BFL ASIC question

[vrtrasura]

Greetings,

I think they number BFL put out are possible from an ASIC, whether they hit them or not we will see.  That said, even if they don't hit the performance target, why would BFL even sell these?  Why not just make back all of their NRE by mining with them?  Our community would still jump to buy them after they (BFL) had already destroyed the difficulty by mining for a year before selling them.  The ROI at current difficulty rates is too large to ignore.  It doesn't make sense to me; consider a Jalapeno pays for itself in 2 weeks.  Anyone care to speculate? 

[mc_lovin]

It pays for itself in 2 weeks now.. before release, but if they sell thousands of them and the 1 TH/s units, the difficulty will go up..  I mean, it'll still pay itself off, but the amount of profit will be different once these are in the wild---IF they get released.

[A_CardeN]

OP - You are very, very wrong my friend.

You are not considering the rise in difficulty when asic comes out.  You cannot calculate asic speed and payback time on todays difficulty.  A jalapeno will probably pay itself off within a year when asic comes out full blown.

Please reconsider.

[vrtrasura]

Of course the difficulty will go up... But until the GPU miners have all quit and the botnets have all quit the ROI of asics is huge... How much do you think the difficulty will go up?  There's a thread that says $200k of pre-orders have been made via bitpay.  Dividing by the Jalapeno cost that's roughly 5 petahashes/s?  Currently the network is operating at 20ph/s so the difficulty will go up... by 25%.  Sure it's sizable, but does difficulty alone explain away my question?  I still think the ROI would be there for them if they mined for a year before selling.  I would think it gets bad for them to mine when the difficulty is up by a factor of 4 or so.

Maybe there are way more preorders than that and the difficulty will double over the next year as things ship.

[A_CardeN]

Of course the difficulty will go up... But until the GPU miners have all quit and the botnets have all quit the ROI of asics is huge... How much do you think the difficulty will go up?  There's a thread that says $200k of pre-orders have been made via bitpay.  Dividing by the Jalapeno cost that's roughly 5 petahashes/s?  Currently the network is operating at 20ph/s so the difficulty will go up... by 25%.  Sure it's sizable, but does difficulty alone explain away my question?  I still think the ROI would be there for them if they mined for a year before selling.  I would think it gets bad for them to mine when the difficulty is up by a factor of 4 or so.

Maybe there are way more preorders than that and the difficulty will double over the next year as things ship.

The difficulty will probably double, at least.

The network speed is going to double when the first wave of asic comes. 

The 200k of orders is probably half Singles.  Not all Jalapenos.  It is naive to think that all those sales are Jalas.  There is also a thread somewhere that said most of the sales are Singles.  40 Ghash.

GPU mining will die like CPU mining did.  The first wavers will be rich and everyone else will be left behind.

[vrtrasura]

Totally agree with you on all of what you said, that is the big picture perspective.  I'm still not getting it, however, from BFL's perspective.  They could make more money keeping it to themselves rather than selling it, or selling it after already getting all of their NRE back.  Is my analysis if way off (probably)?  Still, they will have these things before the block half event.  They are in the position to capitalize on the difficulty bump earlier than anyone else can, so why would they sell to us?





edit: grammer fix

[humanitee]

The first wavers will not be rich. They will receive most of the coins for a couple months at best. As more and more ASIC units are shipped out, their profits will greatly diminish.

[nedbert9]

Current per GH profitability will decline 80-90% once BFL trade-in's are mostly executed.

[molecular]

It pays for itself in 2 weeks now.. before release, but if they sell thousands of them and the 1 TH/s units, the difficulty will go up..  I mean, it'll still pay itself off, but the amount of profit will be different once these are in the wild---IF they get released.

They could produce them (not ship yet) and then use them right after a difficulty adjustments, mine for 2-3 days until the next difficulty jump (a huge one this time) and then start shipping. This would result in a pretty bad slowdown after they switch them off and mail them to the customers (see namecoin problems before merged mining). So I don't think that's a good option.

Should they decide to mine for more than one difficulty-adjustment-period there is another problem: as ArtForz once pointed out (not his words): once your hashrate approaches 50%, you increasingly compete against yourself.

And: them having >50% of hashing power would surely create some pretty bad bitcoin trust-problems that would backfire badly on their profits.

So I think the OP has a point, but I don't think they'll try to exploit it but rather try to make a biz of selling these things.

[vrtrasura]

I've searched but I haven't found it, anyone have any guesses to who is fabbing BFL's ASIC?  GloFo?  TSMC?  Anyone with full forum access willing to ask them for that info in the BFL threads?  It would be a big boost confidence in their product...


Nevemind... someone promoted me when I wasn't looking Thanks-