Bitcoin Forum

mining

I wanted to show you another option.
https://bitcointalk.org/index.php?topic=88008.0

If you wanted to earn dividends mining with Bitforce Singles on GPUMAX.com until they can be upgraded to ASIC Miners:
https://bitcointalk.org/index.php?topic=86854.0

Why should investors in your shares care whether their 1MH/s is going to be produced by ASICs or singles, other than the small difference in power usage between the two?

They should care because (see below quote).  While 1MH/s bonds will be paying out only the proceeds of their 1MH/s, NASTY shares will be upgrading to ASIC Miners with the BFL trade-in program and giving shareholders the benefit, potentially raising the per share hash rate to 20MH/s!

Interesting. How will you handle the transition and prevent allegations of insider trading? I assume that you have shares in NastyMining, so there's no real way for you to avoid a conflict of interest.

Not only that, but the price per mhash/s share will be considerably lower with ASIC rigs than with FPGA singles.

When more information regarding ASIC development and the BFL trade-in program is made public, shareholders will find out the same time as I do.  I don't think insider trading is a big concern.  I won't know exactly how the transition will be handled until the details are announced.

Everyone should find out about the trade in program at the same time, but the transition from a 1MH/s bond to a 20MH/s bond is a huge one that's under your control.

Let me propose this scenario, and I'm not saying you would do this. It's just something that could possibly happen.

A miner issues 20000 shares of a 1MH/s mining bond, selling 10,000 of them at the current price of about 0.30BTC. This brings in 3000BTC.
In 6 months BFL products hit the market, and a 1MH/s mining bond is selling for ~0.03BTC.
The issuer buys 5000 shares of his bond on the market for 150BTC.
The issuer amends the offering to be a 20MH/s bond. Dividends shoot up 2000%. The bond starts trading at 0.6BTC.
The issuer slowly releases his new 5000 shares for 0.6BTC, collects 3000BTC.

 ::)

http://ilovemusubi.com/wp-content/uploads/2009/11/spam-300x225.jpg

Since the market is aware that this transition to ASIC miners is going to happen and I have made that very clear, I don't see why the price would fall to 0.03BTC/share.  If it did, there would be no harm in buying up all the available shares on the market, as that is what a free market is about.  As long as the buyer didn't have any inside knowledge that wasn't available to the public, I don't see the problem.  That is why I will continue to make the company's plans very clear.

Interesting.

My personal train of thought is that most mining operations will end up offering something along the lines of what I'm doing with my PIMP bonds or what OgNasty is doing with his bonds. There may be a little confusing numbers to crunch, but investors in a bond that will adjust with the coming asics will end up being in the best position.

You are doing the math wrong: $0.03/mhash =  0.0046BTC/mhash.
That is a major mistake and should change your conclusion a lot.

It will be interesting to see how the pricing of 1MH/s bonds will price out. At the moment, I personally think things will remain the same. BFL have not got the greatest rep for delivering on time, so even if it is 6 months away, people will make reasonable money with the current bond pricing, for several months. Also over time, the pricing for the 1MH/s bonds was always going to fall.

Phil

Why? Insider trading makes markets more efficient (http://www.economicpolicyjournal.com/2012/03/harvard-prof-defends-insider-trading.html).

I fail to see how that statement has any basis in reality, when they ship if one rig box a day is put into production then in twelve days the network hash power is already doubled on the thirteenth day they are the majority of the hashing. At the end of two months at one a day the network has grown by five times its previous rate.

It must be true if yahoo posted it.. http://news.yahoo.com/leading-sha256-hardware-manufacturer-acquires-venture-capital-funding-081026668.html (http://news.yahoo.com/leading-sha256-hardware-manufacturer-acquires-venture-capital-funding-081026668.html)
Time to set up shop, the guy with 100 posts on the forum speaks for BFL. No reason for them to even bother posting it on their website..

In your analysis you forget to take in the account the halving of the reward in 6 months and the increase of hashing power coming online next week. God forbid if the Bitcoins goes back to $5!

True! I will take your word and I hold you responsible :)