Bitcoin Savings & Trust
Bitcoin Savings & Trust (abbreviated as BST) was a ponzi scheme operated by Trendon Shavers (then known as Pirate). It was launched in November 2011 as First Pirate Savings & Trust. Pirate claimed to have been selling bitcoins to some local tight-lipped buyers, and that he started BST to provide more volume to these buyers. By selling invested bitcoins at a high rate and rebuying them at the market price, Pirate was supposedly able to offer a very high-yield interest rate of 7% per week. This rate attracted many investors, and Pirate claimed that over 500,000 bitcoins had been deposited.
After accumulating an ever larger amount of bitcoin, transactions were becoming difficult and expensive. Pirate attempted to reduce the strain by lowering the interest rate, but this sparked unrest and mass withdrawals. After a discussion with his clients, Pirate decided to close BST, and announced his intentions to return all owed bitcoins. After repaying at least 11 small beneficiaries, BST suddenly announced default on August 28, 2012. It was later revealed that the missing money went towards "rent, car-related expenses, utilities, retail purchases, casinos, and meals."
- Pirate's original post as archived by Vitalik Buterin
- Buterin, Vitalik (30 August 2012). "The Pirate Saga: And So It Ends". Bitcoin Magazine. http://bitcoinmagazine.net/the-pirate-saga-and-so-it-ends/. Retrieved 1 September 2012.
- BitcoinTalk thread 101339. Bitcoin Savings and Trust is closing 17 August 2012. Post 1111794.
- BitcoinTalk thread 50822. Bitcoin Savings and Trust | Home | Closed n.d.
- BitcoinTalk thread 104221. Its Official Pirate Has Defaulted!! 28 August 2012.
- Donnelly, Jacob (19 September 2014). "Trendon Shavers, Bitcoin Ponzi Schemer, Charged $40 Million Fine". Inside Bitcoins. http://insidebitcoins.com/news/trendon-shavers-bitcoin-ponzi-schemer-charged-40-million-fine/24716. Retrieved 29 July 2015.