Topic: Why the Bitcoin community HAS to save the network from HashFast, CoinTerra, BFL. - page 3. (Read 9895 times)

1. Completely untrue. At the very beginning (2009-2010), the market at the time was just not big enough to warrant investing even $150k to develop a 130nm ASIC. Plus Bitcoin's future success was very uncertain (legally and technologically speaking), so it would have been a very risky venture. ASICs were seen as inevitable, provided the Bitcoin market became big enough and the risks decreased. Once these 2 things happened, ASIC developments started.

2. Yes there is a choice: do not buy overpriced mining hardware. Wait for prices to decrease. Duh!

3. Prices will decrease by themselves. Just let capitalism do its work. There are so many ASIC companies competing between each other that prices are falling as we speak. Not too long ago the best you could get was 50 Mhash/s per dollar (Avalon ~75 Gh/s at $1500), and now the market is already moving toward 300+ Mhash/s per dollar (Cointerra TM IV 2 Thash/s at $6000 in 2014).

you sound quite naive.  while your intentions may be honourable, you're living in some dream world where commercial and financial reality doesnt exist.

the goal of an asic company is not just to sell enough chips to pay for its NRE.  thats just one of the big up front costs of going into manufacture.  What about the salaries of the engineers who worked for 6+ months to design the chip, will be working x months to ensure it works and continue optimising the design, and presumably will also be working 6+ months on the next generation chip?  or are they all expected to work for free?   What about the sales staff and the support staff ?  the people who answer the phone to help people with orders, or help people with problems getting it running etc?  And what about the return on investment for the investors who put up the money to start the company in the first place?

also, in the timeframes youre talking about, to design a 400-600 GH chip that you havnt even started yet, would take you 6+ months to design it, then 3+ months to manufacture it, so you're already 9 months behind the competition.   In that amount of time, their chips (which have been dropping in line with the rise in difficulty) will already be the price that youre aiming at, obviating the need for you to do this exercise.

by way of an example look at Cointerra (simply because theyre the lowest cost asic (per GH) i know of at present).  they're selling their december systems (not just chips, actual full systems in a box with power supply, controller host, plug and play...) at $7/GH, and their January systems for $3/GH.  By the time we get to may, june.. when your chips might be ready, just imagine what price theyd be selling them for!?   And what about every other asic company thats also competing for the same business.  theyre not in a vacuum.  theyre competing not only with each other, which keeps them honest, but theyre also selling gigahashes at a price that people decide has an roi or they wouldnt sell any, so they have to keep dropping their price in line with network hash increases.   And all of these guys would prefer to be selling chips on their own instead of systems, and im sure the only reason they build systems is because of time to market issues, and if they left it to others to design their boxes, theyd be out in the marketplace later.

part of the problem that youre missing is that its iots the NRE's that are causing the biggest problem.   its the high cost of starting a new asic that creates the issue (and lots of asics compound the problem).  not the actual production cost.  the bitcoin world actually needs LESS new asics, because its the raisning of the cash for the nre that puts such a strain on the bitcoin economy (all the pre-orders, many of which are paid for in bitcoins, which are converted into fiat and then paid directly to the fab, to pay for the nre).   if we didnt have such high nre's, asic companies wouldnt need pre-orders, and the price of bitcoins wouldnt have such price pressure because of high sales of btc into fiat.

youre compounding the problem.  Why not instead, do a deal with knc, hashfast or cointerra to buy the rights to their old 28nm chip when theyve obsoleted it (in the timeframe that your one would be ready anyway) and theyve moved on to 20, 16 or 14nm for their next chips ?

-- Jez

I suggest Rassah as one, if this proves viable and he's available depending on RL commitments and interest.

The other asic vendors will be there long before you. As difficulty shoots up, market value of these chips per TH drops proportionally. It doesnt really matter if thats achieved by these companies mining themselves or selling their gear. The result is the same, in order to maintain sales, market prices will drop and keep dropping until at some point they meet marginal profitability - which btw, IMO is considerably lower than your estimates. If you pay $10K for a processed wafer, you seriously  need to be looking elsewhere, volume prices are ~$4K for  28nm 300mm bulk.

Sorry to correct you, but electricity varies between 1 and 61 us$cents: http://en.wikipedia.org/wiki/Electricity_pricing#Price_comparison

I don't think this list is up-to-date, but relatively equal is incorrect.

What was stopping these "unknown groups" from buying a lot GPUs/FPGAs before ASICs? The goal of this project is to again make electricity a substantial cost for mining. Because electricity is something that is available at a relatively equal price for everyone.

Make a finite batch and have a lottery for each one, make it random distribution for fairness. One persons money then becomes as good as anothers.

