[Proposal] Mining Co-Op

[armedmilitia]

I'll be legitimately surprised if the SP50 comes in under $50K each. Buying 22x S7 to get the same hashrate would cost you over $40K, plus PSUs, plus the premium of having about 40% lower power consumption and, if it's like everything else SP has ever released, undervoltability (but this is very questionable given the released specs). $50-60k seems about right, which puts the 1MW cost around $3M.

Maybe, but from my chat with SP it looks like we'll only be buying them in a couple of months, there's no way we're a high priority customer. The difficulty will be higher, Avalon's new miners might be popping up, and bitmain will probably have lowered their prices by then, so the SP50 price could come down significantly.

I had a similar email from spondoolies. So Im looking to buy some BTCS stocks  

Only 0,14$ We could than write to them that we are shareholder.

From the email I got:

...initially intend to discuss purchases of the SP50 with certain significant shareholders...

I don't think $0.14 worth of holdings makes us a "significant" shareholder, haha!

With an investment that, large 10+ Sp50's, I think it would be worth while to form an LLC or S-corp... for protections on both ends before and after the purchase but thats just my 2 cents

Yes, I agree there should be a legal framework at that point. I know only the basics about that stuff, I'll have to do some research if it gets to that.

[1714660588]

1714660588

[valkir]

What I mean with 0.14$ is that the stock is 0.14$. We could bough way more than 1. 

[Dr Charles]

With an investment that, large 10+ Sp50's, I think it would be worth while to form an LLC or S-corp... for protections on both ends before and after the purchase but thats just my 2 cents

Yes, I agree there should be a legal framework at that point. I know only the basics about that stuff, I'll have to do some research if it gets to that.

Well I would be happy to help if it gets to that point. Got a business degree and experience in multi-branch operations management.

[armedmilitia]

What I mean with 0.14$ is that the stock is 0.14$. We could bough way more than 1. 

Personally I find it a bit risky to invest a large sum of cash in a company for the sole purpose of trying to jump ahead in line. I'm not sure how successful it would be either. If you think it's a good buy though, by all means go ahead.

Well I would be happy to help if it gets to that point. Got a business degree and experience in multi-branch operations management.

It would be great to have that expertise on board, thanks! I will be contacting you if/when this gets bigger.

[Searing]

I just got a very personal (definitely not a form letter) response from Spondoolies.  

Thank you for your email and your interest in the SP50. We are excited and proud to unveil our next generation machine as a breakthrough product for industrial mining.

With its extremely low power consumption and modular design the SP50 has been specifically designed for maximum power efficiency and ease of management.

Initially the SP50 will be offered in limited quantities only to a select group of customers. Due to the limited anticipated supply and overwhelming interest we initially intend to discuss purchases of the SP50 with certain significant shareholders, although this is not a requirement for purchase. If you have funding and are interested in a bulk purchase please reply to this email and let us know. If you are a BTCS shareholder please let us know that as well. Preference will be given to existing bulk customers and well-funded projects.

As we scale up production we hope to offer the SP50 to a wider market. At that time we will publish pricing and shipping terms as well as warranty information.

We thank you for your interest in the SP50 and look forward to working with you.

Since we aren't funded yet and ready to pull the trigger, it looks like we'll have to wait for wider availability. This might be a good thing, buying a little later would allow us to see whether or not the SP50 is a steaming turd (No offense Spondoolies, but you never know!)

Also:
I did some reading on stackoverflow on how to actually use multisig, it's a little nitty gritty (done on the command line) but well within my capabilities. I also may end up using armory as I've heard there is a good multisig implementation there. Of course, we'll do some test transactions before we start piling money into the address! The best part is that you can generate multisig addresses without needing to trust the person doing the generation--that means I can set it up without actually having full control over it! I think a 4/6 setup would work best, it minimizes risk of keys being lost (and freezing funds forever!) while also being fairly secure from members conspiring to run with the funds.

Phillip would be a great candidate to hold one of those keys. Personally, I think valkir would be good too. Maybe even me as well.  

I read this as ...we are gonna fill out our data hall first...then we MAY get to you on some units IF you buy a shitload of them to make it worth our while...assuming we have any left

(hey I'm just cynical since home mining btc is over for me at 13.5c kwh and 100 amp panel ...I feel soooooo small)

[GreatNorthData]

Well, that's quite the stretch goal!

