ASICMINER Speculation Thread

[ixne]

FC sees the potential in harnessing it for his own mining operations to improve efficiency. Because when it comes down to it, when the difficulty finally stabilizes, it will be the people who can make the most efficient miners that will drive the difficulty just high enough to the point they make a small profit.

Exactly right. When the dust settles, the number everyone will be paying attention to is hashes/watt. The fact that no one gets this now just amazes me, but then if there's anything bitcoin has taught me it's that it's impossible to underestimate people.

[jimmothy]

Why would hardware sales be temporary?  AM makes more on hardware than mining, and that's just the plain truth.  It makes no sense to mine with hardware when you get the prices AM has been getting.

Yes, cooling for franchising, that's what I am talking about.  Enterprise level, not personal miners.  The instant ASIC farm package.

Listen, if you can only scrape a small profit from mining, vs getting all of your mining profits paid to you up front (hardware), which are you going to do?

And developing services/solutions for the bigger operations is the logical next step.  

You are not understanding. FC is selling GEN1 hardware because it is not profitable to mine with as you have stated. Hardware sales are temporary as we know only 500th/s of gen1 will be sold. None more after that. Obviously maintaining ~2% of the current hashrate with old tech is not profitable and nobody claims it will be. But this hardware you claim AM will sell in the future, who will be buying it? If they don't make new gen chips there will definately be no more hardware sales, and if they do make next gen chips you can guarantee they will be solo-mining until it is no longer profitable and then they will begin hardware sales. This is exactly how it was done in the past and how it will most likely be done in the future unless specifically stated otherwise.

Also you need to understand that this franchising counts as AM solomining. Only the franchisers will be taking a small percentage to keep the operation running (they don't buy the asics just host them). AM will not be selling immersion cooled asic systems unless he says otherwise.

[velacreations]

But this hardware you claim AM will sell in the future, who will be buying it?

what makes the new gen any different from current gen?  there's even more competition for new gen, so you better believe that AM will sell that upfront, rather than mining from it.

It's not about current gen vs new gen, it's about profitability and risk.  And it doesn't matter what gen you have, higher profitability is through selling hardware. You get the money up front, rather than waiting for it to pay off.

If they don't make new gen chips there will definately be no more hardware sales, and if they do make next gen chips you can guarantee they will be solo-mining until it is no longer profitable and then they will begin hardware sales. This is exactly how it was done in the past and how it will most likely be done in the future unless specifically stated otherwise.

no, it wasn't done like that at all. 

hardware sales started early on, and mining was still very profitable, that's what gave AM such an advantage.  They had to sell hardware to be able to expand the mining operation.  They didn't wait for hardware to become unprofitable to start selling it.

They started selling hardware when they realized people would pay more than what AM could make mining with it in a reasonable amount of time.  It wasn't that mining was unprofitable (they are still making a profit on the farm, even today), it's that it is MORE profitable to get the cash upfront.

[jimmothy]

But this hardware you claim AM will sell in the future, who will be buying it?

what makes the new gen any different from current gen?  there's even more competition for new gen, so you better believe that AM will sell that upfront, rather than mining from it.

It's not about current gen vs new gen, it's about profitability and risk.  And it doesn't matter what gen you have, higher profitability is through selling hardware. You get the money up front, rather than waiting for it to pay off.

If they don't make new gen chips there will definately be no more hardware sales, and if they do make next gen chips you can guarantee they will be solo-mining until it is no longer profitable and then they will begin hardware sales. This is exactly how it was done in the past and how it will most likely be done in the future unless specifically stated otherwise.

no, it wasn't done like that at all. 

hardware sales started early on, and mining was still very profitable, that's what gave AM such an advantage.  They had to sell hardware to be able to expand the mining operation.  They didn't wait for hardware to become unprofitable to start selling it.

They started selling hardware when they realized people would pay more than what AM could make mining with it in a reasonable amount of time.  It wasn't that mining was unprofitable (they are still making a profit on the farm, even today), it's that it is MORE profitable to get the cash upfront.

You are literally saying the exact opposite of what actually happened... AM made a massive profit back in the days when they were the first and only people with working asics. at one point they had around 20% of the network hashrate. So you think that AM can make more money from selling hardware than mining? If they had and held 20% they would be making 1/5th of 7200 so 1440 btc per day. Lets assume AM is making cubes for dirt cheap and somehow has profits of up to 50% per cube (which is unlikely) then he would need to sell 1440 cubes per day or 50th/s per day.

