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Author Topic: [GLBSE] Introducing: Bitcoin Syndicate, a new mining op trading publicly!  (Read 21411 times)
Glasswalker
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February 20, 2012, 02:01:13 PM
 #1

I would like to introduce to you, the Bitcoin Syndicate.

We are co-operative of individuals working together to mine, earn profit, and seek out ways to benefit the bitcoin economy and community as a whole.

I'll keep this brief, as there is a ton of information over on our site for you to read through:

  • Aggressive Growth: We are using an aggressive growth profile as our primary strategy. Our current forecasts show 100% growth in the first year (shares double in value in a 12 month period)
  • We are primarily a mining operation, but we intend to do so much more We are currently a mining operation. And that will be our primary means of growth/profit for the immediate future. However we have several awesome initiatives in the wings, which we will use to expand into new areas. We don't plan on putting all our eggs in one basket long term (mining), though it will always be a prominent feature for us.
  • We currently operate a 6GHash/s GPU Cluster, and intend to grow FAST! Our founding members have given us a kickstart with enough GPU based mining hardware to build a 6GHash/s cluster. That's pretty big already for a publicly traded mining op. But we intend to use 100% of the funds from our IPO to invest in a large FPGA mining cluster, and to grow the size of that FPGA cluster by a fairly large margin each month!
  • We are open, transparent, and honest: One of our primary goals is to stay as open, transparent, and honest as possible. we will openly share information, our identities, our financial records, and anything else of value or importance to the community and our shareholders. See our site now for our live financial records, and realtime stats of our mining. We'll be expanding this over time to be more robust (based on shareholder feedback!). We will try our best to answer any questions, and make our investors feel at ease with their investment. In addition we will be going through the full extent of identity verification processes with GLBSE 2.0, so you will have a face, name, address, and so on to put to our key members, and the organization as a whole.
  • We are passionate about bitcoin, and want it to thrive. we are also passionate about our own success! We are all passionate about bitcoin as a concept, and want it to succeed and grow. So many/all of our initiatives are designed to achieve this goal. What's good for bitcoin is also good for the Syndicate! Also, we are passionate about the syndicate, and will ensure we always continue to drive towards growth, and success. We won't let our momentum fall!
  • We are profitable! We will be paying dividends, but primarily we will be focusing on growth. 80% of all earnings (this number is open to a motion of course), will be dedicated to expanding our operation. The remaining 20% will go into dividends to be paid out each month. This may sound like you don't earn much, but consider that your investment (and shares) represent a share in ownership of Syndicate hardware, as it expands, the value of those shares expands with it! In addition, if all goes according to our forecasts (Which of course it may or may not, but we feel we've used conservative estimates in the forecasts) an investment in the Syndicate at the IPO, allowed to grow over a 1 year term, will result in overall 5% more profits for the shareholder, than the same investment planted into a purely dividend based mining operation. And after that, the growth will increase your profits drastically.
  • We're in it with a long term game plan We are in this for the long haul. We're not looking for quick returns, and fast get rich ideas. We want to build a long term, sustainable, and overall profitable organization. Which is a positive contributing force to the bitcoin community, and economy. And we want to maximize our overall profits (and therefor those of our shareholders) over the long haul.

If this sounds interesting to you, we'll be doing our first public release of shares VERY shortly (if all goes well, within the next 24 hours, so by the 21st of Feb at the latest).
In this IPO we have issued 12,000 shares. Of which the founders were compensated for their initial contribution of mining hardware (at rates according to public value, all documented clearly in our bylaws). So the founders start off with approximately 45% controlling interest in the Syndicate. That remaining 55% of the shares will all go on sale during the IPO, at a price of 0.25BTC per share. A mere quarter bitcoin will allow you to get in on this excellent investment opportunity.

For more information, check out our website at: http://www.btcsyn.com

And of course if you have any questions, or feedback, we would love to hear them! Please feel free to post here, and I'll do my best to answer promptly!

EDIT (02/21/2012 4:09PM EST):
We have scheduled to do our full public IPO at 10PM EST tonight. That's 10PM EST Tuesday Feb 21st. Approx 7000 shares will be released at 0.25BTC per share via GLBSE For Asset ID: d84ef5271950f7d41bad3ea51059fdb4f25d6b8d455456c0bf8339471242b538  (ticker: BTCSYN) Looking forward to seeing what kind of interest we generate!

EDIT (02/21/2012 10:13PM EST):
Our IPO is delayed by a few minutes due to a minor transaction error on GLBSE. Working with Nefario on it now. I hope to have the IPO completed within 15 minutes.
Sorry for any inconvenience from the delay.
Thanks for your patience!

EDIT (02/21/2012 10:42PM EST):
The IPO is officially live! The shares are now publicly trading in the wild!

Just trying to make Bitcoin a Success... One crazy project at a time. (13rwPKskyATcAq3PpnCikfFG8989DQ8M3c)
HashVoodoo Open Source FPGA Mining Bitstream: https://github.com/pmumby/hashvoodoo-fpga-bitcoin-miner
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mila
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February 20, 2012, 03:30:14 PM
 #2

and as of today 2013 feb 11 (monday) it seems to be the end of the syndicate.
it did not last a single year - see Paul's OP

founding members failed to meet their end of the loan of 6 GH/s.
what they did not fail is to claim the rights stemming from the shares (dividends and votes)


your ad here:
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February 20, 2012, 05:44:04 PM
 #3

Bitcoin Syndicate
We currently operate a 6GHash/s GPU Cluster
http://www.btcsyn.com

Current Total Syndicate MHash: 5,274 MHash/s
nice site but the numbers don't match
how come? do you market speak or some maintenance going on?

5.8 GH/s now. I'm guessing there's some rounding going on.

Glasswalker, though your post and website are both well-written, I feel they lack some essential concrete information. If you want investors in a project led by someone with (no offense) no reputation on these forums or IRC that I know of, you'll need to provide more details. A few points of note:
1. "We intend to do so much more". I appreciate broad-mindedness, but people want to know what they're investing in. A general statement of expanding beyond mining could indicate anything from beekeeping to car sales. You will not be able to sell shares if you do not tell people what else you plan to invest in.
2. "Our current forecasts". You mention transparency as one of your main goals, yet nowhere on your post or site can I find these "forecasts". This smells a bit fishy. You cannot be "open, transparent, and honest" while concealing financial growth predictions.
3. Your share assignment to the owners (bylaws section 4.1) seems a bit overdone. 0.18 BTC, at the time of registration of your domain name, February 9th, was equivalent (1 BTC ~ $5.60 USD) to $1 per Mhash. That would be perhaps a fair rate for FPGAs, but certainly not for GPUs. Even with extraneous parts like cases, you can easily get $0.75/MH, and with optimization, below $0.50/MH is possible. Seems to me like the rewards are a bit overblown.

Whois info for anyone interested:
Quote
Registrant:
 BitcoinSyndicate
 22H Bayshore Drive
 Ottawa, Ontario K2B 6M8
 CA

 Domain name: BTCSYN.COM


 Administrative Contact:
    Mumby, Paul  dns@btcsyn.com
    22H Bayshore Drive
    Ottawa, Ontario K2B 6M8
    CA
    (613) 261-7522
 Technical Contact:
    Mumby, Paul  dns@btcsyn.com
    22H Bayshore Drive
    Ottawa, Ontario K2B 6M8
    CA
    (613) 261-7522


 Registration Service Provider:
    Arcane Networking, themumbys@gmail.com
    (613) 966-8634



 Registrar of Record: TUCOWS, INC.
 Record last updated on 09-Feb-2012.
 Record expires on 09-Feb-2013.
 Record created on 09-Feb-2012.

