Topic: Diablo Mining Company - page 50. (Read 96362 times)

No, I did the math wrong. Its 3.5 thash, not 13.

The addition of 13 Thash/s will by itself more than double the difficulty.  Mining is a game of diminishing returns.  When your share of the total network get to large, you mostly compete with yourself.  You at least need to take your own hashrate into account when calculating the resulting difficulty, and don't assume all other innovation in mining will stop.

Operating costs. Although, the fun part there, I think the federal government still has tax rebates on solar panel deployment, so taxes work both ways.

Don't forget taxes, there is slim to 0 chance of you being able to run an operation of that size without the taxman coming after you.

(The plan has been moved to the op post)

Right now GLBSE certainly wouldn't be ready for something of this size (the market size on GLBSE is simply too small at the moment), and I would need to have added a lot more functionality in managing shares, dividends and other things as well, all coming in due time but not here yet.

Meaningless in the number, yes. Meaningless in the point, not so much.


I concur with theymos. Your idea is perfectly valid, and I think interest does exist, but to launch a venture on this scale is a whole different ballgame with whole different rules in comparison to the GLBSE-funded companies in existence.

I think it's possible for a big, long-term mining operation like this to get funding and succeed, but this isn't a good way to issue shares. You should partner with someone who knows more about finance/business.

I've emailed GLBSE to see if I can get the 8BTC back.

Potential investors and I are just not seeing eye to eye on this, and its a waste of time and money to try to continue. I want to make sure no one can get a stranglehold on the Bitcoin economy, but no one really seems to either think that can happen (stealth privately owned mining companies, etc), or they don't see its worth plunking the money down as a sort of insurance.

Uh, no. All USD in existence is measured in the quadrillions. Our annual Federal budget is more than 2 trillion. The war in Iraq cost more than 2 trillion.

The difference here is, Wall Street valuation is not based on reality, and USD is inflationary. Your comparison is rather pointless.

Just for comparision, 4.7% of all USD in existence is ~2 trillion dollars. Apple's market cap is just about 600 billion.

So, Ive been thinking, that second plan where these are essentially 10 year bonds makes no sense financially. Basically, I take all the risk and get none of the reward.

In fact, where I was originally going to be paying operating costs out of the growth fund, this is still making the risk all mine while I get none of the reward.

So I think I'm going to change the contract before the IPO issues shares to something along the lines of operating costs come out of both sides. Since a lot of people are absolutely convinced I can't raise the 1 million BTC (which says more about their lack of faith in the Bitcoin community than anything), then there is no way I can keep operating costs low enough early on.

Both I and all the investors should split the risk and reward so it is fair for both of us. I am willing to invest a lot of time into this, and, in the long run, my money. The only reason investors exist is because they either can't invest their time or they won't, but they still want some of the action, but entrepreneurs are willing to cut them in on the action in exchange for capital.

Which is partly why I wish to start this mining company. I simply don't trust one of the other mining companies not to become big enough that they're a security risk.

Oh, I agree. The question is whether it will last long enough for this particular venture to be a viable investment. A 51% attack is improbable, yes, but only as long as no breakthrough/flaw is made/found in SHA256.

I won't postulate that your second argument isn't valid, but I personally would rather not bet my assets on the sanity of an unknown personage.

In any case, I think we agree at this point. Thanks for the excellent discussion!

Indeed. However, I don't think overcoming either encryption or 50% of network power will be achieved in the next few years. How long will it last? Well if there's enough adoption to get enough transaction fees to make mining continuously profitable (and hashing power high enough), that should at least make the 50% part improbable.

There's also the argument fact that if you own 50% of the hashing power, with the revenue potential, why destroy bitcoins to start with? Although some people are indeed... not too sane and/or prone to extreme grudge against various things.

I see. "Bitcoin" in the singular is usually used to refer to the currency, and you used the singular at points throughout your post, so I assumed the plural was in reference to online currencies in general. Sorry for my misinterpretation.

I certainly hope so also, but hoping unfortunately doesn't make business plans viable.

by "they", I referred to bitcoins.

However, I don't disagree with the fact that the verification method could be compromised by technological advances, but that is yet to see and I sure hope it does not happen.

I never stated that online currencies had an abysmal chance of survival, I said that Bitcoin did. Lot of difference between the two.

You're sorry? I think Bitcoin is a wonderful idea; if I didn't I wouldn't be here. But I also think that, due in most part to exponential technological advances, Bitcoin's model, most specifically the method of transaction verification, is unlikely to remain secure for 83 years. Surely you don't disagree with that?

Hmm, that sounds a lot like my offer. At least in general structure. Except instead of 50% for buying equipment and fees, it's 40% buying equipment and 10% fees. Otherwise same thing for buying equipment, selling assets and for dividends. Members actually do have right to 100% of the equipment and vote for selecting which kind to buy. I would simply manage the equipment for a fee.

Sounds like good rates overall. You've even had lot of talk. Although it seems like bad publicity. I suppose the 1 million shares IPO and lack of information didn't help. Care to give us more detailed information like planned equipment you'll purchase, how much do you actually expect your fees to actually take up, etc.?
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I'm sorry, but they'll stay around as long as people value them and are willing to trade with them. I'm pretty sure it could live on more than 20 years, even if that means a large devaluation. It has become a convenient payment method for many people online (still low compared to other payment processor, but for such an odd concept, I still find the adoption impressive). It's possible they'll be gone by then, but I don't think their chance of surviving that long is even close to as grim as abysmal.
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Well, that seems a bit unfair to say. His contract DOES include a clause that 100% of sales are returned to members, in case equipment must be liquidated.

I'm a full proponent of online currencies, but the probability of Bitcoin still existing in 83 (or even 17) years is quite frankly abysmal.