FC started selling hardware the second BFL began shipping because the asic monopoly was broken.

[velacreations]

You are literally saying the exact opposite of what actually happened...

I was actually here and an investor during all of that.  I know exactly what happened.

AM made a massive profit back in the days when they were the first and only people with working asics. at one point they had around 20% of the network hashrate.

AM had more than 20% of the network (at one point, they made BTCGuild go over 51% for a short amount of time), and at that point, it was hard to deploy more, because the network wasn't growing fast enough.  And shortly thereafter, they started selling hardware.  

They paid the highest dividends EVER on hardware sales, not mining income.  Mining made up the majority of the dividend back then, but that changed very quickly, until now, the majority is hardware sales.

So you think that AM can make more money from selling hardware than mining? If they had and held 20% they would be making 1/5th of 7200 so 1440 btc per day. Lets assume AM is making cubes for dirt cheap and somehow has profits of up to 50% per cube (which is unlikely) then he would need to sell 1440 cubes per day or 50th/s per day.

One of the biggest complaints people have about AM hardware is that it never meets ROI, or takes ridiculously long to do so...  That automatically makes it more profitable to sell it than to mine with it.

Your whole "if they had 20% of the network" is irrelevant, because they don't have the hardware to maintain 20% of the network, nor the datacenter to house it.

Not only do I think they can make more money from hardware, their financial records prove it.

Profit margins on those cubes are likely 60% or better.  Their cost is likely less than $2/GH to produce them.

FC started selling hardware the second BFL began shipping because the asic monopoly was broken.

You're mistaken.

AM was selling hardware long before BFL was shipping in any quantity to be a threat to anyone.  Hardware sales were making those big dividends back in May/June, and BFL was BARELY shipping anything then.

BFL did not cause AM to start selling hardware, profits did.

[jimmothy]

They paid the highest dividends EVER on hardware sales, not mining income.  Mining made up the majority of the dividend back then, but that changed very quickly, until now, the majority is hardware sales.

FC started selling hardware the second BFL began shipping because the asic monopoly was broken.

You're mistaken.

AM was selling hardware long before BFL was shipping in any quantity to be a threat to anyone.  Hardware sales were making those big dividends back in May/June, and BFL was BARELY shipping anything then.

BFL did not cause AM to start selling hardware, profits did.

"Profits" did not make AM start selling asics? Let me ask you why, when you have a steady income of 20% of the hashrate, would you randomly decide to start selling your machines ultimately making your piece of the pie less? You wouldn't. AM only began to sell right before BFL began rolling out their massive amounts of TH. Why? because FC knew that with current gen hardware nobody would buy for such a high price after BFL begins shipping/raising the difficulty. The massive profits came from a "gold rush" of people thinking they would make money from those usb asics which we now know will never reach ROI.

So you think that AM can make more money from selling hardware than mining? If they had and held 20% they would be making 1/5th of 7200 so 1440 btc per day. Lets assume AM is making cubes for dirt cheap and somehow has profits of up to 50% per cube (which is unlikely) then he would need to sell 1440 cubes per day or 50th/s per day.

One of the biggest complaints people have about AM hardware is that it never meets ROI, or takes ridiculously long to do so...  That automatically makes it more profitable to sell it than to mine with it.

Your whole "if they had 20% of the network" is irrelevant, because they don't have the hardware to maintain 20% of the network, nor the datacenter to house it.

Not only do I think they can make more money from hardware, their financial records prove it.

Profit margins on those cubes are likely 60% or better.  Their cost is likely less than $2/GH to produce them.

I know that they don't currently have the hardware to maintain 20% but that doesn't change the fact that mining is more profitable in the long run than hardware sales. Current 144nm will likely never reach ROI even at your overly optimistic guess of $2/gh so yes with current gen, AM or anyone will never make a profit from this current gen so why do you think there is a huge group of people that for some reason want to buy asicminers useless hardware? There is no such group and what will happen is the development of next gen hardware. And when this superior hardware is produced, why would FC rush out to sell the devices instead of holding his grip on 20% of the network which brings in 500k USD worth of bitcoins per day. I honestly doubt that FC or any asic company will be able to maintain 500k USD worth of asic sales profits.


