Mining Giant Bitmain Posts $500 Million Loss in IPO Financial Filing

[Wind_FURY]

If price follows hashing power, then who in the market gives assurances of buy support if the price crashing, and there are no buyers? The miners? I believe they are both distinct and separate, but it's more logical that the hashing power adjusts depending on the price.

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[franky1]

If price follows hashing power, then who in the market gives assurances of buy support if the price crashing, and there are no buyers? The miners? I believe they are both distinct and separate, but it's more logical that the hashing power adjusts depending on the price.

but the charts do not show hashing power adjust to prices

if miners were in majority market trending. then the hashrate chart would look exactly like a shadow of the market. a offset copy of the market. a silhouette of a mountainous landscape.
but its not. its a curve. where events can be explained by non market events

secondly. when you are looking at the prices you are not understanding the full picture. you are just seeing the daily adjusted high-mid range.

if you think of bitcoins price as being made up of layers. where by the bottomline (prices people refuse to sell below) as the bottomline support. and anything above is the speculative/random/volitile
like waves above the tideline
you start to see the bigger picture

so if you take the cheapest method of mining. and take the cheapest price of a coin on the market over a period (bottomline support)
and you take the ultimate understanding that people try to find the cheapest way to obtain a coin. which is the mining:market dynamic

and you chart it out. and you will see that its the mining that moves the market

i can understand the flawed 'logic' that basement dwelling hobby miners would follow the markets. as thier costs are higher and they are more 'paycheck to paycheck' mindset of wanting/needing to cashout ASAP.

hobby miners are not looking to hoard bitcoin. they are looking to 'pool hop' to altcoins just to make fiat profit. so yea their mindset is not on securing the bitcoin network, not on growing the bitcoin network. they are happy to jump off the network if a more profitable altcoin is the +% profit of the day coin.
so see the logic not of the FEW hobby miners that pool hop hourly/daily which the CURVE OF HASHPOWER shows and proves the hobby emotional market followers do not impact

but think about it from the logic of the true BITCOIN asic FARMS that make up the majority who are playing a different game and its the majority(farms) that are not playing the same game as hobby miners that are making up the progressive planned CURVES.

again if miners were in majority market trending. then the hashrate chart would look exactly like a silhouette of the market. a silhouette of a mountainous landscape.
but its not. its a curve. where events can be explained by non market events

[Wind_FURY]

Thanks for that kind of reply franky1. Not because I believe you are right, but because you are trying to make a real debate absent of personal attacks.

But on the topic, it still is debatable who's right or who's wrong. More exploration required in my opinion.

[pushups44]

The continuing losses of Bitmain are welcome news insofar as that keeps the company from continuing to build up a monopoly in the cryptocurrency space and thus dissuades investors from funding this entity. We need as much decentralization as possible, especially in mining.

[franky1]

Thanks for that kind of reply franky1. Not because I believe you are right, but because you are trying to make a real debate absent of personal attacks.

But on the topic, it still is debatable who's right or who's wrong. More exploration required in my opinion.

psychology: people want to find the cheapest way to obtain bitcoin.. meaning the 2 main methods of getting coin.. market:mining have a link

maturing: mined coins are not spendable instantly. so its not like mining can spend coins as soon as a market changed. so miners had to plan ahead atleast a day minimum their cost/profit. (100confirm maturing). so miners didnt just react to daily changes, they preplanned for the future

math: markets were speculative and volatile and usually have a certain amount of bubbles above the waterline (margin/profit/speculation/premium/extra) so markets PRICE are near always more than the cheapest mining costs. so the mindset was more so on mining to get coin cheap. and sell the coin for profit later to get fiat. thus mining price was mor important upfront and market react to it later

logistics: mining cant just react instantly by the minute. so its not like if a market jumped 50% today that there would be enough ASICS to react.

planning: mining is reliant on electric, and electric companies supplying farms cant just ramp up electricity capacity in seconds without risk of local brownouts. so smart asic farms preplan expansion, upgrades and switch-overs MONTHS ahead

personally i was hoping to see the october s9 sell off/s15 'testing'. to cause a increase in hashrate. thus give positive market pressure for november-february. but it seems they not only didnt want to sell off s9's to replace them 1-for-2 (1 s15 for every 2 s9 to stay at same hashrate).. but they let the hashrate slip.. thus hashrate went down when 'beta testing' the s15's thus not giving support for a stable price to stay above the (pre october) $5800 bottomline support

so with ASIC companies gathering loads of coins from selling S9's
so with ASIC companies gathering coins from mining
did not hit the market the same day as they were mined/gathered. (check blockchain data of coin rewards. they were not sold instantly at 100 confirms)
thus the markets didnt react until november

[cryptokingdom]

I believe mining was very profiting before the bear market started. Every business have it ups and down. Bitmain is the mining Giant that I know will recovery all the loses when bull run starts.

