Weekly loss of N% guaranteed - Enjoy perpetual loss with fixed Mh/s mining turds - page 5.

P4man

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Quote from: organofcorti on August 15, 2012, 02:41:46 AM

Exactly the same as a miner with a fixed Mhps GPU.

Not quite exactly the same, because a gpuminer can salvage part of his investment by selling his cards to gamers, or perhaps even participate in that distributed computing project by (dont remember the name, that VC backed startup?). Most FPGA miners (BFL) will be able to salvage their investment by either upgrading or selling their kit to people who want to buy ASICs. A fixed MH bond holder? He is simply screwed. IN fact he is doubly screwed because last time I checked, per MH bonds were more expensive to buy than GPUs, and they will have close to zero residual value.

organofcorti

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Poor impulse control.

Quote from: P4man on August 15, 2012, 02:31:27 AM

Now guess what will happen with your cherished fixed MH bonds.

Exactly the same as a miner with a fixed Mhps GPU. They will earn significantly less btc. No point guessing what USD they'll earn though - if you knew that, you'd be set to make a killing on MTGOX.

P4man

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[quote author=cuz0882 link=topic=98517.msg1100910#msg1100910
In what sense? Earning per mhash have been increasing for a while. It's unclear how the reward drop and ASIC release will effect it though.
[/quote]

lol. How is that unclear? Bitfountain claim they will have 12 TH online by october or november, and that they can easily expand to 50TH shortly after. Butterfly labs is expected to ship a comparable hashrate around the same period. And there are at least two other ASIC projects underway. One of them might fail or miss their deadlines, maybe even two. But all of them? Bloody unlikely, since its difficult to imagine an ASIC that is easier to design than a bitcoin miner. None of those asics will be unplugged when rewards halve, whatever gpuminers do is essentially irrelevant. Now guess what will happen with your cherished fixed MH bonds.

cuz0882

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Quote from: Bitcoin Oz on August 14, 2012, 06:09:06 PM

Quote from: cuz0882 on August 14, 2012, 02:23:21 AM

Quote from: Bitcoin Oz on August 14, 2012, 01:59:07 AM

Quote from: cuz0882 on August 13, 2012, 01:52:14 PM

Quote from: MPOE-PR on August 12, 2012, 10:33:43 PM

Quote

Bonds are usually good for preserving your capital and earning you a fixed income from dividends. If you think about it, mining turds offer you none of the previously mentioned benefits. At the moment, dividends do not cover the depreciation of your invested capital. Sorry, but this applies to all the mining turds out there.

I just wrote a piece elaborating on that. Hadn't seen your (very well thought out) post, smickles pointed it out tho.

Your comparing purchasing btc to purchasing mining bonds... There is no way to know what bitcoin will be worth in the future. You should be comparing holding your money in dollars vs purchasing mining equipment or bonds. It's pretty clear that mining and bonds are paying out well. There are no capital investment loses right now on the bonds using singles or mini rigs. Even gpu's hold their value pretty well. I expect most gpu's have already paid for themselves.

Shares arent purchased with dollars. If gigavps was listed on the NYSE and you could buy and sell in USD then you might have a good argument

You suggesting that I should charge a higher dollar amount to purchase and run a single for someone? Even though it still costs me the same dollar amount.. And if the price of btc drops to one dollar how would I purchase a single for a fraction of what butterfly charges.. When you purchase a bond, its used to purchase equipment for a set dollar amount. The bitcoins are not just sitting around fluctuation with the price.

I wouldnt mind buying bonds so much if your dividend didnt also take a haircut. Investors lose on both counts.

In what sense? Earning per mhash have been increasing for a while. It's unclear how the reward drop and ASIC release will effect it though.