Also I think AM does have a big enough datacenter to house 20%. If next gen chips could be made for something super cheap like $0.50/gh it would be relatively inexpensive and with immersion cooling it would require only a fraction of the space normally needed for a shitload of asics.

[freedomno1]

Repost:

Not sure if this has been posted before. Some updates from AM:
https://drive.google.com/folderview?id=0ByWHHc0u_thNSWhHS18xM2ZXSUU

Friedcat has either totally lost it or is an utter genius.

edit: selling shovel handles to the people selling shovels.

if you can't beat the competition, sell 'em stuff.

I read it as if you think you can outpace us in mining go for it we will sell the shovel handles and then use that income to build something better to go with our cube.
If we get outpaced serious retail miners will still use the cube to make (your stuff) aka. the competitors hardware more efficient hence the Cube is a unique stream of income and a supplement for its unit production.

At least that's one way of viewing it, by hedging against the hashrate war which may become or turn into a war of attrition they are securing their lines and completely reinventing the ballpark by moving to the eventual end point.

But as AM speculators we are primarily focused on these short term dividends, they prove that their is an income stream coming in and as a result we value them more in the short run, aka money (one cat) in hand is better than money (two cats) in the wild, that said as a long run outcome it is a good strategy, since it not only seems plausible but likely an eventuality that mining will reach that scale after a certain point even if not in the short run.

The idea of AM turning into a swiss army knife, is interesting, by not starting a new company with the funds it has built but instead naturally expanding its scope and the services it provides as a part of the same venture.
As friedcat said nothing is more profitable than bitcoin at this point in time, following that logic it makes sense to extend AM's reaches in the sphere it believes has the most profit.

Mining through hashing, hashing through franchising, and franchising through facilities
Aka: The Gradual evolution of Bitcoin mining as we reach larger scales.

By becoming the first mover in the larger scheme of things and having working asics they will still remain profitable by having advanced services to supplement their hardware and extend their reach which will become a distinct competitive advantage of invincible proportions XD

[velacreations]

"Profits" did not make AM start selling asics? Let me ask you why, when you have a steady income of 20% of the hashrate, would you randomly decide to start selling your machines ultimately making your piece of the pie less? You wouldn't.

no, AM was selling the first hardware for like 70 btc a blade.  The profit margins were HUGE!  way over what they could make mining with those products.

What you don't get is that they couldn't expand the mining operation at that time.  The network was not growing fast enough.  They already had 30%.

Acting like BFL caused AM to start selling hardware is laughable, especially when you look at how many units BFL actually shipped during that time.

AM only began to sell right before BFL began rolling out their massive amounts of TH. Why? because FC knew that with current gen hardware nobody would buy for such a high price after BFL begins shipping/raising the difficulty. The massive profits came from a "gold rush" of people thinking they would make money from those usb asics which we now know will never reach ROI.

BFL didn't start rolling out anything respectable until August/September. They shipped a handful of units in June, a few in July and AM had already been selling lots of hardware by then.  They were no threat to the network, and AM was having no problem keeping up with the network growth during that time.

I know that they don't currently have the hardware to maintain 20% but that doesn't change the fact that mining is more profitable in the long run than hardware sales. Current 144nm will likely never reach ROI even at your overly optimistic guess of $2/gh so yes with current gen, AM or anyone will never make a profit from this current gen so why do you think there is a huge group of people that for some reason want to buy asicminers useless hardware? There is no such group and what will happen is the development of next gen hardware. And when this superior hardware is produced, why would FC rush out to sell the devices instead of holding his grip on 20% of the network which brings in 500k USD worth of bitcoins per day. I honestly doubt that FC or any asic company will be able to maintain 500k USD worth of asic sales profits.

you are having a problem understanding something.  AM is selling it's hardware at more than it can mine.  Do you understand what that means?  That means they can get more money from that piece of hardware than they can mine from it. This is nothing new, it has always sold at these levels, and AM sold out of hardware, so yes, people are still interested in their hardware.

