1GH/s, 20w, $500 — Butterflylabs, is it a scam?

[makomk]

You can validate the subsystem .. e.g. you give it a work unit it and it completes all 2^32 nonce values in XX seconds. without having a completely working system.  Doing so you can be relatively confident of the performance of the final system, as much as you can be with any pre-production setup.

Not sure this makes sense. They appear to be using an FPGA, and until you have a final working FPGA bitstream for your board complete with any IO logic there's really no way to be sure what clock speed you're going to reach. The placement and routing tools can be incredibly temperamental. If they have got one, it'd be surprising to say the least if they couldn't get very close indeed to its full performance.

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[bulanula]

So then what exact time is this ? I am really watching this with anticipation. Thank you !

[Transisto]

.... no hard numbers are released for this particular demo, although I will confirm what I actually see without providing exact numbers ...

1Ghs more or less 15% would that be vague enough a number ?

[fred0]

The BitForce Saga Act II - The Demo

BFL: Hi Inaba, good to see you again. We hope that as a trusted source for forum members you can witness the historic bitcoin widget, err, BitForce SHA256 Single.

Inaba: Yes, good to be here. Hopefully the glitches have been worked out.

BFL:  Yes, well, here is the widget, along with updated software.

Inaba: Yes, I'll just plug this in.

BFL: Remember our agreement about hard numbers.

Inaba: Yeah, well look at that.

BFL: Yes. I hope this puts any doubt to rest.

Inaba:  Well this forum lot is a stubborn group.

to be continued in Act III - The Crisis

[sadpandatech]

I just spoke to BFL and they agreed to demo the current development hardware/firmware tonight.  However, I am otherwise already engaged tonight and they agreed to do the demo tomorrow afternoon.

Part of the agreement of me viewing the development hardware and software was that no hard numbers are released for this particular demo, although I will confirm what I actually see without providing exact numbers until they have a production version of the software available for release.

Not exactly what I know we all want to see, but at least they are willing to provide something.  Having developed both hardware and software products in the past, I am inclined to be a little lenient with expected production issues to a moderate degree.

So anyway, I will report back what I see, just don't expect hard numbers for the demo tomorrow.

  Rock on, thanks.  Even though you can't give hard numbers can you atleast give us a thumbs up or something if it is within, say, 20% of the stated 1.05GHs? ;p

[plastic.elastic]

I just spoke to BFL and they agreed to demo the current development hardware/firmware tonight.  However, I am otherwise already engaged tonight and they agreed to do the demo tomorrow afternoon.

Part of the agreement of me viewing the development hardware and software was that no hard numbers are released for this particular demo, although I will confirm what I actually see without providing exact numbers until they have a production version of the software available for release.

Not exactly what I know we all want to see, but at least they are willing to provide something.  Having developed both hardware and software products in the past, I am inclined to be a little lenient with expected production issues to a moderate degree.

So anyway, I will report back what I see, just don't expect hard numbers for the demo tomorrow.

  Rock on, thanks.  Even though you can't give hard numbers can you atleast give us a thumbs up or something if it is within, say, 20% of the stated 1.05GHs? ;p

So this goes from $500 1GH/s to a $700 800MH/s ?

Interesting.

[legolouman]

I just spoke to BFL and they agreed to demo the current development hardware/firmware tonight.  However, I am otherwise already engaged tonight and they agreed to do the demo tomorrow afternoon.

Part of the agreement of me viewing the development hardware and software was that no hard numbers are released for this particular demo, although I will confirm what I actually see without providing exact numbers until they have a production version of the software available for release.

Not exactly what I know we all want to see, but at least they are willing to provide something.  Having developed both hardware and software products in the past, I am inclined to be a little lenient with expected production issues to a moderate degree.

So anyway, I will report back what I see, just don't expect hard numbers for the demo tomorrow.

  Rock on, thanks.  Even though you can't give hard numbers can you atleast give us a thumbs up or something if it is within, say, 20% of the stated 1.05GHs? ;p

So this goes from $500 1GH/s to a $700 800MH/s ?

Interesting.

Actually, these prices being raised and numbers being lowered make sense. While I question the legitimacy of this, I think that the prices being raised could mean that production costs, and actual numbers they intended to reach aren't as easy to reach (with early software) as they intended. My understanding is that the hardware is quite capable, but the software isn't yet. I'm open to criticism on that point, but my overall statement I think makes sense.

