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Author Topic: MineCo 185 days of 1.5GH/s 500BTC or $3200  (Read 2036 times)
FooDSt4mP
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May 17, 2011, 08:13:15 AM
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Edit: GLBSE isn't quite ready to handle this kind of contract yet, so it is no longer available via that market.  I am still willing to sell these contracts outside GLBSE.  PM if interested.  Price is 500 BTC, or $3200 via Dwolla.  Remember, this is an expected value contract, so any downtime or hardware issues are my responsibility.  If you want to resell the contract, simply send me the email or forum username of the buyer and I will contact them and ask for their payment preferences/address.

The expected generation output, at 1500000 Khps, given current difficulty of 244139.48158254 , is 6.17983851319 BTC per day and 0.257493271383 BTC per hour. (With new difficulty as of 5/18)

MineCo
For each share purchased from MineCo, I will purchase hardware capable of delivering 1.5GH/s to the shareholder for 6 months from the beginning of mining.  Mining will begin within two weeks of the date of initial share purchase.

MineCo is currently offering shares 5 at a time, starting with a initial price of 500 BTC.



Share terms:
The holder of this certificate(from here on known as a shareholder) is a holder of one share of bitcoin transaction processing power.
That is, the owners of this share is the owner of 1.5 GH/s of transaction processing power on the bitcoin network for a period of 6(30 day) months.  You will also receive the BTC for a 5 day test run upon deployment of the hardware.
Mining will begin within two weeks of the initial purchase of the share, but may be delayed upon request of the shareholder.
Payouts will occur every 30 days, with the first payment occuring 5 days after mining begins.  Payouts can either be sent to a bitcoin address or converted to USD via mtgox.com on the payout date and sent as mtgusd or to a dwolla.com account.
There will be 7 total payments.
Payments will be the expected value for the time period (with difficulty changes rounded to the nearest hour).
The shareholder may update their payout method once per pay period, or whenever the share changes ownership.
Hardware failures will be the responsibilty of the hardware operator.
A list of start and end dates for each share will be available at http://www.yrral.net/mineco-sharedates.txt.  Please note these dates when evaluating this share's value.


Question for Nefario: how can I find a unique identifier for a given share?  I'll also need to be able to find a timestamp for when the trade is executed to ensure I meet the 2 week figure.  I'm sure this information is in there somewhere.

Tradable, 185 day mining contracts.  Essentially bitcoin futures that are difficulty sensitive.  Help secure the bitcoin network.

As we slide down the banister of life, this is just another splinter in our ass.
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bitcoinTrader
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May 17, 2011, 09:23:53 AM
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MineCo is currently offering shares 5 at a time, starting with a initial price of 550 BTC.

Think the price is too high for shares.

Sukrim
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May 17, 2011, 11:47:29 AM
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MineCo is currently offering shares 5 at a time, starting with a initial price of 550 BTC.

Think the price is too high for shares.

You could just offer far more shares at a lower price...

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May 17, 2011, 03:40:05 PM
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Think the price is too high for shares.

You could just offer far more shares at a lower price...

Exactly. I don't really understand what is the point in issuing shares in the first place, if you are not going to split them up.

You can and should also pay the shareholders via dividends.
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May 17, 2011, 03:45:28 PM
 #5

What is with these mining companies? Can't you think of something more interesting to fund?

How about a toy company? Buy a thing-o-matic with 200 bitcoin and manufacture toy designs.

Nefario
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May 17, 2011, 03:58:29 PM
 #6

I checked the contract has not been gpg signed.

The reason he's only selling a few share is it's too much work otherwise. He should sell lots of shares at a lower price, but because what you're attempting to do would require too much administrative overhead (keeping track of when a share was issued etc.) for more than a few shares.

To see when a trade happened just run bmc.py market-history it should show a timestamp.

I need to add some functionality to add expiration dates to contracts. Right now there is none of that.

Also there is no way to specify which share to pay, only to all shares, so even when a contract has expired it would be impossible to not pay it.

I would say you should cancel your sell order, glbse just can't handle what you're trying to do right now.

This needs to be handled with smart contracts(automatic contracts),I'll be starting work on that soon(after 2 weeks).

PGP key id at pgp.mit.edu 0xA68F4B7C

To get help and support for GLBSE please email support@glbse.com
FooDSt4mP
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May 17, 2011, 04:33:15 PM
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I checked the contract has not been gpg signed.

The reason he's only selling a few share is it's too much work otherwise. He should sell lots of shares at a lower price, but because what you're attempting to do would require too much administrative overhead (keeping track of when a share was issued etc.) for more than a few shares.

To see when a trade happened just run bmc.py market-history it should show a timestamp.