 Registrar Domain Name Help Center:
    http://tucowsdomains.com

 Domain servers in listed order:
    NS2.MAKERENGINEERING.COM  
    NS1.MAKERENGINEERING.COM  

You requested questions/feedback, here you are. I'm always supportive of new Bitcoin ventures, and I'd certainly consider investing, but I would appreciate more information.

-- BinaryMage -- | OTC | PGP
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February 20, 2012, 08:24:35 PM
 #4

3. Your share assignment to the owners (bylaws section 4.1) seems a bit overdone. 0.18 BTC, at the time of registration of your domain name, February 9th, was equivalent (1 BTC ~ $5.60 USD) to $1 per Mhash. That would be perhaps a fair rate for FPGAs, but certainly not for GPUs. Even with extraneous parts like cases, you can easily get $0.75/MH, and with optimization, below $0.50/MH is possible. Seems to me like the rewards are a bit
overblown.

Read further... this is not a purchase of the hardware, the hardware is merely being LOANED!

It is probably a crazy-high price to buy used gear, to pay it just to borrow the gear is what? Reasonable as lease of hashing costs more than outright buying used gear? Crazier because buying used gear might be a lot cheaper depending on how much it costs to maintain it?

If the gear fails, do the founders it is being leased from guarantee to replace any missing MHashes by for example leasing some elsewhere at their own expense to make up the shortfall?

This kind of plan could be a great way to put some used FPGA gear on a local market for easy convenient purchase, notice the founders can force the thing to shut down and sell its assets (which do not include the initial hardware, which is merely leased/"loaned") for the founders to pick up cheap without even shipping costs...

I want to put together a shares setup for buying FPGA gear but I certainly don't plan on this kind of piracy, heck I didn't even imagine for a moment one would have any chance of getting away with it, as in actually selling any shares. How gullible *are* the buyers on GLBSE?

-MarkM-

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February 20, 2012, 08:31:32 PM
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3. Your share assignment to the owners (bylaws section 4.1) seems a bit overdone. 0.18 BTC, at the time of registration of your domain name, February 9th, was equivalent (1 BTC ~ $5.60 USD) to $1 per Mhash. That would be perhaps a fair rate for FPGAs, but certainly not for GPUs. Even with extraneous parts like cases, you can easily get $0.75/MH, and with optimization, below $0.50/MH is possible. Seems to me like the rewards are a bit
overblown.

Read further... this is not a purchase of the hardware, the hardware is merely being LOANED!

It is probably a crazy-high price to buy used gear, to pay it just to borrow the gear is what? Reasonable as lease of hashing costs more than outright buying used gear? Crazier because buying used gear might be a lot cheaper depending on how much it costs to maintain it?

If the gear fails, do the founders it is being leased from guarantee to replace any missing MHashes by for example leasing some elsewhere at their own expense to make up the shortfall?

This kind of plan could be a great way to put some used FPGA gear on a local market for easy convenient purchase, notice the founders can force the thing to shut down and sell its assets (which do not include the initial hardware, which is merely leased/"loaned") for the founders to pick up cheap without even shipping costs...

I want to put together a shares setup for buying FPGA gear but I certainly don't plan on this kind of piracy, heck I didn't even imagine for a moment one would have any chance of getting away with it, as in actually selling any shares. How gullible *are* the buyers on GLBSE?

-MarkM-


You are indeed correct; thanks for pointing that out. I had simply assumed the price was for purchasing, because it was listed as "this rate is calculated based on the average "street price" of building a mining rig at the time of the formation of the syndicate". Rather deceptive.

With that in mind, glasswalker, you have some serious explaining to do before you release shares.

-- BinaryMage -- | OTC | PGP
mila
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February 20, 2012, 10:54:40 PM
 #6

your add here:

free tip: keep your contribution scarce and valuable.

your ad here:
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February 20, 2012, 10:56:17 PM
 #7

so the message is stay away from this stock?
1. avoid at prices above 0.09
2. read carefully the bylaws what you're actually buying.

Until Glasswalker explains more, my recommendation would be not to buy, that is correct. If my assumptions were incorrect or he can satisfactorily answer my questions, I'll buy; I always think it's a good idea to support the Bitcoin economy.

EDIT: He had indeed explained more, please continue reading and disregard my above statement.

-- BinaryMage -- | OTC | PGP
Glasswalker
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February 21, 2012, 03:12:00 AM
 #8

Hey guys, sorry for the delay in response I was out for a good chunk of the day.

I'll try to answer all of these questions/comments to the best of my ability.

First, THANK YOU for the feedback, and critical thinking! I'm glad to see people are thinking this through initially and asking questions. Blind investment is not what we're looking for.

First, the deviation in MHash/s, that is the rate calculated from our mining proxy which proxies us to the pool. This is the standard un-modified bitcoin mining proxy from github (https://github.com/cdhowie/Bitcoin-mining-proxy)

Our site polls data from the miner database, and shows the current average rate for a one hour window. So that rate will fluctuate (According to the readme for the mining proxy) based on fluctuations in luck and rejected shares.
In addition, we have one mining rig offline at the moment, which will be spinning up shortly, that rig will contribute another 600MHash/s (this is Andrew's rig).

Now, as for the reason for the pricing. To be honest, buying retail mining gear, according to prices on the wiki for mining hardware comparison, and retail "new" prices for gear, we came up with that number (local prices in Ottawa, Ontario, Canada, or cost of online purchases shipped to our location). And frankly buying new hardware, without spending days/weeks/months seeking the ultimate deals I find it difficult to build a full rig, including adequate cooling/chassis/power for under that cost per mhash/s. BUT if my calculations are way off, and someone can point me at a better source for hardware that brings that cost per mhash down significantly, I'd be interested in seeing it (and hell I'll likely use it lol).

As for the concept of the loan. Most GPU mining gear is intended to pay for itself within 1 year time. We are using this hardware to kickstart the syndicate. And with or without outside investors we plan on going ahead with this (unfortunately at a slower growth rate). Our hope was that with outside investment (with 100% going into purchasing additional FPGAs) it would allow a faster growth curve, and allow some better economies of scale. And benefit everyone. We recognize that with the current model, running GPU rigs in a central location right now, day one, and making it profitable is not feasible as a business model. Electricity and cooling costs would be a problem, and so on. With the loan, each founder is responsible for "best effort" to ensure 100% uptime, and to provide their MHash. If gear fails before the end of the loan period, they would be responsible for replacing those MHash. And they are responsible for all upkeep, maintenance, and electricity/cooling costs for those rigs. This way the syndicate is getting MHash, raw. And that's it. I think that does bring a fair bit of value to the table.

Before moving on, to qualify my statement above about it not being a feasible business model, I mean at our current scale, we can't justify renting space and/or paying for hosting for a large scale mining cluster (6-10 GHash) based on GPUs. We have no one central location to handle that, so we are co-operating until we can transition into a large enough scale to justify that location. And we are using the existing GPU rigs as a transitionary step to move towards FPGAs which are much more sustainable as a long term model.

Anyway, so to recap on the previous points. The loan period is meant to be our contribution in MHash to the pool, to get it started. To help kickstart things so to speak until the syndicate is self sufficient with the FPGAs. Your investment is not in the hardware of our GPU rigs. It will be a share in the purchased hardware which will be fully owned by the syndicate, and it will be an investment in a share of the profit/growth to come for the syndicate. The loan period provides that I think, and I don't think that is unfair. But again I'm willing to hear other arguments to consider other points of view.

