ASICMINER Speculation Thread

[juandiegon]

I believe they are overvalued too.

At 4.75 a share, the market capital would be BTC1.900.000 , considering there are about 11 million bitcoins this would have ASICMINER be worth 17% of all bitcoins.

[empoweoqwj]

I'm 100% ready to be flamed, but at current price I actually believe AM to be overvalued by at least 50%

Can't be arsed to flame you, I'll just use the ignore button. I read you in the AMC discussions. You initially made some good points, but unfortunately repeated them 100 times. You don't even own any AM shares or plan to own any so I can only think on one reason you are sTROLLing in here.

[tinus42]

I believe they are overvalued too.

At 4.75 a share, the market capital would be BTC1.900.000 , considering there are about 11 million bitcoins this would have ASICMINER be worth 17% of all bitcoins.

They mine 10-20% of all bitcoins.

[binaryFate]

I believe they are overvalued too.

At 4.75 a share, the market capital would be BTC1.900.000 , considering there are about 11 million bitcoins this would have ASICMINER be worth 17% of all bitcoins.

The same argument again and again. See here for the last time it was explained why it is flawed:
https://bitcointalk.org/index.php?topic=99497.msg2625069#msg2625069

[Eric Muyser]

I believe they are overvalued too.

At 4.75 a share, the market capital would be BTC1.900.000 , considering there are about 11 million bitcoins this would have ASICMINER be worth 17% of all bitcoins.

Sigh, another person who doesn't understand valuation.

If you take the total valuation of all BTC stocks, it greatly exceeds the total amount of bitcoins in existence. If you tried to sell every stock that exists, right now, for the current bid, you would need over 100 million bitcoins to purchase them.

Furthermore, I could see us bitcoin users investing 17% of all BTC in AM right now. It's the stock to be in. There isn't though. Friedcat holds half, created out of thin air for 0 BTC, and the rest were purchased at 0.1 BTC at IPO, some up to 2.5, most around 2.5 BTC, and some up to 4.75 BTC. Lets say half were the IPO, and half 2.5, that's like 10,000 BTC + 250,000 BTC. Not much has actually been spent on AM, thus it can easily drop as supply and demand adjusts, and it can go up or down in valuation to basically any number. If 17% of all bitcoins were actually spent on AM, it would probably have a valuation exceeding the total of all bitcoins. The reason we would do this is basically just that we value the returns at this time more than using the bitcoins themselves, which is true for many people (most people hoard BTC, they don't spend them). If there was a 100% liquidation, as people cash them out, the valuation would adjust downward into nothing, going back to what was actually spent on them in many cases, or even lower. So really, the valuation means nothing as far as investment goes, and thus should not be used to determine overvalue/undervalue.

[velacreations]

The value of AM depends a lot on the dividends.  If they go back to the realm of .03-.04, the share price would go up considerably.  Personally, I think 30% is an appropriate rate for the amount of risk/etc, because there are other options for investing BTC below 30% that may be safer.

At a .02 btc dividend (1.04 /yr), and 30% APR, share price is 3.5 btc
At a .03 btc dividend (1.56 /yr), and 30% APR, share price is 5.2 btc
At a .04 btc dividend (2.08 /yr), and 30% APR, share price is 6.9 btc

I expect stabilization around 5 btc and .03 btc/week for the next few weeks.

[velacreations]

seriously, no one wants to buy asicminer.us?  I am not selling it for a lot, guys: https://bitcointalk.org/index.php?topic=246014

[juandiegon]

If you take the total valuation of all BTC stocks, it greatly exceeds the total amount of bitcoins in existence. If you tried to sell every stock that exists, right now, for the current bid, you would need over 100 million bitcoins to purchase them.

That's what you would call a bubble

[Eric Muyser]

The value of AM depends a lot on the dividends.  If they go back to the realm of .03-.04, the share price would go up considerably.  Personally, I think 30% is an appropriate rate for the amount of risk/etc, because there are other options for investing BTC below 30% that may be safer.

At a .02 btc dividend (1.04 /yr), and 30% APR, share price is 3.5 btc
At a .03 btc dividend (1.56 /yr), and 30% APR, share price is 5.2 btc
At a .04 btc dividend (2.08 /yr), and 30% APR, share price is 6.9 btc

I expect stabilization around 5 btc and .03 btc/week for the next few weeks.

Nice but over time you will notice people are more and more willing to accept lower APR from AM. It's heading into blue-chip territory. In 6 months I expect 0.03 is common-place and AM is so trusted that 10-15% APR is acceptable, giving us a value somewhere between 11 and 16 BTC.

That theory is dependant on continued, consistent 0.02 dividends, an increase to 0.03 (based on the 800TH-1000TH plan), future competitors continuing to delay/take a dump, and BTC not going to the moon (hard to explain, but it's important BTC stays around 100-200), and nothing substantially safer/profitable showing up (unlikely to have both characteristics).

[Eric Muyser]

If you take the total valuation of all BTC stocks, it greatly exceeds the total amount of bitcoins in existence. If you tried to sell every stock that exists, right now, for the current bid, you would need over 100 million bitcoins to purchase them.

That's what you would call a bubble

No different than real life. The dollars in your bank are only worth something until you try to claim too many of them.

[binaryFate]

If you take the total valuation of all BTC stocks, it greatly exceeds the total amount of bitcoins in existence. If you tried to sell every stock that exists, right now, for the current bid, you would need over 100 million bitcoins to purchase them.

That's what you would call a bubble

No different than real life. The dollars in your bank are only worth something until you try to claim too many of them.