I need to add some functionality to add expiration dates to contracts. Right now there is none of that.

Also there is no way to specify which share to pay, only to all shares, so even when a contract has expired it would be impossible to not pay it.

I would say you should cancel your sell order, glbse just can't handle what you're trying to do right now.

This needs to be handled with smart contracts(automatic contracts),I'll be starting work on that soon(after 2 weeks).

Yep, I forgot to sign it.  Is there any way to fix it, or do I need to create a new asset?  I have cancelled the order for now, but wouldn't it be possible to make the payments outside of GLBSE?  Or is a share really just a number of shares?  I was thinking each share was a copy of the contract that got signed and passed around.

As we slide down the banister of life, this is just another splinter in our ass.
Nefario
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May 17, 2011, 04:49:40 PM
 #8

I checked the contract has not been gpg signed.

The reason he's only selling a few share is it's too much work otherwise. He should sell lots of shares at a lower price, but because what you're attempting to do would require too much administrative overhead (keeping track of when a share was issued etc.) for more than a few shares.

To see when a trade happened just run bmc.py market-history it should show a timestamp.

I need to add some functionality to add expiration dates to contracts. Right now there is none of that.

Also there is no way to specify which share to pay, only to all shares, so even when a contract has expired it would be impossible to not pay it.

I would say you should cancel your sell order, glbse just can't handle what you're trying to do right now.

This needs to be handled with smart contracts(automatic contracts),I'll be starting work on that soon(after 2 weeks).

Yep, I forgot to sign it.  Is there any way to fix it, or do I need to create a new asset?  I have cancelled the order for now, but wouldn't it be possible to make the payments outside of GLBSE?  Or is a share really just a number of shares?  I was thinking each share was a copy of the contract that got signed and passed around.

You will need to make a new asset, don't worry I'll help you do it next time, and I'll refund you for this one.

Right now a share is really just a number, glbse uses traditional accounting methods.

If you're interested I'd like you to help me with smart contracts by giving input in terms of what you need. What you wan't can be done using smart contracts, it's just a matter of me doing it.

No point in doing it outside the exchange, the would be even more work on your part.

Aww links for more information on smart contracts.
https://secure.wikimedia.org/wikipedia/en/wiki/Smart_contract
http://www.erights.org/smart-contracts/index.html
http://firstmonday.org/htbin/cgiwrap/bin/ojs/index.php/fm/article/view/548/469

PGP key id at pgp.mit.edu 0xA68F4B7C

To get help and support for GLBSE please email support@glbse.com
oillio
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May 17, 2011, 04:50:24 PM
 #9

This is an interesting idea.
This sort of thing could turn into a difficulty futures market.
Miners could sell futures in order to lock in a profit on their rigs.
Speculators could buy/sell naked to speculate on expected difficulty changes...

The main issue is counterparty risk.  A futures exchange really needs to be the counterparty in order to make the contracts truly generic.  But that requires margin requirements, the ability to make margin calls, etc.  Maybe in a few years the market will be large enough to make this realistic.
Nefario
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May 17, 2011, 04:56:12 PM
 #10

Write up a contract to cover this, great idea.
Contract examples here
http://dev.glbse.com/cgi-bin/list

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oillio
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May 17, 2011, 06:19:09 PM
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I would be happy to write it up, but I don't think your software can handle a true futures market at this point.

Correct me if I am wrong, but these are the features we would need that do not yet exist:
  • Sub-tickers.  Probably a minor thing.  We need a contract for every month (or whatever time period).  So DIF.M1 is the June 2011 contract, DIF.F2 is the January 2012 contract.
  • Ability to short.  Currently, only the contract writer can create new instances of the contract.  We would want a single contract that any miner (or speculator) could offer for sale to the market.
  • A clearinghouse.  This is the big one.  Contract purchasers don't want to have to trust the contract seller will perform as stated.  They want to trust that the central clearinghouse is the counterparty to the contract.  Are you willing to perform this function?  It would require margin accounts on the exchange.  You would need to deal with reserve requirements, provide some level of credit, perform margin calls when required, etc.
  • Smart contracts.  Automatically settle the contract, transfer the specified bitcoin from the shorts to the longs at the specified exercise date(s).  It would be ideal if the exchange software kept track of the difficulty level so that you could specify the calculation directly in the contract, but manually calculating the value would be fine to start.

For now, I could write up a sample contract.  Any miner could use it as a template to make their custom future.  Every seller will have a different ticker symbol and buyers will need to vet every seller and determine for themselves if they trust the seller to perform.
FooDSt4mP
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May 17, 2011, 08:48:49 PM
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I checked the contract has not been gpg signed.