Now moving on... About the future opportunities information, some of these are up in the air, only because they will be fully dependant on a motion. Right now the only solid venture is mining, but we have several ideas (some partially executed, and waiting in the wings) which once we are in operation, the IPO is done, and we are turning a profit, we can raise a motion about adopting them as additional official ventures under the syndicate. Some of those ideas (summarized to point form) are:
- We are engineering our own FPGA solution. Will be mass produced, and distributed, and we'll be able to tap economy of scale to buy FPGAs at a much more efficient rate in the near future. The FPGA solution is intended to be a professional grade, targeted mining board, designed for high density clusters. With a better cost/mhash ratio than anything else out there (that I'm aware of).
- I have a site nearly complete, designed to be a user rating/evaluation portal for bitcoin based businesses. Allowing the community to establish trust levels for the various businesses and ventures out there. It would be 100% community driven, but with the option of the syndicate providing impartial checklist based evaluations of a business for a small fee. All scores and methods of calculating the scores would be published, and the rating system would be fully community dependant. With additional features such as conflict resolution, and mediation as well.
- A bitcoin based kickstarter type service (yes I know a few have tried, but I haven't seen any that have really "pulled it off" yet.
- Our own mining pool (once we have enough internal hashrate to justify it for our own purposes, then we could open it out, would need to develop some benefits to make it worth while of course for people to mine on our pool).
- Leasing our hashrate out through things like GPUMAX, provided their rates are better than our direct mining payout. (to be done on a case by case basis).
- A bitcoin based competitve gaming league (e-sports). (not betting, actual competitve tournaments, using bitcoin for the base currency, based on accepted ESL games).

That's a sample of the ideas we have pending, but initially we want to stabilize the syndicate first, get the IPO done, and then look at other opportunities. Some of those are merely ideas, to be discussed, and refined (or rejected if we can't make a real business case for them), and some are actually underway already, but will be voted on, and either run under the syndicate umbrella, or driven forward independantly (or abandoned once again if the business case falls apart).

Next point. About my forecasts. The math was rather simple really. We didn't get extremely deep into it yet, but we calculated based on the following:
Average earning rate per MHash/s
Expected trend in that earning rate
Expected reduction in block chain payout
Current MHash/s of the syndicate (with our GPU rigs).
Share price we intend to sell at (0.25BTC per share).
The number of FPGA boards we can buy with that capital (if successful, approximately 15 boards).
The hashrate of the new syndicate, and the number of new boards we could then buy per month for the first 6 months.
Increases in FPGA efficiency expected from our new design and costing.

Based on all of the above, we expect to be able to buy 2 additional boards for the first couple months, increasing to 3 new boards after that. Some of the costing on our new designs are up in the air, but we're very confident we can beat current hashrate/cost ratios. So based on that (and dealing with the manufacturing directly), we expect the total value of the assets the syndicate owns, (based on the initial investment from the IPO at 0.25/share) to grow by 100%. (so for example, if we buy 6GHash/s of FPGA gear directly off the IPO, we expect this to increase to 12GHash/s by the end of one year). That means the held assets, and profitability of the syndicate will have doubled, meaning the "raw value" per share should double within that time. When considering the growth in value of the shares, combined with the payout rate over the year, the total payout comes out to be about 105% of what we would expect with our own mining gear with equivalent investment (if we took our miners, never did the syndicate, and just mined for ourselves, we would end up with slightly less profit than we would have in total value gained with the syndicate, not purely mining power, but total value).

I can break down the math in more detail than that if needed, but ultimately we are basing it off of round numbers which I felt were "conservative" based on what I've observed of the bitcoin economy over the past while, and what I expect to happen. Also not accounting for any other possible gains from our other ventures, or on any unexpected wins that may happen (economy shift, another bubble, or whatever). I wasn't intending that number to be a hard guaranteed number, purely an estimate of what we expect ourselves.

Next point, to touch on the clause to let the founders dissolve the syndicate. This one is a negative point sure, but it's also standard fare. Every other mining op trading on GLBSE (that I looked into) had a similar clause in their terms. This is plain common sense. The founders are physically responsible for maintaining and operating the gear. We are incurring expenses. And if the entire economy collapses, or something else catastrophic happens, we need to protect ourselves with the option to call an end to it. We are not giving ourselves a universal "run away with your stuff" clause. We're trying to make it as fair as possible (And please read the segments of the bylaws on liquidation) we try to create an impartial and fair way to decide on the value of the gear, and to then liquidate the gear. Paying back shareholders from the liquidated assets. Also keep in mind if there are loopholes in the bylaws, I'll be glad to adjust them (provided the adjustment is justified). I'm not a lawyer, and we aren't hiring a lawyer to write those up. I personally wrote them all and got an agreement from the other founding members. But this is the first public review, my wording may not be airtight, so give me suggestions! But that said, the "bail out" clause for the founders (who are physically responsible for the operation) will remain. That's as I said, standard fare.

If it helps at all, we have NO intention of that happening. Hell if things are going well, I'll likely (and I know most of the other founders will as well) continue to contribute our GPU gear regardless of the end of the loan term. Just to help the syndicate succeed. But we needed a firm decision so there is a set expectation. I know we all plan on doing this either way. This is not a cash grab to get free money. We're running this syndicate for ourselves even if we get no investment at all. But we wanted to open it up, and hopefully allow a pooling of more resources to open up opportunities for us that wouldn't otherwise be available (yet). If the community ultimately decides it's too risky, that's fine, we'll operate anyway, and revisit at a later time. But I think this really is a GOOD opportunity, that offers great potential. And I really hope more people get on board, to help us do something great.

Anyway, this has been a long post, I sometimes ramble. But I really hope this has put some of your concerns to rest, and at least answered many of your questions. Please feel free to fire more back, as I said I'm actually really glad this feedback is coming in, this is great!

Lastly, a couple other points:
Registration info is in my name, as showin in whois. My identity will be validated by passport/drivers license as well as physical mail validation of my address. The "office address" is my home address. My info is all over the net, you won't have trouble finding details of who I am and what I do. and I have nothing to hide in that regard.

About the IPO itself. We're waiting on one of the founders to sign off on the release of shares, we hope to be able to do the public release of shares tomorrow sometime. (Tuesday the 21st). I'll post an update when that happens.

In the meantime keep the conversation coming!


Just trying to make Bitcoin a Success... One crazy project at a time. (13rwPKskyATcAq3PpnCikfFG8989DQ8M3c)
HashVoodoo Open Source FPGA Mining Bitstream: https://github.com/pmumby/hashvoodoo-fpga-bitcoin-miner
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February 21, 2012, 04:17:11 AM
 #9

I'm not going to quote due to length; this is in response to the above post.

No worries about delays, we all (or I should say most of us) have lives apart from Bitcoin. Thank you for taking time to read, consider, and honestly answer questions; that is quite impressive.

