Topic: ASICMINER: Entering the Future of ASIC Mining by Inventing It - page 1074. (Read 3917058 times)

Not sure why convertibility is that important? TAT shares are traded on public exchanges like bitfunder and btc-tc which also offer full share passthroughs that are convertible. If you have 100 of TAT's shares, you are free to sell them, buy a full share with the high liquidity available on the exchanges, and then convert to a direct share at your leisure.

5% management fee is also not bad. The comparison to mutual funds misses the point that there are thousands of mutual funds in competition with each other and spreading their costs over holdings worth billions of dollars, driving down the fees. In bitcoin world there are like what, 40 or 50 different exchange traded securities, only a small subset of those being companies with any real legitimacy, and only a couple fund/ETF type vehicles? TAT being first to market with an affordable (1/100) share of the most profitable and legitimate bitcoin company (ASICMiner) could probably have charged a 20% fee and still had near as much demand, there being no alternatives.

As for security... presumably the largest risk at each step is that someone along the chain (friedcat, TAT, burnside, ukyo, etc) would run with your money. The higher the profit they make by operating a legitimate operation, the lower their incentive to run with the money. Is it better to make 500 BTC every month or run off with 10,000 BTC once and never make any again? How about if you're only making 5 BTC per month? Given the relative lack of other security provisions besides the reputation of certain specific individuals, I'd much rather said individuals be earning a solid income stream that makes them want to stay legitimate. In short, I'd be more worried about security with someone offering something for no fee.

Milestone Alert

With recent share prices of 2.5 BTC/share on all fronts, Bitfountain is now a "million bitcoin company".

Overvalued? Undervalued? P/E ratio looks good, being between 2-3, which still provides some growth potential for company valuation. However, growth will mainly depend on investor sentiment on how strong of a foothold Bitfountain has in the bitcoin mining industry. How much of the recent investment represents true investor confidence and how much is speculation is difficult to say.

I'd like to disclose that the leadership team and the board members are working hard to make sure Bitfountain is here to stay. This requires constant innovation on the technology front and a business model which scales and satisfies the need of the bitcoin mining community. The challenge is that Bitfountain has to full-fill two opposing goals: Maintaining hash-power and fair pricing of their hardware.

To see why this is a problem is to understand the nature of the competitiveness in the bitcoin mining industry. To maintain hash-power, Bitfountain has to constantly produce new mining boards and add them to the operation. Each added board compromises the earnings of any board sold earlier. This leads to an inflation which can be expressed as a generalized network growth and a devaluation of the mining equipment over time. This has implications for capital investment and ROI. However, being in a position to produce their own hardware at margin costs, Bitfountain is able to compete vigilantly with the overall market on the technology front.

I'll leave it up to friedcat to provide more information on these issues as they become apparent.

For now all I want to say:
Well done Bitfountain. You exceeded even the most optimistic expectations.

Glad our posts help people
Also On another topic I wish you all a very happy Laslo Day Also known as Pizza Day and hope you all get to nom some delicious pizza XD

I do not see the 5% management fee (directly taken from dividends) as an issue here. The only flexibility I would like to see in the future is something TAT touched on in this very thread above. The ability to swap PT for Whole shares in either direction is a feature many investors crave. Because TAT has made it a stated goal to hit the 5000 share threshold and attain a board seat, it makes logical sense to help the fund reach that milestone, which will hopefully open up the doors to greater advantages. Once that board seat has been attained, it is also logical to expect some benefit to be filtered down to the shareholders.

From what I can see here, TAT is a fair alternative to buying whole ASICM shares. You can at any time, buy TAT PT shares on the open market and then convert them to Whole shares. Any time you can do this at your own discretion, should you feel the need to or simply would like to remove another layer of security. There are options available to all investors at this point in the game, with a defined set of risks and rewards for each route. All of these have been outlined clearly in the thread and on this forum so investors can make informed decisions.

Lastly, every single time I have seen a question or concern regarding TAT, voila! You receive an answer in short order. You may not like the answer, however you are not waiting around several days to get key information that impacts your investment decisions. Contrast this with the level of feedback that SDICE shareholders are receiving right now and, well, yeah.




TAT: You have made it clear why you will not be offering convertibility of PT shares right now. You also have mentioned that once the board seat is attained you will be open to revisiting this popular shareholder request. You have made a positive impression on the community to date so I hope we can trust you will keep an open mind to this option when the time is appropriate.

