This is my feeling on the matter as well. I know full well their projections are going to be *way* off. I invested because they'll be one of the first few large scrypt ASIC miners to come online before the torrent of Alpha Tech, KnC, etc hardware comes along....that, and I also do my own due diligence when it comes to this stuff, pretty much ignoring most of the presented prospectus, and developing my own projections on earnings.

On top of that, my plan is to convert any dividends back into Litecoin. If I'm investing in scrypt gear, I want to hold at least some of my earnings in coins based on the algorithm. 

Thanks for the clarification. I suppose only time will tell how altcoin price and volume fluctuations effect dividends.

10 ...10,000 units in each one.

Ha, oh I understand altcoins perfectly well...but I see you're point. 

So I may have missed the answers, but I have two questions that tie into each other:

1) Since dividends are paid in Bitcoin, which exchange(s) will be used to convert any mined altcoins into Bitcoin?
2) Given your projections, you'll be mining 5,000+ Litecoins each week (more at the beginning of course). How do you plan on converting that volume of currency to Bitcoin without disrupting the normal 'ebb and flow'?

With PETA, there were really two primary variables; network difficulty and BTC/Fiat price.
With SCRYPT-X, there are now three; altcoin difficulty (or difficulties), BTC/Fiat price, BTC/Altcoin price. It's like buying gold so you can speculate on the price of silver.

Even if your [unverifiable] wealth is true, there's no possible way that you were able to earn it using any of the BFL equipment you've mentioned so far. At first I was going to call 100% bullshit, especially since you started last year, but then you were sure to include that second to last sentence. Congrats on your investments in things other than mining equipment

Anyone can flip a 10x profit by trading altcoins if they time it right (or lose just as much) and as an early adopter of Litecoin, I can attest.

Mining, however, is a far more challenging game altogether. As far as I know, no Butterfly Labs mining equipment that was purchased solely using Bitcoin has ever made a profit in Bitcoin (e.g. spending BTC10 and earning BTC11).

Obviously this is rhetoric we've heard before, so my question now comes down to "How?"
Starting with the hashrate increase compensation, how will that work? Would they overclock the chips? Send additional hardware?

Sounds good, thanks for the update.


Just wanted to touch on this part specifically. In just about all cases, yes, Angel investors receive their shares vastly cheaper than IPO investors. I'll speculate that in this case the Angels put in less than $1M to help get the company off the ground. Since VC and Angel investing can be quite risky, it's normal to see a smaller investment be worth 20-30% of a company prior to IPO.

I've got 22k kickin' around somewhere. Anybody know what the going rate is these days?

I agree with this, just because it should be a quick implementation and increases security. Definitely open to the OpenID aspect as well.

For having $2,500,000+ in cash, I'd expect a hell of a lot more to get done than what's been implemented already. The only reason I haven't donated is because donations do absolutely nothing to benefit the community or the forum.

Whoooaa, whoa, whoa. Wait a minute.

If I'm reading this correctly, then you're saying that the BTC/USD price has a substantial impact on how your overall revenue and expenses play out (which is understandable). However, this fund started late November, after the price was already spiking well past $500 per coin.

At no point did you think it may be wise to revise projections based on the new prices? At no point did you think it may be in the investors best interest to advise them of such variables, or at least mention that a rising BTC price can lead to lower predicted revenue?
Now the question becomes, did the Panama Fund know how the impact of a rising BTC/USD price (and subsequent stabilization) would effect their business, but withheld that information from the public anyway, ultimately preventing them from any true due diligence when purchasing shares?

I'm no expert in securities law, but I reckon this is a dangerous game you're playing, even in Panama.


BTC was over $1000 for all of 3 weeks or so, and since then the 6 month weighted average has been ~$587. So, your 216BTC in actual revenue is somehow equal to 1267.92BTC...but still half of your projection (granted there haven't been weekly IPOs and the trading volume has been lower).

If Bitcoin spikes up to $10,000 per coin, then that would mean earning 25BTC in revenue is the same as 2500BTC @ $100, right?


To the Havelock Team - Sorry to be harsh, but these are some serious concerns, especially since you're supposed to be the leading Bitcoin-based securities exchange. 

Oh, I didn't even notice that, and that's also odd (not sure if they did it by accident or if was intentional).

To those wishing to view the report: https://drive.google.com/file/d/0BxnW49twNMNbX0tic1N6VVpaV28/edit?usp=sharing

That's sort of what I figured (and freedomno1 pointed out my oversight before), but there wasn't any detail surrounding it in the prospectus. In any case, thank you for the clarification.
Quick question: How did you guys arrive at the $3.6M figure for mass manufacturing, and what happens if you only end up raising, say, 10% of the total $4M?