Ah, the socialist solution to ASIC!

I'm in, if this isn't just a pipe dream.  But what's to stop unknown groups from buying huge chunks of this proposed new hashing power?  Wouldn't this just be another opportunity for the well-funded profiteers to make even more money?

We are open to suggestions about what steps to take to make our operation more transparent. One option is to put all the "we will do x and y" in the company bylaws and making the Executives/Board personally liable if they fail to honor the commitment.


14nm is still a dream. We will be talking to some companies this week to find out if it is even possible anytime soon. So far we know that we won't probably see 14nm ASICs until 2015.

We will let the community nominate and then vote for the treasurers.

We do not have any particular experience with ASIC design. However, majority of the work will be contracted to companies specializing in this. SHA-256 is not a very complicated algorithm, and designing an ASIC for this is relatively easy. We will also hire experienced people to help us make the right decisions.

Everything will be open-sourced, since it is funded by the community.

Interesting idea!  I'm very fond of the transparency around your NRE expenses and community elected treasurer-group suggestion. A few questions though!

Assuming the 28nm AND 14nm projects prove successful (probably a ways to go on the 14nm) what about smaller chip-architecture?

Any plans for election processes of treasury agents? Length of terms of service?

What kind of background does your company have in ASIC design?  You obviously know what you're talking about, I'm just interested as a miner in your "portfolio".

Pubic domain for the die on the ASIC chips sounds wonderful; do you plan on open-source firmware to run the chips too?

Best of luck and I will certainly be following!

By instructing the fab I understand that this will be your obligation to do so, being specified in a contract of some sort.
You see, trust is very hard to earn and stuff like "we will do x and y" means nothing if it isn't clearly stated in some form of legal binding contract.
I am interested in this project, I think it's fair and good to the community to have access to cheap hardware in order to have a more diverse ecosystem. Right now the markups are huge because there is a huge demand for these  products, they are scarce and everyone, from Avalon to Bitfury, CoinCraft, CoinTerra, CoinWhatever has to make the choice of selling this chip at a higher price or mine for themselves (personally I would mine for myself - too much hassle) yet neither of them, so eager to "help the community" has come up front and said "we will make our chip public domain".

There are kickstarter projects that raised more than 2 million yet we buy custom made hardware because we are looking for the same thing: ROI in 4-5 weeks and a fairly fat profit 6-9 months down the road. Greed is natural. Fortunately, technology limits that.

Also you will only get one shot at this so you know... you have to make it count.

I will be watching this thread.

Well I'm curious to see what happens with this. I like your ideas, now you guys need to get them accomplished. Get there and you have my full support. I know I would love to see a low cost chip hit the market and blow away the competition. It is quite possible to be a loss leader here and lead the market. Plus I really like hobby style boards!

Looking forward to hearing about your team.

This.

There is plenty of competition out there. There are at least 7 companies selling ASIC miners presently. As difficulty goes up, the price of these machines will go way way down.

Within 6 months you'll see devices in the 500+ GH/s range selling for just hundreds of dollars, well within the range of a casual miner. Serious miners will be buying devices in the terahash range.

These devices won't be that profitable but people with cheap or free electricity will be able to make a small proft.

Current ASIC companies are doing not anything immoral (well, except for BFL and Avalon). They are simply charging what the market will bear. That's called capitalism. If you don't agree with their prices, don't buy from them.

1. In Bitcoin mining some laws of regular economy don't hold. For example, there would be NO demand for ASICs, if there were no ASICs anywhere. People were still mining happily with GPUs/FPGAs. ASICs just increased the difficulty rate.
2. They have no other choice, we are here to give one.
3. If you read my post properly, you would find the answer to this question. We are not creating just "another" ASIC. We are creating a low cost ASIC ($100 - $200 for a 400 to 600 GHash/sec capacity chip).
4. Irrelevant question.

A few questions:
So the ASIC companies are evil for selling a product with high market demand?
So the people buying ASIC's by the truckload are not the issue?
And this can be stopped by creating another ASIC?
What drugs are you guys on and can i have some?

I hope this is for real

I'm supportive

Once there is huge consensus that this is a good idea, we will disclose our public profiles. That being said, this proposal is not just for us. Others in the industry are more than welcome to step forward to take lead.


Exactly the reason why we proposed this solution.


14nm is the cutting edge. Only very few companies are making 14nm chips at this time. NRE costs for 14nm are even higher. We are still looking into it. We believe 28nm will still last for an year or so.

I suggest running something on btc.tc or similar

This is a very raw proposal yet. We have not selected any members yet, and will totally rely on the community to do this. We are also open to more suggestions about how we can do this more transparently, and what other steps we should take to ensure that we do not end up like other ASIC manufacturers.