Topic: Why are people cheering that ASICMINER will bring 800-1000TH online this year? - page 3. (Read 9200 times)

If you were a middle-man who consistently did that, you would be part of the pyramid below him. 

I probably shouldn't be giving people any ideas who care about their own greed over Bitcoin.

A ponzi scheme pays new investors dividends with their own money or money from subsequent investors, the scheme itself is not profitable and requires that more and more money be "invested" in order to continue to function. If ASICMiner is forced to do this, that means their mining operation is neither profitable nor sustainable. If ASICMiner is a ponzi scheme then it will eventually unravel and you need not worry about them taking over the Bitcoin mining world.

The only way for ASICMiner to be a threat to Bitcoin is if they can continue to grow and reinvest actual profits from their mining activities. Actual profits precludes them from being a ponzi scheme.

I can't see the link between selling suckers overpriced equipment and Ponzi scheme.

btw, I bought does overpriced USB sticks, first batch, sold them for twice as much.

Thank you.  I've been avoiding mentioning what you did because I have no proof.  But yes, if he is selling for fiat it would explain why the spot has been doing a lot of bed-shitting lately.  the price has been slowly dropping around the same time ASICMiner really started to grow.

I won't travel down that path without proof, but it certainly is suspect.

I don't really care personally if people sell...the movement is a natural market force.  But, yeah, it does suck.  People investing in ASICMiner are getting screwed three ways then instead of two.

#1 Overpriced equipment (don't really care so much as people can do what they want)
#2 High prices being used for personal reinvestment in their own mining operation.  (this is the biggest issue.  A USB stick of 330 MH could be increasing his own network speed 4x greater for all we know)
#3 Selling what he has, reducing everyones value.  (Long-term this doesn't matter if BTC survives, but it does suck short term for independent guys that would like to buy hardware at a higher spot)

The nature of Bitcoin doesn't allow me to prove #3 so I tend to avoid that issue.

If you can't see the pyramid of growing a personal operation by selling suckers overpriced equipment, I think you are the one who lacks the notion what it means.

Yup it is just as likely as Barricks Gold (worlds largest gold ore miner) doing something to undermine the confidence in gold bullion. 

Why are you worried? Their very existence depends on BTC having value. If they kill BTC they would kill themselves! Your worry makes no sense.

Well ASICMiner is a "company" (maybe not in the legal sense of the word but in practical application) a large portion of the coins mined are returned to shareholders in the form of dividends.  If those shareholders independently choose to sell coins how is it any different than someone with their own (owned) hardware choosing to sell coins?

As the number of coins climb and the block subsidy declines the influence of new coins on price will also decline.

Today there are ~11.4 million BTC and daily only 3600 or 0.03% of total are being produced.  The number of coins traded daily on the major exchanges (~50,000 BTC) already significantly dwarfs these new coins (even if 100% of them are sold as soon as they are mined).  By the time of the next subsidy cut there will be ~15.8 million BTC and the daily generation rate will have declined to 1,800 or ~0.01% of total. 

Nobody said ASICs are disruptive but if it wasn't ASICMiner it would be someone else and without ASICs increasingly the odds would be on the "someone else" being a hostile actor. 

Exactly this.  Competition will always be possible in the bitcoin realm.  The more valuable it gets, the more sophisticated the competition will get.  As long as governments don't come along and force monopolies by imposing multi-million dollar entry fees regulations, competition will always have the opportunity to compete.

This.  If Bitcoin never gets any bigger then it doesn't really matter what ASICMiner share is but if/when Bitcoin rises significantly in valuation the global mining revenue will bring in new players with deeper pockets.  Global mining revenue is ~$130M annually today.  That is the pie that ASIC developers are fighting over.  It doesn't matter if a company is building hardware for internal use, or selling that hardware to the public the potential revenue (either by directly mined BTC or from hardware sales) come from that same pool of $130M/yr of potential revenue.

Now like I said if Bitcoin doesn't get larger then all this is just a tempest in a teacup.  Does it really matter who is the king of the anthill?  Without continual growth and improvement, Bitcoin will be an experiment that limps along and eventually is replaced by something superior. Under that scenario it doesn't matter if ASICMiner goes bankrupt or runs 100% of the network.  

However lets say (over some period of time, months, years, decades) global mining revenue increases by an order of magnitude.  Suddenly ASIC developers are fighting over $1B potential revenue.  That is going to bring in companies with deeper pockets.  Today the potential revenue is (relatively) low and the risk is high but the longer Bitcoin continues without dying, the more regulatory issues get ironed out, and the higher the valuation the more it shifts the risk vs reward to one where larger players are interested. 

Forget AMD/Intel there are dozens of companies which make specialized ASICs for all types of industries who already have the expertise, staff, and industry contracts to roll out SHA256 ASIC and do so in a streamlined efficient manner (think shrinkwrapped build quality, ease of use, support, and distribution you would expect from say a home router).  However a slice of $100M at very high risk is simply not something they are interested in yet.  $1B+ potential revenue at a lower risk well that is a different story.

Edited for clarity.

