Let's see.... it should have started by now....

Yes, but after about 3pm today, US west coast time, the old Hashfast will likely cease to exist. 

In Eddie's place there will be a court-appointed manager.  That manager's job will be to fairly allocate Hashfast's remaining assets among its creditors.  (S)He will be responsible to the court, not out for personal gain or responsible to shadowy porn investors, or whatever.

It's your own business, and of course the possibility of upsets exists, but paying 40% of your proceeds to a fat lawyer doesn't seem to make sense.

It's like this, for example:

For Batch 1 Babyjet with unpaid MPP (or insert some other item here, say, for every Batch 3 Sierra), each customer will receive a set amount.  Let's say it's $10.  If you don't hire Gallo, you will basically get your $10 back.  If you do hire Gallo, you will get $6 back.

Yeah, it's more complicated than that, but that's the basic jist.

Maybe. And yes, you probably can't compel a person to reveal the private key for a wallet.  But if they don't, and those are resources that a federal court says should be divided among creditors, you can probably throw the owner in jail.  You know, and there are some good people in government. With the right conditions, the kind of guy that investigates white collar crime might love this case.  Doing forensics to find out where white collar criminals hide money is a specialty of some people. Like people that prosecute the Mob. Let's hope they get involved.


I am sure they will try their best to keep the IP by arguing it is separate.  That's Simon's future.  But if Hashfast's resources were used to develop it, and I'm sure they were, then they can't keep it their own.  There may be very traceable patent applications.  If a federal court demands that they turn over the assets, refusing to do so will land them in serious trouble.  They will not be defying some guys on an internet forum anymore, they would be defying a federal judge, typically the kind of person that doesn't like to be defied and has the means to break you will.



Yes, there are competing interests.  But again, they have got to do a cost benefit analysis.  It may turn out the way you fear but let's not presume that.  They may decide that it's better not to fight and to instead cooperate with us, in order to reduce their losses.

But there are so many possibilities here.  Let's not focus on the worst possible, and while I don't think Liquidbits will be a "team player", let's not be too judgmental before we see what they say in detail.  You know, they have to consider the possibility that conflict with us will only prolong the agony, resulting in even less value in the chips, and lower returns to their investors.

But so many possibilities.  What if, for example, it becomes apparent that persons currently or recently associated with Hashfast control large bitcoin wallets?  Or that they are sitting some hot new chip?

What I wish was that there was a more or less neutral party (not somebody with their own large claim) that had the capability to very quickly transform those chips into EVO boards.  The bankrupted Hashfast entity could have the boards made under contract and then sell them, proceeds to be divided among creditors.

Easy fellas.  Duncwa, it would be awesome to get a report from the hearing.  Hopefully there will at least be some tech media there.  Maybe even some mainstream.

I hope all the information comes out eventually on all the sweetheart deals Hashfast made to undermine the interests of its customers.  ActiveMining, the apparent secret data center, mining kickbacks from Liquidbits, god knows what else.

Let's hope that the court-appointed manager that I guess we will get will be a communicative guy, who will regularly keep us posted on what he plans to look into and what he finds.  

He hopefully won't be hesitant to pick up the phone and call the white collar crime division at the FBI (or the IRS, I suppose) when he makes dubious discoveries.  I assume that's his obligation.

I think Liquidbits will try to advance a claim to 28,000 of the chips, but the legitimacy of its chip conversion deal is very dubious.  Some compromise will have to be the result.  There's no way that Hashfast could legally strip away hundreds of peoples' claims by entering into a late hour deal pledging 90% of its assets to one creditor.  That just won't fly.  Liquidbits is going to be a problem for the rest of us, but I can't imagine that court would permit its claim to be settled to the exclusion of ours.

Oh, and the pronsters too.  I wanna know the truth about the pronsters!

I may have unfortunately generated confusion by being unclear about the relationship between Liquidbits and the petitioners in the Chapter 7 bankruptcy filing. My apologies if I screwed anything up.  

In my posts earlier today, I referred to Liquidbits as a fellow creditor, possibly giving the impression that Liquidbits was "in" on the original bankruptcy petition, rather than an intervenor. But Entropy-UC is quite clear.  

To be perfectly honest, I was deliberately ambiguous because I wasn't sure that Liquidbits didn't have some relationship to one of the named creditors in that filing that, for some reason, hadn't been fully revealed until now.  Maybe I was too cautious.

In any event, dhenson and entropy-uc, I'm sorry if my ambiguity contributed to a misunderstanding.

