HashFast Miner Protection Program Discussion

[minternj]

Has there been anymore detail on how this plan would be implemented? How are you tracking ROI for each user? Or would this be done at some high level way? If so please publish formula or criteria used.

[1715351810]

1715351810

[cypherdoc]

Has there been anymore detail on how this plan would be implemented? How are you tracking ROI for each user? Or would this be done at some high level way? If so please publish formula or criteria used.

.

i just went back and reviewed Eduardo's post about the MPP.  i actually think he didn't word it quite as clearly as he could have.

the 4x number that he wrote actually represents 4x the original hashing power as a maximum which they will give to you for free to bring you back to a complete payoff of your equipment if you haven't done so by 3 mo after delivery.

in other words, if you purchased 500GH originally, then a maximum of 2000GH in the form of chips will be offered to you. there are 2 steps, a 2x and a 4x level.  they claim the ROI is determinable by the growth of the network HR, your original HR power, and assuming 24/7 mining beginning on the date of delivery and immediate deployment.

remember, i am not part of the company and am in no way in control of what they ultimately do.  this is however, exactly how i've seen it written and represents my understanding of how the program works.

[minternj]

I get the general idea, but after running the implementation of it in my own mind there are too questions.

Is ROI based on USD exchange rate? Or are we talking about returning the BTC that was paid. It seems to me they are betting on a very stable BTC/USD exchange rate.

If it is based on ROI to USD, what if BTC prices drop to 10$, do they still guarantee ROI in 90 days? Or is ROI based on returning the original BTC paid. If its based on BTC, what if USD/BTC ratewent to $1000, will they still guarantee we ROI on original BTC paid?

[cypherdoc]

I get the general idea, but after running the implementation of it in my own mind there are too questions.

Is ROI based on USD exchange rate? Or are we talking about returning the BTC that was paid. It seems to me they are betting on a very stable BTC/USD exchange rate.

If it is based on ROI to USD, what if BTC prices drop to 10$, do they still guarantee ROI in 90 days? Or is ROI based on returning the original BTC paid. If its based on BTC, what if USD/BTC ratewent to $1000, will they still guarantee we ROI on original BTC paid?

don't forget the max of 4x.

those are good questions, the answers of which i don't have.  if i were you, i wouldn't hesitate to pin them down on this.  i'm with you in the sense i have 8 Babyjets on order.

[AsicShill]

4X hash power is great - but there is a hidden problem with it.

Most casual miners won't be willing to make the sacrifices to have the electrical capacity to handle the additional chips.  Take your own purchases for example.  You say you ordered 8 Baby-jets.  If each Baby-jet optimistically consumes 250W for a 1 chip solution, then you are currently at 2KW, best case scenario.

Lets say hash rate is insane and you get the full 3 additional chips per baby-jet.  You are looking at 8KWs. You are going to need to have four 20A lines to safely consume 8KW of mining.  I believe most houses have 100A circuit to the main in their electrical panel.  You now have 20A capacity for the rest of your house.  Good thing you didn't buy 10 Baby-Jets or you wouldn't have anything else electrical you would want to run.

And these are the optimistic numbers at 250W.  Web page says +-20% from 350W.

The most logical step would be to sell the additional capacity off that you can't use, but since HF hasn't committed to providing hashpower in a usable form, selling the exrta may prove difficulty.

Feel free to poke holes in this line of thinking.

Maybe I should have been called "AsicPessimist" or something 

[DyslexicZombei]

Well, if you read their specs, this *isn't* meant to be used in any other environment *but* a commercial environment. These aren't designed to have you run 8-10 of them in your house or garage (not without significant electrical upgrades at the panel).

Ideally, these devices are meant to be set up in a colocation facility with 100% uptime, filtered/regulated power, and AC for best results.

[cypherdoc]

4X hash power is great - but there is a hidden problem with it.

Most casual miners won't be willing to make the sacrifices to have the electrical capacity to handle the additional chips.  Take your own purchases for example.  You say you ordered 8 Baby-jets.  If each Baby-jet optimistically consumes 250W for a 1 chip solution, then you are currently at 2KW, best case scenario.

Lets say hash rate is insane and you get the full 3 additional chips per baby-jet.  You are looking at 8KWs. You are going to need to have four 20A lines to safely consume 8KW of mining.  I believe most houses have 100A circuit to the main in their electrical panel.  You now have 20A capacity for the rest of your house.  Good thing you didn't buy 10 Baby-Jets or you wouldn't have anything else electrical you would want to run.

