Diablo Mining Company

[BinaryMage]

Keep in mind 1 million bitcoins is 4.7% of all bitcoins ever to be mined. Yes, I understand you wont hold these all at once but its still just a massive percent of the whole economy.

Just for comparision, 4.7% of all USD in existence is ~2 trillion dollars. Apple's market cap is just about 600 billion.

Uh, no. All USD in existence is measured in the quadrillions. Our annual Federal budget is more than 2 trillion. The war in Iraq cost more than 2 trillion.

The difference here is, Wall Street valuation is not based on reality, and USD is inflationary. Your comparison is rather pointless.

Meaningless in the number, yes. Meaningless in the point, not so much.

Potential investors and I are just not seeing eye to eye on this, and its a waste of time and money to try to continue. I want to make sure no one can get a stranglehold on the Bitcoin economy, but no one really seems to either think that can happen (stealth privately owned mining companies, etc), or they don't see its worth plunking the money down as a sort of insurance.

I think it's possible for a big, long-term mining operation like this to get funding and succeed, but this isn't a good way to issue shares. You should partner with someone who knows more about finance/business.

I concur with theymos. Your idea is perfectly valid, and I think interest does exist, but to launch a venture on this scale is a whole different ballgame with whole different rules in comparison to the GLBSE-funded companies in existence.

[1715019457]

1715019457

[1715019457]

1715019457

[Nefario]

I concur with theymos. Your idea is perfectly valid, and I think interest does exist, but to launch a venture on this scale is a whole different ballgame with whole different rules in comparison to the GLBSE-funded companies in existence.

Right now GLBSE certainly wouldn't be ready for something of this size (the market size on GLBSE is simply too small at the moment), and I would need to have added a lot more functionality in managing shares, dividends and other things as well, all coming in due time but not here yet.

[DiabloD3]

(The plan has been moved to the op post)

[Nefario]

Don't forget taxes, there is slim to 0 chance of you being able to run an operation of that size without the taxman coming after you.

[DiabloD3]

Don't forget taxes, there is slim to 0 chance of you being able to run an operation of that size without the taxman coming after you.

Operating costs. Although, the fun part there, I think the federal government still has tax rebates on solar panel deployment, so taxes work both ways.

[sturle]

At 1.5m diff and prices north of $5: 54 BTC a day or $270 a day or $98,550 a year.
[...]
156 * 85 ghash is 13 thash, or enough to completely secure the cryptographic safety of Bitcoin, or make about $9.6 million dollars in the first year, assuming, again, difficulty does not greatly spike or prices do not greatly plummet.

The addition of 13 Thash/s will by itself more than double the difficulty.  Mining is a game of diminishing returns.  When your share of the total network get to large, you mostly compete with yourself.  You at least need to take your own hashrate into account when calculating the resulting difficulty, and don't assume all other innovation in mining will stop.

[DiabloD3]

At 1.5m diff and prices north of $5: 54 BTC a day or $270 a day or $98,550 a year.
[...]
156 * 85 ghash is 13 thash, or enough to completely secure the cryptographic safety of Bitcoin, or make about $9.6 million dollars in the first year, assuming, again, difficulty does not greatly spike or prices do not greatly plummet.

The addition of 13 Thash/s will by itself more than double the difficulty.  Mining is a game of diminishing returns.  When your share of the total network get to large, you mostly compete with yourself.  You at least need to take your own hashrate into account when calculating the resulting difficulty, and don't assume all other innovation in mining will stop.

No, I did the math wrong. Its 3.5 thash, not 13.

[sturle]

At 1.5m diff and prices north of $5: 54 BTC a day or $270 a day or $98,550 a year.
[...]
156 * 85 ghash is 13 thash, or enough to completely secure the cryptographic safety of Bitcoin, or make about $9.6 million dollars in the first year, assuming, again, difficulty does not greatly spike or prices do not greatly plummet.

The addition of 13 Thash/s will by itself more than double the difficulty.  Mining is a game of diminishing returns.  When your share of the total network get to large, you mostly compete with yourself.  You at least need to take your own hashrate into account when calculating the resulting difficulty, and don't assume all other innovation in mining will stop.

No, I did the math wrong. Its 3.5 thash, not 13.

