It's my understanding there are negotiations behind the scenes.

Okay, so they moved to convert to Chapter 11.  So at least that's finally completely settled.  They will go into Chapter 11.  But no plan yet.

They say they have over 1,000 people to notify in case - presumably mostly creditors - and are asking the judge to allow them not to notify everybody of everything. They want to limit notice to the court, the lawyers, the companies and people who are named in the suits that have been filed (the "creditors mailing matrix"), its 20 largest creditors, and various government agencies with an interest.  Just sayin'.  I'm pretty sure anything important will appear here.

I'm talking about Hashfast, or some successor entity that gets the chip for "free" (but with Hashfast's debt) being the mine, and Hashfast's creditors (plus whoever puts up cash to make the boards) being the owners.

Okay.  

Let's say that, starting 2 weeks from now, those chips began to be converted into a mine.  Say that it takes three months for substantially all of them to get hashing (just do it linear). Say that they really get 700 g/hash per chip at 500 watts.  I guess we don't know the component costs for the board, but I'm guessing the other parts (power supplies, electricity, etc) are known.  

How much money could they make, with reasonable assumptions on network difficulty?    I don't know enough to do the calculation.

Not to get too excited about that, because going from chip to mine will cost huge money that, even if made available, will come with a big cost!  But in a relatively smooth case scenario of a conversion into a mine, what's the earnings potential of, say, 35,000 chips?

I agree with the latter sentiments entirely.  But I always thought calling Hashfast an American company was a bit of an oversimplification.  Yes, of course, it is incorporated in the US and is, legally, an American company.  But Americans were not calling the shots.  Among the leaders you have a Brit (Simon), a Canadian (Amy the 1st), and a Latin American CEO (Eddie).  People that came to the US for business opportunity.  And the people that blew the first board, if Hashfast's narrative is to be believed, were in Australia. And one time I saw it mentioned that the CFO for a while, in that middle period, was from Hong Kong (don't know if that's true).  Well, then call it failure of half the Anglophone world!

The point is not to get into national finger-pointing, but more to add a little nuance, because a few times people have come on here with anti-American rants about Hashfast which I found a little misplaced.

If, as I posit, there was a secret pronster (or other) investment behind Hashfast, and those investors walked away with a lot of our money, it will be interesting to see where they came from.  Unfortunately, those guys might be the "real Americans".

But no matter where you come from, for fraud I'm sure a judge can find a nice place for your nationality in an American jail!  :-)

I'm calling BS on you again, Freddie.

First off, I'll take my source on the debt any day of the week over you.  Mine has greater credibility, frankly.  And I have slightly understated what I was told.

Pretty much everything else you say is ridiculous.  

It is possible that Amy was lied to, but you know what?  Let's say she was lied to in the way you assert... that is, that Hashfast was only "solvent" based on fake numbers about chips?  Guess what?  She still knew there was no money to get out of the hole, and that Hashfast was only "solvent" if it realized impossible gains on hypothetical sales.  Sorry, if you just parrot what you are being fed, but what you are being fed doesn't pass the simplest smell test, well, that's pretty much lying in my book.  If you want to compromise, let's say that she "spread lies and should have known better".  That's about as charitable as I can get with her.  And your story implicates the temporary CFO, because Amy said that was who showed her the figures.

Hashfast doesn't want to sell up to 1,000 chips as a "huge chip deal that would bring in a bunch of cash".  1000 chips isn't huge anyway.  It's quite obvious from the filings that Simon doesn't have enough money to meet payroll, pay the lawyers, pay a CRO, and present a credible plan.  No, this "huge chip deal" is just about keeping the phones working, a temp to check the voicemail, and the legal process alive, and that's about it.  

And back to those financials you say Amy was shown.  You offer as an excuse that "the numbers that existed at the time" were not a proper accounting?  What are we to glean from that?  That it's okay to lose money and forget liabilities on your balance sheet?  That you and Amy were content to toil away at a company with hundreds of irate customers beating down the door and accounting that you knew was falsified?  That doesn't sound like an excuse, that sounds like negligence (or worse).

I agree with you that, on the scale of culpability of Hashfast people, and on the basis of what we know, Amy is perhaps the least tainted.  But even giving her the benefit of the doubt, I'm not letting her slide on broadcasting obvious falsehoods. There were naive customers that believed that, that still believe that. "Why did you file the bankruptcy suit, they stopped shipping?"  Of course, there was no money in the bank, a debt to suppliers, a debt to customers, a payroll to meet, lawsuits to defend against, etc.  She gave false hope to people with statements she knew, or should have known, were inaccurate. That's probably why she's catching so much flak.  Sure, a few of those naive customers would have gotten (late, money-losing) machines before Hashfast hit the wall at the speed of sound, but they were going to hit the wall, and most of the creditors were not going to get paid.

