ASICMINER: Entering the Future of ASIC Mining by Inventing It

[furuknap]

Seeing that a mere retention of some profits, which is expected to happen regularly, is causing so many worries, I would suggest friedcat to retain all profits from now on and release quarterly dividends, announcing the exact amount beforehand.

The profit retention in itself isn't a cause for concern; heck we've been so pampered with regular dividends that we're having a massive circle-jerk party every Wednesday.

What is at least my cause for, for lack of a better word, worry, is that there is very little transparency in how Bitfountain operates. Whether they retained dividends and paid that once a quarter or every year is besides the point; if people can't predict whether their shares will be worth a certain amount with a range for speculation then dividend distribution times is rather uninteresting.

A funding need of ฿20K over the next 12 months, for example, would mean something like 30% off the current share prices at the level of dividends we receive now. That's why it's vital to understand whether that level is sustainable without further investment or if we've already acquired the necessary hardware or contracts to keep us hashing for the next few months.

.b

[Mausini]

dont even mention that shit in connection to asicminer!! firedcat and his team are the most reputable and trustworthy people in bitcoin land. you probably have no idea whats going on here. asicminer has already paid back EVERYTHING from ipo and is just delivering massive profit after massive profit for their shareholders. share value in USD has appreciated by a factor greater than 100 since ipo. bitfountain is not selling any additional shares to the public. tell me, how the fuck can this be a scam?

LOL.  I used those same arguments when defending pirate.  He was highly trusted on -otc, was delivering on time every 3 days (and then every week), etc
 

I'm not saying we shouldn't trust friedcat, AM or Bitfountain. They may be perfectly honest, but the business behind it is too murky to effectively evaluate the company.

.b

I totally agree with you. I was just highlighting Mausini's slightly flawed thinking.

Who you trust and why is your decision to make. I was just pointing out that comparing friedcat to pirate is an absolute non-rational stupidity. You may want to have a look on wikipedia what a ponzi scheme is. it requires new investors to pay the old ones. how could friedcat do that, if everything he got from investors is already paid back in double and he never sold a share since ipo??? get your logic straight and dont spread flawed speculation from your gut feeling, because you trusted someone else and got screwed. Seriously, I dont mean to offend you, but that's just wrong.

Thank you!

[furuknap]

furuknap: they made statement that no more than 200000 shares will be sold. so there is just one real source of money for everything - mining. and it's hard to make any statement how many % they will use when BTC price is unstable.

I would like to see more information too, but I don't see why I would deserve it.

You deserve it because you are effectively lending them your money based on the promise that they will be able to repay it at some point or that you can sell your debt on an open market. If you or other investors have little information on how to evaluate the risk of that debt, then essentially it introduces more risk to you.

As for fluctuating BTC prices, again, that's impossible to predict because we have no idea how their debt is denominated. Do they pay employees in BTC or USD? Do they have exchange contracts to protect against fluctuating prices? Do they sell off a portion BTC each week and maintain a balance in RMB to pay for running costs denominated in local currency? The latter would be great in a falling market as is the case now, but not so great in a rising market, which has been the case in April.

No financials, no answers, huge risk.

.b

[lduck]

You deserve it because you are effectively lending them your money based on the promise that they will be able to repay it at some point or that you can sell your debt on an open market. ...

From this point I do not deserve it, because they already repayed me

[imsaguy]

You deserve it because you are effectively lending them your money based on the promise that they will be able to repay it at some point or that you can sell your debt on an open market. ...

From this point I do not deserve it, because they already repayed me

Ugh.  If you bought shares, then you own part of the company.  It isn't a loan.  Any dividends do not dilute your ownership share unless specified in the contract.

[furuknap]

You deserve it because you are effectively lending them your money based on the promise that they will be able to repay it at some point or that you can sell your debt on an open market. ...

From this point I do not deserve it, because they already repayed me

In that case, I'll be happy to take your shares from you.

Of course you deserve it; the repayment isn't a 1:1 thing, it is a repayment based on the risk you took when you (possibly) bought into the IPO. Getting your money back 1:1 is pointless, nobody wants to buy ฿1 for ฿1 sometime in the future. That's not investment, that's an interest free loan.