Or any market with low liquidity. Think of real estate: if you put on sell half of a country houses, price will plummet and be nothing like the value assumed under "normal conditions", that is, when there is relatively little to sell compared to the overall quantity in existence.

[velacreations]

Nice but over time you will notice people are more and more willing to accept lower APR from AM. It's heading into blue-chip territory. In 6 months I expect 0.03 is common-place and AM is so trusted that 10-15% APR is acceptable, giving us a value somewhere between 11 and 16 BTC.

That theory is dependant on continued, consistent 0.02 dividends, an increase to 0.03 (based on the 800TH-1000TH plan), future competitors continuing to delay/take a dump, and BTC not going to the moon (hard to explain, but it's important BTC stays around 100-200), and nothing substantially safer/profitable showing up (unlikely to have both characteristics).

yes, I agree, but right now, 30% seems to be the line, maybe 25%.  I predict a dividend close to .03 for a while, maybe as high as .035, so I think 5 btc is a fair value right now.

[blackreplica]

I too disagree with a valuation of AM based on BTC market cap vs total number of coins in existence. Neither metric has much to do with the worth of the company itself

I take a dividend yield approach but I personally do not think that for the forseeable future, an investor would accept 10-15% yield as acceptable. The reason simply being that bitcoin itself (rather than AM, the company) is too risky for an investor to accept anything less than 20% (I'm more in favour of using the coinlender rate as a baseline, which is already higher at arguably less risk)

I posted earlier about something which bears repeating. Even on the most bullish of my estimates, (based on 0.03 sustained dividend and acceptable yield of 20%)...the absolute maximum price I can see AM is at 7.3 BTC per. On a more conservative premise I was predicting a maximum reasonable price of 5.3 per, though we could exceed this price in the short term.

I have ask walls set up between 5+ to 7+ and I sincerely hope I never see my shares sold because I do enjoy the dividends and the last thing I want to see is an AM bubble like we had with BTC not so long ago

[empoweoqwj]

I too disagree with a valuation of AM based on BTC market cap vs total number of coins in existence. Neither metric has much to do with the worth of the company itself

I take a dividend yield approach but I personally do not think that for the forseeable future, an investor would accept 10-15% yield as acceptable. The reason simply being that bitcoin itself (rather than AM, the company) is too risky for an investor to accept anything less than 20% (I'm more in favour of using the coinlender rate as a baseline, which is already higher at arguably less risk)

I posted earlier about something which bears repeating. Even on the most bullish of my estimates, (based on 0.03 sustained dividend and acceptable yield of 20%)...the absolute maximum price I can see AM is at 7.3 BTC per. On more conservative premises I was predicting a maximum reasonable price of 5.3 per, though we could exceed this price in the short term.

I think 5-6 BTC/share is what we can expect if AM continue to outperform their competitors. But I expect the price to bubble higher than that. Everyone's looking for the "next big thing", and since BTC itself looks as though it could slide to $80 or below, people are keen to increase their BTC holdings. Nothing like healthy dividends over the next 6 months to persuade people this is the right place to be.

[empoweoqwj]

I have ask walls set up between 5+ to 7+ and I sincerely hope I never see my shares sold because I do enjoy the dividends and the last thing I want to see is an AM bubble like we had with BTC not so long ago

If you are putting your shares up for sale between 5 and 7, then I predict you will sell a lot of shares. Will reduce your dividends a bit, but you'll probably be able to buy the shares back in a few months, and that will more than make up for the loss of dividends.

As with all things bitcoin, "we'll see" accurate predictions are almost impossible to come across. There was nobody predicting a 4+ BTC price when I bought at 2.5, people were saying it was "expensive" and there was a big wall there. Poppycock.

[Eric Muyser]

I too disagree with a valuation of AM based on BTC market cap vs total number of coins in existence. Neither metric has much to do with the worth of the company itself

I take a dividend yield approach but I personally do not think that for the forseeable future, an investor would accept 10-15% yield as acceptable. The reason simply being that bitcoin itself (rather than AM, the company) is too risky for an investor to accept anything less than 20% (I'm more in favour of using the coinlender rate as a baseline, which is already higher at arguably less risk)

Many people are risking already, just leaving their bitcoin in their wallet because they're waiting for BTC to hit 500, 1000, or 10000. If they have it sitting there, 15% is enough incentive to lose the ability to cash it into FIAT instantly, so long as they believe in the long-term growth of bitcoin. That's why we saw AM drop 0.3 in price the first time BTC crashed, but barely as much thereafter.

That's my approach. I hate cashing out into FIAT because I may miss that critical moment when/if bitcoin goes supernova. If I can gamble and let the good times roll at the same time (15% is good times) I'm pretty stoked personally.

[CMMPro]

With Jutarul's auction of 1000@4.5 today anchoring the price I think it will stay at 4.5 for the next week...I'm happy with the possible stability resulting from this.  

If the wall get's eaten in a day or two...hold on for the ride because we are going up up up.

[Eric Muyser]

With Jutarul's auction of 1000@4.5 today anchoring the price I think it will stay at 4.5 for the next week...I'm happy with the possible stability resulting from this.  

If the wall get's eaten in a day or two...hold on for the ride because we are going up up up.

Pending 0.04 dividend, get ready for a ride

[velacreations]

he should have set the price at the 24 hr high, I hate it when he holds the price down like this.

[Eric Muyser]

he should have set the price at the 24 hr high, I hate it when he holds the price down like this.

It's for the best bro. It will satisfy the bubble fear mongering.