Is Avalon mining with customer hardware? Answer is here.

[Tehfiend]

it is a neat scheme, and seriously: why sell a product at a price that is exceeded by its recurring output

The exchange rate didn't sky-rocket until after the batch #2 pre-sale concluded.

[Hippie Tech]

The conspiracy to centralize or shut down Bitcoin is plainly evident to me now.

I think you should never underestimate the force of good ol' private enterprise, petty corruption.

Here's an analogy.  One of my good friends is a retired Alcohol, Tobacco and Firearms (USA ATF) agent.  One case he worked on as a young man was at the Marlboro plant in Virginia.  Truckloads of Marlboro cigarettes, hundreds of cases, thousands of cartons were loaded into containers and sent to the Navy at Port Norfolk.  Tax free.

The guy whose job it was to seal the container, certifying that the seal was not to be broken execpt overseas, would spoof the seal on certain trucks.  The driver of that truck would exit on the way to Norfolk, stop, pull out a couple cases into a waiting van, and then press the seal.  When the cigs got to Japan or Europe or where ever, nobody even noticed the shortage.

They got busted.  Mafia?  Nope.  International cigarette smugglers?  Nope?  A couple guys who had the motive (money from free cigarettes to sell), means and opportunity.  

The only thing I underestimated was the scale of the theft(s) involved. I saw this coming soon after I began mining last October, when the asic pre orders and gpu sell-off, were reaching thier peaks even though deadlines were being missed.

Riddle me this.. BTC person...

What will happen to the legitimacy of Bitcoin if we determine that 30% of the new coins mined, since the asic dream began, could be classified as stolen assets/ property ?

I guesstimate its more like 50% if you were to factor in the BTC used to buy the pre orders.

If I were waiting for one, I would be demanding that ALL pool operators find a way to verify that the asics at thier pool are all legitimately owned.

[jspielberg]

To be honest... I think most Avalon purchasers wouldn't care if Bitsyncom test on main net vs. testnet, as long as it doesn't impact the speedy delivery of their completed units.

[coinedBit]

it is a neat scheme, and seriously: why sell a product at a price that is exceeded by its recurring output

The exchange rate didn't sky-rocket until after the batch #2 pre-sale concluded.

right, there's going to be a breakeven point once the BTC/USD ratio adjusts or once diffculty raises even further - which is almost certainly going to result in more hardware being shipped all of a sudden, it simply makes sense  then

[Hippie Tech]

If I were waiting for one, I would be demanding that ALL pool operators find a way to verify that the asics at thier pool are all legitimately owned.

Be careful with that.  Governments around the world are probably already drafting bills that would allow for licensing of mining operations. 

Say what?  You don't have a license for that ASIC?  Well, boy, that is 3 years in a big house; for each Gh/s.  Confiscation of hardware, seizure of property etc.

I never meant to imply that we would need a registry or licensing for high hashpower users.

[Raize]

also heard this backdoor in tp link routers http://www.h-online.com/security/news/item/Treacherous-backdoor-found-in-TP-Link-routers-1822720.html

Jesus that one is scary...

Does it still work if you update the firmware to OpenWRT/DD-WRT?

[Loredo]

What will happen to the legitimacy of Bitcoin if we determine that 30% of the new coins mined, since the asic dream began, could be classified as stolen assets/ property ?

Governments have a problem with bitcoin, that works to the scammers' advantage short term:  if they were to allege fraud -under US law, it would probably be Civil RICO- then, by definition, they would be accepting the legitimacy of bitcoins as something of value, and -worse- would have to assign some value to them to finish the allegation.

I have no doubt that there has been systematic use of Avalon equipment since the March/April price run-up.  I don't believe it has been done by team Avalon, except to the extent that their poor control over their fulfillment processes is responsible in an overarching, "buck stops at the top" way.

But prior to April, I don't believe it was worth it.  I'm not so sure that BFL has done it, or is so loosely organized that it would go on without knowledge; I don't think that's part of their script.

What you are really saying, probably, is this:  If 30% of the new coins minted were done so using the money of those who pre-purchased asic "dreams," only to have those dreams turn into nightmares of difficulty-induced futility, then a lot of people - maybe a critical mass of early adopters - would abandon the concept and it could die.  