[Wind_FURY]

Ok franky1, thanks. I will look more closely into this topic, ask some miners' opinions, and see what information I get. Honestly, I'm not quite convinced yet, but my mind is open.

On the original topic, I told you Bitmain will have losses on the 3rd quarter. Wait for the 4th quarter's filing.

[philipma1957]

Thanks for that kind of reply franky1. Not because I believe you are right, but because you are trying to make a real debate absent of personal attacks.

But on the topic, it still is debatable who's right or who's wrong. More exploration required in my opinion.

psychology: people want to find the cheapest way to obtain bitcoin.. meaning the 2 main methods of getting coin.. market:mining have a link

maturing: mined coins are not spendable instantly. so its not like mining can spend coins as soon as a market changed. so miners had to plan ahead atleast a day minimum their cost/profit. (100confirm maturing). so miners didnt just react to daily changes, they preplanned for the future

math: markets were speculative and volatile and usually have a certain amount of bubbles above the waterline (margin/profit/speculation/premium/extra) so markets PRICE are near always more than the cheapest mining costs. so the mindset was more so on mining to get coin cheap. and sell the coin for profit later to get fiat. thus mining price was mor important upfront and market react to it later

logistics: mining cant just react instantly by the minute. so its not like if a market jumped 50% today that there would be enough ASICS to react.

planning: mining is reliant on electric, and electric companies supplying farms cant just ramp up electricity capacity in seconds without risk of local brownouts. so smart asic farms preplan expansion, upgrades and switch-overs MONTHS ahead

personally i was hoping to see the october s9 sell off/s15 'testing'. to cause a increase in hashrate. thus give positive market pressure for november-february. but it seems they not only didnt want to sell off s9's to replace them 1-for-2 (1 s15 for every 2 s9 to stay at same hashrate).. but they let the hashrate slip.. thus hashrate went down when 'beta testing' the s15's thus not giving support for a stable price to stay above the (pre october) $5800 bottomline support

so with ASIC companies gathering loads of coins from selling S9's
so with ASIC companies gathering coins from mining
did not hit the market the same day as they were mined/gathered. (check blockchain data of coin rewards. they were not sold instantly at 100 confirms)
thus the markets didnt react until november

The bold is less true then it was last year.
The red is still true.

So if coins jump to 5000 mining will do a jump and fast.
This is due to easy clocking on :

bitmain gear
M10 gear
Innosilicon gear.

I have left the world on garage miner. Ie 2x 30 amp 240 circuits.

I added one solar array with buy solar and we were up to 30 kwatt
We now added a second solar array and are at 85 kwatts and hour.
We are in talks to add 115kwatts bringing us to 200kwatts. At zero to four cents cost per kwatt.

So if prices jump we can clock up out s15s m10s t15s and s9s in under 1 hour.

But we would exceed out low cost solar price of 0-4 cents.   Use grid power of 11-16 cents.

Many big farms have 2-4 cent contracts and can exceed the contract of say 5 mega watts but do so at a higher cost.
Many big farms still have the s9 and I know of some with 1000 s9s on lowest setting doing 800 watts a unit. If prices jump they could go to the 1200 watt setting in under an hour.

But at a higher power cost since they exceed the contract of say 5 megawatts.

I am on a shit iPad. Give me a minute to link a graph.

[mercedes321]

i hate bitmain in bear and love in abull,...the loss was real i believe, but in a bull guys 1L3 was being traded at 6K eur in glorry days, can u imagine, and now it was finished with 20 buks at their cloud site, similar S9,...and it happen within a year-1.5Y... and we are going out from accumulation phase guys, ROI when BTC is 8.5k, can be much less then 500 days.