And these are the optimistic numbers at 250W.  Web page says +-20% from 350W.

The most logical step would be to sell the additional capacity off that you can't use, but since HF hasn't committed to providing hashpower in a usable form, selling the exrta may prove difficulty.

Feel free to poke holes in this line of thinking.

Maybe I should have been called "AsicPessimist" or something 

no, no, all real good points.  i would say the following.

as you said, there is always going to be secondary market for chips so at minimum they could be sold for profit.  second, some of us miners, like me, are nutso and will gladly install another outlet to handle the extra demand.  i installed a separate 240V breaker box with a dedicated line over at my office just for my avalons.  but i admit, i'm not necessarily like everyone else.  finally, there are always data centers.

the overarching way i look at this is that the price of BTC is going up.  way up.  i want to diversify and get a hold of as many BTC as fast as i can before that happens.  i've bought my share on the open market and now i'm ready to mine for more by getting in on the ground floor of a new era in asic mining.  i think the HR graph is going to level off sometime soon and that there is going to be a shakeout in the # of companies.  my plan is to help HF be one of the winners in that scenario.  if i can maneuver myself into a small but significant part of the asic market and make money mining i will.  if not, i'll do it anyways to help the network. 

[DeathAndTaxes]

Chargebacks, approx $35 amount to a minor percentage and a is a risk to the merchant that pales in comparioson to that of the vast sums asked from the consumer.

Credit card fraud is assumed by the payment processor, not the merchant.

On what planet does that occur?  You get a chargeback and you lose $35 PLUS THE VALUE OF THE CHARGE.

i.e. sell an $8,000 rig, get a chargeback, the processor is going to deduct $8,035.

[DeathAndTaxes]

4X hash power is great - but there is a hidden problem with it.

Most casual miners won't be willing to make the sacrifices to have the electrical capacity to handle the additional chips.  Take your own purchases for example.  You say you ordered 8 Baby-jets.  If each Baby-jet optimistically consumes 250W for a 1 chip solution, then you are currently at 2KW, best case scenario.

Lets say hash rate is insane and you get the full 3 additional chips per baby-jet.  You are looking at 8KWs. You are going to need to have four 20A lines to safely consume 8KW of mining.  I believe most houses have 100A circuit to the main in their electrical panel.  You now have 20A capacity for the rest of your house.  Good thing you didn't buy 10 Baby-Jets or you wouldn't have anything else electrical you would want to run.

Couldn't you just sell the additional capacity.  Either sell the chips or have them assembled into rigs and sell the excess rigs. I mean really is that the worst possible scenario.

You buy x GH/s you don't break even in 90 days so you are now given 4x GH/s.  You have the chips assembled and then sell the excess capacity thus reducing your loss or improving your gain.  Not saying the buyer protection is a slam dunk but the idea that the stumbling block is you might run out of power ... well that probably is a problem most people wouldn't mind.

Obviously the chips will have "some" value in the future.  How much requires a little guesstimating but the HF is going for ~$15 per GH/s for Oct/Nov delivery.  So 90 days from that you haven't broken even and you are given 4x as much hashing power (chips only).  Lets say difficulty in Jan is 4x, and thus the value of hardware in USD per GH/s is 1/4th. Lets also assume the chips represent 50% of the total miner cost.  You essentially have chips that are worth to somebody 50% of your purchase price.  It doesn't really matter if you use them, sell them, having HF build them into rigs, or find a third party to build them into rigs.  Note the math above is just one scenario.  Difficulty could (unlikely but could) increase by a factor of 20x between Oct and January at which point the chips would be worth much less (maybe 10% of purchase price).

[DeathAndTaxes]

the two big safety valves you have imo are the full refund date and now the MPP.  of course, if they do a BK you'll probably never see these guarantees materialize.  but as i pointed out, they do have several funding options prior to that scenario.

Well I think this is a positive development, whether you or I choose to believe the promises is another question, but the equivalent policy would be bitfury saying they'll send you 256 bare chips if you don't achieve a ROI on your ($8000) full kit after 90 days. Any ASIC from now, even if delivered on time (Aug or Sept) may not achieve a ROI. This announcement is a good thing for miners and hopefully other vendors match it.