The "Mining hardware comparison" page is not really accurate on prices. For example, here is a priced out rig:
HD 5830 x3 @ 109 ea. (off Ebay, refurbished with warranty) - $327
OCZ ZS 750W 80 Plus Bronze @ 100 ea. (new off Newegg) - $100
ASRock 970 EXTREME4 @ 110 ea. (new off Newegg) - $110
AMD Sempron 145 @ 40 ea. (new off Newegg) - $40
Kingston 2GB DDR3 @ 11 ea. (new off Newegg) - $11
Cooler Master HAF 912 @ 60 ea. (new off Newegg) - $60
Total cost: $648; adding in ~$50 for shipping comes to ~$700
MH/s: ~310 per card (can be achieved with minimal effort), ~930 total. $700/930MH = ~0.75 $/MH

That's with an unoptimized rig using all new component excepting the GPUs, including a case. It took me about 15 minutes to configure. Your price is your decision, not mine, but I think $1/MH is simply unrealistic.

Loan-wise, a one-year loan seems reasonable for the same price as to buy with hardware maintenance & electricity included. But I'm unclear on what exactly your method is for maintenance. "responsible for replacing those MHash" is not concrete. Are they required to replace it within a certain time period? What happens if they do not? Is the downtime paid back at the end of the loan? What happens if someone chooses to leave? I'm sure these people are trustworthy, but a year is longer than it seems, especially for an industry so volatile as Bitcoin. I would like it, as a potential investor, if you have a plan for what to do if someone departs the Syndicate.

Future opportunities-wise, you have some novel ideas and some already implemented. If you want more detailed feedback, PM me, but it isn't really relevant to this thread. What I do not understand is why any of these, possibly excepting the first, should be coupled with a mining operation. A competitive gaming league, for example, may be a good idea, but is entirely unrelated to a GPU/FPGA mining operation, and at least in my opinion should be run as a separate company. Investors are not investing in you. They're investing in your company.

Your forecasts seem reasonable enough, though I obviously cannot audit them more closely without numbers.

As for the dissolution, I understand such a clause is necessary, but I still have a few reservations. "Failure to participate in this timeframe results in your shares being counted as "pass" votes" is the first. I'm not sure what the intent is here, but it seems to leave a significant legal loophole. With no method of voting defined, one could simply call a vote, not give any way for anyone to vote, and close the syndicate. I'm not implying that I think it likely you would do this, but it seems something that could easily be changed, and would reassure me.

Secondly, "all liquid assets that the Syndicate holds (all Bitcoin Values) will be used to clear any debts/expenses outstanding for the Syndicate" also concerns me. Unless you are buying gear on borrowed money, since you stated that the electricity costs for the GPU miners are paid by the syndicate members, the only possible expense would be FPGA electricity cost. The chances of FPGA mining becoming unprofitable in the next year are virtually nil. What possible debts are you talking about?

Your identity seems perfectly legitimate. (Though the website listed on your Twitter account, http://www.samuraipotato.com/, gives a 403 error)

Again, thank you for answering my questions. I certainly will "fire back", in what I hope is a perfectly friendly way. Understand I wish the best for you and your operation; I just think investors would much appreciate some clarification. (And hopefully, it will help you too!)

-- BinaryMage -- | OTC | PGP
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February 21, 2012, 04:24:42 AM
 #10

Hi, nice posts, interesting exchange of ideas. anyway I collected some math about present glbse stock

formula: nr of shares x 30d avg price / mining capacity = cost per Ghash / s (ghs)

oldest publicly traded gpu mining operations
BMMO 4000 x 0.357 = 1428 btc for 4 ghs (357 btc / ghs)
MergedMining 5500 x 0.133 = 731 btc for 1.62 ghs (456 btc / ghs; 420 btc / ghs corrected by btc reserves held)
TyGrr 1500 x 3 = 4500 btc (375 btc / ghs)

and the only comparable fpga operations
FPGA.contract 6000 x 0.359 = 2154 btc (770 btc / ghs)

without the fpga purchase would the syndicate model look sour
IPO 12000 x 0.25 = 3000 btc for existing mining gpu 6 ghs (500 btc / ghs) - way too much

but you do it differently
valuation of existing 6 Hhash/s @ 180 btc / ghs equals 1080 btc worth (shares worth 1080 btc distributed among founding members)
remaining shares valued ca at 2000 btc will go to the IPO offer

some mumbled numbers
at 500 btc / Ghash/s it would be 20 - 40 % more expensive than existing traded mining capacity
at 180 btc / Ghash/s it seems like an 40 - 60 % discount (DIY rigs vs assets at glbse)

using the FPGA.contract value as price guide, you could be able to start mining with 2.5 Ghash/s fpga
2000 btc / 770 btc/ghs =~ 2.5 ghs
this added to the 6 existing equals 8.5 ghs and 3000/8.5 = 352 btc / ghs
again very competitive price per Ghash/s as well the ratio gpu to fpga (70:30) making it an interesting mix with lower electricity bills

I'm going to read the bylaws again, check the "small print"
you published a lot of info and your model is not that straight forward as other assets (dividend oriented)

nevertheless, watching you and wishing you good luck raising 2000 btc in the IPO

... on the second look it makes more sense.

your ad here:
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February 21, 2012, 02:52:59 PM
 #11

Hey, thanks for the response again BinaryMage!

Yeah sorry I felt the need to apologize because we had an unexpected visit from my Sister-in-law this weekend, and I was busy being a host most of the weekend when I had intended on focusing on the launch of the Syndicate. Anyway, I was able to reasonably well balance the two... lol

Also sorry again for the length, I tend to be a bit... Verbose... Sometimes lol... Smiley

I appreciate you going to the trouble to quote a rig. I hadn't actually done a full build myself. Are you counting shipping to Canada for those parts? Many sources in the USA charge a LOT more to ship to Canada. (and many won't ship to canada at all).

We've checked the local ebay scene, and our local classifieds as well (kijiji). And local sources (computer stores and so on). For example the cheapest "In canada" for a new, or certified (warrantied) refurbished card on ebay I can find is over $200 per card.

I wasn't able to find any "used" that list that they ship to Canada for the prices you quote, except ones listed as "as-is" with confirmed damage.
Also from newegg, I'd likely end up paying $50 in shipping for the hardware (excluding the GPUs).

Not trying to argue with your math, obviously from where you're standing my price is "higher than market" and I appreciate your openness in accepting that we each have our opinion on the price we set for our goods/services Wink

That said another thing to consider, is that the shares have not been issued to the founders yet. The Syndicate still holds 100% of shares. And the current BTC price is about $4.30. At that price, $0.75/BTC as you suggest is actually 0.1744BTC/MHash which is very close to the 0.18 we set as the value. (Also we all paid a fair bit more than that for our rigs, we were considering that our own loss since the prices fell on BTC and hardware somewhat.)

In light of the above, I still feel 0.18 is justified. But that is of course our opinion Wink Though as I said, I really do appreciate the level of thought you're putting into this. It helps draw out information and ideas that may not have been thought of during our closed process with only our founders. I really sincerely want to be as open and transparent about everything as possible. But I knew I wouldn't be able to achieve that 100% with the website at launch, that's why these forum discussions are so valuable.