[pixie85]

well keeping a dying shitcoin (ie. bcash) takes a lot of money. they need to throw man power, hashing power, money at exchanges for pumping purposes,... and it may not look it but all of these things cost a lot of money. and they have been doing it for over a year now and with bitcoin price declining their main source of revenue has also been decreasing so they didn't have as much money to cover those costs.

Too early to blame everything on BCH. That coin is getting so insignificant nowadays..

It pumped from 300 to 4000 dollars at one point. Somebody had to lead that pump and it probably was Bitmain that switched to mine it at that time. This was combined with Roger's smart move to call the original bitcoin "core" on his site and make their wallet the default when you visited bitcoin.com. They spent a lot of money and did a lot of dirty moves to pump BCH and in the end lost a lot of money. I'd be happy if Bitmain went bankrupt because of it but they won't. They will still be here next year.

[Wind_FURY]

Thanks for that kind of reply franky1. Not because I believe you are right, but because you are trying to make a real debate absent of personal attacks.

But on the topic, it still is debatable who's right or who's wrong. More exploration required in my opinion.

psychology: people want to find the cheapest way to obtain bitcoin.. meaning the 2 main methods of getting coin.. market:mining have a link

maturing: mined coins are not spendable instantly. so its not like mining can spend coins as soon as a market changed. so miners had to plan ahead atleast a day minimum their cost/profit. (100confirm maturing). so miners didnt just react to daily changes, they preplanned for the future

math: markets were speculative and volatile and usually have a certain amount of bubbles above the waterline (margin/profit/speculation/premium/extra) so markets PRICE are near always more than the cheapest mining costs. so the mindset was more so on mining to get coin cheap. and sell the coin for profit later to get fiat. thus mining price was mor important upfront and market react to it later

logistics: mining cant just react instantly by the minute. so its not like if a market jumped 50% today that there would be enough ASICS to react.

planning: mining is reliant on electric, and electric companies supplying farms cant just ramp up electricity capacity in seconds without risk of local brownouts. so smart asic farms preplan expansion, upgrades and switch-overs MONTHS ahead

personally i was hoping to see the october s9 sell off/s15 'testing'. to cause a increase in hashrate. thus give positive market pressure for november-february. but it seems they not only didnt want to sell off s9's to replace them 1-for-2 (1 s15 for every 2 s9 to stay at same hashrate).. but they let the hashrate slip.. thus hashrate went down when 'beta testing' the s15's thus not giving support for a stable price to stay above the (pre october) $5800 bottomline support

so with ASIC companies gathering loads of coins from selling S9's
so with ASIC companies gathering coins from mining
did not hit the market the same day as they were mined/gathered. (check blockchain data of coin rewards. they were not sold instantly at 100 confirms)
thus the markets didnt react until november

The bold is less true then it was last year.
The red is still true.

So if coins jump to 5000 mining will do a jump and fast.
This is due to easy clocking on :

bitmain gear
M10 gear
Innosilicon gear.

I have left the world on garage miner. Ie 2x 30 amp 240 circuits.

I added one solar array with buy solar and we were up to 30 kwatt
We now added a second solar array and are at 85 kwatts and hour.
We are in talks to add 115kwatts bringing us to 200kwatts. At zero to four cents cost per kwatt.

So if prices jump we can clock up out s15s m10s t15s and s9s in under 1 hour.

But we would exceed out low cost solar price of 0-4 cents.   Use grid power of 11-16 cents.

Many big farms have 2-4 cent contracts and can exceed the contract of say 5 mega watts but do so at a higher cost.
Many big farms still have the s9 and I know of some with 1000 s9s on lowest setting doing 800 watts a unit. If prices jump they could go to the 1200 watt setting in under an hour.

But at a higher power cost since they exceed the contract of say 5 megawatts.

I am on a shit iPad. Give me a minute to link a graph.

Bump.

franky1, your reply to philipma1957? I still can't see how the miners' costs can support, and dictate, a market as especially volatile as Bitcoin.

Do the the miners buy Bitcoins too, in durations of price lower than mining costs?

