-d)^k/(750^k k!)
But keeping it simple would be,
0.1 (67 e^(-d/750)+40)
Or
0.1 (40 + 67/E^(d/750))
You could also possibly derive that from
lim_(d->infinity) (4+6.7/e^(d/750)) = 4.
???
Error in my math?
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"They have to do nothing and become stinking rich."
Yeah, they do nothing. Coming from a vendor, this ignorance surprises me.
I agree. But i believe he was talking about SR. Which i also believe is an ignorant statement. Is this guy seriously complaining about SR making money? Would he rather there be no SR at all? Seriously. People need to focus more on the benefits offered rather than how much everyone else is making. It really is none of our concern.
I think you missed a joke guys.
Vendor says something like: "Yeah! I can get rich by doing nothing."
Since most of us don't get rich or do nothing, it sounds like sarcasm to me.
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I'm thinking about the guys in the money section who are taking MP for BTC or selling BTC for cash in the mail and only making 5 or 10% themselves.
How are they making any profit?
There is a guy who says he is doing it to be nice (not really charging a fee). He also says something like "he tried to get into the business by giving away bud samples" but got paranoid about shipping. I could not tell if he was legit as his transactions are mostly hidden by the new system.
Otherwise the money sellers seem to me to have fees (including sr comissions) around 15 to 25%. If you buy coins from vendors for 20% and sell coins to buyers for 15%, there is a lot of money to be made. If you keep it in the SR system, SR probably gets most of it. A lot of money vendors do not do it through SR escrow (as an exception is allowed by SR for that). These vendors can be making a lot of $. If they choose to. they can also scam massivly with their FE based systems. Look at the items the money/btc sellers sell. If they are pretty much free, they are not paying a lot of comission. The "top" $ vendors do keep it in the sysem and that is why SR calculations show them to be "top" vendors.
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Profit percentage and profit margin are NOT the same thing.
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I'd guess most products here have a 20%+ profit margin....
I'd keep guessing, mate.
LOL and this is why vendors are willing to bite the bullet for now. Until there is serious competition I would not expect the fee to go down very much.