For the decisions on the hardware loan, we discussed it, but because we are all co-workers and/or close friends. We overlooked some of the legal items you mention (for what-if? scenarios). But ultimately because the GHash during the loan is intended as a kickstarter, and we're each running it on our own (and have families and lives as you suggested earlier). We didn't want to be bound legally (creating significant liability) to a fixed timeline to replace hardware. For example, as I mentioned, aquiring replacement GPU rigs is not cheap, or easy right now, so doing it in a very short timeline (with a hard legal deadline) puts a significant amount of stress, and potential cost on us in the event that happens. As I mention in the FAQ, we're in it for the long term, and longterm, a loss of 1GHash of mining power for a few weeks even (at the longest I would expect) would not translate to a significant overall loss to the profitability of the syndicate as a whole. But I definitely see where you are coming from. As investors you want assurances. Well I guess what I'm saying is that the "guarantee" would be "best effort". The same as uptime. For example if their home internet provider goes out for a 24h period, that's outside their control. They will get it back up as fast as they can within reason. And I can't hold them accountable legally to hit a full SLA. I spent the past 10-15 years working in senior IT Management of some complex (and critical) infrastructure. I know ALL about SLAs... But an SLA is only as good as it's supporting contracts. If the services backing your service fail, and you have no good SLA to support them, you can't offer your own SLA that's higher than that. It's an impossibility. So if/when the time comes we've grown to a scale that justifies a datacenter to host our gear (which I had planned for and expect to happen). Then we can begin offering full SLAs on things. Until then, it's all "best effort". And while I agree, as a large scale business investment that's a bit shaky, but comparing against the other alternatives in the bitcoin community, I would be surprised if you find a much better alternative for the same price.

Anyway, moving on... The thinking is that the syndicate is STARTING as a pure mining op. And mining will always be our "bread and butter". But we are a bitcoin business, not a mining business. We will undertake initiatives and ventures which span the full gamut of what bitcoin is, and in any way we feel benefits the bitcoin economy. That's why I list that everywhere on the site and in the initial post. It's not a "Mining company" (though I agree the choice of those words in the subject is questionable lol, but that was to reflect it's CURRENT state). For example, long term (beyond 2-3 years) mining is not a guaranteed income. I suspect it will be, but the economics of mining may begin to shift drastically as the block payout changes. Because of this we need to look at other means to diversify ourselves.

I understand what you're saying about people investing in the syndicate and not me. And I intended that to be the case. That's why I pointed out that all shares are voting shares, and every new venture requires a passed motion (voted on by ALL shareholders that choose to vote). If the shareholders view the venture as not a sound investment, they will vote against, and the syndicate won't be involved (at which time I can choose to personally pursue the venture, or abandon it). If the vote is positive, then the new venture would be a Syndicate initiative (and it would be branded as such). And would be fully owned by the syndicate (meaning that investment in the syndicate would include that venture as well).

For the dissolution vote, we force the vote because that keeps people who choose not to participate (or who are absent, or ignorant to the vote). Our thinking is, every one of the shareholders have known each other a while, work together every day (or at least talk nearly every day). Chances are in the next year, short of death or major illness, this will continue to be the case. So the chances of someone "not being able to cast their vote" tend to fall into those extreme cases. Because the dissolution is a safety net, and the case in which it would be called on would be a critical one (we wouldn't do it unless it was critical), we need to be able to act fast. And if people are unavailable due to vacation, illness, or other major issue, we need to move ahead regardless (even if the remaining members may be against the vote for whatever reason.). We stuck that in there intentionally to allow for this kind of circumstance. Though if you can suggest any wording changes I'd love to hear them.

The debt/expenses clause is intended as a future proof clause. Right now there will be NO DEBT. We are buying hardware for cash (bitcoin) up front. We owe nobody anything. And this will be the case for some time. Any business decision to change that would require a shareholder vote. There are valid future cases where expenses or debt would be incurred. If we move to a datacenter, datacenter hosting costs would be incurred. Or if there is a significant business opportunity requiring more investment than we have in liquid capital, we may vote on taking that opportunity (the vote would likely be to issue more shares to raise capital, but if the shareholders decide credit is the way to go, we will go that way). It's all open to shareholder vote. But you're right, right now, under our immediate situation, there will be no debt. Any expenditure requiring "creating" a debt would need to be approved by the CEO and Treasurer, and passed by a vote of the shareholders. So it's not like we would arbitrarily say "oh the syndicate owes me $10,000 so I'm paying out all assets to myself MUAH HAA HAAA HAAA!" lol... because the bylaws regulate that behavior. If that wording is unclear, by all means I again request any suggestions that might help clarify it.

lol, as per my twitter link haven't updated it in a while. Samuraipotato was a random blog I shared with a close friend. He hosts it, and it's likely broken right now (haven't posted to it in ages lol). I should get it back up and running though, as there were some amusing posts on there. I'll talk to him about it.

As for your questions and "friendliness" lol, no worries at all Smiley I take it as that, you're being extremely concise and clear in your intent, and wording your questions courteously and professionally. I hope that I am doing the same. I see this as a professional and helpful discussion to clear the air and make sure everyone is on the same page. As I have said several times. Openness and transparency are important to me. I want to ensure the right info is out there so people can make informed decisions. I don't want to screw anyone, I don't want anyone to get screwed. I sincerely want the Syndicate to be a booming success and make us all (founders AND public investors) a fortune... And that won't happen without the full understanding, and support of all our investors. (and a little passion from all those involved lol).

Mila: as to your post/questions:

I'm not quite sure I'm following your math clearly. The one example I used as a similar comparison (which I was able to glean enough info from directly) was FPGA.contract, which is run by a respected member on these forums, and is also one of the FPGA manufacturers currently available. Their setup was 6000 shares which were issued at 0.25BTC same as ours. That money was used to buy FPGAs, which currently mine around 3GHash/s if I'm not mistaken right now. (but they have ramped up to that over time, overall longterm averaging more like 2.5Ghash/s). That means that an initial investment of 0.25BTC earned you 0.5MHash worth of mining hardware (FPGA) that was owned fully by the organization (and shareholders). In their case their business model is different, they pay out 100% of all mining proceeds to dividends, and keep a small number of shares for the organization to pay for electricity and such. If they want to grow, they have no planned growth budget, so they must pass a motion to issue more shares (potentially devaluing existing shares, but in theory keeping them "the same" in value). This said, their shares have actually increased in value to 0.35BTC for some reason (which is fair, that's what the "market" decided they are worth).

In our setup, we have 12000 shares, of which about 5000 (rounding off for quick math) are issued to founders for the GPU gear loan. The remaining 7000 are sold publicly for 0.25BTC (same price as FPGA contract at their IPO). That money will (if the IPO is successful) raise a total of 1750BTC, which should be enough to buy 15FPGA boards, totalling 6GHash/s roughly. (all round numbers, will depend on BTC exchange at the time, and how successful the IPO is). That 6GHash is owned equally by each share. So that means that it's divided across all 12000 shares. Which works out to 0.5MHash per share. the EXACT SAME as the IPO value for FPGA.contract. BUT what this doesn't consider, is that those shares ALSO own a share of the 6GHash of GPU power, for the first year. Which means they actually control 1MHash of mining hardware for the first year, after which it drops to 0.5MHash. But... By the end of that first year, we'll have bought more than enough FPGA gear to replace that 0.5MHash lost from the conclusion of the GPU loan (if not a lot more). And beyond that point it will continue to grow at a rapid rate.

So overall 0.25BTC for our investment (the way I look at it, over a longer term) is a much better investment opportunity than the FPGA.contract. Both options have their merits (I'm by no means slamming them, Fizzicist is doing awesome work). But each has it's niche. Theirs is a smart short term investment. You spend BTC and get a dedicated hash rate to pay out to you. But it offers no growth opportunity to a given investor. The Syndicate method over a long term stands to be worth much more due to the growth potential, and it will pay out much more eventually (once it grows), but from day one, your initial dividend payout will be less than you would see from FPGA.contract. The risk with the syndicate is that things change, and potentially something negative could happen during that growth period while you're waiting for it to pay off. But that's why we'll be actively seeking out (And voting on) the best ways to optimize our growth and long term stability. So that over that timespan we're constantly adjusting, and rolling with the punches to take the best course of action as we go, and ensure a solid return on investment for our shareholders.