[Msworld83]

The market is currently in bad shape which brought about the decline in all coin including the king refer to as btc which also affect the mining of the coin , and that alone gives low turnout for the price which might also see dump in some time soon as the waves still look bearish but it will be nice to hold their reward now and enjoy the price when the bull finally return.

[franky1]

Bump.

franky1, your reply to philipma1957? I still can't see how the miners' costs can support, and dictate, a market as especially volatile as Bitcoin.

Do the the miners buy Bitcoins too, in durations of price lower than mining costs?

the mining:market dynamic plays out that hardly ever is bottomline mining costs higher than bottomline market price.

firstly you have to realise is the market is layered

imagine it like the sea
sea level is underlying (bottomline) then above that is the waves of speculation.. market price only see's and marks the height of the waves and you really have to find the lowest height(monthly low) to find the real water level

imagine it like a bathtub with bubblebath water
water level is underlying (bottomline) then above that is the bubbles of speculation.. market price only see's and marks the height of the bubbles and you really have to find the lowest height(monthly low) to find the real water level

for instance winter 2017/spring-summer-autumn 2018 was ~$5800 bottomline value even though the price was always above that(nov 2017-nov2018)

mining is not volatile, it does not follow market.
though the hashrates of the network are not equal, its not due to a individual pool jumping up and down but different pools have different hashrates so when different pools win a block, their hashrate shows as a higher or lower number than their competitors last block solution
but none of the pools threw on 3x hash power during november 2017-february 2018.
its easy to see that pools didnt react to the $20k price jump....
...
what goes on is smart pools OTC their coins at a % above thier costs. so say costs were $5800 for most of 2018(q1,2,3,) they were selling their coin for a lil extra via OTC contracts.

it is then the buyers of thos coins that when they see the $20k number in winter 2017-spring 2018 would sell coins for profit which reacted to correct the market down

but they wont want to sell below $6k.. and the miners that had spare coins after the OTC trades wont wont to sell below the $5800 of those first free quarters. so thats why the prices never broke the $5800 barrier

as time approached q4 of 2018 (certain pools ready for testing the next gen asics) they were selling off the old asics cheap giving them more coin(free coin basically). but instead of swapping 2s9 for 1s15 (my expectation) which would have kept hashrates up. or even done a 1for 1 to raise hashrate(my hope) thy decided not to shoot selves in foot like 2013 by rushing to fast, and instead they played a different strategy. they wanted to keep hashrates low so that they were not fighting themselves too fast.
the dumb miners couldnt afford to keep running at a higher cost. so some dropped out(btcc for instance) thus leaving smart pools with a bigger slice(more blocks/more rewards) which meant even at lower network hash the pools could continue and able to fulfill their OTC commitments

pools are less caring about market prices. and more about % share of hash/block creation. because as long as they can stay around say for instance for antpool around the 13% area they are always getting around the 17-19 blocks a day which is the kind of commitment area they plan to stick around

yes antpool has the resources to ramp up and take higher % but thats just going to hurt them in regards to difficulty jumps. so reacting to market price thinking ramping up hashpower during high prices might seem good. it just going to shoot them in foot 2 weeks later, which when corrections in market happen, shoots their other foot too crippling them.

however forgetting about market price(highs)... when pools go through their plan of upping their hashrate and by the time it plays out via th OTC and then the otc buyers from that sell at profit on markets and the buyers on the market buy that, and set thier acquisition costs that third layer of buyer/seller wont sell for less. thus the markets settle to find a new slightly higher bottomline value. and it plays out slowly weeks/months. not minute/hourly.

again major mining farms do not react to hourly/daily price fluctuations (only the small basement /hobbiests that pool/coin jump do, but they are insignificant in the big picture)  

in short..
back in from 2013-2018 i been watching the hashrate and doing math on mining cost to know the bottomline costs thus knew the rough bottomline support the prices would fall to. (sorry no way to predict the spculative highs)
in august 2018 with the announcement of next gen asics my personal thoughts/hopes were another hashrate jump which would cause the bottomline support to go up. in october however i realised the pools were changing tactic by not ramping up hashrate when swapping old for new. so by the time november came i knew not to expect price rise due to a rise of support but instead a price reduction
now im just waiting for some hashrate rises that remain above a certain level for weeks to play out as the bottom line value support rise.
i dont play the games of trying to predict next ATH price. as thats just speculative and temporary drama. i prefer concentrating on knowing the lows and seeing when the lows may progress forward, as thats not volatile, not speculative and not temporary. so im hoping for the s17 or a big influx of s15 buy ups in the mining community as so far this last november2018-feb2019 has seemed to be a slow pickup of hashrate. (it's been a boring period)