[DeathAndTaxes]

I just spoke to BFL and they agreed to demo the current development hardware/firmware tonight.  However, I am otherwise already engaged tonight and they agreed to do the demo tomorrow afternoon.

Part of the agreement of me viewing the development hardware and software was that no hard numbers are released for this particular demo, although I will confirm what I actually see without providing exact numbers until they have a production version of the software available for release.

Not exactly what I know we all want to see, but at least they are willing to provide something.  Having developed both hardware and software products in the past, I am inclined to be a little lenient with expected production issues to a moderate degree.

So anyway, I will report back what I see, just don't expect hard numbers for the demo tomorrow.

  Rock on, thanks.  Even though you can't give hard numbers can you atleast give us a thumbs up or something if it is within, say, 20% of the stated 1.05GHs? ;p

So this goes from $500 1GH/s to a $700 800MH/s ?

Interesting.

Actually, these prices being raised and numbers being lowered make sense. While I question the legitimacy of this, I think that the prices being raised could mean that production costs, and actual numbers they intended to reach aren't as easy to reach (with early software) as they intended. My understanding is that the hardware is quite capable, but the software isn't yet. I'm open to criticism on that point, but my overall statement I think makes sense.

Well mining software is pretty trivial (relatively speaking no offense intended mining software authors), and open source.  My understanding is they are simply taking an open source mining software and modifying it to feed the exact same data in a format understood by their board.

Most of the mining software would be identical to existing software (long polling, pool configuration, share submission, etc) the only part which would be modified it talking to the hashing engine and it is as "simple" as "engine here is a block header. Complete nonces 0 to xxx using this header and return any shares".

[legolouman]

I just spoke to BFL and they agreed to demo the current development hardware/firmware tonight.  However, I am otherwise already engaged tonight and they agreed to do the demo tomorrow afternoon.

Part of the agreement of me viewing the development hardware and software was that no hard numbers are released for this particular demo, although I will confirm what I actually see without providing exact numbers until they have a production version of the software available for release.

Not exactly what I know we all want to see, but at least they are willing to provide something.  Having developed both hardware and software products in the past, I am inclined to be a little lenient with expected production issues to a moderate degree.

So anyway, I will report back what I see, just don't expect hard numbers for the demo tomorrow.

  Rock on, thanks.  Even though you can't give hard numbers can you atleast give us a thumbs up or something if it is within, say, 20% of the stated 1.05GHs? ;p

So this goes from $500 1GH/s to a $700 800MH/s ?

Interesting.

Actually, these prices being raised and numbers being lowered make sense. While I question the legitimacy of this, I think that the prices being raised could mean that production costs, and actual numbers they intended to reach aren't as easy to reach (with early software) as they intended. My understanding is that the hardware is quite capable, but the software isn't yet. I'm open to criticism on that point, but my overall statement I think makes sense.

Well mining software is pretty trivial (relatively speaking no offense intended mining software authors), and open source.  My understanding is they are simply taking an open source mining software and modifying it to feed the exact same data in a format understood by their board.

Most of the mining software would be identical to existing software (long polling, pool configuration, share submission, etc) the only part which would be modified it talking to the hashing engine and it is as "simple" as "engine here is a block header. Complete nonces 0 to xxx using this header and return any shares".

Oh, well see I was wrong. I thought FPGA mining software was still very inefficient (and not optimized) I assumed this was the issue. The price increase, and hash decrease could come from a hardware limitation they did not foresee in the past.

[Inaba]

I am not speaking with any first hand knowledge, I'm just speculating... but I think the price increase came from a discussion I had with BFL in regards to the current state of Bitcoin vs some factors relating to used GPU sales...

The possible hashrate decrease I think is a function of trying to get the communication problem(s) they are having worked out and them artificially slowing things down.  That's just my gist from talking to them, so don't take any of that as some sort of statement on what's may or may not be happening inside BFL, of which I am not privy.

[sadpandatech]

I am not speaking with any first hand knowledge, I'm just speculating... but I think the price increase came from a discussion I had with BFL in regards to the current state of Bitcoin vs some factors relating to used GPU sales...

