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[Vladimir]

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[dust]

If i'm reading this correctly, these prices are ridiculous.  ~12k USD to rent a 4x5970 box (~2GH/s) for a year?  That is around 3k USD in hardware and another 1-2k in electricity.

It appears that you (and other miners?) are buying out the global stock of 5970s, so this could be an attempt to monopolize bitcoin mining.  However, I can't see this tactic succeeding as there are still 58xx and 69xx cards available.

[Vladimir]

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[Anonymous]

* buys shares in AMD.

[ribuck]

If i'm reading this correctly, these prices are ridiculous

Consider Vladimir's 1GHhash/sec contract at £1203 per 3 months. That's £13.22 or $21.36 per day. According to the generation calculator, you can expect to generate 45 BTC per day. Therefore, if you can sell your generated BTC for $0.48 or more, you are winning. At the current price (say, $0.65), you would make a profit of $7.89 per day.

Of course the generation difficulty is likely to increase every 10 days or so, and you will generate fewer coins per day as time goes on. If the price of bitcoins rises fast enough, the venture will continue to be profitable. Otherwise, it becomes a losing proposition. There is certainly a risk, but right now the numbers add up.

One reason to consider this service is if you want to generate, but don't want the noise in your house.

[Vladimir]

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[Vladimir]

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[Vladimir]

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[Vladimir]

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[morpheus]

Do you accept bitcoin?

[Vladimir]

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[morpheus]

Also if you think about it. Buying my service one effectively is buying bitcoins, without driving exchange rates up. Hence it is a Fiat -> BTC conversion vehicle, turning it into BTC -> BTC conversion machine would not make as much sense really.

True, but I have more bitcoin than cash right now, and it's easier to send bitcoin to the UK than USD.

I'm thinking about it.

[talkinrock]

EDITED by talkinrock

[ribuck]

... I have more bitcoin than cash right now, and it's easier to send bitcoin ...

PM sent.

[Vladimir]

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[Vladimir]

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[ronaldmaustin]

Saw this thread in your sig and checked it out.  Interesting business.  At first, I thought, why is he betting against the Bitcoin?  This because, as pointed out, at current rates it is a good deal contrary to prior posts.  People are basically buying a futures contract on the Bitcoin.  But why, over the term of the contract, would you give up Bitcoins that are worth more than the value of the contract?  Simple answer . . . without the contract you would not have the future Bitcoins since you are using the contract money to buy the equipment.  At the end of the contract, you don't have the Bitcoins generated by the 5970's but you DO have the worlds largest private collection of 5970's.   Next to China and the US, you will probably have the worlds next fastest super computer.  Good business model and no risk. [I have a similar business model myself - I call it my credit card.] Hope someone competes.  Then again, I hope they don't and I hope your house burns down in an electrical fire, since you make it easy for non-technical people to mine Bitcoins and you are in competition with me :-)

[ronaldmaustin]

In fact, if the increase in difficulty in mining could be calculated with reasonable probability, you could just sell futures contracts outright.  $3000 today buys you 5000 Bitcoins in March, for example.  You would have many more takers.  A moment ago I wanted your house to burn and now I 'm trying to help you get business.  Go figure.

[Vladimir]

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[ronaldmaustin]

In fact, if the increase in difficulty in mining could be calculated with reasonable probability, you could just sell futures contracts outright.  $3000 today buys you 5000 Bitcoins in March, for example.  You would have many more takers.  A moment ago I wanted your house to burn and now I 'm trying to help you get business.  Go figure.

I am working on this project full time now and have some help too. Competing with me will not be easy.

Before responding, just so you know where I'm coming from, let me say that you are well respected and known around here and I think there is very low risk in your offer and it is a genuinely good one that I would myself invest in if I had the money.  Your offer is a 'win-win' for both you and your customers.  But . . . competing with you would be very easy, I think, because the upfront investment is made by those buying the contract and, as pointed out in past posts, the contract cost well exceeds the equipment cost.  In fact, if I were as well known and trusted as you I would compete with you myself (if my mom would not mind losing the basement space).   But people don't know that I'd be around in three months, much less a year, or that I'd evaporate into thin air with their money. [EDIT- I meant "would not evaporate" ... Freudian slip?]  That is your advantage at this point.

And, as I previously said, I hate to even mention it because if my statements encourage others to compete with you, they are competing with me as well, since everyone mining is in competition with eachother.  But my gut still tells me that competition is a good thing for both of us on some level.