61 SP50s (6.7PH/1MW) calls for quite a bit of cash. Some napkin math and price guesses probably puts the total upfront payment over 2M USD. I don't think our pockets go that deep, but who knows.

Regardless, the more you show up with the cheaper hosting will be.

[armedmilitia]

I read this as ...we are gonna fill out our data hall first...then we MAY get to you on some units IF you buy a shitload of them to make it worth our while...assuming we have any left

(hey I'm just cynical since home mining btc is over for me at 13.5c kwh and 100 amp panel ...I feel soooooo small)

Me too.
However, it also seems like they will end up selling to the general public in a few months--and from there we can negotiate a bulk buy. Luckily, there's no pressure to start collecting funds now, so we can afford to wait until the moment is right.

[notlist3d]

With an investment that, large 10+ Sp50's, I think it would be worth while to form an LLC or S-corp... for protections on both ends before and after the purchase but thats just my 2 cents

And personally, I wouldnt touch the BTCS stock, at least not yet. BTCS has been operating at a loss since day one. Although, year over year they have managed to diminish the total deficit/year operating loss... it is still far from a profitable holding.

There are a few forms LLC or S-corp types.   Some require board meetings.  If we made a min investment to join, we could have a "board" and decide business through it.  With skype we would be able to do it online even.

I think the main thing is finding cheap electricity location.  If we can do our own location  I think we can get the lowest possible price, no middle man.  Just the CO-OP owning it.

I honestly hope something like this happens

[Dr Charles]

With an investment that, large 10+ Sp50's, I think it would be worth while to form an LLC or S-corp... for protections on both ends before and after the purchase but thats just my 2 cents

And personally, I wouldnt touch the BTCS stock, at least not yet. BTCS has been operating at a loss since day one. Although, year over year they have managed to diminish the total deficit/year operating loss... it is still far from a profitable holding.

There are a few forms LLC or S-corp types.   Some require board meetings.  If we made a min investment to join, we could have a "board" and decide business through it.  With skype we would be able to do it online even.

I think the main thing is finding cheap electricity location.  If we can do our own location  I think we can get the lowest possible price, no middle man.  Just the CO-OP owning it.

I honestly hope something like this happens

I think it would be the best way to handle a venture like the proposed Co-op.

[varakunai]

I would be in for an investment pending the setup and hw pricing.  Was looking at buy an SP50 for my farm, but would love to get lower than .075 electricity like I have now. 

[notlist3d]

I would be in for an investment pending the setup and hw pricing.  Was looking at buy an SP50 for my farm, but would love to get lower than .075 electricity like I have now. 

The thing with the CO-OP I think if we go out and find cheap electricity for it we could easily beat that.   I would hope .03-.04 would be my goal range for the mining CO-OP to be able to compete with the "big guys".

Finding the right place for electricity and setting that  up would be a big part of the initial setup period.

[armedmilitia]

The thing with the CO-OP I think if we go out and find cheap electricity for it we could easily beat that.   I would hope .03-.04 would be my goal range for the mining CO-OP to be able to compete with the "big guys".

Finding the right place for electricity and setting that  up would be a big part of the initial setup period.

A lot more risks come into play if we decide to build our own datacenter. We'd need to hire dedicated support staff and provide an absolutely massive upfront investment. It will take far longer to get from planning --> funding --> hashing. Remember, our quoted hosting rate includes not only electricity, but dedicated staff and space in the datacenter as well.

For that reason I think we should outsource our hosting--although we don't win on cost, it greatly lowers risk (its hard for someone to run with the funds), and greatly increases transparency.

I say we keep it as simple as possible.

[torepia]

The thing with the CO-OP I think if we go out and find cheap electricity for it we could easily beat that.   I would hope .03-.04 would be my goal range for the mining CO-OP to be able to compete with the "big guys".

Finding the right place for electricity and setting that  up would be a big part of the initial setup period.

A lot more risks come into play if we decide to build our own datacenter. We'd need to hire dedicated support staff and provide an absolutely massive upfront investment. It will take far longer to get from planning --> funding --> hashing. Remember, our quoted hosting rate includes not only electricity, but dedicated staff and space in the datacenter as well.

For that reason I think we should outsource our hosting--although we don't win on cost, it greatly lowers risk (its hard for someone to run with the funds), and greatly increases transparency.

I say we keep it as simple as possible.

I agree, kinda. It's good that it includes rack space, management and cooling. Probably save a couple of watts on cooling that makes up for the "higher" kwh/$.

