Topic: ASICMINER: Entering the Future of ASIC Mining by Inventing It - page 736. (Read 3917468 times)

I do like the franchise thing though. The issue of trust is not much of an issue. Say you run away with a bag of blades, fine you won't get another bag of next gen. The mining technology is moving quick, you won't make a lot for one time scam. Or say a franchisee dies, FC won't care either since the cost of making them is so tiny for manufacturer.

It would scale quicker, if the franchise is done in multi-level model.

Very informative and rational post and I really agree with most points, However I humbly and respectively disagree with this point.

You're looking for correlation where none exists.  The markets (bitcoin, asicminer) are far too illiquid to draw anything meaningful from it.

Tell me this, what's the total market cap of bitcoin? And what do you think woul happen to that market cap if a single large participant needed to exit TODAY, by placing a market order to sell even $10mm of bitcoins? Or vice versa, we see what BTC trades at, could someone reliably buy $10mm of bitcoin across even an entire day and not move the market more than a little? Either case is doubtful. There is zero liquidity, for either bitcoins or for its largest trading security.

Ie; this morning, I sold $200k of a single tickers share from a clients portfolio. The ticker involved was fairly thinly traced; however, I was able to do so across an hour and the share price fell by 3 cents during that time. I would have taken longer, but was told they had to be out ASAP. By thinly traded I mean total market cap, couple hundred million dollars, and a few thousand shares traded per day.

That sort of trade isn't possible to do in BTC, let alone a BTC denominated security without having a major impact on the market. Welcome to the world of no liquidity. It works now because most people are holding their BTC expecting higher prices. It won't work at all if something forces a major movement out.

Same for asicminer shares; most are held on friedcats person ledger. Should anyone attempt a large purchase or large sale, they quickly burn through the open orders and force huge price movements.

Asicminwr trades at an incredible yield. That its as low as it is is testament to people's uncertainty about bitcoin, about asicminers ability to deliver what was hoped, and more importantly, the sentiment of the last person seeking to make a large purchase or sale.

There's lots of moving pieces, but none of them are based on the correlation between BTC/usd, and all to do with the moves of the last few big players that push prices in extreme directions by doing trades that would be considered to be very small in any other market.

well, maybe a little.  I'm still long-term AM, but short term has me wondering wtf? I know there's a lot of shit FC doesn't tell us, and that's fine, but the last month hasn't been a great one.  

And, I think we have some rocky weeks ahead of us, unless FC surprises everyone with something big.


please don't take me seriously, that would hurt my feelings.

About this "something" that happened this month, when the hash rate was low, it was about half the "normal" one. Maybe they were moving to a different location, moving half of the hardware at a time? It would be possible that the initial location does not fit the needs for further expansion, be it in terms of space or electricity, or even safety or whatever may not be super urgent at the beginning of the operation but becomes relevant when the company consolidates.



I doubt that we will get much communication about 2nd gen at all. This would be very valuable to competitors, actually I prefer not to have this information... If friedcat does it purely "friedcat's style", we will get an unexpected message one day that announces some awsome specs and that gen2 hardware is in stock ready to ship. 

Freidcat can probably afford his own coal plant at this point. (Coal being the go-to fuel source in China at the moment.  In the US natural gas is now more popular)

Because those systems weren't all integrated onto a single die. Right now the tech to 'hack' a single chip doesn't really exist (or at least, it costs more then just making your own chips)

You could do a DRM miner, essentially you'd just have it check a digital signature on the block header, and require it to do 20 signed work units for every unsigned one (or whatever).

But the problem is you'd need to add a lot of transistors, more then the number required to simply hash the block header.

Agreed and maybe they have some excess capacity to expand marginally between now and then  but I don't see AM hashrate going to say 120 TH/s using 130nm tech.  That would mean doubling power to over a megawatt.  One other factor is that "something" happened in the farm over the last month.  Looking at the 3 day average ( http://asicminercharts.com/ ) on 8/23 the 3 day average rate peaked at 53 TH/s and then over the next 4 days declined to half that.   Now say you are FC and you have 60 TH/s of hardware deployed but are running into problems getting 60 TH/s out of your 60 TH/s of hardware and another 10TH/s of boards arrive does it really make any sense to install them and possibly compound your problems.   AM Blades somehow still sell very close to their expected net revenue so just sell the hardware (for roughly the same amount as you would get mining from them over the next couple months) while you can still get a good price.  