.b

[furuknap]

You deserve it because you are effectively lending them your money based on the promise that they will be able to repay it at some point or that you can sell your debt on an open market. ...

From this point I do not deserve it, because they already repayed me

Ugh.  If you bought shares, then you own part of the company.  It isn't a loan.  Any dividends do not dilute your ownership share unless specified in the contract.

Actually, share equity is debt to owners.

.b

[imsaguy]

You deserve it because you are effectively lending them your money based on the promise that they will be able to repay it at some point or that you can sell your debt on an open market. ...

From this point I do not deserve it, because they already repayed me

Ugh.  If you bought shares, then you own part of the company.  It isn't a loan.  Any dividends do not dilute your ownership share unless specified in the contract.

Actually, share equity is debt to owners.

.b

It'd be a bond if it were debt.  They sold shares.

[memvola]

Seeing that a mere retention of some profits, which is expected to happen regularly, is causing so many worries, I would suggest friedcat to retain all profits from now on and release quarterly dividends, announcing the exact amount one week in advance.

What sense would this make? If asicminer would have to overtake other companies or would have other investing opportunities then i would say that makes sense. But till now the needed money for investment is only a small part of the created money. So it would be useless to stockpile huge amounts of bitcoins laying around. Thats fully different to other companies that could use this money for something.

Yes, preserving the money is added risk. However, if what the shareholders want is predictability and accurate accounting, then I don't think that can work in weekly intervals. You need to pick one or the other. People are talking about Apple, as if what Apple is doing is transparently available to the shareholders in real-time.

Having said that, I'm sure we will receive a satisfactory post from friedcat when this phase of deployment is over. They have an insane amount of workload now.

A funding need of ฿20K over the next 12 months, for example, would mean something like 30% off the current share prices at the level of dividends we receive now. That's why it's vital to understand whether that level is sustainable without further investment or if we've already acquired the necessary hardware or contracts to keep us hashing for the next few months.

Good point. Not sure if even they know it yet though. Since the pass-through share price has increased so much, people are wondering whether they should sell or not. I understand the worry, but friedcat might not have the remedy yet. It's better to wait a few weeks more to start pestering.

[imsaguy]

Having said that, I'm sure we will receive a satisfactory post from friedcat when this phase of deployment is over. They have an insane amount of workload now.

In order for asicminer to maintain the level of network hashing that everyone keeps dreaming of, there will always be an insane amount of workload unless either more people are hired or the network hashrate vastly diminishes.

[lduck]

from contract:
"...Board members could ask for details of Bitfountain, as well as inspecting and monitoring our financials..."
I didn't find in contract any weekly updates, so strictly by contract I don't deserve even them.

[furuknap]

Who you trust and why is your decision to make. I was just pointing out that comparing friedcat to pirate is an absolute non-rational stupidity. You may want to have a look on wikipedia what a ponzi scheme is. it requires new investors to pay the old ones. how could friedcat do that, if everything he got from investors is already paid back in double and he never sold a share since ipo??? get your logic straight and dont spread flawed speculation from your gut feeling, because you trusted someone else and got screwed. Seriously, I dont mean to offend you, but that's just wrong.

Please don't take this the wrong way, but we have no insight into how the company is run so there's no way to know whether this is exactly what happens. I trust friedcat until he proves I can't, I understand the strains of running a startup (I've done it multiple times myself), and I know it's difficult to cater to every whim an investor craves.

Nobody is claming friedcat, AM, or BF is in any way deceptive. Out story so far indicates the exact opposite; friedcat has been very forthcoming with information on a short-term basis. That's great, we're kept in the loop on day-to-day operations and that certainly has value.

AM has the makings of something really, really big. They are first movers, they have proven reliability in delivery, and they hash faster than anyone. This could very well be the next Apple, valued at hundreds of billions in five years.

However, it can also be the next complete and utter failure, not from any malice but from not anticipating some factor that we can't predict now.

My point is that AM can prove to the world that BTC investments are real, that they are valuable, and that we can play the game of big money. That game, however, is played with some predictability and with some plans longer than "I'll pay tomorrow once I get some sleep". That sleep is probably more deserved than anyone's has ever been, but for investors to even consider putting any real money into this game (and I'm not talking speculating in BTC/USD in general, I'm talking BTC investing) then we need to have a poster child for how an asset is run.