The possible hashrate decrease I think

  I agree and also pointed out in an email to them something along the lines of the price 'not being in the spirit of sound capitalism'...

 Not directed at Inaba or anyone inparticular;
  There is no possible hashrate decrease unless you know soemthing we don't.  My request to get any kind of report back and placing a range on it, in this case 20%, was simply in the hopes if getting any kind of word back on the performance. It was taken out of context greatly by the next poster. I guess I could have clearified my intentions better. But after reading my request a few times I am finding it hard to see how it could have been percieved as any kind of official statement of performance or willingness to accept the result of -20% at new price.......

  I know my grammar and verbage can be a little rough sometimes but there is very rarely anything to "read between the lines" in my ramblings..


  Cheers,
    Derek

[DeathAndTaxes]

I am not speaking with any first hand knowledge, I'm just speculating... but I think the price increase came from a discussion I had with BFL in regards to the current state of Bitcoin vs some factors relating to used GPU sales...

The possible hashrate decrease I think

  I agree and also pointed out in an email to them something along the lines of the price 'not being in the spirit of sound capitalism'...

What you mean that old adage of figuring out the cost of production then putting fair markup on it is not good enough anymore, that used to be the definition of sound capitalism until the fucking MBAs and their price points got involved with their everyone must make sure to gouge as much as possible from the customer.

Fair markup is what the market will accept.  For some products that might be 1% for others it might be 70%.

If this product is real then selling it cheaper just because you can was never "sound capitalism". 

If the market would accept $700 and you are limited to 100 initial units why would you sell it for a nickle less than $700.  To make less money?  To take more risk for no increased gain.  Obviously if the market doesn't accept $700 they would need to lower the price.  If their cost was $3,500 per board well the market likely isn't going to accept that even with 0% markup.

Not sure what "old adage" you are talking about but cost of production + some % has never been the market value for anything.  My cost of production for a bag of aged dog poop (70% pure) is $3.95.  Will you consider it a good deal at only 1% markup?  If I can mine gold @ $600 an ounce would you consider it a bad deal if I sold you as much as you want for 100% markup?

Since you are passing on the "ripoff" gold @ $1200 an ounce let me know how many tons of aged dog poop you would like.  I accept BTC or Paypal.

[DeathAndTaxes]

I would not pay $20 for gold it is fools like you that keep these ripoff prices in effect, you must bend over for ever new release from Apple too do ya...

I own no Apple products.  As far as Gold I though the fair price was production cost + small profit margin.  Global gold production costs are ~$600 per ounce.  That would put the "sound capitalistic price" (your definition) at $650 to $700 right?  So why do you value Gold at <$20 per ounce?   I guess you just indicated the fallacy of your own claim.  The "fair price" is what the market will bear and has nothing to do w/ production cost.  You wouldn't even consider a price of 3% of production cost (97% loss for producer) to be "fair".

There is no "sound capitalism" in keeping margins lower than market will bear.  If the market won't bear higher prices then you need to ACCEPT lower margins (or possible negative margins, or halt production).

I'll take it you aren't interested in any "high value", "low market" aged dog poop then?

[fred0]

I would not pay $20 for gold it is fools like you that keep these ripoff prices in effect, you must bend over for ever new release from Apple too do ya...

I own no Apple products.  As far as Gold I though the fair price was production cost + small profit margin.  Global gold production costs are ~$600 per ounce.  I guess you just indicated the fallacy of your own claim.  The "fair price" is what the market will bear.

There is no "sound capitalism" in keeping margins lower than market will bear.  If the market won't bear higher prices then you need to ACCEPT lower margins (or possible negative margins, or halt production).

That's why health care is an industry in the good ol' USA. Can't afford to pay what we want, fine go die somewhere.  After all fair markup is what the market will accept.

[likuidxd]

I would not pay $20 for gold it is fools like you that keep these ripoff prices in effect, you must bend over for ever new release from Apple too do ya...

Gold is one of the oldest currency on earth and most governments are scared of its purchasing power. If you don't think it's worth its trade price or higher, I take you for the fool.

[DeathAndTaxes]

I would not pay $20 for gold it is fools like you that keep these ripoff prices in effect, you must bend over for ever new release from Apple too do ya...