Having run a 10KW GPU farm for over a year, if FriedCat can successfully manage 50x the power AND has a plan to more efficient tech, well that is worth more than a stable dividend in the long run.  I think many of these other mining ops have no idea the complications that "real" power loads bring to the table.    Going from 200W to 1K of mining gear is pretty simple just plug it in and go; going from 100KW to 500KW isn't quite the same thing.   I would like to see the hashrate stabilize north of 50 TH/s for more than a week and some communication on the plan to migrate to 2nd gen.

Interesting hypothesis, this sounds plausible indeed. But gen2 is not expected before November, that would imply we will stay at 60TH/s until November/December, and hardware sells will need to be enormous to compensate the lack of mining dividends. 60TH/s in 2 months will be nothing, maybe 2%.

Woah woah woah.....Velacreations is going bearish on AM?!

I really need to reconsider my position.

Has anyone considered what 65 TH/s of 130nm tech uses in power?  65 TH/s @ 8.5 J/GH is ~ 550KW or >2200 Amps @ 240V.    They have enough floor space, power and cooling to support >550KW of equipment.  If they are planning to migrate to more efficient "next gen" tech and they are near capacity why pay for the cost to expand if they don't need to. To illustrate say AM's 2nd gen chips are ~0.6 J/GH at the wall.  The existing space, power, and cooling could support not 65 TH/s but >900 TH/s.  If FC knows superior tech is coming and they are close to their limit on power that their current buildings can handle why would they want to expand to additional buildings rather than sell the excess rigs at what I consider to be a very good price.   The selling price isn't leaving that much net profit on the table.  So while you wait for 2nd gen chips, maintain the existing farm and sell excess capacity to improve cashflow.  When the 2nd gen blades are ready, replace the existing farm with current one, sell of the old tech and expand the farm to 1 PH/s.

It is very possible that AM will NOT expand their hashrate to more than 50 to 60 TH/s until they can replace existing tech with next gen tech.


on edit: edited for brevity and clarity.

well, we had that done some time ago.  It seems like getting a 50 TH/s farm up isn't too much of an issue for FC and team, but keeping it at 50TH/s and expanding beyond that is a significant hurdle.

up until about a month or so ago, and expansion has completely stagnated. 

based on what?  I don't see any signs of the mining operation improving, and hardware delivery has been stalled waiting on the new blades. 

Those businesses usually see a share price correction,  as is necessary and appropriate.

The correction that has occurred so far is not sufficient.

I think patience is the biggest obstacle that AM investors need to overcome. People act like putting together a 50 THs farm is nothing more than pre-ordering 100 baby-jets.

AM wouldn't be here if they didn't have their act together. FC has been planing expansion from the beginning and has been doing great.

The bears have been loud recently and have used this two weeks of lower hash-rate to get the lowest share price, but I don't think it will last long.

well, that brings us back to the original thing of "why"  Why can't AM take advantage of the clear opportunities at its feet? 

As we've seen in the last 4 weeks, AM clearly can't increase hashing rate, for whatever reason, nor release new hardware that has been promised since July.

I find that a bit worrying, to be honest.  Whatever obstacles that are preventing AM from moving forward may be significant obstacles that won't be resolved anytime soon.  Without more info from FC, there is no way to tell for sure. 

Are these obstacles something AM can't overcome?

By this logic there are quite a few people & businesses missing major revenue though.

well, we're making assumptions using very little information.  There could be a lot of scenarios where they can't physically add more hashrate to the farm.  Or maybe there was a major flaw in the design of the new blades that has prevented their release.

In the end, we don't know "why", we just know the result: no hashrate increase and no new blades.

FC is likely making the best choices given the information he has.  I don't doubt he knows what he is doing, but that doesn't change the fact that AM is missing major revenue.

The bitcoin / AM share price correlation theory again - which I highly doubt.  I think share prices slump because of the low dividend and apparent low share of network hash power.  Even if bitcoin is $45, would you be willing to pay 4.5 BTC for a share that pays out only 0.012 BTC / week?  NO.  Let alone the 9 BTC price base on your theory.

People are accustomed to others involved in bitcoin making poor decisions (or outright scam).

Maybe they sold all the hardware instead of adding it to the farm. Maybe some hardware went to franchises. Maybe AM knows what they are doing.

Or, maybe the forums know better than AM?

So many arguments here operate on the premise that AM somehow chose to do something stupid regarding any given topic, why?