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How does the Casascius business model work? Can someone explain it to me?

Murch
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Tiago Emanuel Pratas
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1 Answers1

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If you're asking about the Casascius Physical Bitcoins business operated by Mike Caldwell, the simple answer: it doesn't, as it has been defunct since 2013. See the bitcoin wiki page.

The coins he produced were sold at a markup over the included BTC amount.

Pieter Wuille
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  • do you know how much? – Tiago Emanuel Pratas Dec 23 '20 at 01:28
  • @Tiago: an amount that was simultaneously too much for many buyers and too little to run a business on? – RedGrittyBrick Dec 23 '20 at 10:11
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    @RedGrittyBrick defunct because gov said stop, not because of bad business, afaiu – chytrik Dec 23 '20 at 11:49
  • @chytrik, I'd forgotten that. I guess Mike Caldwell didn't want the hassle of registering as a money services business and getting state licences. He felt he was selling collectibles rather than transmitting money. So his collectibles business was profitable. Apparently he was also concerned that at around $1000 per coin (inc 1 BTC) his cost of inventory and theft risk was getting too high. – RedGrittyBrick Dec 23 '20 at 14:55
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    It's also just a bad business in general, there's 100% absolute trust that whoever is making the "coins" doesn't retain the private key for themselves. It sort of worked when the community was tiny, but it definitely shouldn't today. Nobody should be buying and trading those coins believing that they have any value other than the metal they are made from. – Claris Dec 23 '20 at 23:25