Bitcoin Forum

Bitcoin Shop, Inc Shareholder Update

https://www.youtube.com/watch?v=b2DA98yeGho&feature=youtu.be

switch to min 8 to see the miners.

They have to learn from haobtc about how to plan a building for mining....

+1

Pretty sweet operation! I wonder what the total amount of hashing power will be... And what the cost of electricity is for all of the miners running.

I have some experience in hosting, so let me review this operation. North Carolina... I'd heard they were doing this but I figured they would realize this was a stupid idea.

1) Hot climate? Check

2) Non-competitive electricity price? Check

3) Amateur layout of their equipment? Check

We'll they're screwed.

Let's forget about the cost of that equipment. They'll burn that equipment out faster cooling like that and from what I can gather electricity is more than 6 cents USD/kwh. (I looked at some suppliers online, appeared to be 5.5 cents/kwh plus tax, demand and service charges.) Those Spondoolies machines make 16 cents/kw right now. I'd guess that after overhead, supplies and a couple of employees they're in for at least 3 more cents/kwh. So they're burning 9 cents/kwh now. So a 75% rise in difficulty and they're basically underwater at this price. We're going to see 5% rise on difficulty in a few days. And based on what i see, I'd be surprised if they were at only 3 cents/kwh of overhead. Where it was an older unit for a prior use, that AC likely can't handle anywhere near their BTU, so I'm presuming that's far less than what would actually be needed, but it probably uses a ton of electricity.

Gut feeling? They're paying 12 cents usd/kwh after all reoccurring costs. Let alone upfront costs for all that work and miners. ROI is a distant memory.

Your "all in" cost per kwh in Iceland, Georgia, Washington and China is under 5 cents/kwh.

These guys are in a lot of trouble. They've just put near $1 million into a facility that's probably underwater before the end of 2015. $100K/MW isn't too bad, but it appears that this building came with a large transformer... and suddenly $100K/MW is pretty bad. Your main transformer (and ancillary equipment) is 50-75% of your cost, depending on the voltage the power authority is giving you.

Also the "we're looking at mines in other locations" at the end of the video is a nod to the fact that my assumptions aren't that far off.

But hey, maybe they'll get lucky and the price run will continue to outpace difficulty. (And the rest of us too!)

This video did not inspire me at all. In my opinion, it was design to put the best face possible on their plan for "Transaction Processing Services" (aka Mining). Every hardware purchase was about what a great deal they got on the specific bit of hardware (i.e. racks for $xxx, but worth $yyy). They seemed to omit 21 Inc from their possible competitors, as well SFARDS and Avalon. Maybe those companies aren't really a threat, but I don't know why not.

I saw nothing to significantly distinguish them from any other ASIC hardware manufacturer that "self mines" and doesn't sell their hardware to the general public. I don't understand why calling it "Transaction Processing Services" makes that better.

I really hope that Spondoolies can produce great mining hardware that is sold to folks, otherwise their great Engineering talent will be wasted.