ASICMINER Speculation Thread

[Whtwabbit]

If BTC rewards halves to 12.5 from 25 BTC

 due to continued demand shouldn't BTC double in value if demand is continuous?
,

[shawshankinmate37927]

There are about 8 or 9 companies with ASIC design now, and 2850000 btc to be minted before next block reward halving in two years. If AM gets 10% of that, with chip sales and mining, it's 0.71/share.

Keep in mind that friedcat said that 1/3 of profits would be retained and reinvested with the other 2/3 being paid as dividends.  How many PH would he need to sell in order to distribute 285,000 BTC in dividends before the next reward halving?

Assuming an exchange rate of $650 USD/BTC and $0.20 in dividends for every GH sold, that would require 926.25 PH in sales.

(285,000 BTC * $650)/$0.20 = 926.25 PH

[shawshankinmate37927]

If BTC rewards halves to 12.5 from 25 BTC

 due to continued demand shouldn't BTC double in value if demand is continuous?
,

BTC would increase in value, but AM shares are priced in BTC.

[hlynur]

If BTC rewards halves to 12.5 from 25 BTC

 due to continued demand shouldn't BTC double in value if demand is continuous?
,

BTC would increase in value, but AM shares are priced in BTC.

this is the main thing about shares valued in btc that always boggles my mind.
after the last halfing (november 28th 2012) btc shot up in value (with some delay). ofc a lot of other circumstances were involved during that time(cyprus, media attention etc.)

thinking about AsicMiner as a company it should theoretically also have to grow exponentially to keep its sharevalue on a steady basis, right?

edit: on second thought that highly depends on how fc balances the growth between mining and production and how high the next bubble rallys. (if we'll ever see one again...  )  

[jimmothy]

keep its sharevalue on a steady basis, right?

There will never be a steady share value as long as it is denominated in such a volatile currency.

[hlynur]

keep its sharevalue on a steady basis, right?

There will never be a steady share value as long as it is denominated in such a volatile currency.

sure, my problem is that everytime i think about these things i switch back to fiatmode to determine value for midterm evaluation.
nobody knows how the endgame will evolve though and in the long term this "fiat backed standard" could become trivial the faster btc adaption expands.

[shawshankinmate37927]

BTC would increase in value, but AM shares are priced in BTC.

this is the main thing about shares valued in btc that always boggles my mind.
after the last halfing (november 28th 2012) btc shot up in value (with some delay). ofc a lot of other circumstances were involved during that time(cyprus, media attention etc.)

thinking about AsicMiner as a company it should theoretically also have to grow exponentially to keep its sharevalue on a steady basis, right?

edit: on second thought that highly depends on how fc balances the growth between mining and production and how high the next bubble rallys. (if we'll ever see one again...  )  

I look at investing in AM to be somewhat similar to buying mining hardware.

When someone buys mining hardware they are typically trying to earn a return.  That is, for every bitcoin that is spent on hardware, power, taxes, etc., they hope to mine it all back and then some.  If their BTC mining revenues exceed their expenses, then they are mining at a profit.  If their expenses exceed their revenues, then they are mining at a loss.  If they are mining at a loss they would be better off financially just holding BTC.  Also, once a piece of hardware is no longer profitable, they don't expect to sell the hardware for more than what they initially paid for it.  Similarly, once I've owned a share of AM for a few years, I don't expect to be able to sell it for more than what I initially paid for it.

With AM, instead of speculating on expected ROI in BTC from mining, I'm speculating on expected ROI in BTC from dividends.  If I buy a share of AM for .2 BTC today, I'm hoping to make all of that back and then some at some point in the next few years in dividends.  I expect the AM share price and profits (measured in BTC) to go down as block rewards are reduced, just as those operating mining hardware expect their BTC earnings to go down when block rewards are reduced.

[hlynur]

I look at investing in AM to be somewhat similar to buying mining hardware.

When someone buys mining hardware they are typically trying to earn a return.  That is, for every bitcoin that is spent on hardware, power, taxes, etc., they hope to mine it all back and then some.  If their BTC mining revenues exceed their expenses, then they are mining at a profit.  If their expenses exceed their revenues, then they are mining at a loss.  If they are mining at a loss they would be better off financially just holding BTC.  Also, once a piece of hardware is no longer profitable, they don't expect to sell the hardware for more than what they initially paid for it.  Similarly, once I've owned a share of AM for a few years, I don't expect to be able to sell it for more than what I initially paid for it.

