That’s pretty slick. These folks need to come to the Carolina Code Conference in a couple of weeks…
Carolina Cloud pays SOFR on unused prepaid credits
11–20 of 57 posts
Re: Carolina Cloud pays SOFR on unused prepaid credits
#12I think this is pretty great, though I’m sure hyperscalers will find a way to make sure such a scheme becomes as shitty for customers as frequent flier programs are today. Think of it from a small hobbyist perspective: I want to host a few small workloads, but I don’t want to deal with reoccurring billing. Maybe I have money now, but can’t guarantee it later. With this scheme, I frontload with a substantial amount of…
This is correct, if you put in $1000 you could basically run a small dedicated VM in perpetuity.
Re: Carolina Cloud pays SOFR on unused prepaid credits
#13I've looked at doing this in Europe before, interest-bearing completely changes the classification of the prepayment. I didn't dig too deeply, but the general gist was that regulation-wise it really wasn't worth doing for a relatively gimmick-level feature
Very interesting I am curious how this is the case, could you share some more details/information about it? Also, how does it compare to say, accepting gold or treating a gold based ledger instead treating gold as a currency and similar ideas? Also could this re-classification be ever useful too? For examples bonds being treated in such way?
It's the case because once you buy cloud credits you are in an entirely unregulated space. At Carolina Cloud, that means your cloud credits are nothing more than an audited and backed up DB entry. Therefore, we can do whatever we want with them. We could double them every 6mo if we wanted. We settled on something more reasonable (SOFR).
Not unlike the hyperscalers giving $100k+ to startups and it not counting as income for C-corp tax purposes. Totally unregulated space!
Re: Carolina Cloud pays SOFR on unused prepaid credits
#14I think this is pretty great, though I’m sure hyperscalers will find a way to make sure such a scheme becomes as shitty for customers as frequent flier programs are today. Think of it from a small hobbyist perspective: I want to host a few small workloads, but I don’t want to deal with reoccurring billing. Maybe I have money now, but can’t guarantee it later. With this scheme, I frontload with a substantial amount of…
"I think this is pretty great, though I’m sure hyperscalers will find a way to make sure such a scheme becomes as shitty for customers as frequent flier programs are today." Oh, that's not even a challenge. The reason to offer a scheme like this is basically to abuse the fact that a human customer will value this disproportionally to the cost of providing it. But if the customer perceives that value, that means you c…
You can do all these things. If you are a small player trying to stick out, you can make a point of not playing these particular games.
Re: Carolina Cloud pays SOFR on unused prepaid credits
#15I think this is pretty great, though I’m sure hyperscalers will find a way to make sure such a scheme becomes as shitty for customers as frequent flier programs are today. Think of it from a small hobbyist perspective: I want to host a few small workloads, but I don’t want to deal with reoccurring billing. Maybe I have money now, but can’t guarantee it later. With this scheme, I frontload with a substantial amount of…
This is correct, if you put in $1000 you could basically run a small dedicated VM in perpetuity.
Just so long as the price of the small dedicated VM doesn't also increase with inflation
Re: Carolina Cloud pays SOFR on unused prepaid credits
#16I've looked at doing this in Europe before, interest-bearing completely changes the classification of the prepayment. I didn't dig too deeply, but the general gist was that regulation-wise it really wasn't worth doing for a relatively gimmick-level feature
This is interest on credits, not on cash. Once you start paying interest on cash you need a banking license. I think you'd be fine even in Europe paying interest on credits.
Why would you think credits and cash would be treated differently? I am not a EU tax expert but it would be shocking if that’s the case because you could create some pretty interesting schemes if by turning cash into a “credit” meant it was treated entirely different.
Maybe that’s the case for the EU but it would be surprising.
Re: Carolina Cloud pays SOFR on unused prepaid credits
#17I think this is pretty great, though I’m sure hyperscalers will find a way to make sure such a scheme becomes as shitty for customers as frequent flier programs are today. Think of it from a small hobbyist perspective: I want to host a few small workloads, but I don’t want to deal with reoccurring billing. Maybe I have money now, but can’t guarantee it later. With this scheme, I frontload with a substantial amount of…
How many small hobbyists really want to front load $150, instead of paying $5 a month, and would only be swayed if they got interest/credits?
At 5% simple interest, your $150 would give you 62.5c per month. So you'd need closer to ~~$1200 to have a perpetual hosting machine; for a $5/month VPS or whatever.
You also now have an additional problem: $1200 of committed spend on a cloud provider; which could go out of business one day; for a $5/month workload.
I think for most people, the second problem is much bigger than "I don't wanna set up recurring billing".
Re: Carolina Cloud pays SOFR on unused prepaid credits
#18I've looked at doing this in Europe before, interest-bearing completely changes the classification of the prepayment. I didn't dig too deeply, but the general gist was that regulation-wise it really wasn't worth doing for a relatively gimmick-level feature
Very interesting I am curious how this is the case, could you share some more details/information about it? Also, how does it compare to say, accepting gold or treating a gold based ledger instead treating gold as a currency and similar ideas? Also could this re-classification be ever useful too? For examples bonds being treated in such way?
What is surprising? Paying interest on cash is effectively a financial instrument. Not sure what gold has to do with it. If you pay a business cash and they turn it into credits that pay interest that would not pass a smell test.
No customer would truly care about this and in most jurisdictions you would probably go through a lot more paperwork because of the interest payments.
Re: Carolina Cloud pays SOFR on unused prepaid credits
#19I think this is pretty great, though I’m sure hyperscalers will find a way to make sure such a scheme becomes as shitty for customers as frequent flier programs are today. Think of it from a small hobbyist perspective: I want to host a few small workloads, but I don’t want to deal with reoccurring billing. Maybe I have money now, but can’t guarantee it later. With this scheme, I frontload with a substantial amount of…
How many small hobbyists really want to front load $150, instead of paying $5 a month, and would only be swayed if they got interest/credits? At 5% simple interest, your $150 would give you 62.5c per month. So you'd need closer to ~~$1200 to have a perpetual hosting machine; for a $5/month VPS or whatever. You also now have an additional problem: $1200 of committed spend on a cloud provider; which could go out of bus…
This is aimed at CFOs, not hobbyists
Re: Carolina Cloud pays SOFR on unused prepaid credits
#20I've looked at doing this in Europe before, interest-bearing completely changes the classification of the prepayment. I didn't dig too deeply, but the general gist was that regulation-wise it really wasn't worth doing for a relatively gimmick-level feature
In some regulations you can also be expected to declare and pay tax on the money you earned from the interest, which can be annoying to do for such small values.