That's my understanding too.  If they can't present a credible plan, they go into liquidation.

I imagine that Eddie's getting ready to board a flight to Venezuela or wherever he came from (I don't personally know where).  With his credentials maybe Maduro would be interested in hiring him.

Alright, well, this is what I hear.  I don't think any of this is secret, it's just secondhand information.  I assume it's accurate, but I have no personal knowledge.

Hashfast's debt to customers is significantly into 8 digits, i.e. > US $10,000,000.  Maybe even $15 million.

Hashfast also has debt to suppliers, perhaps around $2 million.  The suppliers may physically control some Hashfast assets, cough, like the important ones.

Emerging from bankruptcy will require a large infusion of cash.  It is not clear if anyone is prepared to make such an investment at all, much less on terms acceptable to the creditors.

The obvious question is where all the damn money went.  I have nothing new about that.  I've previously posted my own suspicions.

It also brings to mind Hashfast's later apologists, like Amy A. and now, the "dog".  What bullshit they are full of.  

Come on, Amy, claiming Hashfast was solvent until the day before you were fired?  Lie.

Dog, you're trying to rewrite events into a narrative that makes you feel better about what happened, and which I doubt has much to do with reality.

Well, I've been informed that the financial situation at Hashfast is perhaps even worse than we have been told or I personally imagined.  I'll leave it to somebody more directly in the know to say it out loud.  If nobody comes by to enlighten us, I'll post what I've heard later.  I'd rather it be less heresay and more from somebody directly present in the bankruptcy proceedings.

Here's the order:

http://bit.ly/SiSUHd

It's pretty self-explanatory.  

Hashfast's lawyer didn't remove "alleged debtor" like the judge asked him to.

They can sell enough stuff to meet payroll, pay the lawyers, and pay a CRO.  Everybody awaits the reorganization plan.

The everything that the proceeding halted was the bleed off of the remainder of Hashfast's resources to any of a number of sharks circling it.  And Simon was happy to feed the sharks, oddly enough, as long as he got a piece of the meal that was his own company.

They might have dripped out a few dozen more machines to the small customers over the last couple weeks without the bankruptcy proceeding (probably including my own Batch 2 upgrade board - still not shipped), but these just would have been little pieces of debris breaking off the Hashfast jet as it accelerated in its terminal spin into the wall that Eddie aimed it at.  There's a greater chance of justice, and of economic fairness to all of us doing it this way.

It seems fairly easy to understand to me.  I don't have any extra sources, but listening to the conversation, this is my interpretation:

We're not dealing with the Chapter 11 plan yet.  We're just dealing with the chip sale.  Hashfast is very eager to make this chip sale, of up to 1000 chips (probably VMC or Peppermining, or both).  I assume that is because they desperately need the money.  I don't know, but I can guess, that they might need to meet payroll and/or they need the money to present a remotely credible Chapter 11 plan (pay the lawyers?).

To secure the consent of the creditors to the chip sale plan Hashfast agreed to appoint a CRO.  Gallo suggested the guy, and Hashfast immediately hired him - before the other creditors had actually signed off on Brinko.  So Brinko's assistant has been hired for a few days, but it's not decided that Brinko will actually be the CRO, since all creditors have not agreed.

Assuming that the creditors agreed yesterday afternoon on a price, the judge entered an order permitting them to make the sale.  The CRO question, however is unresolved.  Further, there is no agreed plan, as yet, for how the proceeds of the chip sale will be spent.  That will require another order, apparently, and will require Hashfast's cashflow document.  

So, in sum (my best guess):

1. Hashfast will probably sell "up to 1000" chips at prices the creditors can accept.

2. Hashfast has agreed to hire a CRO, and has hired Brinko (Gallo's suggestion), but Brinko may not stay, since he was not approved by all the creditors.  

3. How Hashfast will spend the money it earns with the sale is undecided (but I bet it will be allocated between payroll, lawyers' bills, and the forthcoming Chapter 11 plan).

4. We're still waiting for the Chapter 11 plan.  

Wow, no update yet?

I don't know, but I believe that a "sources and uses of funds" document is basically a cashflow statement.  What's coming in, and what's going out.  Except maybe they are using it here in the future tense, as in a plan.  I dunno.  Hopefully we can get an audio file or briefing from Entropy_UC.

On the CRO:  https://en.wikipedia.org/wiki/Chief_restructuring_officer

I assume a Trustee has a binding obligation to report any financial misconduct discovered at the company. If it's a CRO rather than a Trustee, does the CRO have similar obligations?

Victims of bankrupt bitcoin miner company Hashfast will recognize Abram Kottmeier in Bliss Devices' promotional youtube video.  

Kottmeier is linked to male prostitution in the San Francisco Bay Area, as well as to a hardcore pornography company specializing in extreme torture-like abuse porn.