Bitcoin Oz

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Wat

Quote from: cuz0882 on August 14, 2012, 02:23:21 AM

Quote from: Bitcoin Oz on August 14, 2012, 01:59:07 AM

Quote from: cuz0882 on August 13, 2012, 01:52:14 PM

Quote from: MPOE-PR on August 12, 2012, 10:33:43 PM

Quote

Bonds are usually good for preserving your capital and earning you a fixed income from dividends. If you think about it, mining turds offer you none of the previously mentioned benefits. At the moment, dividends do not cover the depreciation of your invested capital. Sorry, but this applies to all the mining turds out there.

I just wrote a piece elaborating on that. Hadn't seen your (very well thought out) post, smickles pointed it out tho.

Your comparing purchasing btc to purchasing mining bonds... There is no way to know what bitcoin will be worth in the future. You should be comparing holding your money in dollars vs purchasing mining equipment or bonds. It's pretty clear that mining and bonds are paying out well. There are no capital investment loses right now on the bonds using singles or mini rigs. Even gpu's hold their value pretty well. I expect most gpu's have already paid for themselves.

Shares arent purchased with dollars. If gigavps was listed on the NYSE and you could buy and sell in USD then you might have a good argument

You suggesting that I should charge a higher dollar amount to purchase and run a single for someone? Even though it still costs me the same dollar amount.. And if the price of btc drops to one dollar how would I purchase a single for a fraction of what butterfly charges.. When you purchase a bond, its used to purchase equipment for a set dollar amount. The bitcoins are not just sitting around fluctuation with the price.

I wouldnt mind buying bonds so much if your dividend didnt also take a haircut. Investors lose on both counts.

Sp0tter

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Quote from: conspirosphere.tk on August 14, 2012, 02:04:44 PM

Quote from: Sp0tter on August 14, 2012, 01:42:13 PM

I pulled everything out of GLBSE last month.

Would you mind to tell us why?

I set sail on the pirate ship. And I fully agree with EskimoBob about the validity of mining "bonds" at a fixed mh/s with no buyback....

conspirosphere.tk

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Bitcoin is antisemitic

Quote from: Sp0tter on August 14, 2012, 01:42:13 PM

I pulled everything out of GLBSE last month.

Would you mind to tell us why?

Sp0tter

sr. member

Activity: 285

Merit: 250

Quote from: odolvlobo on August 04, 2012, 02:31:17 PM

Quote from: Sukrim on August 04, 2012, 12:33:58 PM

Just release a script that parses the GLBSE CSV file and calculates if one has actually made a loss or is still in the win-zone atm. with mining "bonds".

The GLBSE Chrome extension will do that for you.

I created a little script to help with this as well:
https://bitcointalksearch.org/topic/glbse-api-frontend-to-keep-track-of-assets-and-returns-89970

Note: Script is not currently being improved or updated since I pulled everything out of GLBSE last month.

cuz0882

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Quote from: P4man on August 14, 2012, 03:41:41 AM

Cuz, I understand that very well. Im not saying bonds are per definition a bad idea, they are not.
But Im a miner. And unlike you, and unlike most investors apparently, I can see *why* miners are so keen to sell you bonds at those prices. It seems investors dont understand the mining market and dont understand the impact reward halving, Moore's law, fpgas and in particular, asics will have. Thats why these bonds were ridiculously overpriced, and most still are today.
Ive been saying this for months, and I just showed you DMC as an example, I could have pointed to YABMC as well:
https://glbse.com/asset/view/YABMC

Or puremining, or other bonds that are not propped up by freebee asic upgrades.

If you want to hedge against a BTC price collapse, all you have to do is buy less BTC. But holding BTC at this point makes infinitely more sense than buying overpriced bonds.

Anyway, Ill repeat my offer: lend me your bonds for 6 months, and Ill pay you all dividends plus a negotiable bonus. If you feel so strongly about holding bonds, how could you possibly lose?

I'm done explaining this to you. I never said no bonds are overpriced. Some charge just above cost. Some people would rather pay a small fee and not bother with equipment. If you want to mine yourself, go for it.

