cross-post because the discussion of pricing hardware is also relevant for ASICMINER (
https://bitcointalksearch.org/topic/m.3339723)
All ASIC companies are pushing out too many chips too fast. 3600 coins per day is just not enough to spread around for the amount of money people have dumped into hardware costs. There are too many people involved. Too much greed by ASIC manufacturers. And too many chips. It would be far more wise to get refunds and buy btc directly. The reward for mining is in the hands of the elite now. Even people that dumped in 5-6 figures are in trouble unless they just bought chips. You need to be capable of making your own PCB's for as cheap as possible now.
The problem is not that they produce chips too fast. It's their valuation/pricing. Free market valuation of hash power tends to be above expected yield (i.e. a net loss for the miner) for two reasons:
a) Miners are taking to much risk when valuing the hash power at the "edge", i.e. close to the expected yield. Exponential rise causes slight timing and projection errors to easily cause the profitability to fluctuate between -70% - +200%.
b) Companies have an incentive to engage in mining activities to make their R&D back, which creates a vacuum for the sales and at the same time depreciates the expected yield. Just look at ghash.io. I don't know whether the size of that farm was anticipated.
The pricing scheme for hash power is the big issue here, not its yield. Given point a), failure to price correctly causes either the miner to make a huge loss or profit. This needs to change and the first companies who can create a scheme which works for miners and companies alike will be the innovators here.
A good pricing scheme has two features:
i) it removes the risk/unknowns effects of network growth projections on the profitability of mining (operational profit certainty)
ii) it instantly shows whether the miner is willing to mine for profit or for loss (declaration of intent)
Unless i) and ii) are fixed, all missed projections will cause the ASIC companies to look fraudulent, since it causes a net wealth transfer from the mining community towards the ASIC producers.
On that note it may be interesting to establish a shareholder sentiment on the pricing strategy for ASICMINER hardware, between
a) aggressive (maximizing profits)
b) fair/honest
c) competitive (undercutting competition)
Maybe someone would want to organize a poll?
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