There are more errors.  Your calculations assume 50 BTC per block, and this is going to halve during the first year of operation.  If you get started after December 9th or thereabout, your block reward will start at 25 BTC.

[DiabloD3]

At 1.5m diff and prices north of $5: 54 BTC a day or $270 a day or $98,550 a year.
[...]
156 * 85 ghash is 13 thash, or enough to completely secure the cryptographic safety of Bitcoin, or make about $9.6 million dollars in the first year, assuming, again, difficulty does not greatly spike or prices do not greatly plummet.

The addition of 13 Thash/s will by itself more than double the difficulty.  Mining is a game of diminishing returns.  When your share of the total network get to large, you mostly compete with yourself.  You at least need to take your own hashrate into account when calculating the resulting difficulty, and don't assume all other innovation in mining will stop.

No, I did the math wrong. Its 3.5 thash, not 13.

There are more errors.  Your calculations assume 50 BTC per block, and this is going to halve during the first year of operation.  If you get started after December 9th or thereabout, your block reward will start at 25 BTC.

No, I already included a disclaimer for that: I have not factored that in, and I think BTC prices will double because of it.

[sturle]

There are more errors.  Your calculations assume 50 BTC per block, and this is going to halve during the first year of operation.  If you get started after December 9th or thereabout, your block reward will start at 25 BTC.

No, I already included a disclaimer for that: I have not factored that in, and I think BTC prices will double because of it.

You don't want to predict any difficulty increase, but price doubling is assumed?  In that case try another calculation.  Spend all the USD to buy BTC before the block reward halves, and sell afterwards when the price has doubled.  Much more profitable than this mining operation, and less risky because you don't depend on constant difficulty.  :-)

[DiabloD3]

There are more errors.  Your calculations assume 50 BTC per block, and this is going to halve during the first year of operation.  If you get started after December 9th or thereabout, your block reward will start at 25 BTC.

No, I already included a disclaimer for that: I have not factored that in, and I think BTC prices will double because of it.

You don't want to predict any difficulty increase, but price doubling is assumed?  In that case try another calculation.  Spend all the USD to buy BTC before the block reward halves, and sell afterwards when the price has doubled.  Much more profitable than this mining operation, and less risky because you don't depend on constant difficulty.  :-)

Can't predict difficulty, however. I've seen it swing wildly up AND down.

[highlevelminer]

This a very relevant issue for the future of the bitcoin and all its participents.

A mining operation of this scale can place a permanent stranglehold on the uprise of the bitcoin's price margin as well as ensure large amounts of coinage do not fall into unscrupulous hands.

I will definitely making positive reference to this as well as the BTK lending operation on a vlog I'll be posting today.

Great work and stay tuned

[MPOE-PR]

This has easily been the most entertaining thing I read all week.

[rjk]

This has easily been the most entertaining thing I read all week.

Small minds are easily amused.

[2weiX]

noted

[highlevelminer]

Okay here is the link for the promotional video I did on youtube for reputable bitcoin lending operations.

I made a few mistakes as to names but I think the general idea was made in a clear and concise manner

Here is the link for review:https://bitcointalk.org/index.php?topic=67446.0

[DiabloD3]

https://bitcointalk.org/index.php?topic=78052.0

Started a poll. Vote now.

[DiabloD3]

I've updated the plan to further cover green cooling and power generation further.

tl;dr: Reducing operating costs is good, alternate income sources are also good, state and federal incentive programs are good as well.

[Dusty]

I find this strategy far from optimal, spending so much for FPGA is not wise, with such an amount of money you should develop your own ASIC...?

[DiabloD3]

I find this strategy far from optimal, spending so much for FPGA is not wise, with such an amount of money you should develop your own ASIC...?

It would cost about $10 million just to get to the first ASIC run unless you want really shoddy chips and/or SASIC (which isn't particularly much better than FPGA). Plus, shitty ASIC or the best SASIC designs at >=45nm is going to be pretty hard pressed to beat 28nm FPGA at mhash/$ and they'll be in the same ballpark for mhash/watt.

So, given that, I'd rather be the first major ASIC customer, and although I'd love for that to be my first gen hardware, I'm not seeing it happen.