Smiley

If you could explain the math you've done there, I'd love to understand your point of view so I can better discuss it.

And again, thanks for your feedback all of you! Keep it coming!

And I hope that I'm so far doing a good job of answering questions, and alleviating concerns/fears.

In the end I'm just a guy, who's passionate about bitcoins and their potential for our society. I've convinced my friends and co-workers to get involved as well, and some of that passion has rubbed off on them. We're now co-operating, so that we can pool our resources to achieve bigger and better things (and yes, make a buck of course). And we feel that by opening that up to the public, we not only allow more people to benefit from that, but it gives us a bigger pool of resources to do great things. And that's what we want. To seek out ways to do great and amazing things in the bitcoin community. This is (hopefully) our means to do that. (and your means to be part of it!)

Doh, I've done it again. Sorry for the wall of text. Hopefully these posts will get siginficanly shorter over time lol...

Just trying to make Bitcoin a Success... One crazy project at a time. (13rwPKskyATcAq3PpnCikfFG8989DQ8M3c)
HashVoodoo Open Source FPGA Mining Bitstream: https://github.com/pmumby/hashvoodoo-fpga-bitcoin-miner
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February 21, 2012, 06:06:42 PM
 #12

...the hardware is merely being LOANED!...
...If the gear fails, do the founders it is being leased from guarantee to replace any missing MHashes by for example leasing some elsewhere at their own expense to make up the shortfall...
...notice the founders can force the thing to shut down and sell its assets (which do not include the initial hardware, which is merely leased/"loaned") for the founders to pick up cheap without even shipping costs...
...but I certainly don't plan on this kind of piracy, heck I didn't even imagine for a moment one would have any chance of getting away with it, as in actually selling any shares. How gullible *are* the buyers on GLBSE?...

Hey Mark, sorry I should have addressed you directly earlier. Since you were the most directly "negative" of the comments, I'll take the time now to respond to your comments.

For one, I don't appreciate the reference to "Piracy" but you are of course open to your opinion, and I'm not going to take direct offense, as it was pointed out my initial release may have been lacking some of the clarification needed.

Ultimately what this boils down to is:
- The hardware is loaned in, for one year as a kickstart to get things off the ground (because we had the gear already). The plan is to transition fully to FPGA, so longer term doesn't make sense anyway (and since most GPU rigs are designed to pay off within a year anyway, that's the useful lifespan of the investment anyway.) This is explained in more detail in my previous couple posts.
- The FPGAs are being bought based on shareholder vote and approval from known retail sources. And we are operating them in a central location. Anyone else is welcome to do the same thing. We have chosen to do this, and to offer shareholders a way to buy in. If you disaggree, and feel you can do it better, I suggest you either do this yourself, and do it better, and prove us wrong in our methods. In which case hey we may even decide to buy some shares in your operation! Or, give us suggestions on specific methods/ideas how we can do it more efficiently or "better".
- IF it came down to the syndicate coming crashing down, sure we could liquidate the gear, and we would have the OPTION of buying it ourselves (provided we had the assets to pull that off). But if you read in full the method of liquidation, it requires a fairly open process in deciding on the value of the gear. The lack of shipping for us is a bit of a silly point, as this would apply to ANYONE who happened to be local to where the gear was hosted. (if you hosted the gear at your location, you could buy it out without paying shipping if that opportunity presented itself). And as I point out in my previous posts, this clause is STANDARD in all mining ops trading publicly, it's a "cover our ass" clause for the founders (who have the responsibility of physically managing, operating, and maintaining the equipment, infrastructure, website, and so on, as well as managing the syndicate). A service for which we are not directly PAID. (aside from some initial shares for the hardware loan we kicked in). If things go south, we need a way out without major financial or legal liability. While doing our best to make sure our shareholders get some form of payout as well so nobody gets completely screwed.

Ultimately we want this to succeed, we're starting a business around bitcoin. We are running that business one way or another, regardless of what happens with the IPO. We would like to let others in to get involved, and in doing so it increases the overall pool of our resources. The increased resources allow us to pursue larger opportunities (such as larger bulk orders of FPGA gear) which we couldn't do otherwise.

All I can offer is all the information I've posted here, and on our website, and my personal assurances we have no intent of this being a scam to get free/cheap FPGAs. This is a legitimate business venture which we want to succeed.

As for the price of our shares, if you check GLBSE, there are other mining operations trading at similar pricing to ours with lower or equal returns. So I think we're inline with the "going rate".

Hopefully with the clarification from earlier posts, and the answers above, this puts your concerns to rest. But as I said if you have ideas about ways to do it better, I suggest you either go ahead and do it yourself, or let us know what you suggest, and we'll look into doing it ourselves (So you can feel better about investing, and improve the outcome for everyone else at the same time).

Thanks (and in the future, probably best to reserve final judgement, allowing the opportunity for people to respond to things, before throwing accusing, or negative terms like "Piracy" out there in a public forum, while you're entitled to your opinion, such things can reflect negatively on both yourself, and the person you're talking about, if taken the wrong way. Especially if they later redeem themselves through a response). As I said, not taking offence, just offering advice which helps keep discussion mediums like this forum a little bit more civil Wink

Just trying to make Bitcoin a Success... One crazy project at a time. (13rwPKskyATcAq3PpnCikfFG8989DQ8M3c)
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February 21, 2012, 06:16:07 PM
 #13

Glasswalker: Yello

Quote
If you could explain the math you've done there, I'd love to understand your point of view so I can better discuss it.

I did some mistakes (wrong premises) at the start of the math so the model is not applicable to each glbse asset
but one can say that existing operations provide a total mining capacity (in GHash/s) value estimated nr. shares x price
this estimated value of an operation is then divided by the capacity. thus a comparison of gpu mining assets

BMMO 4000 x 0.357 = 1428 btc / 4 ghs (357 btc / ghs)
MergedMining 5500 x 0.133 = 731 btc / 1.62 ghs (456 btc / ghs; 420 btc / ghs discount for bitcoin reserve held per share)
TyGrr 1500 x 3 = 4500 btc (375 btc / ghs)

once dividends are added to the above data, P/E can be calculated.
this are roughly the initial costs per mining capacity per selected glbse asset.

but again, those social contracts are not limited in time. while btcsyn is a 1 year mining contract that might not pay itself off (some fringe configurations of exchange rate and difficulty may render this activity a non profit venture). especially since this is the last year before the mining reward halving. the relation to mining hardware in the above assets is a kind of ownership or exclusive use rights that do not expire.
btcsyn is a 12+ month hardware loan and the gpu capacity will cease to exist.

I wanted to know what's my hashing power Wink since I do not mine myself but want to mine bitcoins badly, this is a nice match.
btw it's 216 MHash/s

those figures need to be correlated with electricity prices at the hosting location but as an initial rough guide they're what's easily available.
who would like to enter fpga mining at the quoted price, would need roughly 770 btc to have 1 GHash/s up & running. for rough estimates what's doable with ipo btc it's better than wild guessing. thinking in terms of assets, their prices, mining capacity their represent it does not require an arm and a leg for monitoring, maintenance, utility bills and ad hoc effort to keep it mining. they all are optimized for dividends but that can be easily abstracted as equal to the growth budget contributions from mining.

now it boils down to keep it profitable to raise funds for the fpga boards.
i've found my initial mistakes (as why the initial formula is not applicable for this ipo)
hope this helped to give you an insight what the numbers should represent
some of the numbers should be even comparable with the wiki mining hw comparison

plus I keep in mind the rumor that gpu's have two years to live in average
thus a 1 year mining contract should not cost 100 % of the hw but more or less 60-70 % (that's my opinion on pricing of such goods & services).