New gen will not change the fact that it is more profitable to sell it than mine with it.  You get the entire ROI up front (or in AM's case, more than ROI)

[jimmothy]

"Profits" did not make AM start selling asics? Let me ask you why, when you have a steady income of 20% of the hashrate, would you randomly decide to start selling your machines ultimately making your piece of the pie less? You wouldn't.

no, AM was selling the first hardware for like 70 btc a blade.  The profit margins were HUGE!  way over what they could make mining with those products.

What you don't get is that they couldn't expand the mining operation at that time.  The network was not growing fast enough.  They already had 30%.

Acting like BFL caused AM to start selling hardware is laughable, especially when you look at how many units BFL actually shipped during that time.

AM only began to sell right before BFL began rolling out their massive amounts of TH. Why? because FC knew that with current gen hardware nobody would buy for such a high price after BFL begins shipping/raising the difficulty. The massive profits came from a "gold rush" of people thinking they would make money from those usb asics which we now know will never reach ROI.

BFL didn't start rolling out anything respectable until August/September. They shipped a handful of units in June, a few in July and AM had already been selling lots of hardware by then.  They were no threat to the network, and AM was having no problem keeping up with the network growth during that time.

I know that they don't currently have the hardware to maintain 20% but that doesn't change the fact that mining is more profitable in the long run than hardware sales. Current 144nm will likely never reach ROI even at your overly optimistic guess of $2/gh so yes with current gen, AM or anyone will never make a profit from this current gen so why do you think there is a huge group of people that for some reason want to buy asicminers useless hardware? There is no such group and what will happen is the development of next gen hardware. And when this superior hardware is produced, why would FC rush out to sell the devices instead of holding his grip on 20% of the network which brings in 500k USD worth of bitcoins per day. I honestly doubt that FC or any asic company will be able to maintain 500k USD worth of asic sales profits.

you are having a problem understanding something.  AM is selling it's hardware at more than it can mine.  Do you understand what that means?  That means they can get more money from that piece of hardware than they can mine from it. This is nothing new, it has always sold at these levels, and AM sold out of hardware, so yes, people are still interested in their hardware.

New gen will not change the fact that it is more profitable to sell it than mine with it.  You get the entire ROI up front (or in AM's case, more than ROI)

I will put it extremely simple for you. The gold rush is over. No longer will AM be able to make shitloads from selling shovels because there is already a massive surplus of shovels. Now it will come down to the most efficient large scale mining operations.


The only reason AM made so much money was the gold rush, a massive influx of people thinking they would be getting rich by buying hardware that they thought would reach ROI in 15 days. This scenario will never happen again.

[velacreations]

I will put it extremely simple for you. The gold rush is over. No longer will AM be able to make shitloads from selling shovels because there is already a massive surplus of shovels. Now it will come down to the most efficient large scale mining operations.

The only reason AM made so much money was the gold rush, a massive influx of people thinking they would be getting rich by buying hardware that they thought would reach ROI in 15 days. This scenario will never happen again.

I completely agree.  That's why AM is moving towards enterprise solutions.  They're setting up to sell fleets of bulldozers, while everyone is focused on shovels.

[Aruut]

I will put it extremely simple for you. The gold rush is over. No longer will AM be able to make shitloads from selling shovels because there is already a massive surplus of shovels. Now it will come down to the most efficient large scale mining operations.

The only reason AM made so much money was the gold rush, a massive influx of people thinking they would be getting rich by buying hardware that they thought would reach ROI in 15 days. This scenario will never happen again.

I completely agree.  That's why AM is moving towards enterprise solutions.  They're setting up to sell fleets of bulldozers, while everyone is focused on shovels.

Smiled at the metaphor.
Fingers crossed.

[stripykitteh]

Another nice thing about going down the enterprise route is that AM can kill their competitors on volume.

How many chips can you fit in a shipping container with immersion cooling?

When mining is a low-margin activity, the cost of manufacture by definition will become significant, and the profit-per-chip will be lower. Therefore being able to deploy a lot of product will be crucial to profits. The small hobbyist miner market will probably be saturated or not growing very much at that stage.

I do wonder if it might be a little early for enterprise to take over (the margins on low-volume high-performance chips must still be very high) but it's certainly a vision of what enterprise mining might look like in a couple of years.

