here's just how screwed ASIC buyers are - READ THIS if you have a preorder

[Richy_T]

Far from it. The point is to isolate mining with the prototype devices to prevent network disruptions (in total hash rate, difficulty, and profitability). If it was discovered the any of the companies were profiting on their own product, it wouldn't make the community very happy, including their investors. It's a terrible business model.

The same applies to the drug trade...don't use your own product

Well, they wouldn't profit as they'd be passing it on to their customers. It might also count as a bit of reassurance : "This device generated x bitcoins in y minutes". Not that I mind either way as I'm not going ASIC, it just seems a shame to waste energy (assuming all other things equal)

[scrybe]

Sure I believe them. Especially BFL. Come on, don't be naive. What stops any manufacturer from mining for themselves and ignore it is them?

Just wondering. Hypothetically, an ASIC manufacturer could mine with prototypes themselves (or have it done by an accomplice) and blame the increase in difficulty on another manufacturer.

Like to quote yourself much?

Of course the answer in reality in a physical sense is nothing can be done to stop it, but you should ask instead why would they?

OTOH, if you run BFL and your investors come and take the company you built away because you violated their trust and the trust of your customers, you might regret the decision to voilate that trust.

BFL is not 2 guys sitting in a basement somewhere. There are real business agreements, salaries, leases, and other things ties up in running a business than you seem to acknowledge. There are real world obligations and long term opportunities for these businesses to continue serving a community for quite a white, or get acquired by someone if it starts amounting to more than chump change. Contrary to what some would have you believe, BFL keeps investing and appears to be in this for the long haul. CablePair and ngzhang are similarly trying to grow a stable business. Unlike a scam, these businesses must continue to build trust and keep customers coming back.

In case it had not occurred to you, the ~180TH/s that has been sold so far is a drop in the bucket compared to the market available for ASIC. We should see 1-2 Petahash/s sold over the next 12-18 months. 90% of the ASIC profits for this period are still up for grabs, why bow out now!?

[scrybe]

Far from it. The point is to isolate mining with the prototype devices to prevent network disruptions (in total hash rate, difficulty, and profitability). If it was discovered the any of the companies were profiting on their own product, it wouldn't make the community very happy, including their investors. It's a terrible business model.

The same applies to the drug trade...don't use your own product

Well, they wouldn't profit as they'd be passing it on to their customers. It might also count as a bit of reassurance : "This device generated x bitcoins in y minutes". Not that I mind either way as I'm not going ASIC, it just seems a shame to waste energy (assuming all other things equal)

It's a nice idea, but it should have been conceived of, communicated, and articulated in the plan up-front. What you refer to may happen as a promotional thing in the future, but at this point everyone is all "shut up and take my money" so why put all that extra effort into some (very) fancy coupons? When you have a business venture growing at a massive rate the last thing you want to do is add any complications that are not absolutely needed.

I'm going to be burning 1-2Gh/W compared to .01Gh/1W with an FPGA single. This is wasteful?

Of course, all other things are not equal, every miner helps add to the security of the network which is why it pays in proportion with the contribution. Contribute less security, get less Bitcoin.

If you want to be green, decide on a wattage that you are willing to donate to bitcoin, and pay for carbon offsets to match that wattage. Every 3, 6 or 12 months buy the gear with the best GH/W rating that fits in your wattage allowance (and get some extra carbon credits for the manufacturing cost offset)

Personally this is too much trouble for me, so I'm replacing a standard light bulb with a florescent or LED bulb for every 10Gh and calling it even.

[Richy_T]

I'm going to be burning 1-2Gh/W compared to .01Gh/1W with an FPGA single. This is wasteful?

Sorry, that was a little ambiguous. I mean that running against testnet is wasteful (assuming that you are reasonably confident that your operations will be valid).

[deeplink]

Sure I believe them. Especially BFL. Come on, don't be naive. What stops any manufacturer from mining for themselves and ignore it is them?

Just wondering. Hypothetically, an ASIC manufacturer could mine with prototypes themselves (or have it done by an accomplice) and blame the increase in difficulty on another manufacturer.

Of course the answer in reality in a physical sense is nothing can be done to stop it, but you should ask instead why would they?

OTOH, if you run BFL and your investors come and take the company you built away because you violated their trust and the trust of your customers, you might regret the decision to voilate that trust.