P4man

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Cuz, I understand that very well. Im not saying bonds are per definition a bad idea, they are not.
But Im a miner. And unlike you, and unlike most investors apparently, I can see *why* miners are so keen to sell you bonds at those prices. It seems investors dont understand the mining market and dont understand the impact reward halving, Moore's law, fpgas and in particular, asics will have. Thats why these bonds were ridiculously overpriced, and most still are today.
Ive been saying this for months, and I just showed you DMC as an example, I could have pointed to YABMC as well:
https://glbse.com/asset/view/YABMC

Or puremining, or other bonds that are not propped up by freebee asic upgrades.

If you want to hedge against a BTC price collapse, all you have to do is buy less BTC. But holding BTC at this point makes infinitely more sense than buying overpriced bonds.

Anyway, Ill repeat my offer: lend me your bonds for 6 months, and Ill pay you all dividends plus a negotiable bonus. If you feel so strongly about holding bonds, how could you possibly lose?

cuz0882

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Activity: 392

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Quote from: P4man on August 14, 2012, 02:30:48 AM

If you are going to insist on looking at this from a $ perspective, then at least be consistent: you will not have realized a single dollar cent of profits before you sell your bond and sell the bitcoins. The latter is pretty profitable for now, at least for anyone not silly enough to have traded nice coins for worthless bonds, but the former is something you consistently ignore.

I will try to explain it as simple as possible.

If you purchase 100 bonds while the btc price is $5.00.(50btc) The bond issuer turns around and buys, lets say a 5970. It costs him $500 dollars. He pays out 10% monthly in interested. After the first month, you decide to cash in your bond. But the price of btc doubled since last month. The issuer can sell that equipment for $500 dollars. Which is only half the number of bitcoins you paid. That 5970 didn't lose or gain value because of the btc price change. Now you only have 25btc+10%. If the price of bitcoin had dropped in half. That $500 dollars worth of equipment could have purchased 100 btc. You would have ended up with twice as many bitcoins+10%. Although the bond was traded in btc, your invested was not held in btc. So you didn't profit or lose any dollar amount because of the btc price changes. Unless your money is held in something with a fixed btc value. Your not going to gain or lose anything because of changes in btc price. So until a company starts selling mining equipment for a fixed btc amount regardless of its value, this is not going to change. Mining equipment will always be valued in dollars, and that's what bonds are invested in.

P4man

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If you are going to insist on looking at this from a $ perspective, then at least be consistent: you will not have realized a single dollar cent of profits before you sell your bond and sell the bitcoins. The latter is pretty profitable for now, at least for anyone not silly enough to have traded nice coins for worthless bonds, but the former is something you consistently ignore.

cuz0882

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Quote from: Bitcoin Oz on August 14, 2012, 01:59:07 AM

Quote from: cuz0882 on August 13, 2012, 01:52:14 PM

Quote from: MPOE-PR on August 12, 2012, 10:33:43 PM

Quote

Bonds are usually good for preserving your capital and earning you a fixed income from dividends. If you think about it, mining turds offer you none of the previously mentioned benefits. At the moment, dividends do not cover the depreciation of your invested capital. Sorry, but this applies to all the mining turds out there.

I just wrote a piece elaborating on that. Hadn't seen your (very well thought out) post, smickles pointed it out tho.

Your comparing purchasing btc to purchasing mining bonds... There is no way to know what bitcoin will be worth in the future. You should be comparing holding your money in dollars vs purchasing mining equipment or bonds. It's pretty clear that mining and bonds are paying out well. There are no capital investment loses right now on the bonds using singles or mini rigs. Even gpu's hold their value pretty well. I expect most gpu's have already paid for themselves.

Shares arent purchased with dollars. If gigavps was listed on the NYSE and you could buy and sell in USD then you might have a good argument

You suggesting that I should charge a higher dollar amount to purchase and run a single for someone? Even though it still costs me the same dollar amount.. And if the price of btc drops to one dollar how would I purchase a single for a fraction of what butterfly charges.. When you purchase a bond, its used to purchase equipment for a set dollar amount. The bitcoins are not just sitting around fluctuation with the price.