This.  It isn't a slam dunk.  You can always lose money but if someone was buying a 400 GH/s rig from bitfury and bitfury announced that at no additional cost if you didn't break even in 90 days they would give you 256 chips that you could
a) have bitfury assemble at an additional cost
b) have a third party assemble at an additional cost
c) simply sell the excess chips to reduce your purchase price

would anyone say "no I would rather pay full price with no option of additional chips if/when I don't break even"?

Now ultimately what matters is what is the value of the extra chips?  Obviously if when you get them if the chips are only worth 1% of your purchase price it doesn't really matter but lets say they are worth 20%.  One way of looking at it, it is like the purchase price was 20% lower.  Buy rig for $5,600 worse case scenario gets chips worth $1,120.  Sell them and it is the same as if you originally bought the rig for $4,480.  Would anyone really complain about paying 20% less that what they originally planned to?

Maybe (in this hypothetical scenario) even with the 20% back (by selling the chips or using them for reduced cost miners) you still lose.  Ok well you would lose more without them.

[Bitcoinorama]

Chargebacks, approx $35 amount to a minor percentage and a is a risk to the merchant that pales in comparioson to that of the vast sums asked from the consumer.

Credit card fraud is assumed by the payment processor, not the merchant.

On what planet does that occur?  You get a chargeback and you lose $35 PLUS THE VALUE OF THE CHARGE.

i.e. sell an $8,000 rig, get a chargeback, the processor is going to deduct $8,035.

Thank-you for pointing out the bleedin' obv. I do know how refunds work.

[crumbs]

the two big safety valves you have imo are the full refund date and now the MPP.  of course, if they do a BK you'll probably never see these guarantees materialize.  but as i pointed out, they do have several funding options prior to that scenario.

Well I think this is a positive development, whether you or I choose to believe the promises is another question, but the equivalent policy would be bitfury saying they'll send you 256 bare chips if you don't achieve a ROI on your ($8000) full kit after 90 days. Any ASIC from now, even if delivered on time (Aug or Sept) may not achieve a ROI. This announcement is a good thing for miners and hopefully other vendors match it.

This.  It isn't a slam dunk.  You can always lose money but if someone was buying a 400 GH/s rig from bitfury and bitfury announced that at no additional cost if you didn't break even in 90 days they would give you 256 chips that you could
a) have bitfury assemble at an additional cost
b) have a third party assemble at an additional cost
c) simply sell the excess chips to reduce your purchase price

would anyone say "no I would rather pay full price with no option of additional chips if/when I don't break even"?

Now ultimately what matters is what is the value of the extra chips?  Obviously if when you get them if the chips are only worth 1% of your purchase price it doesn't really matter but lets say they are worth 20%.  One way of looking at it, it is like the purchase price was 20% lower.  Buy rig for $5,600 worse case scenario gets chips worth $1,120.  Sell them and it is the same as if you originally bought the rig for $4,480.  Would anyone really complain about paying 20% less that what they originally planned to?

What is this, backyard sophistry 101?  Of course no one would complain about paying 20% less, but there's no talk about paying 20% less.  
HashFast didn't cut their prices by 20% -- only promised to send you more chips once you didn't break even.  Chips that will most likely be obsolete, and certainly not worth the additional $$$ on parts & assembly turning them into functional miners.  Who would tool up to build computers around Intel 386s?  Who would buy these 386s?

Maybe (in this hypothetical scenario) even with the 20% back (by selling the chips or using them for reduced cost miners) you still lose.  Ok well you would lose more without them.

Sure.  Though getting a bunch of chips is hardly "miner protection."  Sort-a like getting another GPU chip if your racy new AMD graphics card becomes obsolete when Nvidia releases a 10x better board at 1/10th the price.  Enjoy the chip.  

[DeathAndTaxes]

Chargebacks, approx $35 amount to a minor percentage and a is a risk to the merchant that pales in comparioson to that of the vast sums asked from the consumer.

Credit card fraud is assumed by the payment processor, not the merchant.

On what planet does that occur?  You get a chargeback and you lose $35 PLUS THE VALUE OF THE CHARGE.

i.e. sell an $8,000 rig, get a chargeback, the processor is going to deduct $8,035.

Thank-you for pointing out the bleedin' obv. I do know how refunds work.

We aren't talking about refunds we are talking about fraud and the highlighted statement would indicate you have no understand of "how it works".

[jspielberg]

@AsicPessimist -

I think your complaint that you get so much free stuff that you couldn't possibly use all of it is going to be a tough sell.   
What is next?  "The chip is too fast" or "Too power efficient"?