[Wind_FURY]

The posts, and explanations get more and more confusing. Hahaha.

phillipma1957 made a good illustration of how miners react quickly after large price moves, but I fail to see how miners increase hashing power on the network, and make the market price follow, unless there's a pre-planned boost from market players. But I will do more reading, and asking.

vapourminer, you merited franky1's post. Can you ELI5?

[franky1]

ok so lets look at that chart of december the 18th to february 14th

i can only see a 20% change throughout the entire period (38exa to 45exa)
i wouldnt call 20% over 2 month "massive"

funny fact.
i went and checked on the last 12 months of changes.
and the average difficulty change per fortnight was 5-6%. so 5 difficulty jumps in th december-march period of that graph. sems to be ontrack with normal progress
 

also the 2 circled elements. 42exa-44exa  was not dramatic. but even so. if you follow the red arrow.back and read the red writing
it seems that it says how the market was being manipulated because "we had hashpower spike THEN price spike"
what it doesnt say is "market then hashrate"

to me, trying to keep things realistic. i feel there is over use of "massive" and "spikes". and its just normal daily fluctuation drama. thus i wouldnt even try using as ammo to prove my point even if the proof was wrote in red writing.

but hey. im more about the sustainable support that growth can be found. not the temporary drama certain people are looking for hence i didnt put any emphasis on the charts, until windfury after 2 posts poked at them.. but didnt actually read the chart

anyway.
the mining:market dynamic has ben a known fact since 2010. even the likes of hal finney pointed it out. as have many over the last few years.

but it must be mad clear its not about using as a crystal ball to be a trend anal for the next ATH speculative price drama.
its just a good measuring stick guide for the long term lows to know the baseline that prices should settle to once all speculation subsides, thus giving a good support area for what is deemed as the value of bitcoin people are reluctant to sell below as thats where it really cuts into majorities(serious peoples) costs if they were foolish to sell below

[franky1]

as for how if there is a hash power rise. windfury cant see that it can cause the markt to follow.. its easy.

when hashpower rises. it costs more to mine bitcoin.
so people decide its not as cheap to buy coin OTC from miners. and instead buy on the market.

buying on the market=price rise
eli-5 enough?

[kelz1]

The result of promoting a shitcoin fork is never going to be positive. However, miners are coming back for the halving so things may turn around

[stompix]

ok so lets look at that chart of december the 18th to february 14th

i can only see a 20% change throughout the entire period (38exa to 45exa)
i wouldnt call 20% over 2 month "massive"

This is because you stick to those percentages that show only one side of the story.
I told you that those tiny increases mean sometimes half a million s9 worth half a billion in investment getting put online.

When the second and third guy started mining bitcoin the difficulty went up 81% but that means just some cpu power, worth a few hundred bucks at most. Make a chart that shows difficulty spikes by correlating them with the most efficient miner prices required for that jump, and you will see how astronomically high the jump that you can't call massive is in reality.

One of my friends told me this once:

Germany had a 3% GDP growth, but Guinea had a 47%, you know how they've managed this?
...
Their goat had triplets

The posts, and explanations get more and more confusing. Hahaha.

phillipma1957 made a good illustration of how miners react quickly after large price moves, but I fail to see how miners increase hashing power on the network, and make the market price follow, unless there's a pre-planned boost from market players. But I will do more reading, and asking.

Because phillipma1957 is a miner, franky1 is not.  

[philipma1957]

Thanks for that kind of reply franky1. Not because I believe you are right, but because you are trying to make a real debate absent of personal attacks.

