I own a rather large quantity of GIGAMINING bonds, and watching them depreciate over the last few weeks has been rather painful. That being said, I think they're a hell of a bargain right now and I have considerable faith in the fact that they're worth considerably more than their current valuation on GLBSE.
The last round of dividend payments was 0.013075 BTC/bond or 2.14% of their 0.61 BTC/bond valuation. Each bond pays out earnings from 5MH/s of mining power.
The upgrade program, to TERAMINING, will cost 0.29 BTC on top of the current 0.61 BTC/bond cost, though you will receive 4 x 22.5 MH/s bonds for your investment.
That's 90 MH/s for 0.9 BTC vs. 5 MH/s for 0.61 BTC, today. In other words, you'll be getting (90/5) x (0.61/0.9) = 12.2x more hashing power for your investment if you choose to upgrade.
So, the question is, will the difficulty stay low enough (and will Gigavps get the hardware fast enough) to actually realize a 12.2 x 2.14% = 26.1% weekly dividend return on your investment, post-upgrade? Definitely not, but how high will the difficulty have to go before the benefits of the upgrade are negated?
The last dividend payout was for a difficulty of 2.7 million. What if difficulty hits 10 million? And if we throw in a consideration for the reward halving (pseudo-difficulty of 20 million)? Even in that situation, you'll still realize 12.2 / (20 / 2.7) = 1.647x the current GIGAMINING dividend payouts, meaning GIGAMINING bonds should be worth 0.61 x 1.647 = 1 BTC well into 2013.
Perhaps someone could try to speculate on how long it will take the difficulty to hit 10 million to gain a further appreciation for the true worth of GIGAMINING bonds?
Edit:
here's an analysis that speculates ASICs will drive difficulty to 15,336,055 (or a pseudo-difficulty of 30,672,110 taking into account the reward halving). If that turns out to be the case, then GIGAMINING bonds should currently be worth 12.2 / (30.672 / 2.7) = 1.07 x 0.61 = 0.65 BTC, which is pretty close to what they are right now.
Interesting.
