[Closing] [GLBSE] Philj's Impressive Mining Project (PIMP)

[Philj]

nothing to see here

[Bitcoin Oz]

Well at least the name is different

[Kansattica]

I must say, the name alone got me looking at this. I would certainly consider investing in PIMP, if only so I can see it when I check my GLBSE account.

[GeoRW]

So you have no mining hardware yet? And you will order it after IPO is sold? That may take a while until you start to pay dividends. 

[JWU42]

Best of luck with this - I am in for some shares at this very attractive price!

[PsychoticBoy]

Bought some shares 



Good luck with your mining company.


Greetz

[VEscudero]

Bought some bonds.

Greetz!

[Tachikoma]

Bought because of the awesome name, good luck

[VEscudero]

I have just bought the last ones so the IPO is finally over.

Happy investing for everyone!

[JWU42]

Will double check the coupon amount now...

[JWU42]

Yep - looks right...

http://goo.gl/VDpAc

[VEscudero]

Hi guys,

I think that PIMP bonds are very undervalued so I will put here some reasons behind my rationale:

• Investors could get all the best features of mining bonds, that is getting dividends without the hassle of maintenance and electricity costs.
• Given the way he calculates difficulty variations, his dividends will be always better or at least equal to similar mining bonds.
• Because of his statement of providing free upgrades to BFL ASICs when available.
  

If/When the BFL ASICs arrive, this could really boost the MH/s he will be providing for the same price, but even if they do not arrive any time soon, his current price of 0.25 per share is also a good deal.

As a result of what I think has been a thoughtful evaluation I have heavily invested in Pimp bonds.
I am truly optimistic in the evolution of this asset for long term investors, so if you are one of them I urge you to make your own analysis and share your own opinions.

[JWU42]

The upgrade offer is nice - but as Meni and Giga have said, nobody knows when this will happen so discussing it now seems pointless.

I hoped Phil would not add 2K bonds per week and stay smaller and possibly increase price like JAH.  We saw last week that the 500 shares at .2625 never moved.  I suspect the 2000 at .25 will not either.  Too much too soon in a turbulent market.

That said, nice to see that the price has held at .25

DISCLAIMER - I am the issuer (one of) another mining bond (not saying which to avoid spamming the thread) so take my comments with this understanding...

[VEscudero]

I hoped Phil would not add 2K bonds per week and stay smaller and possibly increase price like JAH.  

I agree 100% with this statement.

[EskimoBob]

"[GLBSE] Philj's Impressive Mining Project (PIMP) 1MH/s FREE ASIC UPGRADE"

FREE ASIC UPGRADE?  Really? Do you have a official letter from BTL with all the details how his works and when is it going to happen or is this just a pure speculation, based on a dodgy press release with no dates or details?
One more question. What if they want you to send back the old rig before they send you new shiny ASIC rig. What happens then?
 

[GeoRW]

I hoped Phil would not add 2K bonds per week and stay smaller and possibly increase price like JAH.  

I agree 100% with this statement.

JAH is issuing more bonds at lower price, not 2k but still 

[P4man]

Hi guys,

I think that PIMP bonds are very undervalued so I will put here some reasons behind my rationale:

• Investors could get all the best features of mining bonds, that is getting dividends without the hassle of maintenance and electricity costs.
• Given the way he calculates difficulty variations, his dividends will be always better or at least equal to similar mining bonds.
• Because of his statement of providing free upgrades to BFL ASICs when available.
  

If/When the BFL ASICs arrive, this could really boost the MH/s he will be providing for the same price, but even if they do not arrive any time soon, his current price of 0.25 per share is also a good deal.

As a result of what I think has been a thoughtful evaluation I have heavily invested in Pimp bonds.
I am truly optimistic in the evolution of this asset for long term investors, so if you are one of them I urge you to make your own analysis and share your own opinions.

Help me understand.

These bonds are sold at 0.25 BTC, they currently yield 0.0044315 BTC per week, correct? Thats what, ~7% per month?  So you are looking at ~40% ROI on your investment as dividends by December, at which time, mining revenue will half.  So you'd be lucky  if dividend payments compensate the expected loss in value of your bonds and thats when completely ignoring the rather obvious trend over the past 6 months where difficulty has increased steadily by almost 10% per month on average; a trend I suspect will accelerate when BFL will start shipping its minirigs in volume (the ones I know about alone represent almost 1TH), and a trend that will explode once they or anyone else starts shipping ASICs.

I dont understand how anyone can believe this is a sound investment. Mind you, that goes for all mining bonds on GLBSE, not just Philj's..

I really really wish I could short sell them. Perhaps I should instead set up a virtual mining bond thats not backed by any mining equipment but will just pay out dividends based on difficulty.