Indeed a growth oriented stock has not manifested itself. It makes the reinvesting easier Wink

your ad here:
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February 21, 2012, 06:23:47 PM
 #14

Glasswalker: Yello

Quote
If you could explain the math you've done there, I'd love to understand your point of view so I can better discuss it.

I did some mistakes (wrong premises) at the start of the math so the model is not applicable to each glbse asset
but one can say that existing operations provide a total mining capacity (in GHash/s) value estimated nr. shares x price
this estimated value of an operation is then divided by the capacity. thus a comparison of gpu mining assets

BMMO 4000 x 0.357 = 1428 btc / 4 ghs (357 btc / ghs)
MergedMining 5500 x 0.133 = 731 btc / 1.62 ghs (456 btc / ghs; 420 btc / ghs discount for bitcoin reserve held per share)
TyGrr 1500 x 3 = 4500 btc (375 btc / ghs)

once dividends are added to the above data, P/E can be calculated.
this are roughly the initial costs per mining capacity per selected glbse asset.

but again, those social contracts are not limited in time. while btcsyn is a 1 year mining contract that might not pay itself off (some fringe configurations of exchange rate and difficulty may render this activity a non profit venture). especially since this is the last year before the mining reward halving. the relation to mining hardware in the above assets is a kind of ownership or exclusive use rights that do not expire.
btcsyn is a 12+ month hardware loan and the gpu capacity will cease to exist.

I wanted to know what's my hashing power Wink since I do not mine myself but want to mine bitcoins badly, this is a nice match.
btw it's 216 MHash/s

those figures need to be correlated with electricity prices at the hosting location but as an initial rough guide they're what's easily available.
who would like to enter fpga mining at the quoted price, would need roughly 770 btc to have 1 GHash/s up & running. for rough estimates what's doable with ipo btc it's better than wild guessing. thinking in terms of assets, their prices, mining capacity their represent it does not require an arm and a leg for monitoring, maintenance, utility bills and ad hoc effort to keep it mining. they all are optimized for dividends but that can be easily abstracted as equal to the growth budget contributions from mining.

now it boils down to keep it profitable to raise funds for the fpga boards.
i've found my initial mistakes (as why the initial formula is not applicable for this ipo)
hope this helped to give you an insight what the numbers should represent
some of the numbers should be even comparable with the wiki mining hw comparison

plus I keep in mind the rumor that gpu's have two years to live in average
thus a 1 year mining contract should not cost 100 % of the hw but more or less 60-70 % (that's my opinion on pricing of such goods & services).

Indeed a growth oriented stock has not manifested itself. It makes the reinvesting easier Wink

Well Red Star Mining RSM which I'm just starting with two Radeon HD 7970's is only 250 BTC per GH/s and that's if I only get 1.2GH/s from the two 7970's 1.44 GH/s is possible and I'm looking to expand to three Radeon HD 7970's pretty rapid.  By far the best deal for a mining company offer on the GLBSE but I understand it may seem a gamble to a lot of people as it's brand new that's why the low price.  3BTC get's you a 1% stake in the company.  Shares are being sold for 0.3BTC.

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February 21, 2012, 06:57:05 PM
 #15

Hey, I'm loving the discussion going on here Wink lol

So to answer these last 2 posts.

Mila:
I think the best way to compare apples to apples, is the value of the share itself. If you ignore dividends, and look at raw MHash/BTC you get for your investment.
That's what you are "Buying" for that money. The dividends end up being part of the business model (the means of making profit).

So a breakdown comparison using this method of the ones you gave examples of (using the numbers in your post) is:

Bitcoin Syndicate:
After 100% successful IPO, the syndicate (and so the shareholders) will own 6GHash/s of FPGA mining power.
We have 12,000 shares total.
This means 0.5MHash/s per Share
That means that at a price of 0.25BTC per share (our IPO price) you get 2MHash/s per BTC invested.
Features:
- We have 6GHash/s of "Additional" mining power for the first year (doubling the effective MHash/s per BTC to 4MHash/s per BTC invested during that first year)
- If our forecasts hold (which I admit they may or may not) at the end of the first year, when the 6GHash of GPU power ends. We will have added enough FPGAs through the growth fund to make it still worth 4MHash/s per BTC invested at that stage, and going forward indefinitely beyond that (and continuing to grow).
- We will grow in value rapidly due to 80% of mining power being re-invested
- We pay out 20% of all mining power to dividends monthly

BMMO:
Currently owns 4GHash/s of mining power.
4,000 shares total.
This means 1MHash/s per Share
Current share price: 0.357BTC per share
Current mining power per BTC: 2.80Mhash/BTC
Features:
- 100% dividend payout? (don't see this on their site at first glance)
- No growth plan that I can see

MergedMining:
Currently owns 1.62GHash/s of mining power.
5,500 shares total.
This means 0.3MHash/s per Share (rounded up slightly)
Current share price: 0.133BTC per share
Current mining power per BTC: 2.25Mhash/BTC
Features:
- BTC discount (I'm not following how that works just yet)
- No growth plan that I can see
- 100% dividend payout? (again not seeing this clearly defined, but assuming it's the case)

TyGrr:
Currently owns 12GHash/s of mining power.
1,500 shares total.
This means 8MHash/s per Share
Current share price: 3 BTC per share
Current mining power per BTC: 2.66Mhash/BTC
Features:
- 95% dividend payout
- No growth plan that I can see
- Nice warranties
- SLA on the uptime (though I'd love to see the backing contracts for this, and/or penalties they offer if it's breached).

Does that make sense for a nice apples to apples comparison of the other alternatives available out there? Smiley

And according to this, over the short term, and the long term, you are looking at a minimum of a 30% improvement in ROI from the Syndicate than you will get from any of the above mentioned options (only factoring in the asset value of a share).


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HashVoodoo Open Source FPGA Mining Bitstream: https://github.com/pmumby/hashvoodoo-fpga-bitcoin-miner
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February 21, 2012, 07:32:54 PM
 #16

Hey, I'm loving the discussion going on here Wink lol

So to answer these last 2 posts.

Mila:
I think the best way to compare apples to apples, is the value of the share itself. If you ignore dividends, and look at raw MHash/BTC you get for your investment.
That's what you are "Buying" for that money. The dividends end up being part of the business model (the means of making profit).

