Topic: Why are people buying asic mining shares? are they insane? - page 3. (Read 9352 times)

Because compared to BFL they offer extremely poor value (Mh/s per BTC). Why pay 1.99 BTC for 336 Mh/s, when you can buy 5 Gh/s for 3 BTC? Why buy 10 Gh/s for 50 BTC when you can get 50 Gh/s for 25 BTC?

Whatever happens, you're looking at reduced prices due to competition, leading to a decrease in income from hardware sales. The fact that their is competition will mean that the competition will capture network share from AM, making it harder for them to capture 30% of the network even if they wanted to. AM have purchased 50 TH/s already and have 200 TH/s incoming over the next few months. That's 250 Th/s maximum. Avalon also have about 250 Th/s from chips and the 3 batches, whereas BFL have almost 400 Th/s incoming according to that unofficial pre-order list.

With the competition set to match or beat AM's hashing power, they're not going to be selling as much hardware or their network share will slip further behind. The hardware they do sell will have to be sold for competitive prices. Both of those factors will reduce the dividends from selling hardware.

Me too.  As they keep on growing, one day I'll be able to get a whole share with it.

I love my poor man's TAT.ASICMINER 

Why is this obvious?

What you are saying is that the market leader in hardware sales is less likely to be competitive in future sales than newcomers?

BFL 5 GH/s = $274
18 Mh/s per USD
1.8 Gh/s per BTC @ 100 USD/BTC

1 AM share costs more than 2.74 BTC at the moment and the exchange rate is at 100 USD/BTC. Assuming that AM was at 2.74 BTC per share, then 1 share would need to provide 5 Gh/s in order to offer the same value as a 5 Gh/s BFL. At 5 Gh/s per share, AM would need a hashrate of 5 Gh/s/share * 400, 000 shares = 2,000 Th/s.

People claiming that AM continuously adding hashing power is a reason why share prices are currently undervalued need to take a serious look at the numbers. With a share price of 2.74 BTC, AM needs a hash rate of 2,000 Th/s in order to be competitive with a 5 Gh/s BFL. Their initial wafer order was for 50 Th/s. The current wafer order is for 200 TH/s in two parts. These should be coming online over the next couple of months. That's a maximum of 250 Th/s.

With the rate at which BFL is dispatching back orders, they should be shipping from the shelf by the time AM bring that 250 Th/s online. Going by this site's numbers, BFL have about 400 Th/s to bring online.

Avalon's 3 batches should be online by then as well, which is another 100 Th/s. Avalon chips should be shipping by then as well, so we'll see a number of new mining systems based on them. That's another 150 Th/s. 100 Th/s should come online in July and August from 100TH and 50 Th/s should come online from Metabank in August and September. In September and October, KnC should also be bringing 200 Th/s online.

The next gen chips from Avalon and AM are due in October and Yifu said said that Avalon would be using 55 nm. The BitFury chips used by 100TH and Metabank are also 55 nm and I'd assume AM will also be 55 nm. At this point, most of the hashing power will be coming from BFL products, and Avalon and AM having a similar amount at around 250 Th/s. BitFury and KnC should also have similar amounts at around 200 Th/s.

AM needs 2,000 Th/s to be competitive with a 5 Gh/s BFL, to be competitive with a Metabank BitFury 120, we have the following:

Metabank BitFury 120
120 Gh/s
2160 USD
55.556 Mh/s per USD
5.556 Gh/s per BTC

ASICMINER
6,500 Th/s
400,000 shares
16.25 Gh/s per share
2.93 BTC per share
5.556 Gh/s per BTC

It truly boggles my mind how anyone could believe that ASICMINER is undervalued.

The other thing to keep in mind is that not everybody has 50 BTC to spend on a miner.  I personally don't even have enough to buy a full ASICMiner share, but my TAT.ASICMiner is affordable.  In the few weeks that I've held it, I've received enough in dividends to buy another share.  I'll be buying another share next week.

Last week was ~0.017 from hashing, ~0.02 from hardware sales.

1) SEC Oversight:
Enron...
Worldcom...
Bernie Madoff...

2) "proper financial reporting"
I love getting reports from ASICMiner every week or two, and dividends every week. In the absence of a thick stack of regulations, information seems to flow much more freely and frequently.

3) "Just some guy...with a spreadsheet"
Ultimately, that's what everything is. Your point here amounts to double-counting SEC-oversight as two separate points.


To your implied point about risk/trust, yes, bottom line, investors DO have to trust the operators of ASICMiner. Why do we trust them? Well, history to date, both of terms of operational performance and meeting their word every step of the way. Note that in any investment where you hand your money over to someone else, you have to trust them to some extent. Yes, it's harder to get away with massive fraud in an SEC-regulated company, but I consider the upside to ASICMiner to far outweigh the risks. The PE and Div yield on ASICMiner crush anything in the traditional stock market. I've evaluated the risks, and I think it's a clear buy for a fraction of my portfolio.

I will gladly pay 2.9 Bitcoins for a chance (and a good one IMO) to receive dividend payments for the rest of my life. There is no doubt that the shares will pay for themselves many times over as long as Asicminer stays in business long enough. The question is how much you believe in them, but up to now I have seen only positive growth which I think has exceeded everyone's expectations.

I see that lol

I see, so most of you buying those shares are considering this similar to buying stocks in a publicly listed company with sec oversight and proper financial reporting, you are assuming you really own part of the asic miner "company" and all profits made by the "company" are reinvested in growth and shared among its share holders. And this is not just some guy in a basement with a spreadsheet that has your name on it and decide what he wants to pay you each week...

Ok now it's clear, i just couldnt figure out why people are buying those "shares".


It was a question, no need to be rude. Well aware of what value investing is, i work in the capital markets for a living. Maybe you should ask graham what he thinks about paying $250 for an asic miner "share"

I am good with 0.02X range. I went in at around 1.6 (now 3BTC) hoping for consistent .02 range. Needless to say, I've been pleased. 

I think it's going to break BTC3.0 Tuesday night before dividends and then drop quite a bit back down. To maybe 2.7. Hardware sales have sold out so I assume the dividend should be reduced. Maybe in the 0.02X range.

I love AsicMiner, but @2.9btc I think it is overpriced. Thats 1,200,000 btc for the whole company!!
And bitcoin changes really fast, you don't know what is going to happen. This starts to remember me before the bitcoin crash at @266$ all the people was greedy like now and just speaking how rich they're going to be.

I would counter that anyone selling Asicminer shares at the moment is insane. I bought in a few months ago and the share price has more than doubled. I don't see any reason why the share value shouldn't increase more. The thing most people are missing is that the shares never expire, so unless Bitcoin dies or Asicminer goes out of business, you will get paid the dividends until all coins have been mined which will definitely not be anytime in the near future.

there is a book called Intelligent Investor by Benjamin Graham... or Security analysis. Try before you write something, ehm, stupid