Yeah, that's possible.  But as long as the "scheme" regardless of the ethics of those around it, continues to produce 400 thousand dollars worth of something every day, there for the taking for anybody who has the right piece of electronic gadgetry, there will be those to replace those who drop away, if someone promises them that gadget.

The governments and the Central banks might, ultimately, kill this.  But right now, they haven't figured out how to attack it effectively, and, frankly, it isn't big enough - yet - for them to worry too much about.

[Luke-Jr]

I don't know why this comes as a surprise to anyone.
For political purposes, it makes sense that BFL decided not to mine mainnet for burnins, but other than that, why would a company want to basically throw away potential revenue?
The pattern here certainly does look like testing/burnin to me, at least - if someone wants to bother, they can plot when people received units against the hashrates seen on Eligius (that data is public, I think).

Besides, didn't someone at Avalon say outright that they were mining on them before shipping?
I seem to recall reading that somewhere...

[Rampion]

I don't know why this comes as a surprise to anyone.
For political purposes, it makes sense that BFL decided not to mine mainnet for burnins, but other than that, why would a company want to basically throw away potential revenue?
The pattern here certainly does look like testing/burnin to me, at least - if someone wants to bother, they can plot when people received units against the hashrates seen on Eligius (that data is public, I think).

Besides, didn't someone at Avalon say outright that they were mining on them before shipping?
I seem to recall reading that somewhere...

Care to explain me your logic here? Aren't the "political reasons" linked to "business reasons" and therefore to "projected revenue reasons"?

Or you intend to say that BFL is after some kind of greater good?

[ThickAsThieves]

I don't know why this comes as a surprise to anyone.
For political purposes, it makes sense that BFL decided not to mine mainnet for burnins, but other than that, why would a company want to basically throw away potential revenue?
The pattern here certainly does look like testing/burnin to me, at least - if someone wants to bother, they can plot when people received units against the hashrates seen on Eligius (that data is public, I think).

Besides, didn't someone at Avalon say outright that they were mining on them before shipping?
I seem to recall reading that somewhere...

Care to explain me your logic here? Aren't the "political reasons" linked to "business reasons" and therefore to "projected revenue reasons"?

Or you intend to say that BFL is after some kind of greater good?

What he meant was, they didn't steal because they put up with enough bitching from people, and wouldn't want to deal with even more.

What that actually means is, BFL would only steal if there was low risk of being caught.

There is low risk of being caught.

[Luke-Jr]

Doing burnins on mainnet is not in any sense "stealing".
The burnings have to be done anyway, no point throwing that away.

[Lincoln6Echo]

I don't know why this comes as a surprise to anyone.
For political purposes, it makes sense that BFL decided not to mine mainnet for burnins, but other than that, why would a company want to basically throw away potential revenue?

Thing is, that they mine bitcoins with the hardware of their customers! So they are stealing revenue! The amount of dust inside of the avalon cases indicates that they do ''urnins'' for days and not hours!

What the fuck is this shit?  

[minternj]

Doing burnins on mainnet is not in any sense "stealing".
The burnings have to be done anyway, no point throwing that away.

Burn in is one thing, mining them to the point where dust can actually collect on the internal components is another.

[Rampion]

I don't know why this comes as a surprise to anyone.
For political purposes, it makes sense that BFL decided not to mine mainnet for burnins, but other than that, why would a company want to basically throw away potential revenue?

Thing is, that they mine bitcoins with the hardware of their customers! So they are stealing revenue! The amount of dust inside of the avalon cases indicates that they do ''urnins'' for days and not hours!

What the fuck is this shit?  

In a business like mining where each past second is more valuable than the future one, I'd say that could be expected that "burnins" would be done against the customers address, especially considering that we are speaking about preorders. I guess the *promise* of profit in ASIC mining its been huge for a limited window, and the companies could get away with it. This is going to change. ROI is going to be very tight for everybody.

[nbtcminer]

Doing burnins on mainnet is not in any sense "stealing".
The burnings have to be done anyway, no point throwing that away.

@Luke-Jr:

Here is the difference;

Throwing away would mean that it would otherwise be wasted. Stealing means that BTC earned by a machine during "burnin" paid for by a customer not given to them is a loss to the customer / a gain by said third party; its called stealing. What part about paying for equipment and having someone else use it / earn profit (real money) don't you understand as stealing?

BTW I should point out that no other company / group / collective of BTC FPGA projects ever burned-in on the main net. Even Ngzhang didn't do that with the Icarus / Lancelot project.