Alternatively, it wouldn't be a bad idea to buy into BTCINVEST which has some level of diversification or put your coins in CoinLenders.

Yes, I always thought this was the purpose of TAT. Reinvest dividends while you're getting enough together for another whole share, or shares. That's what I've been doing. The majority of my AM holding is in whole shares. TATs put the bit left over to work, as well.

You guys are looking at this all wrong.

Assume 2.5BTC/Share and 0.035 dividends.
Lets say only have enough to buy .8 of a share and tomorrow is Wednesday. Do I just let 2BTC sit around doing nothing? No. This is where the genius of TAT comes in. I get 80 TAT shares and when dividends hit I get 0.028-5%=0.0266 more BTC then I would have had. Now I'm a little closer to buying a whole share. The fee means very little because if TAT wasn't around I'd just have the BTC sitting there.

TL;DR Make BTC work for you, not the other way around.

Just bought some shares. Thanks for all the info you write here 

I use Thieves excellent work for an exchange and until it hits the board member seat would not support a drain of shares from the fund it was in the release announcement and makes perfect sense, it even provides investor incentive if you read the prospectus. That said you all seem to be missing a key point
The Arbitrage is generally bigger than the dividend between these two exchanges even on btct
A position with a slightly lower cost than the main one can cover and even surpass the dividend compared to that of a full share
Also the cost of entry is the same if you don't like a 5% dividend cut just jump the exchanges on dividends until the gap is too small to make that profitable
Two cents

Yes, I made the same point. Saying a security isn't trustworthy, when it is completely up front about its fees and convertibility of shares, is ridiculous.

the point is, he set up the PT with the fee, and we (anyone who bought it - i have 28 shares of his) accepted the arrangement. anything else is pointless to discuss, because it's already happened.

.double.

a conventional mutual fund manages billions are dollars worth of assets. If TAT gets to 5000 shares, he has 1-2m worth of assets. He also has way more risk than a conventional mutual fund. I think 5% (of DIVIDENDS not net assets) is completely reasonable, but if you don't start your own fund.

I agree. Dividends on 5000 shares * 0.05 is basically full dividends on 250 shares, which is like 200 btc per year (@ 0.015 / week). Thats a lot of overhead for like 1-2k USD per month.

If we look at conventional Mutual Funds, a 5% management fee would be killer. In fact 2% is really a lot, and 1% or less is really desirable for assets that are held long.

Let's use TAT's example of high dividends of 0.036/week for 2 years.

For AM-PT
Earned 0.036/week * 52 wks/yr * 2 yrs = 3.744
Original cost = 2.5 BTC
Profit = 3.744 - 2.5 = 1.244

For TAT
Earned (95% * 0.036/week) * 52 wks/kr * 2 yrs = 3.5568
Original cost = 2.45 BTC
Profit = 3.5568 - 2.45 = 1.1068

Difference = 0.1372 BTC (or $16 in today's rate)

Whether 0.1372 BTC is a lot for you depends on your own judgment, beauty is in the eye of the beholder. But if you had 10 shares, or 100 shares, you can multiply that out and see we would now be talking about $167 to $1674 difference!

1) TAT now represents a lot (hundreds?) of shareholders. I'm sure most of those people would prefer that he gets a board seat. He's been up front about that goal the whole time.
2) If you want direct shares, sell your TAT shares, buy burnside shares, and transfer them. Or even better, just buy direct shares up front, they are typically a little cheaper since liquidity is worse.
3) You should base your trust on history, not on conditions that you would be willingly agreeing to when buying the security but which you don't like.

You are welcome to your own interpretation, but I have to warn you that thinking one layer deep is why some people make less money than others. Your example completely ignores my point.

Regarding my security, what do you find lacking?

What I'm saying is that my income from dividend fees is very very small.

Sorry are you saying you're not making a profit at all? Not even breaking even? You must be. I'd be worried if you weren't.

TAT - Had to reply to your (terrible) example.

If direct (or PT) divs = 100 BTC
Then TAT divs =           95 BTC

an example should be simple and illustrate a point.
Meanwhile, what I mean is that I don't trust your security. You're the one who has to make me trust you, not the opposite.
No transfer to direct shares = no trusting the security.