So a breakdown comparison using this method of the ones you gave examples of (using the numbers in your post) is:

Bitcoin Syndicate:
After 100% successful IPO, the syndicate (and so the shareholders) will own 6GHash/s of FPGA mining power.
We have 12,000 shares total.
This means 0.5MHash/s per Share
That means that at a price of 0.25BTC per share (our IPO price) you get 2MHash/s per BTC invested.
Features:
- We have 6GHash/s of "Additional" mining power for the first year (doubling the effective MHash/s per BTC to 4MHash/s per BTC invested during that first year)
- If our forecasts hold (which I admit they may or may not) at the end of the first year, when the 6GHash of GPU power ends. We will have added enough FPGAs through the growth fund to make it still worth 4MHash/s per BTC invested at that stage, and going forward indefinitely beyond that (and continuing to grow).
- We will grow in value rapidly due to 80% of mining power being re-invested
- We pay out 20% of all mining power to dividends monthly

BMMO:
Currently owns 4GHash/s of mining power.
4,000 shares total.
This means 1MHash/s per Share
Current share price: 0.357BTC per share
Current mining power per BTC: 2.80Mhash/BTC
Features:
- 100% dividend payout? (don't see this on their site at first glance)
- No growth plan that I can see

MergedMining:
Currently owns 1.62GHash/s of mining power.
5,500 shares total.
This means 0.3MHash/s per Share (rounded up slightly)
Current share price: 0.133BTC per share
Current mining power per BTC: 2.25Mhash/BTC
Features:
- BTC discount (I'm not following how that works just yet)
- No growth plan that I can see
- 100% dividend payout? (again not seeing this clearly defined, but assuming it's the case)

TyGrr:
Currently owns 12GHash/s of mining power.
1,500 shares total.
This means 8MHash/s per Share
Current share price: 3 BTC per share
Current mining power per BTC: 2.66Mhash/BTC
Features:
- 95% dividend payout
- No growth plan that I can see
- Nice warranties
- SLA on the uptime (though I'd love to see the backing contracts for this, and/or penalties they offer if it's breached).

Does that make sense for a nice apples to apples comparison of the other alternatives available out there? Smiley

And according to this, over the short term, and the long term, you are looking at a minimum of a 30% improvement in ROI from the Syndicate than you will get from any of the above mentioned options (only factoring in the asset value of a share).



Well in RSM it's 4MH/s per BTC invested in the IPO  Grin and that's if I don't decide to extend the IPO to buy three Radeon HD 7970's which are all having the GPU's overclocked to 1200MHz minimum and gRAM underclocked to 600MHz.

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February 21, 2012, 07:55:55 PM
 #17

Well in RSM it's 4MH/s per BTC invested in the IPO  Grin and that's if I don't decide to extend the IPO to buy three Radeon HD 7970's which are all having the GPU's overclocked to 1200MHz minimum and gRAM underclocked to 600MHz.

That's not too shabby, that's a good return. Though are you considering that if you extend the IPO to cover additional Radeon's you will still have a similar ratio? (if you add more shares it divides further, or if you increase the value of a share it balances the average out).

So if you get 2 Radeons for 200BTC (random numbers for easy math) and each radeon does 1GHash, that's 100BTC per GHash, or 1BTC for 10MHash. But if you alter it to buy a 3rd radeon that's 3 radeons for 300BTC which still only works out to 10MHash per BTC. (does that make sense). There is potential for bulk savings, but it's my experience that there is little in the way of bulk savings to be had on GPU tech (unless you're buying at least $20K or more worth of hardware at a time, and even then it's more like 5% - 10% savings, maybe 20% on a damn good day with your sales rep in a good mood). Wink

Also consider your GPUs will be consuming AT LEAST 10 times more power than my FPGA rigs will in the long run, if not closer to 15-20x Wink

But either way 4MHash/s per BTC invested is a great return, I wish you the best of luck with your venture!

Just trying to make Bitcoin a Success... One crazy project at a time. (13rwPKskyATcAq3PpnCikfFG8989DQ8M3c)
HashVoodoo Open Source FPGA Mining Bitstream: https://github.com/pmumby/hashvoodoo-fpga-bitcoin-miner
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February 21, 2012, 08:31:06 PM
 #18

MergedMining:
Currently owns 1.62GHash/s of mining power.
5,500 shares total.
This means 0.3MHash/s per Share (rounded up slightly)
Current share price: 0.133BTC per share
Current mining power per BTC: 2.25Mhash/BTC
Features:
- BTC discount (I'm not following how that works just yet)
- No growth plan that I can see
- 100% dividend payout? (again not seeing this clearly defined, but assuming it's the case)

Just wanted to address this to avoid spreading misinformation.  I believe the BTC discount that was referred to is the current displayed company holdings of close to $100, 1,000 NMC & 60 BTC.  You also say we have no growth plan, that is untrue.  The company was started with no rig, no money & no mining power of any kind.  We continue to grow by leaps and bounds and are currently raising funds for our next leg of expansion.  I would say our entire plan is a growth plan...  You also assume a 100% dividend payout.  This is most certainly not true.  We use profits for share buybacks, expansion, reserves and upgrading existing equipment.

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February 21, 2012, 09:08:34 PM
 #19

Just wanted to address this to avoid spreading misinformation.  I believe the BTC discount that was referred to is the current displayed company holdings of close to $100, 1,000 NMC & 60 BTC.  You also say we have no growth plan, that is untrue.  The company was started with no rig, no money & no mining power of any kind.  We continue to grow by leaps and bounds and are currently raising funds for our next leg of expansion.  I would say our entire plan is a growth plan...  You also assume a 100% dividend payout.  This is most certainly not true.  We use profits for share buybacks, expansion, reserves and upgrading existing equipment.

Hey! thanks for the post, and the clarification. By no means did I want faulty info posted. I was simply repeating the raw data posted by mila, combined with what I could see with about 30seconds (literally) of research lol...

If you have more accurate data for me to put in there I'll gladly edit that post to reflect the actual data.

For example, what ratio of reinvestment do you do? Versus your percentage payout to dividends?
Also I didn't mean to imply by "no growth plan" that there is no growth. (for example FPGA.contract is doing additional share releases to fund waves of hardware). But their growth in value per-share is not planned for. They issue new shares which are fully allocated to new hardware. I'm assuming by your response that you have a more complex growth plan, based on re-using some of your internal profits from mining to re-invest and expand the value of existing shares.

Please let me know and I'll update it, as I said I definitely don't want to be posting false data about the other mining ventures. We can keep this to a friendly competition right? Wink lol

Just trying to make Bitcoin a Success... One crazy project at a time. (13rwPKskyATcAq3PpnCikfFG8989DQ8M3c)
HashVoodoo Open Source FPGA Mining Bitstream: https://github.com/pmumby/hashvoodoo-fpga-bitcoin-miner
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February 22, 2012, 12:33:38 AM
 #20

(In reply to Glasswalker's earlier post in reply to mine)

Sorry for the delay, I also have had a busy schedule.

Length is not an issue, there's nothing wrong with being verbose. It's much more important that you convey your points clearly, which you have.

I did include an estimated $50 for shipping for the hardware, but you would certainly know the shipping situation better than I, living in Canada as you do. Just do consider the fact that you're competing with US-based businesses, in many cases. Again, it's not what I'd price the hardware at, but it's your call.

I think it's perfectly reasonable to use the USD/BTC conversion rate at the time of the IPO; that's just not what's stated in your bylaws. ("this rate is calculated based on the average "street price" of building a mining rig at the time of the formation of the syndicate")
If you change that, I think the price would be much more reasonable to investors.

"Best effort" is understandable. As long as you have at least considered the legal issues, I understand guarantees are tough, and I certainly wouldn't want you making promises you couldn't keep.

I'm afraid I still don't understand the reason to run multiple unrelated ventures under one banner; you aren't (I assume) being taxed. But as long as you would require a majority vote on each one, I can acquiesce.

A future debt clause is fine. Just wasn't sure what you were referring to there. (wanted to make sure I wasn't misinterpreting anything)

Thanks (again) for answering all of my questions completely and professionally. I look forward to (hopefully) seeing this business prosper.


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