[bitcoin.newsfeed]

Guys just a little speculation for you enjoy

Yesterday the AM mined 5blocks from 44 ... in timeframe from ~12:00 to ~19:00, so it was ~1/9 of whole network ... the network hashrate is estimated to be around 3.5 Ph so the 1/9 is around 388Th , we had around 88 before so here we have extra ~300 Th ... i did some calculations and here is the speculation : On one of the photos in immersion cooling exhibition we see 4 dry coolers, so lets assume the power of 4 containers... for one container its 5000 gen1 blades each 10-12Gh, so full container of Gen1 blades is hashing around 60 Th, for 300 Th we need 5 containers plugged & hashing, its close to 4, right? So why they was mining only couple of hours?

I don't believe in this kind of luck. The time between blocks was constant and we mined so many block in relatively short time period like we're mining per week.

[scarce]

Guys just a little speculation for you enjoy

Yesterday the AM mined 5blocks from 44 ... in timeframe from ~12:00 to ~19:00, so it was ~1/9 of whole network ... the network hashrate is estimated to be around 3.5 Ph so the 1/9 is around 388Th , we had around 88 before so here we have extra ~300 Th ... i did some calculations and here is the speculation : On one of the photos in immersion cooling exhibition we see 4 dry coolers, so lets assume the power of 4 containers... for one container its 5000 gen1 blades each 10-12Gh, so full container of Gen1 blades is hashing around 60 Th, for 300 Th we need 5 containers plugged & hashing, its close to 4, right? So why they was mining only couple of hours?

I don't believe in this kind of luck. The time between blocks was constant and we mined so many block in relatively short time period like we're mining per week.

To support your speculation, let's think what's in the following pics:
http://image.photovisi.com/ce2c3e03-7e24-4710-a850-ad5077a3d51dwallpaper.jpg

My speculation is, that's many containers of blades with immersion cooling put into racks. I don't know how many of them are actually filled with blades, but all FC now need to do, is to start filling them up. The dry coolers you mentioned are inevitable part of it, too. So turning on some of these would easily give us your mentioned hashrate. I hope we will finally see some AM hashrate's rise soon.

[bitcoin.newsfeed]

My speculation is, that's many containers of blades with immersion cooling put into racks. I don't know how many of them are actually filled with blades, but all FC now need to do, is start filling them up. The dry coolers you mentioned are inevitable part of it, too. So turning on some of these would easily get us your mentioned hashrate. I hope we will finally see some AM hashrate's rise soon.

You're right. It was not containers, it was probably HK datacenter.

Lets assume that AM have 2 rows with 10 racks as picture shows. That give us 60 small-bath-containers (3 for each rack as on picture). Lets assume ~300 Th in 60 "small containers", so its 5Th for one.

On the other photos we see that each "small container" is filled with some ... "big blades" with 92 gen1 blades, so it gives us ~1Th per big blade, how many of them are in one "small bath container", 6? So now we have 6Th per small container, 18Th per rack and around 360Th for two "fully populated rows".

The last mentioned batch for gen1 was 500Th, so 300Th for HK datacenter and 200Th for 4 containers(4x50Th) seems right, the question is, where are they mining right now?

[Endlessa]

Guys just a little speculation for you enjoy

Yesterday the AM mined 5blocks from 44 ... in timeframe from ~12:00 to ~19:00, so it was ~1/9 of whole network ... the network hashrate is estimated to be around 3.5 Ph so the 1/9 is around 388Th , we had around 88 before so here we have extra ~300 Th ... i did some calculations and here is the speculation : On one of the photos in immersion cooling exhibition we see 4 dry coolers, so lets assume the power of 4 containers... for one container its 5000 gen1 blades each 10-12Gh, so full container of Gen1 blades is hashing around 60 Th, for 300 Th we need 5 containers plugged & hashing, its close to 4, right? So why they was mining only couple of hours?

I don't believe in this kind of luck. The time between blocks was constant and we mined so many block in relatively short time period like we're mining per week.