But on the topic, it still is debatable who's right or who's wrong. More exploration required in my opinion.

psychology: people want to find the cheapest way to obtain bitcoin.. meaning the 2 main methods of getting coin.. market:mining have a link

maturing: mined coins are not spendable instantly. so its not like mining can spend coins as soon as a market changed. so miners had to plan ahead atleast a day minimum their cost/profit. (100confirm maturing). so miners didnt just react to daily changes, they preplanned for the future

math: markets were speculative and volatile and usually have a certain amount of bubbles above the waterline (margin/profit/speculation/premium/extra) so markets PRICE are near always more than the cheapest mining costs. so the mindset was more so on mining to get coin cheap. and sell the coin for profit later to get fiat. thus mining price was mor important upfront and market react to it later

logistics: mining cant just react instantly by the minute. so its not like if a market jumped 50% today that there would be enough ASICS to react.

planning: mining is reliant on electric, and electric companies supplying farms cant just ramp up electricity capacity in seconds without risk of local brownouts. so smart asic farms preplan expansion, upgrades and switch-overs MONTHS ahead

personally i was hoping to see the october s9 sell off/s15 'testing'. to cause a increase in hashrate. thus give positive market pressure for november-february. but it seems they not only didnt want to sell off s9's to replace them 1-for-2 (1 s15 for every 2 s9 to stay at same hashrate).. but they let the hashrate slip.. thus hashrate went down when 'beta testing' the s15's thus not giving support for a stable price to stay above the (pre october) $5800 bottomline support

so with ASIC companies gathering loads of coins from selling S9's
so with ASIC companies gathering coins from mining
did not hit the market the same day as they were mined/gathered. (check blockchain data of coin rewards. they were not sold instantly at 100 confirms)
thus the markets didnt react until november

The bold is less true then it was last year.
The red is still true.

So if coins jump to 5000 mining will do a jump and fast.
This is due to easy clocking on :

bitmain gear
M10 gear
Innosilicon gear.

I have left the world on garage miner. Ie 2x 30 amp 240 circuits.

I added one solar array with buy solar and we were up to 30 kwatt
We now added a second solar array and are at 85 kwatts and hour.
We are in talks to add 115kwatts bringing us to 200kwatts. At zero to four cents cost per kwatt.

So if prices jump we can clock up out s15s m10s t15s and s9s in under 1 hour.

But we would exceed out low cost solar price of 0-4 cents.   Use grid power of 11-16 cents.

Many big farms have 2-4 cent contracts and can exceed the contract of say 5 mega watts but do so at a higher cost.
Many big farms still have the s9 and I know of some with 1000 s9s on lowest setting doing 800 watts a unit. If prices jump they could go to the 1200 watt setting in under an hour.

But at a higher power cost since they exceed the contract of say 5 megawatts.

I am on a shit iPad. Give me a minute to link a graph.

Bump.

franky1, your reply to philipma1957? I still can't see how the miners' costs can support, and dictate, a market as especially volatile as Bitcoin.

Do the the miners buy Bitcoins too, in durations of price lower than mining costs?

 Lots of  us miners have 2-4 cent power and turn a profit.

with gear like the s9  which can do  800 watts and 10 th  1200 watts and 13th  1350 watts and 14th

we can  move the entire network   20-40% higher over night.

I suspect  that a strong bull run from 3800 to 5000 stable would move the network to  50 billion gh  from the current 42 billion gh.


the real question is if price does 5000 then 8000 stable  will network go from 42 to 50 to 57(all time high) to 84 matching the price jump to the hash jump  in 2 or 3 or more jumps.

I think the miners can go to 65 billion gh  really fast maybe 70 billion.  as I think  that number is what is on hand.

At that point the old cycle of the gear is too damn costly to get would start again.
I think we have more idle gear then we have ever had.
I think bitmain halted sales issued coupons to make miners hunger for gear.

Over the next 3-6 weeks  all the s9's will move to low power spots.  and better gear will sell easier.
I wonder how much  hashpower in terms of s17 would sell if coins were at 9k vs 4k.

[Wind_FURY]

as for how if there is a hash power rise. windfury cant see that it can cause the markt to follow.. its easy.

when hashpower rises. it costs more to mine bitcoin.
so people decide its not as cheap to buy coin OTC from miners. and instead buy on the market.

buying on the market=price rise
eli-5 enough?

Wouldn't that be adding to more risk? I don't believe adding more hash power automatically causes price to increase. Price would depend on demand on Bitcoins.

Wouldn't it be better for miners to observe what the market does before doing anything? 

Or are the miners anticipating what the markets would do? Because that would make "price follow hashing power" have more sense.