Be very careful with this company.  I wouldn't touch anything having to do with Kottmeier with a 10 meter pole.

For more information, read up in the main Hashfast thread in the bitcoin mining hardware section.

OMG Long Dong rides again.  

We need to make sure that whatever threads are on this company are aware of the HF debacle.  It's really even our responsibility to do so, to make sure nobody else gets sucked into the same trap.

Did anybody ever go down and pull Abram's criminal record at the courthouse in San Jose?  I posted the case numbers in this thread.  Come on, one of you in the Bay Area, it's possible that it is nothing significant... but on the other hand it could very interesting.

This reinforces my suspicion that there was a pronster investment behind Hashfast (represented at the company by Kottmeier and Skrodenis), and those people may have our money, and may have subsequently put it in this company.

EDIT:

Just as an addition, Bliss is claiming on its website that their ASIC will mine Vertcoin, a scrypt-n altcoin that is designed to be ASIC-resistant.  The website also uses the Vertcoin logo.  Well, apparently, the Vertcoin devs have made clear that they will fork VTC if the product from Abram's company hits the streets, so if Bliss ever actually makes any units, they will likely be DOA for anybody wanting to mine Vertcoin with them.  Bliss knows this, as its lead has weighed in on Reddit threads.  The attitude of some of the Vertcoin guys is that Bliss is engaged in what's tantamount to fraud, by suggesting those machines will mine VTC when they know VTC will fork to avoid them.

You really ought to change your signature.  

Nobody has made their bitcoins back mining with Hashfast equipment.

If the ship sinks (liquidation), there are plenty of people who will tie Eddie, Simon, and Scrotum to the deck.

What I mean by that is that Hashfast has angered enough people with its lies and vanishing money that, through some combination of bankruptcy, civil, and maybe criminal lawsuits, it will be ensured that Hashfast's management does not personally profit from this fiasco.

I have no more say in the matter than anyone else, I'm just a small creditor, but in my view the MPP claims absolutely must be pursued.  They were not an oral pledge (which in any event can be an enforceable contract), they were very explicitly spelled out on the website, including a Q&A, and the MPP was expressly placed under the TOS.  MPP claims are absolutely legitimate. I bought after the MPP was announced, and I bought because the MPP was announced.  It was what put me over the edge.

It does get a little confusing deciding where, in the order of things and in our present situation, the MPP claims stand in terms of their priority.  But maybe the way things are worked out will make that question irrelevant.

dhenson and others who have retained a lawyer will come on here and try to convince you to sign up with that group, at a cost of 40% of anything that is recovered (paid to the lawyer).  I'm not going to discourage you from doing that, but I'm not doing that myself.

Entropy_UC will come and (correctly, in my view) observe that you can just ride the bankruptcy out.  Once the company is under supervision of the court, creditors big and small will be addressed (although some will be more vocal and pushy than others, and priority will have to be worked out, if any priority exists).

But if Hashfast goes into liquidation, for example, there will be process by which you can present your claim.  Stay tuned.

Hashfast's main asset right now are 40,000 chips (previously reported as 30,000... now they say 40,000) that they have in hand.  All the rest of the money and bitcoins went poof into a cloud of dust and disappeared. Hashfast doesn't have the money to make these chips into boards, in fact it hasn't had any money for months, which is why they haven't been shipping our orders, and is why they announced that they wanted to be the "intel of bitcoin mining" - to sell the chips, since they have no resources to make boxes.

I think that what everyone is hoping - but balancing the interests correctly is a problem - is that the creditors can take control of the company and find the money to put the chips on boards.  Now, all the related questions like, "So, then, do I get boards?"  Or "So, then, do they sell the boards and we get cash for our share of the debt, basically as shareholders in Hashfast 2.0?"  All this sort of business, it's all up in the air.

But as many point out, the value of the chips goes down every day.  So every day that Simon tries to hold on as CEO and the creditors can't reach a deal among themselves, the value we will recover probably goes down.  

I think that on Wednesday we will get information that might make the future a little clearer.

Bicknellski, I know you have enemies in bitcoinland related to disputes I have no knowledge of, and those people will complain about my saying this, but I think this is good advice.  

But we're sort of the peanut gallery here.  We who post here are mainly small creditors and we have a voice, but there are bigger fish than us, who have their own guidance. Maybe some of us will get into that room, but our power in some senses is, in actuality and at this point, this board.

We may need a little more investigation to fully suss out the malignant parts.

/end serious discussion

/begin troll management

On the village idiot:


Yes, show me, you moron from hell.  I can't make up for lack of education and inability to think critically - or, well, even an inability to read. Continually giving you the benefit of the doubt, I can maybe suggest a more productive path. But you are not allowed to characterize my statements with your own impotent brain.  You must quote them with appropriate context.  Take a stroll?  Sure. But please keep it in PMs.  I don't think there's much stomach for a public re-rendition.