Congrats on the chip by the way!

I had initially missed this while skimming last night, but I had a chance to read it all this morning, and unfortunately I have a concern about the overall offer itself.

As far as I've read, Alcheminer is solely a manufacturer, focusing on R&D and equipment / IP sales. This is all well and good, but it means everything they do / earn will be based in fiat. Let's think about this from a USD point of view:
Initial offering per share is (roughly) equal to ~$56 (ignoring fluctuations at this point).
Overall company valuation is $11.2M:
-- IPO - $4.48M (40%)
-- Angel Funding - $3.36M (30%)
-- Founders - $3.36M (30%)

In this case, I'm assuming (it was never specified) that monthly net income is dispersed as a dividend. If their projections hold true, 2014 dividends (total) for Investors should amount to about $45 per share (40% of the projected $9M net income / 80,000 shares). 2015 dividends (total) would then amount to a nice $96 per share, again based on their projections.

As it stands right now, the projections seem fairly reasonable (2014 revenues only require selling a few thousand units).

The problem with all this is the BTC/USD volatility. The share price is 0.14BTC, and 2014 dividends would amount to 0.1125BTC (assuming a rate of $400 per coin). But what happens if we see a spike to $600, $800, $1000 again? Suddenly those dividends are only worth 0.075BTC, 0.056BTC, 0.045BTC.
What about in 2015? Anyone know what the price per BTC will be then?

What made ASICMiner a good investment wasn't just that they dealt in development and equipment sales, but that they were miners as well (and the first large ASIC farm). This meant that anything they earned could be distributed as a dividend without having to be converted first, leaving shareholders largely unaffected during the price spikes / drops between January - May 2013.

Even if Alcheminer went this route, they'd still have to contend with fluctuating altcoin exchange rates, which can be even more volatile than BTC/USD.

The site was sold nearly 6 months ago lol ..and with the evolving regulations in Canada, it made sense to do so.. though don't consider that my praise for the new owners.

As for transferring HMF, I don't think it's possible (because where would you transfer it to?). You'd have to get in touch with Lightbox on that one.

I suppose it was more 'tongue in cheek' than anything else. Consider it a prelude to the coming storm of "zomg so overvalued", and "their value iz waayy 2 high" 

Whether or not raising $4M is needed, I don't know. My first thought was, "OK, they need money for R&D that doesn't include preorders...cool...but then what the hell was the Angel Seed Funding used for, especially to warrant a 30% stake?"

I'll have to read up on this a bit more, but it's piqued my interest at least.

Though unfortunately I can't say I trust a startup that states in their initial prospectus:

Unless I'm mistaken, HMF is still run by Lightbox (the former owner of Havelock) and not The Panama Fund.

I can't say there's been too much going on, at least nothing too interesting. Still awaiting the CoinTerra gear for the April batch.

One of our KnC Jupiter boards died late last week, bringing our rate down on the unit from 550GH/s to ~420GH/s. I had it RMA'd without too much of a hassle, which was nice, but I did pay for shipping out of pocket to get the board back to them as soon as possible. I installed the replacement board on Monday and all is well...except now another board has died. I can't tell if I'm just unlucky, or if the boards degrade over time...

Other than that, I've been trying to piece together a plan of action going forward...one that accounts for a lower BTC/USD rate like we're seeing now, and it's certainly a challenge. Since the vast majority of equipment is based in USD, and coupled with the low BTC/USD rate, there's been a fairly high probability (~90%+) that the purchased mining rig (regardless of manufacturer) will never make back the BTC spent to purchase it. This, of course, is based on a fairly substantial difficulty increase over the next 6 months as companies ship their equipment, as well as a low (but steady) monthly difficulty increase after that (similar to what we saw during the GPU phase, pre-ASICs), and also accounts for a delay in shipping (such as ordering a unit that ships in June, July, etc).

If I remember correctly, it's something like this:
A = Currently price per unit
B = Last Dividend per unit
C = How often after dividends paid. 12 = once per month, 365 = once per day, 52 = once per week, etc.

[(B * C) / A] * 100 = APY in %

For example, with B.MINE:
[(0.00041088 * 365) / 0.032] * 100 = 468.66%

With AM1:
[(0.000065 * 52) / 0.60] * 100 = 0.5633%

In reality, it sort of breaks based on how Havelock determines the timeframe. For me, paying every 2 weeks means 26 periods...an APY of about 43.3% at current prices...but for whatever reason Havelock calculates it as if it were only 12 periods per year. 

And for the Difficulty Derivative, it's even more skewed since the overall timeframe of the asset doesn't reach one year anyway.