But, if we could get community members to host it at a better hosting price, I'm all for it!
Ex: Guys like dmwardjr got 36k W available for mining at home

[notlist3d]

The thing with the CO-OP I think if we go out and find cheap electricity for it we could easily beat that.   I would hope .03-.04 would be my goal range for the mining CO-OP to be able to compete with the "big guys".

Finding the right place for electricity and setting that  up would be a big part of the initial setup period.

A lot more risks come into play if we decide to build our own datacenter. We'd need to hire dedicated support staff and provide an absolutely massive upfront investment. It will take far longer to get from planning --> funding --> hashing. Remember, our quoted hosting rate includes not only electricity, but dedicated staff and space in the datacenter as well.

For that reason I think we should outsource our hosting--although we don't win on cost, it greatly lowers risk (its hard for someone to run with the funds), and greatly increases transparency.

I say we keep it as simple as possible.

I agree, kinda. It's good that it includes rack space, management and cooling. Probably save a couple of watts on cooling that makes up for the "higher" kwh/$.

But, if we could get community members to host it at a better hosting price, I'm all for it!
Ex: Guys like dmwardjr got 36k W available for mining at home

I think we could get most of the skills needed to set it up.  I think initial investment would not be horrible if we can find a place that rents in a area of low electricity.  I could be wrong but I think going with a data center we will pay twice the electricity price we could get.  I would hope we could find a place close to a member or two, but that could be wishful thinking.  But it would be a heck of a lot easier I agree with that.

I don't see it really being a CO-OP if we use a data center though.  That is something any of us could do now. CO-OP: a business or organization that is owned and operated by the people who work there or the people who use its services.

Are there any data centers in US you are looking at?  A lot of data centers are going to have a VAT in other countries.  Does the one your looking at have a vat to get miners sent there?

[GreatNorthData]

I think we could get most of the skills needed to set it up.  I think initial investment would not be horrible if we can find a place that rents in a area of low electricity.  I could be wrong but I think going with a data center we will pay twice the electricity price we could get.  I would hope we could find a place close to a member or two, but that could be wishful thinking.  But it would be a heck of a lot easier I agree with that.

I don't see it really being a CO-OP if we use a data center though.  That is something any of us could do now. CO-OP: a business or organization that is owned and operated by the people who work there or the people who use its services.

Are there any data centers in US you are looking at?  A lot of data centers are going to have a VAT in other countries.  Does the one your looking at have a vat to get miners sent there?

Duty (VAT) entering Canada is 5%, otherwise taxes are included in our fees. And if you register as a business in Canada, you'll get the VAT back on your taxes as Canadian businesses get refunded any VAT they spend. (Offset by any you collect, which would be none as mining won't normally result in any HST collection.)

And its not just electricity you need. Each cent per kWh is $7.50, roughly, a month. You need a rental space, insurance, maintenance, gas etc. Say you do 100kW of demand. Rent is easily going to be $2000 or $3000 a month. Take the lower number, and that's almost 3 cents/kWh by itself, before electricity. If you could find a spot to rent for super cheap, go for it, but I don't think you're going to find a decent electrical hook up for cheap. (Especially with legalized marijuana, grow ops compete with bitcoin mines in some states for power.)

Whoever is going to service it is also going to expect to get paid and have their gas and expenses reimbursed. Throw in insurance and all the things that could go wrong, like leaks or building security issues.

You'll find electricity is actually less than all the other costs of running a data centre on the scale you're considering. Run your own numbers, but I doubt you'd be able to bring 100kW online for less than our prices, unless someone in the group buy has that kind of power and is willing to give you a sweetheart deal on rent.

That being said, don't let me stop you guys if that's the direction you want to go. It just appears you're all serious, so I thought I'd jump back in. Our hosting would come with maintenance and 24/7 staff onsite.

[HerbPean]

Talked with Valkir during the weekend. (Very cool guy btw)

I might be interested to join you guys if you can settled a deal. (SP50 would be great)

I will be following the thread.

Herb

[torepia]

GND has a decent price. For comparison, I work at 2MW datacenter. The price for hosting a sp50 would be around 400$ a month just in rack-space, + electricity + inet + mgmt ++(And of course 25% VAT).

GND: Does the price include management of the miners?

[GreatNorthData]

GND: Does the price include management of the miners?

Yes

[armedmilitia]

I might be interested to join you guys if you can settled a deal. (SP50 would be great)

Awesome. The more the merrier!

[valkir]

Armed, any update from spondoolie ?