I am committed in my own small way to the entropy-uc-led Chapter 7 filing, and that's where I intend to stay.

For the existing stock, it may come down who can take the chips and make boards for sale.... fast.  

(And, to be clear, I'd have an extremely hard time bringing myself to support Gallo.  Just substituting one pig for another, frankly.)

But the previously secret whale is a problem.  If he eats 28,000 plankton chips, then there's not much left for us minnows.  We're fried.  Mixed metaphors from hell.

Then again, that pledge of 90% of Hashfast's assets - when the order was for $6 million against what, maybe $20 million or more in outstanding orders (remember the MPP too)? - well, hardly legitimate.  Mismanagement. Just more of Eddie's self-interested bullshit.  His family wouldn't invest in Hashfast because they knew him, I'll bet.

Seems like he'd promise anything to anybody, big or small, didn't matter.  The answer for Hashfast's failings was always to pledge bigger, better, and faster just around the corner ... whether the promise had any correlation to reality or not.

Way to go McCombs School of Business at the University of Texas at Austin!  Fucking MBAs.  Should be a trade school degree.  Like welding. Look at what bidness "education" results in?  Crooks.

And then there's the IP, if they really have a chip that works.

If the new chip really "screams", as Amy the 2nd claimed, I think that IceDrill Will detected that Simon may have been trying to play him as the fool.  That Simon wanted to offload Hashfast's baggage onto IceDrill and all jurisdictional crap and confusion that would cause, and try to walk away with the (possible) new chip.

But I also still tend to suspect that the pron crowd are a big reason why Hashfast is so broke. The waterboarders and prostitutes got in and out fast.  Pretty ironic.  If I'm right, those guys must be enjoying a pretty good laugh.  The "dregs of society" might be the only ones to walk away from this mess intact.

That's what I'm saying.  The value may be in the new chip design (IP), if they learned enough about "substrates" to get it right the second time around.

I imagine Eddie has been careful to create companies with an alleged arms-length distance from Hashfast to own that IP, and that it will be argued that those holdings shouldn't be part of the proceeding.  Just a thought.



EDIT:  Actually, I suppose what they learned about substrates isn't relevant to the future, because nobody would put them in charge of the PCB again.  What matters is that there'd be somebody that could do that job competently.

Yeah.  There's obvious value in the chips that exist, but especially given how long it's going to take to sort the crap out, if the new design works, that IP might be worth a heck of a lot more.  Not sure if that wouldn't be where I'd focus an effort.  As a matter of justice, I'd like to make sure those assholes don't walk away with it.

Simon, Simon, Simon... if only you hadn't hooked up with crooks.  Well, for all I know you're one too, but I'd like to think that if you hadn't hooked up with Bullshit Eddie, the waterboarding porn and prostitution crowd, and the Church of Greed, that maybe you could have gone down as a brilliant chip designer.

I feel like St. Paul must have today.  The scales are falling from my eyes and the truth unfolds.  So, Zetta Mine and the Jacobson Brothers...

So we come semi-full circle here.  Wonder if Inaba wants to comment on this. Harh harh.

Liquidbits is one of several companies that comprise Coinware.

http://www.coinware.io/

One of Coinware's other ventures is Nimbus mining.

http://www.nimbusmining.com/

Nimbus mining is BFL's cloud mining host.

https://products.butterflylabs.com/nimbus-mining.html

Nimbus doesn't seem to have any other public customers.

Oh, headache.

So this guy Bachrach, who bought the huge HF order, has some major deal with BFL too.  I wonder to what extent he represents his own (and coinware fellow execs) capital, and to what extent he's fronting for other investors.  Would love to know the details of the BFL too.

Since I don't think these guys are going to show up here, some more docs to cry over:

Contract for the 3 Petahash (2500 Sierra) order and "self-mine" kickback (3 October 13):
http://bit.ly/SnXpAm

Agreement to covert that order into 30,000 chips (4 March 14):
http://bit.ly/RXrOFe

Declaration of Gregory Bachrach, Liquidbits CEO (? May 14):
http://bit.ly/TyjpcO


And finally, for the moment, the memorandum summing it up (from Liquidbits' perspective) for the motion it made to hold the bankruptcy hearing earlier.  The motion was granted, and the hearing is tomorrow (Fri 23 May):

http://bit.ly/1hcNofg


Just call me PACER.  

But, hey, we should alert the press, and we should inform them of the perspective of the small customer.  This is not just a dispute between Hashfast and Liquidbits, there are also the interests of hundreds of unpaid small customers at stake.