Bitcoin Oz

hero member

Activity: 686

Merit: 500

Wat

Quote from: cuz0882 on August 13, 2012, 01:52:14 PM

Quote from: MPOE-PR on August 12, 2012, 10:33:43 PM

Quote

Bonds are usually good for preserving your capital and earning you a fixed income from dividends. If you think about it, mining turds offer you none of the previously mentioned benefits. At the moment, dividends do not cover the depreciation of your invested capital. Sorry, but this applies to all the mining turds out there.

I just wrote a piece elaborating on that. Hadn't seen your (very well thought out) post, smickles pointed it out tho.

Your comparing purchasing btc to purchasing mining bonds... There is no way to know what bitcoin will be worth in the future. You should be comparing holding your money in dollars vs purchasing mining equipment or bonds. It's pretty clear that mining and bonds are paying out well. There are no capital investment loses right now on the bonds using singles or mini rigs. Even gpu's hold their value pretty well. I expect most gpu's have already paid for themselves.

Shares arent purchased with dollars. If gigavps was listed on the NYSE and you could buy and sell in USD then you might have a good argument

P4man

hero member

Activity: 518

Merit: 500

Quote from: cuz0882 on August 14, 2012, 12:25:31 AM

What price dumps are you referring to? Mining and dividends have not been this profitable in 7 months.

Lending to greece and spain was never this profitable either

Bitcoin Oz

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Wat

Quote from: cuz0882 on August 14, 2012, 12:25:31 AM

Quote from: Bitcoin Oz on August 13, 2012, 11:33:20 PM

The massive price dumps of these is the market deciding how much they suck

Glad I have never owned any of them and never will.

What price dumps are you referring to? Mining and dividends have not been this profitable in 7 months.

You need to take into account the loss of principal over time. If you cant redeem a bond for what you paid you need to account for that loss in your calculations.

cuz0882

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Merit: 250

Quote from: Bitcoin Oz on August 13, 2012, 11:33:20 PM

The massive price dumps of these is the market deciding how much they suck

Glad I have never owned any of them and never will.

What price dumps are you referring to? Mining and dividends have not been this profitable in 7 months.

Bitcoin Oz

hero member

Activity: 686

Merit: 500

Wat

The massive price dumps of these is the market deciding how much they suck

Glad I have never owned any of them and never will.

cuz0882

sr. member

Activity: 392

Merit: 250

Quote from: MPOE-PR on August 12, 2012, 10:33:43 PM

Quote

Bonds are usually good for preserving your capital and earning you a fixed income from dividends. If you think about it, mining turds offer you none of the previously mentioned benefits. At the moment, dividends do not cover the depreciation of your invested capital. Sorry, but this applies to all the mining turds out there.

I just wrote a piece elaborating on that. Hadn't seen your (very well thought out) post, smickles pointed it out tho.

Your comparing purchasing btc to purchasing mining bonds... There is no way to know what bitcoin will be worth in the future. You should be comparing holding your money in dollars vs purchasing mining equipment or bonds. It's pretty clear that mining and bonds are paying out well. There are no capital investment loses right now on the bonds using singles or mini rigs. Even gpu's hold their value pretty well. I expect most gpu's have already paid for themselves.

P4man

hero member

Activity: 518

Merit: 500

Maybe Diablo's "$1 million" mining company turning in to a 1 millionth of a dollar mining company will open some people's eyes as to what can (and will) happen with these bonds:

https://glbse.com/asset/view/DMC

Now Im sure Diablo will purchase a few shares back himself to save face, but the simple fact is his shareholders (which really are mining bond holders since DMC only owns mining bonds) saw 99.5%. of their investment evaporate, Oh well, 99.48% if you take past dividend payments in to account. Like I said, if you like high coupon payments, buy Greek debt, its far less risky.

Topic: Weekly loss of N% guaranteed - Enjoy perpetual loss with fixed Mh/s mining turds - page 5. (Read 14723 times)