Crumbs though has a slight point. 
If the chip is considered "old tech" in 90 days after delivery and the secondary market doesn't develop, do we know that HashFast has our back and will turn our chips into useful hasher?

Can we PLEASE get an official estimate for a bare-bones "assembly fee" for the chips, i.e. anything that we can't get off the shelf... no case, no psu, no liquid cooling (if it is a standard off the shelf model)?

[DeathAndTaxes]

Sure.  Though getting a bunch of chips is hardly "miner protection."  Sort-a like getting another GPU chip if your racy new AMD graphics card becomes obsolete when Nvidia releases a 10x better board at 1/10th the price.  Enjoy the chip.  

Nobody is going to be releasing a board 10x better.  Future (as of yet not even developed) ASICs may improve efficiency (MH/W) some but most of the low hanging fruit is gone.  You aren't getting 10x better boards even going to 14nm full custom ASICs made by Intel on a scale of millions of boards a year.  Better boards?  Sure.  10x better boards?  Hardly.   

As for the price of new ASIC chips will they be lower sure but I don't see them going to 10% (that would be <$1 per GH/s) any time in the near future.  Still even if they did the chips would still have some value.  Whatever you think the value of 1 GH/s of chips will be in January ($2 per GH/s?  $5 per GH/s?) that is what the "bonus" chips will be worth.  How much is that going to be?  I don't know, it depends on how aggressive pricing gets, it obviously isn't going to be $15 per GH/s but it also isn't going to be $0 per GH/s.  

[DeathAndTaxes]

If the chip is considered "old tech" in 90 days after delivery and the secondary market doesn't develop, do we know that HashFast has our back and will turn our chips into useful hasher?

How would a 28nm chip be "old tech" in 90 days?  See anyone releasing a chip magnitudes higher efficiency?  The price of this chip (and all other ASIC) chips is almost guaranteed to decline but that doesn't make it obsolete.  

[crumbs]

If the chip is considered "old tech" in 90 days after delivery and the secondary market doesn't develop, do we know that HashFast has our back and will turn our chips into useful hasher?

How would a 28nm chip be "old tech" in 90 days?  See anyone releasing a chip magnitudes higher efficiency?  The price of this chip (and all other ASIC) chips is almost guaranteed to decline but that doesn't make it obsolete.  

You're tossing around 28nm as some sort of hallmark of quality, a standard by which a chip is measured.  That's ridiculous.  My cat can cut & paste some cores & have them implemented in 28nm process.  Or a team of experienced engineers could go through multiple iterations of design/prototype/redesign to come up with a slightly better chip using the same 28nm tech.  Do you suppose a good design house could beat my cat by a factor of 10?  My cat don't think so, but i worry.  He's ordered himself a dev board & picked up the lingo.  He's pretty good at getting what he wants, so we'll see.

[DeathAndTaxes]

If the chip is considered "old tech" in 90 days after delivery and the secondary market doesn't develop, do we know that HashFast has our back and will turn our chips into useful hasher?

How would a 28nm chip be "old tech" in 90 days?  See anyone releasing a chip magnitudes higher efficiency?  The price of this chip (and all other ASIC) chips is almost guaranteed to decline but that doesn't make it obsolete. 

You're tossing around 28nm as some sort of hallmark of quality, a standard by which a chip is measured.  That's ridiculous.  My cat can cut & paste some cores & have them implemented in 28nm process.  Or a team of experienced engineers could go through multiple iterations of design/prototype/redesign to come up with a slightly better chip using the same 28nm tech.  Do you suppose a good design house could beat my cat by a factor of 10?  My cat don't think so, but i worry.  He's ordered himself a dev board & pick up on the lingo.  He's pretty good at getting what he wants, so we'll see.

Well I think the burden of proof would be on the one making the outlanding claims.  Can you beat 1GH/W by a factor of 10x?  Can anyone?  No other competitor has, no other competitor even indicates that is possible.  There is nothing to indicate that a 1,000% increase in performance is possible at 28nm.  If it isn't then these chips would be "obsolete" anytime soon.  This is not to say that the price of new hardware won't continue to decline, they will .  Still given the financial rewards for designing a superior chip the fact that nobody (not just HF but all competitors) has done so would mean claiming the chip will be "obsolete" requires a little more than a empty statement.

