Claiming they would deliver a product by the end of October in early October was fraud, plain and simple. There is no way they could have actually delivered anything at that point and they knew it. They would never be able to convince a court that they were that clueless about the time it takes to design an ASIC and get it up and running, test it, manufacture it, and ship it.

The funny thing is that they probably actually were pretty fast in designing their product when compared to others who have done so. It was just all the lies that made it look like they were so late.

There needs to be a class action lawsuit, or investigation by the attorney general to see what they were really intending when they announce a late October shipping date. My guess is that it was done to spur on more pre-orders and scare away their competitors. That is illegal. I bet a subpoena of their e-mails and internal memos would should that is exactly what they were doing.

Thus, I believe they deserve the scammer tag.

Not everyone paid with bitcoin though. I think it was bitcoin-only for the very early orders, but certainly by Sept or Oct, credit cards through paypal were an option. And I don't see anyone would pay by bitcoin if paypal/credit card was an option.

Yes but you've never had to deal with thousands of others all selling the same GPU on ebay before.

If you already have the GPUs, well then by all means, keep on mining. You should be able to cover the cost of your electricity for some more time and you'll get free heat in the winter. If you don't already own the GPUs though, don't buy them, you'll never recover their cost.

Avalon batch 2 started shipping today if you haven't heard.

Ask for a refund now.

You'll eventually get one, but you'll never make enough money from it to back for itself.

Avalon batch 2 has just started shipping.

You won't make any money mining if you are getting into it now.

Just buy bitcoins.

Or buy shares in ASICMiner (at bitfunder). They pay a dividend based on their mining profits.

You CAN'T buy ASICS right now to mine with.


Here are your options and why they aren't a good idea:

- ASICMiner USB and Blades. They are expensive and you will never ever make your money back due to rising difficulty
- Avalon. Batch 1 and 2 already shipping, batch 3 sold out. You can buy discrete chips which will ship in 8-10 weeks, plus some time and more money to assemble them into a machine, figure 3 months total. You aren't likely to make your money back but it is your best option so far. Difficulty might be low enough that you could break even but it's risky.
- Butterfly Labs. The worst choice. There are 60,000+ orders ahead of you and they haven't even finished developing their product yet. Even they people who ordered early aren't likely to make their money back.


Your best best right now is to go to bitfunder and buy ASICMiner shares. They pay a weekly dividend from their mining profits.

I just released... that if difficulty goes up high enough such that no one who has a pre-order would have a hope of making their money back and BFL still hasn't shipped, then people will begin to ask for their money back from their pre-orders.

If BFL refuses, people will request refunds from paypal or their credit card (unless they paid with bitcoins). Paypal will close BFL's account and they won't be able to accept new orders. Everyone else will sue BFL to get a refund if BFL refuses. The legal costs and refunds will quickly cause them to go out of business.

This could all happen very suddenly once we cross that difficulty threshold. It's probably in the couple hundred million range, maybe 3 to 500 million?

We could easily see that difficulty hit by the end of the year if Avalon and ASICMiner continue on schedule.

Given that it is now the second half of May and they haven't even finished development of 3 of the 4 of their products how could they have legitimately believed they were going to ship within a month at the time? Even if they had a working prototype they couldn't have done it. They didn't even have a working ASIC!

It should be quite obvious to anyone that that claim at the time (last fall) was nothing more than pure fraud intended to boost their pre-orders and scare off competitors.

Why are they not being investigated by state attorney generals or why is there no class action lawsuit being organized against them?

There is no way they can claim that they actually believed they would be able to ship a product at that time. No one is going to believe that a company was that completely ignorant as to the sechedule it takes to develop, test, produce, and ship an ASIC.

I'd like to see their e-mails and records subpoenaed so we can really see what was going on in the company at that time.

