ASICMINER: Entering the Future of ASIC Mining by Inventing It

[Jutarul]

http://trilema.com/2013/the-analysis-of-a-failure-asicminer/

Mircea Popescu runs MPEX which is an exchange that ASICMiner refused to be listed on. He's been attacking AM ever since so anything he says should be taken with scepticism.

The official position of bitfountain was to only manage claims of direct shareholders (https://bitcointalk.org/index.php?topic=99497.msg1571278#msg1571278), and that hasn't changed.

I don't really understand the hostility towards ASICMINER in the article. If the author is upset with the current situation he is free to offer a solution to the market using available means to establish a solid pricing mechanism. And last time I checked, the existing pass-thrus seemed to do an acceptable job. Also there are constantly auctions on the auction forum.

I think his main critique is mainly pointed towards the recent decrease in share price. I don't think the decrease in share price is a failure of the pricing mechanism. It's rather the outcome of a liquidity crunch (more investment opportunities than capital, causing chronic undervaluation), combined with the deployment cycle of ASICMINER miner and their dividend policy.

I expect the share price to stabilize above 2 BTC/share. If it does not, it provides an incentive for previous owners to move back into the market.

[houseofchill]

One thing that everyone should realize that its in Friedcat's interest for the share price to decrease significantly right before rolling out a 2nd generation of hardware or products. Why? Because he is the only person that knows exactly what the company is planning to do AND while he cannot sell his existing shares without those actions being known (via the blockchain), he can buy cheaply from others much more anonymously.

In other words, if you're Friedcat and you know the plans for the next 6 months or so, you can increase your company ownership much easier by first withholding dividends and / or newly purchased hardware for some period of time, then purchasing additional shares (on whatever market) at a reduced price. This is insider trading, but since this is a virtual market, there is no protection against it.

I'm not accusing Friedcat of anything, I'm simply explaining a consequence of the current market. I'm here for the dividends, the share price has lost 50% of its value, and it would take over 18 months for reduced dividends to make up the difference, but at the company's current valuation, I'm much more of a buyer than a seller.

And the psychology here, people don't talk about AM like a long term business. It's as if the whole operation is valued on engineering project and just hash rates.  How come people never guess what friedcat sees about AM's leading role in bitcoin and into the future?  I guess friedcat plays it close to the chest.  From a trust point view, he's laid out many many pages and what he has said he has always done on point.  From the business plans down to never increasing 400K shares of FountainBit.

[JordanL]

I am part of a company set up to sell and service ASICMINER Block Erupter hardware for miners in nearly every country on earth:

https://2asic.com

In addition to the contact information on the website, you may private messages me here regarding our products.

Get yours while supplies last!

[ThickAsThieves]

I am part of a company set up to sell and service ASICMINER Block Erupter hardware for miners in nearly every country on earth:

https://2asic.com

In addition to the contact information on the website, you may private messages me here regarding our products.

Get yours while supplies last!

Neat!

[lophie]

What really has shown itself many times is the effect of Bitcoin exchange price to the Bitcoin stock markets. The link is because some people look at Bitcoin as an investment and they park their coins in stocks to even grow them. Then when Bitcoin price shoots they pull some coins to fiat hence the decline in share prices.

But the percentage of the drop in proportions is simply higher than the liquidity pulled. Is it the FUD effect?

I hope this FUD effect would help clean the market of weak knees so it can grow stronger and more stable. In mean while lets enjoy cheap shares of ASICMINER.

Regarding the competition, We now see potential competitor hashrate wise but really what about expanding? None got clear views and progress but ASICMINER.

[DebitMe]

I am part of a company set up to sell and service ASICMINER Block Erupter hardware for miners in nearly every country on earth:

https://2asic.com

In addition to the contact information on the website, you may private messages me here regarding our products.

Get yours while supplies last!

Is there no option to order with bitcoin? I looked through the currency options but didn't see bitcoin at all

[JordanL]

I am part of a company set up to sell and service ASICMINER Block Erupter hardware for miners in nearly every country on earth:

https://2asic.com

In addition to the contact information on the website, you may private messages me here regarding our products.

Get yours while supplies last!

Is there no option to order with bitcoin? I looked through the currency options but didn't see bitcoin at all

Yes, you can pay with Bitcoins. It is not currently in our currency drop-down list, the price will be converted to BTC on the checkout page.

[stripykitteh]

I think his main critique is mainly pointed towards the recent decrease in share price. I don't think the decrease in share price is a failure of the pricing mechanism. It's rather the outcome of a liquidity crunch (more investment opportunities than capital, causing chronic undervaluation), combined with the deployment cycle of ASICMINER miner and their dividend policy.

I expect the share price to stabilize above 2 BTC/share. If it does not, it provides an incentive for previous owners to move back into the market.

I know you are an early investor and I presume a board member, so you have access to lots of information that most people don't have. But that is part of the problem with valuing AM as a run-of-the-mill investor. The market occasionally get short updates from Friedcat that give a general idea of where the company is going, without too many specifics.

Last week was a case in point. The dividend was low, so everyone dumped their shares in a panic. Then we were told some BTC was held back for gen 2 chips. What we *don't* know is:

- how long has Friedcat been holding back dividends
- how much has he held back
- how much more does he need to pay for the next gen
- how much stock is still on hand

etc etc

When the market operates in a near-vacuum of information, the only things we can go on are:

- the dividend
- the estimates of hashrate
- estimates of hardware sales
- any news about new competitors

which is why the share price bobs around like a cork in the ocean, as I'm sure it will continue to do until something changes. I think that's now a bigger factor than the lack of capital compared to investment opportunities.