With AM, instead of speculating on expected ROI in BTC from mining, I'm speculating on expected ROI in BTC from dividends.  If I buy a share of AM for .2 BTC today, I'm hoping to make all of that back and then some at some point in the next few years in dividends.  I expect the AM share price and profits (measured in BTC) to go down as block rewards are reduced, just as those operating mining hardware expect their BTC earnings to go down when block rewards are reduced.

but so far i can't imagine that payed out dividends would sufficiently compensate for sinking share price compared to simple holding (esp. not after halfing and with the ongoing exponential rise of btcvalue) .
this was the case if you've bought in the beginning on IPO, now i really don't see any ground for this.
in the case that the open source project for AM chips soars heavily, gen3 in kombo with mining and gen4 could perhaps return current share price until roughly spring 2016?
i wonder if AM will again have a starving phase of low to no divs until sellout of gen 4, because that is one of my main concerns.
just got burned so hard holding shares during the last bubble, i always see it from trader's perspective now how to get the most coins with the least risk. 
then the better strategy would be to buy shares during times of regular flow of dividends and steady btc value and sell without a loss as soon as it bubbles.

[jimmothy]

i wonder if AM will again have a starving phase of low to no divs until sellout of gen 4, because that is one of my main concerns.

This is why I hope they set up at least one behemoth 20MW datacenter with cheap electricity so that we can have steady divs until gen4.

[shawshankinmate37927]

but so far i can't imagine that payed out dividends would sufficiently compensate for sinking share price compared to simple holding (esp. not after halfing and with the ongoing exponential rise of btcvalue) .

You're referring to future dividends, right?  I agree that future dividends aren't going to lead to ROI anytime soon, if ever, for the shares that sold at 4 or 5 BTC.  That's why I don't think the price will reach that high again.  Four or five years seems to be the most that AM shareholders are willing to wait for an ROI, which would equate to a dividend yield of 25% or 20%.  I think the people that were buying at those prices thought the dividends would just steadily keep getting paid at close to last summer's level until the block reward halved.  I certainly didn't expect to see dividends slow down to a trickle and then disappear completely.

this was the case if you've bought in the beginning on IPO, now i really don't see any ground for this.

This will also be the case if I buy a share now for .2 BTC and then .4 BTC are paid in dividends over the course of the next year.

in the case that the open source project for AM chips soars heavily, gen3 in kombo with mining and gen4 could perhaps return current share price until roughly spring 2016?

I'm not sure how long it will take to reach ROI via dividends at current share price.  All I can do is speculate like everyone else.  Once dividends start getting paid again and we hear more from friedcat, we should have a better idea of what to expect.

i wonder if AM will again have a starving phase of low to no divs until sellout of gen 4, because that is one of my main concerns.

If we have another phase of disappearing dividends and shrinking share price, I'll consider reinvesting more dividends and picking up cheap shares.  He's said that he plans to produce Gen4 and Gen5 chips, so it sounds like he's going to keep at this for a few more years at least.

just got burned so hard holding shares during the last bubble, i always see it from trader's perspective now how to get the most coins with the least risk.

So, it's time to burn someone else, huh?  Just waiting for another bubble and another sucker to come along and dump those overvalued shares in his lap?  I don't know if that opportunity is going to arise, but if it does I'll sell some shares too.  I think there's going to be a lot of selling pressure in the future from people in your shoes that are trying to recover their losses.  We'll just have to wait and see.

then the better strategy would be to buy shares during times of regular flow of dividends and steady btc value and sell without a loss as soon as it bubbles.

Different strokes for different folks.  I'm not a trader.  I prefer to invest for the long term, but would sell some of the shares that I've held for over a year if another bubble forms, but I'm not holding my breath.  (I pay a lower tax rate on long-term capital gains--shares that are held for over a year.)

[freedomno1]

i wonder if AM will again have a starving phase of low to no divs until sellout of gen 4, because that is one of my main concerns.

This is why I hope they set up at least one behemoth 20MW datacenter with cheap electricity so that we can have steady divs until gen4.

Yah I want one as well but they said in their question list that it made sense to sell chips then get miners to purchase it to create a bigger marketplace than going the otherway.

That and their energy ratios are efficient and would only be better with the new chips but the first part needs to occur first.
Still it would be nice for AM to mine scare away some of that 50% concern with Ghash

[hlynur]

just got burned so hard holding shares during the last bubble, i always see it from trader's perspective now how to get the most coins with the least risk.

So, it's time to burn someone else, huh?  Just waiting for another bubble and another sucker to come along and dump those overvalued shares in his lap?  I don't know if that opportunity is going to arise, but if it does I'll sell some shares too.  I think there's going to be a lot of selling pressure in the future from people in your shoes that are trying to recover their losses.  We'll just have to wait and see.

then the better strategy would be to buy shares during times of regular flow of dividends and steady btc value and sell without a loss as soon as it bubbles.