So trust from their customers and not wanting to violate that trust prevents an ASIC manufacturer from mining for themselves is what you are saying?

BFL is not 2 guys sitting in a basement somewhere. There are real business agreements, salaries, leases, and other things ties up in running a business than you seem to acknowledge. There are real world obligations and long term opportunities for these businesses to continue serving a community for quite a white, or get acquired by someone if it starts amounting to more than chump change. Contrary to what some would have you believe, BFL keeps investing and appears to be in this for the long haul. CablePair and ngzhang are similarly trying to grow a stable business. Unlike a scam, these businesses must continue to build trust and keep customers coming back.

In case it had not occurred to you, the ~180TH/s that has been sold so far is a drop in the bucket compared to the market available for ASIC. We should see 1-2 Petahash/s sold over the next 12-18 months. 90% of the ASIC profits for this period are still up for grabs, why bow out now!?

Your opinion is that ASIC manufacturing is very profitable long into the future (To me it is just one possible scenario). Combined with the first point you are saying that an ASIC manufacturer does not want to risk its own business and potential future profits by violating trust of its customers.

That is absolutely a valid point. Mine is that corruption is also possible and I find it likely to happen when large additional profits can be made and chances to get caught are almost zero.

[scrybe]

That is absolutely a valid point. Mine is that corruption is also possible and I find it likely to happen when large additional profits can be made and chances to get caught are almost zero.

You have to be joking... If they mine enough to matter, someone will notice. Both the risk of getting caught and the consequences of doing so are more significant than you seem to realize.

Fine, let's game this out:
They are making millions of dollars worth of mining equipment, so to match risking that they would need a hefty profit, at least in the $100k range. So they get a couple MiniRig-SC units assembled, and decide to run them for a couple weeks to make an extra $173k (based on current info, no hardware cost) and then ship them out for an additional $30k each for a total of $233k from 2 rigs. The problem is that the 2 minirigs just generated 3TH/s for 2 weeks, impacting the difficulty by 10%. This means that the (say) 20 minirigs that ship out are only making 90% of what they should have if you had not stolen from your customers. Unless you think that Josh can keep his mouth shut forever, eventually someone would leak, or the 4x size of EMC would show and folks would cry foul. Every customer then joins a class action lawsuit and sues you into oblivion, or you get to live the live of a fugitive with $170k.

If you make the reward bigger, the detectability goes up, and if you lower it to a couple singles it's an inconsequential amount of money. In any case it is not worth the prison time. Why risk millions (and a long term opportunity) for thousands (and a lack of long term options?)

You keep asking for reasons why not and I keep giving them. Maybe you should refocus on the why would they part of the equation more.

When dealing with a guy running a financial trading house from his basement, the risk of vanishing deposits is high, when you have a known brick and mortar business the risk is a lot lower and you generally have more ways to get relief or detect problems.

[SgtSpike]

That is absolutely a valid point. Mine is that corruption is also possible and I find it likely to happen when large additional profits can be made and chances to get caught are almost zero.

You have to be joking... If they mine enough to matter, someone will notice. Both the risk of getting caught and the consequences of doing so are more significant than you seem to realize.

Fine, let's game this out:
They are making millions of dollars worth of mining equipment, so to match risking that they would need a hefty profit, at least in the $100k range. So they get a couple MiniRig-SC units assembled, and decide to run them for a couple weeks to make an extra $173k (based on current info, no hardware cost) and then ship them out for an additional $30k each for a total of $233k from 2 rigs. The problem is that the 2 minirigs just generated 3TH/s for 2 weeks, impacting the difficulty by 10%. This means that the (say) 20 minirigs that ship out are only making 90% of what they should have if you had not stolen from your customers. Unless you think that Josh can keep his mouth shut forever, eventually someone would leak, or the 4x size of EMC would show and folks would cry foul. Every customer then joins a class action lawsuit and sues you into oblivion, or you get to live the live of a fugitive with $170k.

If you make the reward bigger, the detectability goes up, and if you lower it to a couple singles it's an inconsequential amount of money. In any case it is not worth the prison time. Why risk millions (and a long term opportunity) for thousands (and a lack of long term options?)

You keep asking for reasons why not and I keep giving them. Maybe you should refocus on the why would they part of the equation more.

When dealing with a guy running a financial trading house from his basement, the risk of vanishing deposits is high, when you have a known brick and mortar business the risk is a lot lower and you generally have more ways to get relief or detect problems.