[crumbs]

If the chip is considered "old tech" in 90 days after delivery and the secondary market doesn't develop, do we know that HashFast has our back and will turn our chips into useful hasher?

How would a 28nm chip be "old tech" in 90 days?  See anyone releasing a chip magnitudes higher efficiency?  The price of this chip (and all other ASIC) chips is almost guaranteed to decline but that doesn't make it obsolete.  

You're tossing around 28nm as some sort of hallmark of quality, a standard by which a chip is measured.  That's ridiculous.  My cat can cut & paste some cores & have them implemented in 28nm process.  Or a team of experienced engineers could go through multiple iterations of design/prototype/redesign to come up with a slightly better chip using the same 28nm tech.  Do you suppose a good design house could beat my cat by a factor of 10?  My cat don't think so, but i worry.  He's ordered himself a dev board & pick up on the lingo.  He's pretty good at getting what he wants, so we'll see.

Well I think the burden of proof would be on the one making the outlanding claims.  Can you beat 1GH/W by a factor of 10x?  Can anyone?  No other competitor has, no other competitor even indicates that is possible.  There is nothing to indicate that a 1,000% increase in performance is possible at 28nm.  If it isn't then these chips would be "obsolete" anytime soon.  This is not to say that the price of new hardware won't continue to decline, they will .  Still given the financial rewards for designing a superior chip the fact that nobody (not just HF but all competitors) has done so would mean claiming the chip will be "obsolete" requires a little more than a empty statement.

Let's slow down a bit.  HashFast is the one making extraordinary claims -- a team of unknowns bringing an unusual 28nm ASIC to market in record time.  With no previous ASIC experience.  Nothing but the founder's love of bitcoin for credibility.  And you want *me* to substantiate my claims?

Edit:  I'm still trying to wrap my head around what you just wrote...  A guy on the interwebz promises to make a 400GH/s 28nm ASIC, and you're fine with that, but *I* have to prove that it might be obsolete in seven months?!  (and yes, that's seven from now -- start counting from the refund date: Jan 1st, 2014)

[DeathAndTaxes]

If the chip is considered "old tech" in 90 days after delivery and the secondary market doesn't develop, do we know that HashFast has our back and will turn our chips into useful hasher?

How would a 28nm chip be "old tech" in 90 days?  See anyone releasing a chip magnitudes higher efficiency?  The price of this chip (and all other ASIC) chips is almost guaranteed to decline but that doesn't make it obsolete.  

You're tossing around 28nm as some sort of hallmark of quality, a standard by which a chip is measured.  That's ridiculous.  My cat can cut & paste some cores & have them implemented in 28nm process.  Or a team of experienced engineers could go through multiple iterations of design/prototype/redesign to come up with a slightly better chip using the same 28nm tech.  Do you suppose a good design house could beat my cat by a factor of 10?  My cat don't think so, but i worry.  He's ordered himself a dev board & pick up on the lingo.  He's pretty good at getting what he wants, so we'll see.

Well I think the burden of proof would be on the one making the outlanding claims.  Can you beat 1GH/W by a factor of 10x?  Can anyone?  No other competitor has, no other competitor even indicates that is possible.  There is nothing to indicate that a 1,000% increase in performance is possible at 28nm.  If it isn't then these chips would be "obsolete" anytime soon.  This is not to say that the price of new hardware won't continue to decline, they will .  Still given the financial rewards for designing a superior chip the fact that nobody (not just HF but all competitors) has done so would mean claiming the chip will be "obsolete" requires a little more than a empty statement.

Let's slow down a bit.  HashFast is the one making extraordinary claims -- a team of unknowns bringing an unusual 28nm ASIC to market in record time.  With no previous ASIC experience.  Nothing but the founder's love of bitcoin for credibility.  And you want *me* to substantiate my claims?  

Please stick to one claim at a time.  You claimed the chip would be obsolete due to superior tech.  Obviously it doesn't matter how superior future tech is if no chips are ever delivered.   So HF delivers a chip but the chips are worthless because some as of yet superior tech renders it obsolete in the near future.  Claiming superior (>10GH/W) tech is right around the corner is an extraordinary claim regardless of who's is making the chips.  The same "obsolete" argument would apply to every ASIC in production right now regardless of who is making it.

Will HF deliver a chip?  Well that is an entirely different argument.  It seems kinda stupid to be debating the merits of the miner protection plan if you believe no chip will be delivered at all.  Right?