[mog]

Jumping in to this from the reddit thread.
I prepaid for a batch 2 unit, I got that unit delivered (finally). Thats all I care about and all the business of Avalons I have the right to be involved in. If they didn't scam me of exactly what I paid for then I'm fine with them. However they chose to run their business before I get my box is their business and there was a very likely risk I wouldn't even see my box that I accepted. They don't owe you anything, they haven't committed fraud regardless of what your layman's grok of law makes you think.
Upset?

Hire a lawyer sue them, otherwise stop wasting everyone time with your complaining. When you bring a product to fruition and ship as promised in 9 months beating your competitors maybe then I'll have some sympathy for your opinions. For now you just sound like a whiny rabble.

[Bitcoinorama]

Vice: You aren’t doing any mining at all?

Yifu: Nope. Fun fact: none of the Avalon team have their own mining units (outside of test units).



http://motherboard.vice.com/blog/engineering-the-bitcoin-gold-rush-an-interview-with-yifu-guo-creator-of-the-first-asic-based-miner

[Hippie Tech]

What will happen to the legitimacy of Bitcoin if we determine that 30% of the new coins mined, since the asic dream began, could be classified as stolen assets/ property ?

Governments have a problem with bitcoin, that works to the scammers' advantage short term:  if they were to allege fraud -under US law, it would probably be Civil RICO- then, by definition, they would be accepting the legitimacy of bitcoins as something of value, and -worse- would have to assign some value to them to finish the allegation.

I have no doubt that there has been systematic use of Avalon equipment since the March/April price run-up.  I don't believe it has been done by team Avalon, except to the extent that their poor control over their fulfillment processes is responsible in an overarching, "buck stops at the top" way.

But prior to April, I don't believe it was worth it.  I'm not so sure that BFL has done it, or is so loosely organized that it would go on without knowledge; I don't think that's part of their script.

What you are really saying, probably, is this:  If 30% of the new coins minted were done so using the money of those who pre-purchased asic "dreams," only to have those dreams turn into nightmares of difficulty-induced futility, then a lot of people - maybe a critical mass of early adopters - would abandon the concept and it could die.  

Yeah, that's possible.  But as long as the "scheme" regardless of the ethics of those around it, continues to produce 400 thousand dollars worth of something every day, there for the taking for anybody who has the right piece of electronic gadgetry, there will be those to replace those who drop away, if someone promises them that gadget.

The governments and the Central banks might, ultimately, kill this.  But right now, they haven't figured out how to attack it effectively, and, frankly, it isn't big enough - yet - for them to worry too much about.

F what the government and it's legal system thinks and lets get on with damage control.

Just follow the BTC and alt-coin trail.

[Luke-Jr]

In a business like mining where each past second is more valuable than the future one, I'd say that could be expected that "burnins" would be done against the customers address, especially considering that we are speaking about preorders. I guess the *promise* of profit in ASIC mining its been huge for a limited window, and the companies could get away with it. This is going to change. ROI is going to be very tight for everybody.

Maybe the burning income was counted in the original pricing of the units...? Same net effect as trying to "rebate" via a burnin later.

Doing burnins on mainnet is not in any sense "stealing".
The burnings have to be done anyway, no point throwing that away.

@Luke-Jr:

Here is the difference;

Throwing away would mean that it would otherwise be wasted.

And in the case of burning, it would otherwise be wasted.

Vice: You aren’t doing any mining at all?
Yifu: Nope. Fun fact: none of the Avalon team have their own mining units (outside of test units).

This sounds to me like he's talking about their own personal mining, not what goes on with burnin testing of units they're selling.

[Bitcoinorama]

Vice: You aren’t doing any mining at all?
Yifu: Nope. Fun fact: none of the Avalon team have their own mining units (outside of test units).

This sounds to me like he's talking about their own personal mining, not what goes on with burnin testing of units they're selling.

Perhaps, the questions specifically does ask if he is doing any mining at all directly, to which he answer's, "Nope", before adding the fun fact, so I figured it is worth adding to the convo.

In any case, if Yifu is a man of integrity, i'm sure he will explain.

Would make a great gift to charity if it was used to encourage the main well known charities to openly start excepting Bitcoin donations. No one would deny Bitsyncom that. Plus would make a wise PR move...kind of like a modern day Robin Hood!