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 Author Topic: BFL/ASIC - Payoff calculations, Warranty & Return/Refund Period.  (Read 1501 times)
Definit
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 June 30, 2012, 05:07:48 PM

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Dargo
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 June 30, 2012, 06:47:52 PM

Payoff Calculation:

There are too many unknowns for this to be done precisely, but we can at least determine roughly what needs to happen before ASIC mining becomes less profitable than mining on non-ASIC is now. Here is my take on that question from another thread:

"Right now with GPU/FPGA you can get around 0.0009 Th (=0.9 Gh) for \$600 = 0.0000015 Th/\$ (or 1.5 Mh/\$) (very rough - I'm thinking of the BFL single, but GPU is reasonably comparable). The SC MR is 1 Th for \$30,000 = 0.00003 Th/\$. So, very roughly speaking, BFL ASIC is 20x better in terms of hashrate/\$.

Ignoring power cost (which varies widely anyway), BFL ASIC mining will be more profitable than mining pre-ASIC at least until the post-ASIC difficulty reaches 20x pre-ASIC. After that, it will still be better depending on your power cost. How long to ROI? That's much harder to estimate, but assuming you could pay off \$600 invested in 0.0009 Th in about 200 days pre-ASIC, BFL ASIC will do better than that at least until post-ASIC difficulty reaches 20x pre-ASIC.

So, to boil it down to something very simple but not totally off-base, investing in BFL ASIC will be a better investment than what is currently available so long as you get your ASIC equipment quickly enough that the difficulty doesn't increase 20x over what it is now within 200 days after you get your equipment. Of course, you could still pay off the investment, even within 200 days, if difficulty increases faster than this.

Let's use these numbers and assume that the same amount of \$ gets invested in BFL ASIC as is invested currently in the entire network. The current network is 12.5 Th. That divided by 0.0000015 Th/\$ is \$8.3 million. \$8.3 million worth of BFL ASIC would be 250 Th. 250 Th is exactly 20x the current network speed (this shouldn't be surprising). So, basically, BFL ASIC will be more profitable than what we've had pre-ASIC recently until miners pour more money into BFL equipment than they have so far building the entire current network (and assuming that BFL or a competitor doesn't drop prices before this happens)."

How long till we reach 250 Th? Hard to say. So far the pace of orders has been blistering, and it's quite possible that the first shipment alone could take us half way or more. If so, the second shipment would no doubt take us the rest of the way. Also, it may be that current BFL equipment already makes up at least 25% of the current network, and if so, at least 125 Th will come online through the exchange program alone (which ends March 1st). But on the other hand, if we reach 250 Th with BFL ASICs alone, this means that people will have invested about \$8.3 million in BFL equipment. With so many miners saying they will "wait and see" or "refuse to do business with BFL" or "are getting out for good," it might take a while for such a large sum to be invested.

The profitability picture will get clearer as time goes by, but whatever that picture turns out to be, profit will diminish the longer you wait. I know all this is pretty vague, but as I said, there are too many unknowns at this point for a precise profitability calculator to have any meaning. Also, it looks like these units will come out around the time that the reward halves, making it even more difficult. Those who like more transparency in their investments should stay away.

Warranty & Return/Refund:

Warranty will probably be the same as it is for FPGA. I'm not sure what that is, but 6 months comes to mind. I'm sure someone will chime to verify/correct.

BFL has stated that there are no returns/refunds unless they fail to perform. In addition to a defective unit, this includes failure to deliver within 60 days of their target (stated vaguely as "October"). They also said they would consider refunds on a case by case basis for other reasons.

Hope this helps.
Stephen Gornick
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 June 30, 2012, 08:52:28 PM

Excellent work!

I know all this is pretty vague, but as I said, there are too many unknowns at this point for a precise profitability calculator to have any meaning. Also, it looks like these units will come out around the time that the reward halves, making it even more difficult. Those who like more transparency in their investments should stay away.

"Prediction is very difficult, especially about the future." - Niels Bohr

Also, consider that when you place the order today, you are spending your bitcoins at today's exchange rate.

If you were to, say, wait until October to place your order, the exchange rate could be higher (or lower, but let's say higher ... say \$8).

So the person who pays for the \$1,299 SC Single today at \$6.65 pays about 195 BTC.  The person who pays in October at a (hypothetical) pays about 162 BTC for the same product instead.  But person who waits until BFL has the units "in the wild" didn't need to worry that BFL really could deliver on these units.

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||bit
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 June 30, 2012, 11:49:38 PM

Excellent work!

I know all this is pretty vague, but as I said, there are too many unknowns at this point for a precise profitability calculator to have any meaning. Also, it looks like these units will come out around the time that the reward halves, making it even more difficult. Those who like more transparency in their investments should stay away.

"Prediction is very difficult, especially about the future." - Niels Bohr

Also, consider that when you place the order today, you are spending your bitcoins at today's exchange rate.

If you were to, say, wait until October to place your order, the exchange rate could be higher (or lower, but let's say higher ... say \$8).

So the person who pays for the \$1,299 SC Single today at \$6.65 pays about 195 BTC.  The person who pays in October at a (hypothetical) pays about 162 BTC for the same product instead.  But person who waits until BFL has the units "in the wild" didn't need to worry that BFL really could deliver on these units.

Yeah, that's something to consider. You could then buy 4 for the price of 3 at todays prices. So, in that scenario, there is effectively a 30% inrease in hash rate per dollar. But this might be balanced by the first month being most profitable. Furthermore, ordering now and get the hardware to mine before this hypothetical \$6 to \$8 increase. So, we need to consider the potential factor that you will have likely mined significant amount of coins before they become lower in supply (i.e. the 50 to 25 bitcoin discovery size). So, who knows.

And also consider that BFL will have to either charge less per hash rate once the difficultly goes too high. Afterall, when network hashing goes up 30x, who would want to buy at tody's prices? I suppose there will be some kind of market equilibrium...perhaps eventually. Miners won't invest if there is no reasonable time to ROI, and difficulty won't increase if miners don't invest.

||bit

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