Different strokes for different folks.  I'm not a trader.  I prefer to invest for the long term, but would sell some of the shares that I've held for over a year if another bubble forms, but I'm not holding my breath.  (I pay a lower tax rate on long-term capital gains--shares that are held for over a year.)

no, i really don't want to burn someone else. as stated before i lost around 9 btc with sinking sharevalue until now and what can I say...I will never get these back via div payout or selling shares but at least i managed to partly compensate the loss with trading the november bubble.
when i think of how easy and to a part predictable the trading game was i struggle to invest once again in AM just to eventually realize after another year of holding shares that i could have earned much more than the divs within a shorter timespan trading same amount of coins on the exchanges.

originally i also am in bitcoin with the intention of longterm investment but given the extra risk AM still has more the taste of " a golden ticket" and "all or nothing" for me instead of a reasonable investment worth the monthly divs.
sure, it could become one of the biggest players in the endgame but at the same time if btc thrives that far it will perhaps already have reached a value that easily outperforms any possible growth in company value.

these are just personal mindgames here and i admit i lack the economic knowledge to grasp the whole situation.
perhaps i'd also have other sentiments if i'd have got burned at trading in the past, but so far I'm doing quite well in that regard.

my only conclusion on this subject: the less volatile btc gets the more favourable investments in AM appear.

[Another User]

Why do people think that there will be another AM bubble? It's posts like this that confirm there will be:

I don't know about you guys, but PETA is still doing a great job despite all these odds. If you know any better Bitcoin investment, especially a mining investment of bitcoin... let me know.

[Another User]

That group of new forum members came in January, which there has been over 100k new members since the start of 2014. So yeah, the bubble will happen. The question is, what side will you be on when it starts moving?

[hdbuck]

Why do people think that there will be another AM bubble? It's posts like this that confirm there will be:

I don't know about you guys, but PETA is still doing a great job despite all these odds. If you know any better Bitcoin investment, especially a mining investment of bitcoin... let me know.

Its not about bubble. Its about business. AM is a company. Not some store of value or new technology like bitcoin.
Enough with that noobish attitude, making a first investment in bitcoin and assuming its all the same.
Its risky as well, but at this point, so are every assets listed on common stock exchanges.

[KarmaShark]

Why do people think that there will be another AM bubble? It's posts like this that confirm there will be:

I don't know about you guys, but PETA is still doing a great job despite all these odds. If you know any better Bitcoin investment, especially a mining investment of bitcoin... let me know.

This is a fair point. The entire lack of other reliable BTC security investments is astonishing, mining related or not. Once AM starts driving revenue down through to the shareholders (of which AM/Bitfountain are majority owners), we could see another rapid increase in the share price. Given how long the wait has been for shareholders and how far the price has fallen, it may not be a bubble however a period of over-valuation is likely to transpire. Hard to imagine that a year since Gen1 and ASIC MINER still appears to be the only blue chip investment available to the public.

I am of the strong opinion that anyone selling at 0.2 BTC/share is going to be burned, very badly and very soon.

[VJain]

Why do people think that there will be another AM bubble? It's posts like this that confirm there will be:

I don't know about you guys, but PETA is still doing a great job despite all these odds. If you know any better Bitcoin investment, especially a mining investment of bitcoin... let me know.

This is a fair point. The entire lack of other reliable BTC security investments is astonishing, mining related or not. Once AM starts driving revenue down through to the shareholders (of which AM/Bitfountain are majority owners), we could see another rapid increase in the share price. Given how long the wait has been for shareholders and how far the price has fallen, it may not be a bubble however a period of over-valuation is likely to transpire. Hard to imagine that a year since Gen1 and ASIC MINER still appears to be the only blue chip investment available to the public.

I am of the strong opinion that anyone selling at 0.2 BTC/share is going to be burned, very badly and very soon.

There are a few reliable investments IMO. Take a look at RentalStarter for instance. A downside to this is that it's assets are valued in USD and not BTC.

Ontopic... I remember seeing a chart which showed AM's USD value, and it's been pretty level. It definitely has room to grow on the USD side of things, as AM doesn't have a monopoly on Chip Sales anymore (never had a monopoly, I know, but they were a market leader).

[Blazed]

Bitmain's new chips: https://bitcointalk.org/index.php?topic=656461.0

Thinking AM prices about to tank more...Who would buy the AM chips now?!?!

[hdbuck]

Bitmain's new chips: https://bitcointalk.org/index.php?topic=656461.0

Thinking AM prices about to tank more...Who would buy the AM chips now?!?!

lol try again.

[RoadStress]

i wonder if AM will again have a starving phase of low to no divs until sellout of gen 4, because that is one of my main concerns.

This is why I hope they set up at least one behemoth 20MW datacenter with cheap electricity so that we can have steady divs until gen4.

Don't they have a 500MW (or KW?) immersion cooled setup ready? Actually it is filled with gen1 chips, but no idea why aren't they using with their gen3 chips..