IM not interested in pricing a Sierra. Frankly thats as silly as doing a BOM analysis on a minirig with an integrated Nexus 7 tablet to make a point that prices per GH couldnt go below $15/GH. Bare bones "designs" that asicminer and bitfury put out, is what future miners will look like. No fancy cases, no water cooling, no integrated tablets, just cheap as chips boards at most in a very basic box of fans. What HF, Cointerra etc are putting out soon is pretty darn nice, but at the prices they can ask for these rigs, there is no reason not to. But in  6 or 12 months when margins evaporate, water cooling  and seasonic PSU's may look as silly as an integrated tablet in a minirig today.

At the network speeds we are talking about, those wouldnt be small runs. As for the price per chip, these bitcoin asics are no bigger than typical mid/highend mobile SoCs. You've already seen how I came to my estimates, but lets see what ARM has to say on that:

"Our SoC partners might put the first one out on the market with a $15 ASP, and as soon as the second person comes on the market the price drops to $7 and within a month or two, they'll be at $5."

http://www.theinquirer.net/inquirer/news/2303601/arm-reveals-the-mali-t720-gpu-to-help-vendors-get-android-devices-to-market-faster

In all likelihood, mobile socs would have lower yields (far less redundancy), more layers, and far more complicated IO. On the flip side, packaging for low wattage might be easier, but if HF could save money by using seperate chips per die, rather than packaging 4 in one MCM, Im pretty sure they would do it. Really, your low estimate is pretty high. Maybe asic vendors now cant reach that low because they dont have the volume to order directly with the fab, but at some point they will.


Surely you are joking?
Have you seen the cases of KnC? Just 2 flimsy cheats of aluminum that couldnt cost more than $3 in volume. For reference, here is a full fancy looking ATX case for $6
http://www.alibaba.com/product-gs/1016257579/Mini_ATX_Case_Mini_ATX_Tower.html
IT even comes with fans that you price at $10 each


Again, you have to be kidding. Its not because those prices are common in retail, targeting a select niche market that tolerates such prices, that large volume orders would cost anything like that. $20 tops. Here is a huge radiator, likely the most expensive part,  for $12:
http://www.alibaba.com/product-gs/425032365/Computer_water_cooling_cooling_system.html

You are off by, well, a LOT. Again, for reference first hit on Alibaba, pricing starts at $0.6:
http://www.alibaba.com/product-gs/1059988680/High_tech_120mm_fan_12v_dc.html


Im not gonna look for prices, but honestly, you are way,WAY off. First crappy 360W PSU I find
http://www.alibaba.com/product-gs/1313266704/360W_Constant_Voltage_12V_Power_Supply.html
Yep, $10 instead of you estimated $150. etc, etc.

I didnt even search for the cheapest, just took one of the first relevant results to give you an idea. Now the above components may be as crap as the infamous BFL power supplies,  might be wrong spec, whatever, but you get the idea. You really confuse retail prices of A brands with what stuff from China costs in volume.

Are they..
I dont remember that website listing a gazillion BFL preorders, so Ill use this for now to get an idea of their product mix ratio's :
https://bitcointalk.org/index.php?topic=89685.0

jala's: 215
LS: 45
Single: 369
Minirig: 25

That list contains a total of 58TH divided over 657 units gives an average of 88GH per unit. So even using a single as default unit is probably understating it.


I recall it was months ago that I read that. I also read he was claiming shipping 300 units per day back in July (http://www.coindesk.com/inside-butterfly-labs-the-challenges-of-producing-bitcoin-mining-hardware/). Either way, even if its still "only" 20K units,  multiplied by 88GH gives 1.7PH and corresponds to $85M worth of asics shipped (and quite likely a multiple of that in unshipped preorders).

No matter how you look at it, the dollar count is staggering, and the gross profit margin would be close to 90%. As much as I would like to see otherwise, bankruptcy simply isnt gonna happen.

FWIW, I end up with very similar numbers when calculating the "end game", using todays BTC value and estimating costs based on HF's chip efficiency and estimated production costs:



The big unknown is how fast we will get there, it will probably take longer than a year, but I have no doubt we will get there if todays BTC value holds.

Already very much on their radar, as I posted earlier and what triggered this OT subthread:
https://bitcointalk.org/index.php?topic=297503.msg3430985#msg3430985
(Ken is CEO of VMC/Activemining).


IN all likelihood,  the sec is still in the (informal) investigation stage, requesting documents from the exchanges and apparently at least some asset issuers. In that sense, the closure or blocking of US investors may be "voluntarily", but almost certainly a result of being asked questions. (think SEC:  "what steps are you taking to prevent US investors from using your exchange to comply with xyz". Ukyo: "Ooops").

This always bothered me; assume a string of (non elastic) rope from earth to Mars. If someone pulls it on earth, wouldnt it be noted instantly on Mars?

I think you just dont realize how much BFL has sold and is shipping. My estimate is that they shipped over 1PH worth of 65nm asics by now. Thats 20,000 singles or 200,000 jalapeno's.  I dont know their product mix, but lets assume its close to 50/50, which would mean ~100K units.  They have been shipping them since April, do I remember that correctly? So less than 200 days and therefore ~500 units per day. Thats more than KnC managed.