To support your speculation, let's think what's in the following pics:


My speculation is, that's many containers of blades with immersion cooling put into racks. I don't know how many of them are actually filled with blades, but all FC now need to do, is start filling them up. The dry coolers you mentioned are inevitable part of it, too. So turning on some of these would easily get us your mentioned hashrate. I hope we will finally see some AM hashrate's rise soon.

you sir understand an absolute total sum of shit on a stick when it comes to hardware

[KS]

Guys just a little speculation for you enjoy

Yesterday the AM mined 5blocks from 44 ... in timeframe from ~12:00 to ~19:00, so it was ~1/9 of whole network ... the network hashrate is estimated to be around 3.5 Ph so the 1/9 is around 388Th , we had around 88 before so here we have extra ~300 Th ... i did some calculations and here is the speculation : On one of the photos in immersion cooling exhibition we see 4 dry coolers, so lets assume the power of 4 containers... for one container its 5000 gen1 blades each 10-12Gh, so full container of Gen1 blades is hashing around 60 Th, for 300 Th we need 5 containers plugged & hashing, its close to 4, right? So why they was mining only couple of hours?

I don't believe in this kind of luck. The time between blocks was constant and we mined so many block in relatively short time period like we're mining per week.

That would be luck. They don't seem to have mined anything for the next 12 hours thereafter and the avg hashrate for the last 25blocks is 83TH/s. It went up to 125TH for the last 5 blocks and is down again for the last 3. If they really had 380+TH, the avg hashrate for the last blocks would reflect it.

[11:01] <StalkBot_AM> [ Estimated hashrate between the last 25 deposits <83435.7 GH/sec>     ]
[11:01] <StalkBot_AM> [ Mining 720.54886429 over 9 days, 53 minutes at 510929738 difficulty ]

Last 5:
[11:01] <StalkBot_AM> [ Estimated hashrate between the last 5 deposits <146257.45 GH/sec>    ]
[11:01] <StalkBot_AM> [ Mining 100.3932466 over 17 hours, 14 minutes at 510929738 difficulty ]

Last 3:
[11:02] <StalkBot_AM> [ Estimated hashrate between the last 3 deposits <88698.79 GH/sec>     ]
[11:02] <StalkBot_AM> [ Mining 50.33863821 over 14 hours, 15 minutes at 510929738 difficulty ]

[scarce]

you sir understand an absolute total sum of shit on a stick when it comes to hardware

You might be right, but could you sir please elaborate? After all, this is what this thread is all about. I'm afraid that with your insults, you are rather off topic.

[jimmothy]

Guys just a little speculation for you enjoy

Yesterday the AM mined 5blocks from 44 ... in timeframe from ~12:00 to ~19:00, so it was ~1/9 of whole network ... the network hashrate is estimated to be around 3.5 Ph so the 1/9 is around 388Th , we had around 88 before so here we have extra ~300 Th ... i did some calculations and here is the speculation : On one of the photos in immersion cooling exhibition we see 4 dry coolers, so lets assume the power of 4 containers... for one container its 5000 gen1 blades each 10-12Gh, so full container of Gen1 blades is hashing around 60 Th, for 300 Th we need 5 containers plugged & hashing, its close to 4, right? So why they was mining only couple of hours?

I don't believe in this kind of luck. The time between blocks was constant and we mined so many block in relatively short time period like we're mining per week.

To support your speculation, let's think what's in the following pics:


My speculation is, that's many containers of blades with immersion cooling put into racks. I don't know how many of them are actually filled with blades, but all FC now need to do, is start filling them up. The dry coolers you mentioned are inevitable part of it, too. So turning on some of these would easily get us your mentioned hashrate. I hope we will finally see some AM hashrate's rise soon.

I think that every single rack might be filled with gen1 at the moment and here is why.

I found that each row has 92 blades and each rack has 3 rows with 20 racks. Assuming the blades are getting around 13gh/s per you would get:

13 x 92 x 3 x 20 = 71,760 which is pretty close to what FC said AM was hashing at (I think he said previously 67th/s).

[bitcoin.newsfeed]

I think that every single rack might be filled with gen1 at the moment and here is why.

I found that each row has 92 blades and each rack has 3 rows with 20 racks. Assuming the blades are getting around 13gh/s per you would get:

13 x 92 x 3 x 20 = 71,760 which is pretty close to what FC said AM was hashing at (I think he said previously 67th/s).

Hmmm, we have 92blades on one "big blade", here >



how many of these big blades fits in one "bath container", if you think that only one, then you're right, but i see space for maybe 6?



When we're considering that each rack has 3 of these containers, you'll get : 13x92x6x3x20 = 430560(overclocked)/331200(normal) or 331Th ... exactly what you need for 10% of the network, like we had for few hours yesterday