Now that Avalon Batch 2 is shipping, with batch 3 and the discrete chips not far behind, BFL hardware with be worthless when it finally does arrive. And a honest, fair estimate is about 3-4 months for just the first 10,000 units. Let's look at the schedule:

2-4 weeks for BFL to figure out the kinks in their single SC board.
2 weeks to order chips, assemble a couple of single SC machines, and ship them out to reviewers
2 weeks to receive enough chips and get the new PCBs made in large enough quantity
2 weeks to ramp up assembly
2 weeks to package and ship
10 weeks of production to make 10,000 units assuming they can make 1000 a week (it's ambitious).
Add in another 4 weeks for potential delays, of which there is always something

That's about 3-4 months just to get started making a dent in the backlog of pre-orders they have. By then we might even be seeing home-made Avalon ASIC machines out there mining.

If you don't believe it will take this long, look how long it's been since they got the first Jalapeno working and how many people have them? It takes a while to go from "prototype" to ramping up production to significant volume. And they don't even have a working prototype for the single SC/minirig right now.

Damn right we did.

It's amazing how BFL dropped the ball on this one. I knew they would be late when I ordered last fall, but I didn't expect this.

They missed so many opportunities to do the right thing.

Now only thing left to do is sit back and wait for the impending class action suit.

Because when GPU mining becomes unproftable, everyone will dump their used GPUs and you are not going to get 80% of what you paid for them.

Second, you don't have 2.5 months. Difficulty will double in the next month or so. Even if you take a very conservative approach and figure it only continues to go up 15% every 2 weeks as it has been, you still won't realize a ROI in anywhere near 2.5 months.

The only chance you can break even is if you sell your GPU now, buy bitcoins instead, and pray for them to go up in value.

With 1200 65GH/s Avalon machines on their way, not including ASICMiner and BFL machines, you are going to be in trouble.

Your problem is your profitability is going to decline by waaaay more that 60%. More like 98% or so.
You need to take into account:
- The 600 65GH/s Avalon machines that will be shipping in batch 2 any day now
- The 600 65GH/s machines from Avalon batch 3.
- The 200 TH/s that ASICMiner says they will add in the next 2-3 months
- The 60,000 plus Butterfly Labs pre-orders, which should add another 200-300 TH.
- The hundreds of thousands of Avalon discrete 282 MH/s chips that are being sold.

Difficulty will easily be in the hundreds of millions in the next 6 months.

How do you figure this?

I'm putting in 50 million for the difficulty, and assuming a GPU that does 750MH/s and costs $300. I put 250W power consumption and the default of 0.15 cents/KWh. I used $115 for the btc rate. Let's see that device will break even... NEVER according to the calculator. You lose money just running it.
Even if your electricity is free, it will still take a year to pay for itself, and in a year the difficulty will be more like 500 million, not 50 million.

maybe not even a DDOS, it's not that bad, just a little slow right now.

Except the government didn't, and still doesn't consider Bitcoin to be a "currency". It's digital property, and MtGox lets you buy and sell it. MtGox broke no laws here.

Try looking at the specs that Avalon has been releasing?

It's relevant to bitcoin because Amazon is trying to capitalize on the success of bitcoin with this marketing trick. People out there who don't know anything about bitcoin are likely to think that Amazon coin is a competitor.

I've managed to accumulate almost 1000 coins using only Dwolla. I wasn't even aware there was a Dwolla limit. I transfered $5000 chunks to MtGox more than once with Dwolla.

As to not to compete with Amagimetals, I am thinking of focusing on products that they do not seem to carry such as Austrian Philharmonics, Chinese Pandas, Credit Suisse bars, and gold bars in larger sizes such as 10 oz and 1 kg. Escrow would also be an option for those who want it. Prices would be in the same range as Amagimetals and much cheaper than coinabul. I already have a collection that I am currently getting rid of so I might start there. I'm trying to gauge interest right now. Is there a desire out there for people who wish to buy gold/silver with their bitcoin?

I always had a good experience using them. Most of threads where people claimed to lose money were delayed orders that were eventually resolved by coinabul. I don't recall ever seeing a situation were someone didn't get their gold or their money back. Many of the delays were due to people ordering internationally. Now that they are gone, I might start using Amagimetals.

Gold's intrinsic value is a very tiny fraction of it's market price. It's actual use in industry is very limited and if you go by that it is tens of thousands of times over valued. It also takes very little gold to plate a wire or a pane of glass which is one of it's main uses.

The intrinsic value argument doesn't fly with gold. Gold's value is purely subjective.