+1... the people thinking that BFL will try to mine and not get caught are not fully thinking through the situation and consequences.

[hardcore-fs]

Mining is a function of Quality assurance.........

Since these manufacturers need (hopefully) to test the kit before it is sent out ,and a 1 hour burn in would be totally acceptable.
Personally We used to run 24 hour burn ins to remove 'bath tub failures' on lighting.

Unless they setup dummy  mining servers or utilise dummy back ends, it is feasible that they will 'impact' the generation of bit coins.

Now we could in theory use that 'meta-data' to see when they actually start manufacturing /shipping these rigs.


HC

[Frequency]

Mining is a function of Quality assurance.........

Since these manufacturers need (hopefully) to test the kit before it is sent out ,and a 1 hour burn in would be totally acceptable.
Personally We used to run 24 hour burn ins to remove 'bath tub failures' on lighting.

Unless they setup dummy  mining servers or utilise dummy back ends, it is feasible that they will 'impact' the generation of bit coins.

Now we could in theory use that 'meta-data' to see when they actually start manufacturing /shipping these rigs.


HC

Well there are no asic out there yet, but they will be shipping them nov/dec  mmm testing them for 4 weeks then ship them to customers they hang them on the net 24/7 and after 6 weeks they blow up then there super customer service will deliver a new one in few days??? yeah right dream on people...

[SgtSpike]

Here is a quick little representation of the mining income upon ASIC release.

The only assumptions are 2 BFL SC singles and a linear rate of difficulty adjustment per day. Not completely realistic but close.

This is an interesting chart... if this holds true, I stand to only make back 1/3 of my investment (relative to BTC, not USD) in this timeframe.

[mybitcoincharts]

Here is a quick little representation of the mining income upon ASIC release.

The only assumptions are 2 BFL SC singles and a linear rate of difficulty adjustment per day. Not completely realistic but close.

https://i.imgur.com/7u8sv.png

Another assumption is that you are up and running with your singles while the difficulty is still at <30TH/s What make you assume that you get your equipment on day one and not on day 30? (Honest question, perhaps BFL stated that they will ship everything on the same day or something similar, and I missed it).

[Cablez]

There should be plenty of units in the wild initially if BFL sticks to their 1/3 policy.  The real weak assumptions are just how fast everyone will get their units online and how the difficulty will react accordingly.

I did a similar chart with the 10x increase in difficulty spread to 60 days and the picture is much rosier.

[deeplink]

That is absolutely a valid point. Mine is that corruption is also possible and I find it likely to happen when large additional profits can be made and chances to get caught are almost zero.

You have to be joking... If they mine enough to matter, someone will notice. Both the risk of getting caught and the consequences of doing so are more significant than you seem to realize.

Fine, let's game this out:
They are making millions of dollars worth of mining equipment, so to match risking that they would need a hefty profit, at least in the $100k range. So they get a couple MiniRig-SC units assembled, and decide to run them for a couple weeks to make an extra $173k (based on current info, no hardware cost) and then ship them out for an additional $30k each for a total of $233k from 2 rigs. The problem is that the 2 minirigs just generated 3TH/s for 2 weeks, impacting the difficulty by 10%. This means that the (say) 20 minirigs that ship out are only making 90% of what they should have if you had not stolen from your customers. Unless you think that Josh can keep his mouth shut forever, eventually someone would leak, or the 4x size of EMC would show and folks would cry foul. Every customer then joins a class action lawsuit and sues you into oblivion, or you get to live the live of a fugitive with $170k.

If you make the reward bigger, the detectability goes up, and if you lower it to a couple singles it's an inconsequential amount of money. In any case it is not worth the prison time. Why risk millions (and a long term opportunity) for thousands (and a lack of long term options?)

You keep asking for reasons why not and I keep giving them. Maybe you should refocus on the why would they part of the equation more.

When dealing with a guy running a financial trading house from his basement, the risk of vanishing deposits is high, when you have a known brick and mortar business the risk is a lot lower and you generally have more ways to get relief or detect problems.

+1... the people thinking that BFL will try to mine and not get caught are not fully thinking through the situation and consequences.

I am not saying that BFL (or any other ASIC manufacturer as we are talking in general here) will mine.

It is speculation at this point and both scenario's are possible. No black and white outcome yet, it's all odds. We can and seem to disagree about how likely both possible scenario's are, but if you do not even want to consider the scenario in which they will mine themselves, I guess no argument can be made.