Well, in case you were wondering what Simon was up to in Amsterdam:

http://bit.ly/1i8dcJJ

No comment on the Gallo business.  I'm not associated with that.

Truth is what I like, and we're getting some.  Okay, the huge customer is a Florida company called Liquidbits.  

New data point:  As of May 8th, 2014, Hashfast had approximately 31,000 chips on hand.  (Basis:  Hashfast admitted that 28,000 chips constituted "about 90%" of its inventory.)

At the same time, Hashfast had only delivered 2,000 out of 30,000 it committed to provide to Liquidbits under a "chip conversion" MOU executed on March 4th.  

Not that, speaking personally, I would necessarily grant any priority to the whale's claim over that of others.  

Another fact point:  When Liquidbits converted the 2500 sierra (3 petahash) order into chips on March 4th, Hashfast maintained its 25% payout from Liquidbits' gross mining income (less costs).

OMG.  Hashfast did try to "self-mine".  This is not an allegation, this is a written contract I am reading.  And it may mean that my co-creditor will not appear here, because he was part of the deal.

In early October 2013, Hashfast sold 3 petahashes to a company, estimated to be ~2500 Sierras depending on how they performed.

The company paid $6 million dollars for those Sierras.  Delivery beginning 15 November.  Units undelivered by 31 December could be cancelled.

But it wasn't just a hardware deal.  Hashfast would get a kickback of 25% of the gross revenues of the purchasing mining company (less costs).

What would you have done if you had known in early October 2013 that Hashfast had inked a deal to sell 2500 sierras and share in the mining profit from them?  I wonder if there were even more deals like this.

Makes the whole "drama" of Amy and her two shipping boxes in Montreal look like such bullshit theater to entertain the little guys like us.

In March (yes March), the company "converted" its order into 30,000 (yes 30,000) chips.  Hashfast only delivered 2,000 of those chips and has refused to deliver more.  Hence...

I need to correct the record.  

The bankruptcy petition correspondence that I referred to yesterday turns out not to be from Hashfast's attorneys.  (Would you shut up already armyof1ne, you idiot?)

Rather, it relates to a (granted) motion by one of the others that brought the petition.  A motion to speed up the process.

Since I'm very much a junior (small) member of the petition group, I won't speculate on the significance.  Hopefully one of the other creditors will explain.

I will say, however, that according to what I have received, there will be a hearing on the petition TOMORROW (Fri, 23 May), at 2:00PM at the federal bankruptcy court at 235 Pine St in San Francisco.

The motion makes for incredible reading.  Allegations, but.... Tens of thousands of chips, conflicting agreements, alleged attempts to move assets offshore, alleged attempts to sell (at bargain prices) assets already encumbered by claims and agreements, "millions of dollars unaccounted for", violation of arbitrators orders.  Oh, heavens.  If none of the senior creditors appears here soon, and it's not posted on the court website, I'll go ahead and scan it.  Read it and you will weep, I promise.

Sigh. Knows more about litigation than lawyers.  Knows more about Hashfast than Hashfast.  Posts replies without reading original.  No wonder you're an army of one. 

Well, Army, your wish may be their command.  

Last week, on Thursday and then again on Friday, Hashfast's (see edit) lawyers generated UPS overnight labels addressed to me. (The annoying UPS "my choice" service spams me every time a UPS shipper farts in my general direction.)  Both times last week they didn't actually send anything and the labels appeared as cancelled the following day.

Today they generated two more labels and have marked, according to the UPS website, one of them as "Order Processed: Ready for UPS".  This is further than we got before.

So perhaps they really are replying and some news will be here tomorrow morning.

Then again, it could just be another false start.

PS: The video is good, although videobam sucks.  I just want name tags on Goebbels and whoever else that is standing beside him.

EDIT:  See below.  This turned out not to be from Hashfast but rather to relate to a motion to speed up the process, filed by a creditor.

That "army" guy wasn't ever going to get his "full refund".  This is the logical failure (among many) of his arguments.  In addition to knowing more about litigation than any lawyer yet contacted about Hashfast, he argues from the false pretense that all the people owed "full refunds" have the possibility of getting them.  They don't. The money is not there.  Unless you count what was probably looted, but that's not coming back except possibly through a judicial process, and might not be enough anyway.

The MPP, well, that's never coming either.  (I'm owed it too.)  The only possibility of the MPP ever coming is once it is worthless, but it looks like Hashfast will be folded before then.  Same difference.