Topic: Gigamining / Teramining - page 90. (Read 216459 times)

Wait! 90% PPS? Are you telling me you are reducing to 90 mhash per upgrade instead of 100 mhash?

I'm not sure you realize, but 1 BTC equals 350 mhash on the current ASIC specs/price for BFL. 0.40 for 90 mhash upgrade? Really? 0.40 BTC buys 140 mhash. That's already a 35 % cut for you.

you already have 3 rigs. 1 rigs converts to 50% free on an ASIC rig. Or 500 Ghash free on each upgrade (1500 Ghash total). That's basically 15000 x 100 mhash FREE (or 15000 upgrades to 4 x 25 mhash TERAMINING BONDS). Only the other half of those rigs need to be paid. (That's 37.5% of the upgrade for all bonds free)

Almost HALF of the 40 000 upgrades FREE to top the fact the upgrade price has a 35% cut included of what it could directly buy.

And the cherry on top of that, that leaves a large GPU farm for you to sell!

I would really like to see how you arrived to the conclusion that you need to charge that much to give so little.

1. You take 35% cut of what the upgrade cost can buy directly.
2. BUT, you actually get 37.5% reduction on the upgrade costs to top it.
3. You're left with your GPU farm you can sell to further reduce the upgrade cost.

Now, I wouldn't mind the 35% even if it's high, but that seems to completely make abstraction the fact that #2 and #3 are already paid for by investors. If we consider that's a 50% reduction total worth on upgrade price, asking for 0.20 BTC per upgrade would be a 35% cut, but 0.40 BTC seems damn high.

Can you give any explanation as to what your actual cut is in this, and why it seems you're taking a seemingly insane cut, barring there has been some major issues along the way you forgot to tell us? BFL rigs will require MUCH less maintenance, space, extra equipment and power usage per performance than your old farm, but you're jacking up the price and your % cut? At least give us numbers to back such a decision.

I do not think many people willing to spend 0.4 BTC for an upgrade. Now GIGAMINING 5 day average price is 0.67 And it will keep dropping if you will not change that. BITBOND will do for 0.25 BTC the same thing if you want a large competitor. But for those who not willing to invest much I would suggest HYDRO.BONDS. They will do exactly the same thing for free, and not charge you 0.4 BTC neither 0.25.  

I agree with the statement that as the difficulty grows perpetual mining bond price will sink, so I only hold FPGAMINING and JTME apart from HYDRO.BONDS which has a promising upgrade path.

Hi usagi,

Thanks for the vote on the fee.


I will take your comments into consideration.

Best,
gigavps

Hi Factory,

Thanks again for your calm and rational comments. I wish everyone in the community would learn from your excellent posts.

For point #2, there will be costs associated with running the equipment including rack space, internet and power. There are also costs associated with running on pools because in the future i suspect that most pools with not be free. The 10% would go towards all of these costs.

As for tiered pricing, I hope that I am giving plenty of notice for those that would like to have lower pricing on upgrading. There is still the free upgrade path which has not changed.

Best,
gigavps

Yes, it is in fact at the discretion of the issuer. They can and have used different share classes and specific contracts in the past, but are not obligated to do so.

Private placement is not completely applicable to this situation (yet), in accordance to what gigavps has suggested. Private placement is an offering done in private (by definition.) Gigavps is clearly making the discounted offering public, and stated it would be based on not who the buyers are, but the size of their purchase. Of course, he simply made a quick mention of the idea, and when he makes a final decision he could go many ways with it.

We may be getting a bit ahead of ourselves.

Looking at the current bids on these turds now, I wonder if you could have tanked the price a bit more dramatically by just simply setting fire to your miners and publishing the carnage on Youtube.

It is discriminatory but it's at the discretion of the issuer. Traditional markets don't typically use a different share class entirely in private placements, I don't believe specific contracts are used either. http://en.wikipedia.org/wiki/Private_placement

A discounted offering for specific parties would been seen as discriminatory. This is why in traditional markets such offerings are normally done with a different share class entirely or specific contracts that lock the shares for specific durations. If gigavps hand selected specific entities to give discounts to, there is little he can do to prevent them from selling their shares on the open market. For that reason, it seems to me, the best solution is to not have any 'discount' or form of tiered pricing.

1. I believe tiered pricing is not beneficial to your shareholders on a whole, and puts all of your small investors (likely the majority of the community looking to invest in Teramining) at a disadvantage.

2. I am all for 90% PPS; so long as the contract clearly illustrates what the other 10% would be utilized for to keep Teramining sustainable.

• Would the 10% PPS go toward growing the mining operation further in attempt to off-set the growth of the total network hashrate?
• Would the 10% PPS be a management fee?
• Would it be a combination of growth/fee, or something else entirely?

To all Gigaminers:

I mentioned a couple days ago that I would be proposing some changes to the Teramining upgrade.

• I would like to propose that the Teramining offering would be at 90% PPS. I have done a lot of thinking about this and I believe that Teramining would be unsustainable over the long term without it.
• I would like to change the fee structure. The new fee structure would be tiered.
  
  • 1-100 bonds = .40 BTC per bond
  • 100-999 bonds = .35 BTC per bond
  • >= 1000 bonds = .30 BTC per bond

Post your constructive questions or comments in the thread and I'll make sure to answer them in a timely fashion.