A good investor however should look at all possible outcomes.

[Richy_T]

A good investor however should look at all possible outcomes.

There's really no reason to think they'll use the ASICs to mine (for profit) any more than you'd expect your car dealer to take your car on a trip to Mexico before they deliver it to you.

[tvbcof]

A good investor however should look at all possible outcomes.

There's really no reason to think they'll use the ASICs to mine (for profit) any more than you'd expect your car dealer to take your car on a trip to Mexico before they deliver it to you.

The analogy would be a little more accurate if 'landspeeder' were substituted for 'car'.  I've seen no compelling evidence that custom Bitcoin mining ASIC chips currently exist in the real world at this time.  Admittedly though I have not looked very hard since I would not have even a potential interest in obtaining any until they are demonstrated.  I don't even follow the mining forum normally.

[molecular]

who hit rewind...

BFL, CablePair, Avalon have all publicly stated they will use testnet in a box.

That's just a waste of money. They should mine real BTC during the burn in but put them in a paper wallet they include in the box.

Far from it. The point is to isolate mining with the prototype devices to prevent network disruptions (in total hash rate, difficulty, and profitability). If it was discovered the any of the companies were profiting on their own product, it wouldn't make the community very happy, including their investors. It's a terrible business model.

The same applies to the drug trade...don't use your own product

but for totally different reasons.

[scrybe]

Mining is a function of Quality assurance.........

Since these manufacturers need (hopefully) to test the kit before it is sent out ,and a 1 hour burn in would be totally acceptable.
Personally We used to run 24 hour burn ins to remove 'bath tub failures' on lighting.

Unless they setup dummy  mining servers or utilise dummy back ends, it is feasible that they will 'impact' the generation of bit coins.

Now we could in theory use that 'meta-data' to see when they actually start manufacturing /shipping these rigs.


HC

FFS: They are all using TestNet In A Box!

Here's BFL's announcement:
https://forums.butterflylabs.com/showthread.php/52-ASIC-Pre-Shipment-Testing-Policy

Here is info about Testnet in a box:
https://bitcointalk.org/index.php?topic=4483.0

A good investor however should look at all possible outcomes.

WTF? We HAVE looked at it, I'm ignoring anything. We looked, we asked them, we got the answers, and we moved the heck on.

get another freaking topic already.

[Desolator]

There's a difference between claiming to use artificial testing methods and actually doing it.  Like someone said, they can mine on the main network and blame it on others.

[deeplink]

There's a difference between claiming to use artificial testing methods and actually doing it.  Like someone said, they can mine on the main network and blame it on others.

I said that and according to opinions here that is not at all possible, because.   I give up, reality is not welcome here.

[scrybe]

There's a difference between claiming to use artificial testing methods and actually doing it.  Like someone said, they can mine on the main network and blame it on others.

There is also a difference between a bait and switch scam, and a real legitimate business.

You are just saying "no, no, no, no" I'm adding more and more evidence to my side of the scale. Make an argument other than whining and I'll give it some real weight, but right now I see nothing you have said that is even slightly convincing.

Deeplink, I respect your opinion, as well as yours Desolator, you both can continue to believe that these guys are scams and can never get caught, but at this point the chances of that are less than that of Mitt Romney getting elected and declaring this the Peoples Republic of America.

There are thousands of eyes watching them, and employees working for them, if there is a breach in this policy, even the suspicion of violating their direct statements to us, and you know the size of fecal hurricane that will hit them. It will not require proof, only suspicion, I've been on this board long enough to see that!

This is business. If you piss off your customers, they fire you. Generally they get a lawyer and sue you if there is real money involved. If you think some of the guys buying multiple mini-rigs will hesitate to take BFL to court if they violate this, then you are nuts. I bet they get sued anyway even if they ship on time.

Go back to my previous post. If BFL mines enough to be worth the effort, it will skew the difficulty by at least 5-10% Anything less and they will make more money selling a dozen more singles. We have examined this issue and long ago passed the "they would be nuts to try, they know that, and they have stated they won't" point.

WTF do you want? Videographic proof of the birth of Jesus Christ? What is your standard of proof, or are you going to continue whining about this forever, no matter how much ASIC is manufactured?

If this is indicative of your risk assessment methodology, I recommend investing in a rock to hide under.