.b

[gramma]

You deserve it because you are effectively lending them your money based on the promise that they will be able to repay it at some point or that you can sell your debt on an open market. ...

From this point I do not deserve it, because they already repayed me

Ugh.  If you bought shares, then you own part of the company.  It isn't a loan.  Any dividends do not dilute your ownership share unless specified in the contract.

Actually, share equity is debt to owners.

.b

It'd be a bond if it were debt.  They sold shares.

Exactly.  The confusion may be because debt and equity are on the same side of the balance sheet.  But they are not the same thing.  http://en.wikipedia.org/wiki/Accounting_equation

[memvola]

Having said that, I'm sure we will receive a satisfactory post from friedcat when this phase of deployment is over. They have an insane amount of workload now.

In order for asicminer to maintain the level of network hashing that everyone keeps dreaming of, there will always be an insane amount of workload unless either more people are hired or the network hashrate vastly diminishes.

Hiring people is also work.

[ThickAsThieves]

Who you trust and why is your decision to make. I was just pointing out that comparing friedcat to pirate is an absolute non-rational stupidity. You may want to have a look on wikipedia what a ponzi scheme is. it requires new investors to pay the old ones. how could friedcat do that, if everything he got from investors is already paid back in double and he never sold a share since ipo??? get your logic straight and dont spread flawed speculation from your gut feeling, because you trusted someone else and got screwed. Seriously, I dont mean to offend you, but that's just wrong.

Please don't take this the wrong way, but we have no insight into how the company is run so there's no way to know whether this is exactly what happens. I trust friedcat until he proves I can't, I understand the strains of running a startup (I've done it multiple times myself), and I know it's difficult to cater to every whim an investor craves.

Nobody is claming friedcat, AM, or BF is in any way deceptive. Out story so far indicates the exact opposite; friedcat has been very forthcoming with information on a short-term basis. That's great, we're kept in the loop on day-to-day operations and that certainly has value.

AM has the makings of something really, really big. They are first movers, they have proven reliability in delivery, and they hash faster than anyone. This could very well be the next Apple, valued at hundreds of billions in five years.

However, it can also be the next complete and utter failure, not from any malice but from not anticipating some factor that we can't predict now.

My point is that AM can prove to the world that BTC investments are real, that they are valuable, and that we can play the game of big money. That game, however, is played with some predictability and with some plans longer than "I'll pay tomorrow once I get some sleep". That sleep is probably more deserved than anyone's has ever been, but for investors to even consider putting any real money into this game (and I'm not talking speculating in BTC/USD in general, I'm talking BTC investing) then we need to have a poster child for how an asset is run.

.b

Sounds like you'd prefer to have less direct access to info from the CEO. Then when AM starts operating more like an American corporation, you'll say "You used to tell us whenever you took a nap!  WTF!"

[gramma]

...I trust friedcat until he proves I can't, I understand the strains of running a startup (I've done it multiple times myself)...My point is that AM can prove to the world that BTC investments are real, that they are valuable, and that we can play the game of big money. That game, however, is played with some predictability and with some plans longer than "I'll pay tomorrow once I get some sleep". That sleep is probably more deserved than anyone's has ever been, but for investors to even consider putting any real money into this game (and I'm not talking speculating in BTC/USD in general, I'm talking BTC investing) then we need to have a poster child for how an asset is run.

.b

I am feeling a little uncomfortable with the amount of my very modest BTC fundage I have in this investment. I gauge that "a little uncomfortable" is about right for the level of risk/reward as I see them at this time. My downside risk is ow-worthy to be sure, but not devastating.  However, there's a whole lot more room on the upside.

I've done the startup thing as well, and it is...intense. And that's without the constant Fx challenges friedcat faces between BTC/RMB. I doubt he pays the power bill in BTC.  I have no doubt that he could use a helping hand. But that in itself is a lot of work, even if you have a skilled and trustworthy candidate already lined up.  I know friendcat needs his sleep, and I hope he understands that even though we're all interested in more detail, at the end of the day (or night) we're cheering for him to succeed.