[JWU42]

I hoped Phil would not add 2K bonds per week and stay smaller and possibly increase price like JAH.  

I agree 100% with this statement.

JAH is issuing more bonds at lower price, not 2k but still 

Correct - he did recently but stayed at ~2K for several weeks...

[friedcat]

These bonds are sold at 0.25 BTC, they currently yield 0.0044315 BTC per week, correct? Thats what, ~7% per month?  So you are looking at ~40% ROI on your investment as dividends by December, at which time, mining revenue will half.

Mining revenue will half. Difficulty will also drop to neutralize some of it.

 So you'd be lucky  if dividend payments compensate the expected loss in value of your bonds and thats when completely ignoring the rather obvious trend over the past 6 months where difficulty has increased steadily by almost 10% per month on average

The difficulty curve of the past 6 months shows a slowing down of acceleration to me. And in spite of the mass production of FPGAs, the difficulty hasn't recovered to the level of last August's. So it's a drop over the past 10 months.

... a trend that will explode once they or anyone else starts shipping ASICs.

Of course, it will even explode more once 20nm ASICs destroys 130, 65, and 45nm ASICs. The problem is when.

I dont understand how anyone can believe this is a sound investment. Mind you, that goes for all mining bonds on GLBSE, not just Philj's..

Besides the reasons I listed above, I have to add another: Imagine the Bitcoin price drops to 1/10 of the current level. If you have 100BTC (600+$) and don't invest in anything now you only 60+$. But if you buy PIMP bonds at 0.25BTC/each, we can safely predict that the difficulty will decrease to at least 1/4 of the current level (hard to pay electricity bills, lots of mining operations closing). Then you have a 28% per month return, which translates to 1934BTC after a year if you reinvest, that is, more than 1160$. Isn't it a good investment if you could turn 60$ to 1160$ in a year?

Of course I'm exaggerating with a nearly impossible scenario. I also neglected the halving of block reward. But this is the idea.

I really really wish I could short sell them. Perhaps I should instead set up a virtual mining bond thats not backed by any mining equipment but will just pay out dividends based on difficulty.

I remember someone talked about exactly the same thing before. Not sure if he's already doing so or not.

[P4man]

The difficulty curve of the past 6 months shows a slowing down of acceleration to me.

Wishful thinking IMO
http://bitcoin.sipa.be/speed-lin.png
Next difficulty again +~10%.

And in spite of the mass production of FPGAs, the difficulty hasn't recovered to the level of last August's. So it's a drop over the past 10 months.

If you are going to look at difficulty of last summer, you cant ignore BTC price. But because you invest in BTC and get your return in BTC, any profits (or losses) coming from a BTC rise have to factored out. After all, if thats what you are betting on, you should just buy or sell BTCs. So you really have to look at BTC price / difficulty, and that has been going down fairly steadily:
http://bitcoinx.com/charts/chart_large_log.png

Note the log axis.  I see no reason why that trend would reverse, quite the opposite.

Buying these mining bonds at current prices only makes sense to me if you assume three things: the declining BTC/difficulty trend willl somehow reverse AND the reward halving will cause a significant drop in difficulty mostly offsetting it AND those (s)-asics will not arrive for another ~12 months. That a lot of assumptions and I would be willing to bet against any of them individually; let alone the combination of them.

Of course, it will even explode more once 20nm ASICs destroys 130, 65, and 45nm ASICs. The problem is when.

Thats actually unlikely to happen, given the extremely low marginal costs of asics, the performance gains from shrinking asics to newer process nodes is unlikely to be big enough to warrant the investment any time soon, if ever; but thats for another discussion. Agreed that the 'when' is a big factor, but (s)asics are the sword of Damocles hanging above your bonds; its not a matter of if it will drop, but when and Id be very surprised if it didnt hit in the next 6-9 monts. Anticipation and resulting value loss of these bonds will begin a lot earlier, probably as soon as a time table is made public.

Besides the reasons I listed above, I have to add another: Imagine the Bitcoin price drops to 1/10 of the current level. If you have 100BTC (600+$) and don't invest in anything now you only 60+$. But if you buy PIMP bonds at 0.25BTC/each, we can safely predict that the difficulty will decrease to at least 1/4 of the current level (hard to pay electricity bills, lots of mining operations closing). Then you have a 28% per month return, which translates to 1934BTC after a year if you reinvest, that is, more than 1160$. Isn't it a good investment if you could turn 60$ to 1160$ in a year?

If you want to speculate on a huge price drop or rise, buy or short bitcoins and you will make a whole lot more if your prediction pans out. A said earlier, those bonds are denominated in BTC and earn you BTC, so thats what you have to look at. Difficulty dropping to 1/4 just aint gonna happen, but if you are willing to make a bet in that direction, Im certainly up for it.