From: Joichi Ito -.1

From: Joichi Ito -.1 > To: Jeffrey Epstein <[email protected]> Subject: SIM rain contract Date: Mon, 25 Apr 2016 14:09:41 +0000 Is the last sentence correct? When you take, for instance, a contract that pays out $i million if it rains tomorrow, and put it into your accounts, you will be required to guess the chance of rain—maybe so%— and value that asset at something like $5oo,000. The contract will actually never pay out $500,000; it will either be worth zero or $1 million in the end. But if you were forced to trade it today, you'd probably sell it for something dose to $5oo,000; so for tax and management purposes, you "value" the contract at $5oo,000. On the other hand, if you unable to sell it because there were no buyers, it might actually be valued at zero today by regulators, but then suddenly valued at $i million tomorrow if it rains. EFTA00828835