I am hoping that friedcat can become that poster child you mention, and I have money on that. In terms of poster-child candidates, our bench is not yet very deep in this space.  If friedcat sets a terrific example, that situation will improve.

[furuknap]

It'd be a bond if it were debt.  They sold shares.

I'd look that up with an accountant if I were you :-)

A share is a declaration of debt in the form of ownership. In other words, a shareholder gives the face value of a share to the company and the company acknowledgeds that debt in the form of a share of ownership. It is generally an irredeemable and interest free debt unless the company is liquidated at a balance, but it is still a debt.

The premium a shareholder gets from that share is the share price, the debt owed by the company to the share holder is the face value.

Yeah, technically, the term debt refers to something that will be paid off and earns an interest, whereas stock equity is not paid off and any 'interest' paid is called dividends, but in practice it is the same thing. You sell shares and increase your debt (or stock equity).

Otherwise, issuing shares would be an income for the company, which it certainly isn't.

Look, the technicalities of book keeping is irrelevant to the discussion. Even if a share holder is comfortable with the return they have gotten, that return is still tied to a promise made at the IPO by the company and the expectation of the share holder that those promises will be kept. The risk the share holder puts on the possibility of a default on those promises, plus whatever earning they expect from their investment, is the price they expect to get from an eventual sale.

At this point, it seems nobody has any clear answers to how we can evaluate that risk. That uncertainty should make an investor uncomfortable at some level, regardless of whether they believe in a bright future for Bitcoin or cryptocurrencies in general.

.b

[JaredR26]

dont even mention that shit in connection to asicminer!! firedcat and his team are the most reputable and trustworthy people in bitcoin land. you probably have no idea whats going on here. asicminer has already paid back EVERYTHING from ipo and is just delivering massive profit after massive profit for their shareholders. share value in USD has appreciated by a factor greater than 100 since ipo. bitfountain is not selling any additional shares to the public. tell me, how the fuck can this be a scam?

LOL.  I used those same arguments when defending pirate.  He was highly trusted on -otc, was delivering on time every 3 days (and then every week), etc
 

I'm not saying we shouldn't trust friedcat, AM or Bitfountain. They may be perfectly honest, but the business behind it is too murky to effectively evaluate the company.

.b

Then don't.  The door is that way.

Friedcat has been 100% honest, and every thing he has said has worked so far- Blades sold and shipped immediately, hashing power visible and going up, etc.

You are demanding more transparency at the same time everyone else demands that he move faster and deploy the 50 TH/s tomorrow.  Stop acting like a bunch of whiny children.  There is a direct inverse correlation between the size of Friedcat's updates and the work that AM does for that week.  For the last 6 weeks he gave lots of updates, and mostly not much was happening.  Now everything is happening at once, and everyone who isn't whining here like you wants Friedcat to focus on deployment & manufacturing first, then communications and corporate structure.

[ineededausername]

In other news, hashrate is climbing slowly again. 13.5 TH/s.

[Mausini]

dont even mention that shit in connection to asicminer!! firedcat and his team are the most reputable and trustworthy people in bitcoin land. you probably have no idea whats going on here. asicminer has already paid back EVERYTHING from ipo and is just delivering massive profit after massive profit for their shareholders. share value in USD has appreciated by a factor greater than 100 since ipo. bitfountain is not selling any additional shares to the public. tell me, how the fuck can this be a scam?

LOL.  I used those same arguments when defending pirate.  He was highly trusted on -otc, was delivering on time every 3 days (and then every week), etc
 

I'm not saying we shouldn't trust friedcat, AM or Bitfountain. They may be perfectly honest, but the business behind it is too murky to effectively evaluate the company.

.b

Then don't.  The door is that way.

Friedcat has been 100% honest, and every thing he has said has worked so far- Blades sold and shipped immediately, hashing power visible and going up, etc.

You are demanding more transparency at the same time everyone else demands that he move faster and deploy the 50 TH/s tomorrow.  Stop acting like a bunch of whiny children.  There is a direct inverse correlation between the size of Friedcat's updates and the work that AM does for that week.  For the last 6 weeks he gave lots of updates, and mostly not much was happening.  Now everything is happening at once, and everyone who isn't whining here like you wants Friedcat to focus on deployment & manufacturing first, then communications and corporate structure.

Exactly!