I own no Apple products.  As far as Gold I though the fair price was production cost + small profit margin.  Global gold production costs are ~$600 per ounce.  I guess you just indicated the fallacy of your own claim.  The "fair price" is what the market will bear.

There is no "sound capitalism" in keeping margins lower than market will bear.  If the market won't bear higher prices then you need to ACCEPT lower margins (or possible negative margins, or halt production).

That's why health care is an industry in the good ol' USA. Can't afford to pay what we want, fine go die somewhere.  After all fair markup is what the market will accept.

Well no there is absolutely no free market in health care costs.  Personally I believe the only viable health care system would be universal coverage.  Yeah I can be a capitalist AND believe that capitalism isn't the answer for everything.  I believe free markets could solve health care "crisis" but most people would be unwilling to accept that solution so rather than beat my head on the wall for ideology I would accept any sane public or private system.    What we have now in the US has absolutely nothing to do w/ free markets of fair pricing.

Still Healthcare isn't FPGA or Gold or dog poop.  Capitalism and free markets do fine in those areas.  Selling your product based on some pre-defined notion of a "fair price" is stupid.  It leaves you under capitalized.  What is a competitor releases a better product?  Would have been nice to collect higher margins on your product before it became obsolete.  What if you face unexpected regulatory or legal costs.  What is warranty claims are higher than expected.

Limiting profits just to limit them is not a free market.  The market will limit what BFL (or any company) can sell the product for.  

[P4man]

If the market would accept $700

First of all, do you have any evidence "the market" would accept $700 before BFL had working products? Judging by this thread, precious few ppl seemed willing to pay even $499 without bullet proof evidence. It seems unlikely they sold out all 100. Besides, even if only as a publicity stunt, it must have been well worth the few $1000 it "cost" them.

As for why "only" $700 now; economics 101 teaches us lower price will increase volume. Particularly if it turns out there is an s-asic  under that heatsink, its not very hard to see why they are undercutting the other FPGA by so much. Because they can, and because they have to to achieve their volume. The window of opportunity isnt going to stay open forever, if they have an open standing order for 1000 or several 1000's of these chips, it tends to have an effect on how much "the market will accept". Keep in mind just 1000 - what you stated was the minimum order for HC s-asics- so 1000 of those singles would represent ca 15% of the entire bitcoin network.  You might find a few fools willing to pay $2000 for it, but you wont find 1000 of them.

[DeathAndTaxes]

If the market would accept $700

First of all, do you have any evidence "the market" would accept $700 before BFL had working products? Judging by this thread, precious few ppl seemed willing to pay even $499 without bullet proof evidence. It seems unlikely they sold out all 100. Besides, even if only as a publicity stunt, it must have been well worth the few $1000 it "cost" them.

As for why "only" $700 now; economics 101 teaches us lower price will increase volume. Particularly if it turns out there is an s-asic  under that heatsink, its not very hard to see why they are undercutting the other FPGA by so much. Because they can, and because they have to to achieve their volume. The window of opportunity isnt going to stay open forever, if they have an open standing order for 1000 or several 1000's of these chips, it tends to have an effect on how much "the market will accept". Keep in mind just 1000 - what you stated was the minimum order for HC s-asics- so 1000 of those singles would represent ca 15% of the entire bitcoin network.  You might find a few fools willing to pay $2000 for it, but you wont find 1000 of them.

I don't disagree with any of that.  Not really sure what you are refuting.

I was responding to this:
"What you mean that old adage of figuring out the cost of production then putting fair markup on it is not good enough anymore, that used to be the definition of sound capitalism "

The nominal amount doesn't matter.  $700, $200, $2000, $25,000.  There is no "old adage" about selling product at a price that is a fair markup on cost of production.  You sell a product at the price the market will bear.

So once again I am not sure what point you are making but it wasn't in response to mine.

[likuidxd]

I think the 'big box' stores have proven in a so called capitalist economy, selling quantity far outweighs selling at an acceptable market price

[Transisto]

The only thing one could say is Thanks Inaba and others for letting us sell our used card,
Or being mad at the price increase.

Can't believe this turned into a two page economic lesson on gold vs poo prices.

I wish to add, unlike GPUs for gaming, there is no cap on the number of these an individual could want.