Best,
gigavps

To all Gigaminers:

Coupon payments for the week have been paid.

Enjoy,
gigavps

Gigamining wasn't giving the best dividends earlier, prices probably dropped down due to demand shifting to the bonds with better returns.

There's a lot of choices to make in terms of mining bonds.

I believe that the drop in the prices of mining bonds is simply due to the increase in supply of the bonds, without an increase in the demand for the bonds. There are a lot of new bonds on the market (especially bonds anticipating the new ASIC hardware). Investors are selling their current mining bonds to buy these new bonds, so the prices are dropping.

I believe the winners will be the bonds of the miners that get the ASICs first, and those will be the bonds like gigamining, bitbond, and hydrobond because they were the first to order them. The new miners may have to wait months for their ASICs and their bonds are going to suffer horribly while they wait.

The biggest losers will be the bonds that are not upgrading, such as yamc and puremining. These bonds will tank once the ASICs come out. The reason they have maintained their value is that there is the possibility that the ASICs will not arrive as expected.

I believe that gigamining is undervalued for those reasons.

Yes.


Gigamining will soon be at 200Gh.

I did not see you recapping any of the proposed Teramining offering.

Those posts went on and on, and there were too many to read, so I'll make it short and sweet...


The value of a "perpetual" bond is a function of only 2 things and nothing else: the risk, and the ratio of the return and the discount rate. Any evaluation of a perpetual bond must state what discount rate is used. Otherwise, it is not very useful.

An important factor in evaluating bonds is choosing the discount rate. In the bitcoin world, the discount rate could be the average return on a bitcoin investment. With pirate's 7% out of the picture, the discount rate is effectively the average return of a mining bond. The important point here is that the returns of all mining bonds fall as the difficulty rises, so the ratio remains constant -- in this case, the value of the bond is independent of the difficulty. If you disagree with my choice of discount rate, please adjust accordingly.

Source: http://en.wikipedia.org/wiki/Perpetual_bond and others

Of course.

Have any of the facts I recapped in the previous post materially changed, like Teramining terms?

Hi sunnankar,

I have stated this multiple times but I will state it again. I will continue to faithfully fulfill the terms of the contract.

As for the upcoming Teramining contract, I think there will be changes coming.

Best,
gigavps

The market, where able and willing buyers and sellers meet, will determine whether the price bounces back up or continues to fall.

Perhaps you have not done adequate due diligence as there are several reasons not discussed so far that could be causing the decline.

One reason is Gigavps has, with the buyback clause, a call option on bonds which acts like a short position. The lower the price goes the smaller his contingent liability. Consequently, there is tremendous financial incentive for him to drive the price down, even to worthless, and then execute the buyback clause to extinguish his liability.

Default is the failure to pay in full on time as agreed. A second reason is the market may be beginning to price in a default which would go to your premise of whether Gigamining is a solid operation.

I raised some questions to Gigavps previously about the financial condition of the GIGAMINING venture.

From his answers we are to understand there is (1) 160Gh/s mining on GPUMax at 114% PPS (Pirate's related pool which appears to have some problems). (2) The 160Gh/s has been paid for and so has the upgrade which has not been delivered, So there is counter-party and performance risk with BFL along with the ability to actually deliver the product as represented and on time. (3) We do not know Gigavps's expenses with running the mining equipment such as electricity, rent, insurance (if any), etc. (4) We do know that some funds 'from the gigamining offerings were used to fund [Gigavps's] BTCST account.

Since there are only 160Gh/s of equipment producing at about 182.4Gh/s at 100% PPS, additional expenses and 200Gh/s at 100% PPS liability we can deduce that Gigavps's mining production capacity is in deficit of about 18.6Gh/s to liability without accounting for electricity, rent, etc. Based on current difficulty and exchange rates this amounts to about $500+ of negative cash flow per week only taking into account the production deficit.

When asked how many bitcoins Gigavps has in his personal possession the response was 'I have spare coins to cover any short falls in the foreseeable future."

So the critical question is: How long can Gigavps continue to in full on time as agreed?

If the price rises then it indicates the market believes the 'foreseeable future' has a longer duration. As the price declines it indicates the market believes the 'foreseeable future' has a shorter duration.

The great thing about the market is those who correctly calculate profit and those who do not realize a loss.

I have no agreement, understanding or even communication with Gigavps about executing the buyback clause.

ANY BONDS TO BORROW?
Nevertheless, I am considering taking a short position of about 1,000 to 2,000 units in GIGAMINING. If anyone is willing to lend them then please PM me so we can work something out similar to ciuciu's short contract. I can easily provide sufficient collateral.

Exchange rate goes up, hash rate goes up, difficulty goes up, earnings per mhash go down, and price goes down. Not exactly too hard to predict.

I think that a lot of people got used to seeing the high price of Gigamining for a while, and wouldn't sell for less even as demand at those prices fell. It is a clear economic phenomenon that people stick to price. Throw that in with people not wanting to realize a loss, and now being forced to to meet liquidity requirements.

Anyone who listened to that noise about Giga and pirate is crazy. I think YARR's backing needing to be liquidated had a lot to do with this drop too.

t