+1 very well articulated. ASiCminer is also powerful enough to manipulate BTC market pricing now by suppressing the price offloading coins they harvest 25% the total of.

You keep using that word. I do not think it means what you think it means.

I thought Deepbit was taking over Bitcoin.
Wait, it is still 2012 right?

I back it up by watching his percentage continually grow.  I never said he wasn't sending people what they paid for.  Those are two seperate issues.  I only have issues with the former, which is a ponzi.  I wouldn't care that he is selling overpriced equipment if he wasn't using the funds to grow his own operation.  Nobody should deal with a big hardware development company that mines on anything but testnet if you care about keeping mining independent and in as many hands as possible.  Mining with what is developed on such a grand scale will lead to centralization.

Would you trust Bitcoin if the Federal Reserve was doing the same thing?  Like bank loan products based on a fractional reserve system, you are being sold products that actually hurt you.  Every loan devalues your own purchasing power that much more.  In this case it is hashrate.  You are getting screwed twice.  Once with high prices and second devaluation of your own hashrate worth by the same guy selling you the shovels he is using for himself.

The Federal Reserve has the luxury of printing their own dollars that are used against you to enrich themselves.  The same thing is happening here if the term dollars is replaced with hashrate.

It boggles my mind that people can't understand why this is a problem.

May I ask, why did you care to pay so much for blades?  Or did you get them second-hand?  The latter would be better.  The former helps him grow and screw you over.


What is a waste of time is paying for overpriced blades for the sole benefit of the creator to increase their operation to continually screw you over with each adjustment.  Unless you bought for cheap second-hand, you are paying for your mistake twice over.  It's like taking out a loan at the bank to buy something and getting charged interest on debt notes that were given to you.

FYI, I have no problem with group buys.


Your analogy doesn't work.  I am making comparisons to the financial industry.  Not a health care service sector where plenty of competition exists.  Health "insurance" actually causes prices to rise along with your premiums but that is a different topic.


You are confused.  Re-read what I said.  Now I'm not even sure why I replied to your post to begin with because you don't seem to understand the concern, at all.

The difference is the amount of money it takes to attempt to compete.  With bitcoin it's zero.  You don't have to pay any politicians, purchase permission to mine, appease 48 different states to mine in the US, file any information with any regulators, all you have to do is have the parts to compete.  In the traditional banking system, they have put so many layers in place that no one can even try to compete without millions of capital to throw at regulations.  In bitcoin, all you need is the hardware.

It may be centralized now, but that's just because ASICMiner was first to market.  First mover advantage is a big one.  But there's no barrier to entry.  I am making money mining right now.  Maybe not much, but I, as an individual with a small amount of capital and a belly for risk, am making money even though ASICMiner is raking it in.  And because I want to keep making money, I'm rolling profits over into new ventures.  Maybe I'll succeed, maybe I won't, but ASICMiner can't line politician's pockets to forcefully keep me from competing.  The only way for them to stay in front is to be better.  I much prefer that method to the current method, where you have to know people or have oodles of money to even play the game.

People still believe Bitcoin is decentralized because the code tells them it's suppose to be. In reality, this asic phase is turning it into a centralized currency.

At least Banks have regulations to conform to and their books can be examined. Asicminer can do whatever they want and pay dividends at whatever rate they want and you will have no clue as to how much profit they are making. You really think this is a better situation for a currency?

seems like they are selling their coins for fiat !!

Centralization of this kind will always happen. Power compounds. I'm just glad friedcat doesn't seem to be the sort of person who just wants to watch the world burn. If such a person ever ends up in the same position some day in the future, Bitcoin is in trouble.

This.

The amount of sour grapes in this thread is ridiculous.

Remember that it is BFL that is NINE MONTHS delivering their product. And it doesn't look like they are going to make the 90 day promise they made about a month ago either. Their promise of delivery back as far as October was completely fraudulent. They must have known they were months away from delivering every time they said they'd be shipping in 2 weeks. BFL customers should be pissed as this was blatant illegal behavior.

Avalon is also multiple months late on batch 2 and just last week they said they'd be finished shipping by the end of the month. Well, here it is July 1st and all of batch 2 has not been shipped out yet. Also there is plenty of evidence that they were mining with customers machines in the meantime. That is bad. Very bad.

Now, let's look at ASICMiner. They developed a working product, and have both mined and sold it and sold shares which have returned higher dividends than anyone could have expected. If you bought shares just a few months ago you would have 5 times your money just from the share price alone!

Their hardware was expensive, but they delivered immediately and the hardware worked as claimed so plenty of people bought it anyways. IMO, they priced the hardware PERFECTLY. Any lower and they would have been screwing over their shareholders! Remember that they had no competition for mining hardware at the time! Neither Avalon nor BFL could sell you a product they would deliver right away. ASICMiner has been nothing but trustworthy so far. If you are frustrated by their success, just buy some shares and share in the profits.

So much hate in chinese guys, we all know that chinese are powerfull, just see BFL was the first to annouce a asic, but avalon and asicminer appeared and first come first serves.

Chinese guys are strong will own the world.