The reason he's only selling a few share is it's too much work otherwise. He should sell lots of shares at a lower price, but because what you're attempting to do would require too much administrative overhead (keeping track of when a share was issued etc.) for more than a few shares.

To see when a trade happened just run bmc.py market-history it should show a timestamp.

I need to add some functionality to add expiration dates to contracts. Right now there is none of that.

Also there is no way to specify which share to pay, only to all shares, so even when a contract has expired it would be impossible to not pay it.

I would say you should cancel your sell order, glbse just can't handle what you're trying to do right now.

This needs to be handled with smart contracts(automatic contracts),I'll be starting work on that soon(after 2 weeks).

Yep, I forgot to sign it.  Is there any way to fix it, or do I need to create a new asset?  I have cancelled the order for now, but wouldn't it be possible to make the payments outside of GLBSE?  Or is a share really just a number of shares?  I was thinking each share was a copy of the contract that got signed and passed around.

You will need to make a new asset, don't worry I'll help you do it next time, and I'll refund you for this one.

Right now a share is really just a number, glbse uses traditional accounting methods.

If you're interested I'd like you to help me with smart contracts by giving input in terms of what you need. What you wan't can be done using smart contracts, it's just a matter of me doing it.

No point in doing it outside the exchange, the would be even more work on your part.

Aww links for more information on smart contracts.
https://secure.wikimedia.org/wikipedia/en/wiki/Smart_contract
http://www.erights.org/smart-contracts/index.html
http://firstmonday.org/htbin/cgiwrap/bin/ojs/index.php/fm/article/view/548/469

Yeh, now that I think about it GLBSE doesn't have our keys.  Duh.  All I really need it to be able to discriminate between shares, and I could handle the rest.  But if that's not ready yet, I guess I'll have to wait.  I suppose I could create a new asset each time with a specific start and end date, but then the asset/ticker creation fees start to add up.  Ideally, a more generic futures market that tracks difficulty and includes the calculation in the contract would be awesome.  Then, all miners need to do is set their price and deposit the right amounts of BTC before each payout.  But, that's probably not feasible just yet.  I would love to help out however I can (I can program, primarily in Ruby, Perl, and C but I can manage in most languages), but I need to be able to justify the economics of any time I spend.  Also, is there a particular reason why GLBSE itself is not being traded?  Perhaps you could offer shares in exchange for work, which would allow you to share the risk, or just raise funds to hire a few developers.  I'm not really looking for work now, but like I said, I am willing to help out some if you have any small tasks you can pass off.

As we slide down the banister of life, this is just another splinter in our ass.
Nefario
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May 18, 2011, 08:58:29 AM
 #13

I dont see multiple contracts (sub contracts) needing to be issued. Simply have the terms in the contract such that it is valid for x days after purchase, or valid in x mining term after purchase (a mining term being whatever timeperiod you specify). This is going to be a pain in the ass to implement, but doable.      The main reason glbse shares are not being traded is e havent worked out the terms with the other shareholders. Contract text, number of issues etc.

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To get help and support for GLBSE please email support@glbse.com
FooDSt4mP
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May 18, 2011, 10:18:03 PM
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I dont see multiple contracts (sub contracts) needing to be issued. Simply have the terms in the contract such that it is valid for x days after purchase, or valid in x mining term after purchase (a mining term being whatever timeperiod you specify). This is going to be a pain in the ass to implement, but doable.      The main reason glbse shares are not being traded is e havent worked out the terms with the other shareholders. Contract text, number of issues etc.

Ah, definitely take the time to reach a consensus.  I didn't realize there were more than a couple shareholders.  If you're using Rails (I seem to remember that being mentioned as the back end), you just need to create a shares model with creation and expiration date.  Then add a shareholder_shares model with shareholder_id and share_id (assuming the user model is "shareholder").  Add in a couple associations, and you have shareholder.shares.where(:asset_id => 'blahblah').count to replace your shareholder.folio.where(:asset_id => 'blahblah').quantity.  At least, that's how I'd go about it.  Of course, there are other usages that will need updated, but hopefully you have a decent test suite to do regression testing.

As we slide down the banister of life, this is just another splinter in our ass.
oillio
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May 18, 2011, 10:57:39 PM
 #15

People may want to trade contracts that are not immediately active.  Also, someone may want to sell a contract that they purchased.
If every contract has an arbitrary start and end date, then the buyer will need to inspect every contract which they buy.  A true market can't be made.  You won't be able to go and place a buy order for 100 DIF.M1 @ 95.  You will have to look through all offered contracts for ones that match your specifications. 
There will be no way to automatically match up offers with bids, because each one will be slightly different.

If you standardize the contracts on a small number of date ranges, say 1 per month or 1 per difficulty period, you can make markets and everything can work much smoother.
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