Thats not to excuse BFL; if you have backlog of >100K units that are fully paid up front, there is no excuse not to invest in a supply chain to be able to deliver these things a whole lot faster. That 1PH would have netted them $50M and if we assume they are only 1/3 through their backorder log, they would have cashed in some $150M. Surely enough to rent a frigging large assembly hall and hire a boatload of people, preferably people with some relevant experience rather than Joshes,  or do what Hashfast did and contract a large specialist assembly plant. But thats the part they may have done on purpose; the slower they ship, the longer difficulty stayed low, and the more presales they generated. But BFL bankrupt? I dont think so.

You mean from end of october to middle of november, no? Thats 2 weeks in my book. Even if its three, thats still no 3 difficulty adjustments and certainly not 50% ones.


No one every said KnC got out of the business, but they finished batch 1, batch 2 will only start shipping mid November, by their own account. Hence the next 2 weeks I dont expect spectacular increases in the network hashrate. As for what will happen after that, everyone would have told you it would go ballistic in December and January, but you cant blame HF for that. If anything their delay will also delay the ballistic trajectory.


I can have a PCB prototypes made in 2 days and volume production in a week. Anything can cause delays, but not seeing a PCB is not a worry, nor is seeing one any reason to breath easily (think BFL monarch PCB pics).


I see no evidence of lying at this point. Certainly not more than one might have "seen" months ago.

LOL! Someone's fucked.

Werent 40K of those reserved for bitfountain?

2 weeks is not 3 difficulty adjustments, its barely more than one. Difficulty adjustments are also not 50% (yet) and particularly the upcoming one is likely relatively modest; KnC is done shipping, the rest isnt ready yet, so you will only get some BFLs and Bitfury's being added to the network. Honestly, if a 2 week delay wasnt factored in to your purchase decision, you should never have  bought; Ive had shipments at customs for longer than that. And that would be a lot worse than when everyone is delayed 2 weeks.

ANyway, best I can tell, the FTC is on your side and you should have the right to get a refund.  I will support anyone trying to get it, but at the same time I find it hard to crucify hashfast over what is so far a very very modest delay, certainly when compared to BFL customers that have been waiting 6 or 12 months.

As if that would work. Many of us have been predicting this bloodshed among virtually all asic customers for years now, it didnt change a thing, and wont change a thing. 


Doesnt everybody want to make money without working? As long as asics are at least marginally profitable, people will buy. And when people no longer buy, prices will just drop until they buy again. The capacity is there, its going to be used one way or another. Even if miraculously miners no longer buy, these asics will just end up in large private mines.

BTW, Im sure there are loads of (ex)miners like me, sitting out the current onslaught, but who want to get in to the game again once things have settled down a bit, say next summer or so. I dont mind thin margins and long ROI times, I just dont want it to be a 100% gamble if my chosen manufacturer will be shipping one week sooner or later and how much the others will ship in the 6 weeks thereafter. Satoshi dice gives you far better odds. But that doesnt mean I wont buy an asic ever, if the opportunity presents itself, Ill buy. But thats not gonna happen anytime soon.

While they havent said it, KnC should be ready with batch by now, so I assume assembly is idle until batch 2. Also the 600 was over a weekend it seems, the biggest per day production number they achieved was 455
https://www.kncminer.com/news?page=2

They wouldnt be able to stop everyone from installing it obviously, but the damage that could be done to bitcoin if just running the bitcoin client is deemed illegal is enormous.
Im not looking forward being put at risk of breaking laws from just about every regulator in the world and Id rather not risk finding out what exactly it is they could do.

Regulators might try to argue that each bitcoin client is a security exchange.

Maybe BFL expected (even) more customers to trade their 65nm orders for 28nm miners and "mining by the GH". That way they could "finish" 65nm backlogs much  more quickly, and postpone the pain for BFL miners to next year.

Anyone soliciting funds from US investors had better care. Thats pretty much every bitcoin asset issuer out there.
Not that the situation is any different for European or Asian markets, where very similar laws exist.
ALso: http://www.sec.gov/about/offices/oia/oia_crossborder.shtml


That could eliminate the need for exchanges, but wouldnt help anything for asset issuers, who would still be breaking the law. On top of that, I have some fears that polluting the blockchain with asset management may put bitcoin as a whole at risk.

If it aint broken, dont fix it. Apparently they are selling pretty well, otherwise (and sooner or later anyway) you'd see far more aggressive price cuts. That goes for all vendors btw.

SEC appears to be gathering info on bitcoin denominated asset issuers:
https://bitcointalk.org/index.php?topic=297503.msg3430985#msg3430985

I realize thats for bitfunder, but who in their right minds believes they wont track the assets down to the other exchanges where most of these assets moved to since ever since BF started refusing US investors. The clock is ticking.

No one picks up on this? SEC going not only after exchanges, but asset issuers .
Ken, do you have any insights on your own legal liability? Would the SEC consider it the exchange fault for targeting unsophisticated (US) investors, or yours too?