[houseofchill]

What really has shown itself many times is the effect of Bitcoin exchange price to the Bitcoin stock markets. The link is because some people look at Bitcoin as an investment and they park their coins in stocks to even grow them. Then when Bitcoin price shoots they pull some coins to fiat hence the decline in share prices.

But the percentage of the drop in proportions is simply higher than the liquidity pulled. Is it the FUD effect?

I hope this FUD effect would help clean the market of weak knees so it can grow stronger and more stable. In mean while lets enjoy cheap shares of ASICMINER.

Regarding the competition, We now see potential competitor hashrate wise but really what about expanding? None got clear views and progress but ASICMINER.

Ah I didn't think other ppl saw bitcoin stocks that way to invest fiat, and so they simply want to cash in when bitcoin goes higher..  I'd rather see my bitcoin stocks as bitcoins in the end.

No other minining company like BFL or Avalon has any success like AM, but the wild west market can be crazy. I can see AM as a financial services company like a new kind of bank. The new USBs can be adapted to hardware wallets that can go on keychains. Guess it's still early to think like an investor instead of like a speculator. I'll enjoy cheap shares then in the meanwhile.

[lophie]

Ah I didn't think other ppl saw bitcoin stocks that way to invest fiat, and so they simply want to cash in when bitcoin goes higher..  I'd rather see my bitcoin stocks as bitcoins in the end.

Yes alot are like that and for "bigger" investors they have the luxury and "heart" to stick to long term investments in Bitcoin stock markets but personally I know a few who only entered Bitcoin recently and with few coins and they rode labcoin, btcgarden, fenix and other waves to increase their stake in Bitcoin.

[Panterino]

Seems like we're ready for a bounce at current prices with the hashrate back on target and the price near long term resistance.

[Jutarul]

- how long has Friedcat been holding back dividends
- how much has he held back

Would it help if friedcat releases a cashflow statement everytime a dividend payment occurs?

e.g. something like:

x BTC dividend payment  = x BTC revenue -  x BTC withheld

then the market can build their own balance sheet during the release of financial statements...

[twentyseventy]

Seems like we're ready for a bounce at current prices with the hashrate back on target and the price near long term resistance.

Hoping that the sell off of LC will help bring the price back a bit as well

[dhenson]

Seems like we're ready for a bounce at current prices with the hashrate back on target and the price near long term resistance.

I'm guessing others are waiting on the cryptx IPO.  At least that's what's stopping me from taking advantage of the current price.

[freedomno1]

http://trilema.com/2013/the-analysis-of-a-failure-asicminer/

MPex is completely irrelevant to everyone except the poor souls who bought into it.

Facepalm.jpg
Right and SatoshiDice did a better job as a gambling exchange that spammed the blockchain with a suspicious buyback mumble.
"The workings of contracts strengthened by another good example, such as Satoshi Dice was through its lifetime."

http://trilema.com/2013/the-analysis-of-a-failure-asicminer/

Mircea Popescu runs MPEX which is an exchange that ASICMiner refused to be listed on. He's been attacking AM ever since so anything he says should be taken with scepticism.

+1

MPEX IS a sinking boat and yes I know there is a 25% chance Mircea will write an article on that later

[stripykitteh]

- how long has Friedcat been holding back dividends
- how much has he held back

Would it help if friedcat releases a cashflow statement everytime a dividend payment occurs?

e.g. something like:

x BTC dividend payment  = x BTC revenue -  x BTC withheld

then the market can build their own balance sheet during the release of financial statements...

Sure, I think it would help, and reduce the volatility, which I don't think helps anyone really.

[Rival]

If you believe the risk premium caused by what you consider to be a lack of transparency by FC is unacceptable then perhaps AM is not for you. If FC were more transparent then it would make valuation much easier, stabilize the price, and make profits for both speculators and accumulators much lower. Personally I like it the way things are now. It makes accumulation much cheaper and easier, and speculators can eat the stupid money like candy.

For some reason AM shares are more closely tied to fiat than btc. I don't know for certain why, but knowing this can make you wealthy.

[chriswilmer]

If you believe the risk premium caused by what you consider to be a lack of transparency by FC is unacceptable then perhaps AM is not for you. If FC were more transparent then it would make valuation much easier, stabilize the price, and make profits for both speculators and accumulators much lower. Personally I like it the way things are now. It makes accumulation much cheaper and easier, and speculators can eat the stupid money like candy.

I casually assumed that the lack of transparency had mostly to do with maintaining a competitive advantage over other miners. *shrugs* I don't know really know. Can't wait for that 200 TH/s deployment though...

[ThickAsThieves]

I think his main critique is mainly pointed towards the recent decrease in share price. I don't think the decrease in share price is a failure of the pricing mechanism. It's rather the outcome of a liquidity crunch (more investment opportunities than capital, causing chronic undervaluation), combined with the deployment cycle of ASICMINER miner and their dividend policy.

I expect the share price to stabilize above 2 BTC/share. If it does not, it provides an incentive for previous owners to move back into the market.

I know you are an early investor and I presume a board member, so you have access to lots of information that most people don't have. But that is part of the problem with valuing AM as a run-of-the-mill investor. The market occasionally get short updates from Friedcat that give a general idea of where the company is going, without too many specifics.

Last week was a case in point. The dividend was low, so everyone dumped their shares in a panic. Then we were told some BTC was held back for gen 2 chips. What we *don't* know is:

- how long has Friedcat been holding back dividends
- how much has he held back
- how much more does he need to pay for the next gen
- how much stock is still on hand

etc etc

When the market operates in a near-vacuum of information, the only things we can go on are:

- the dividend
- the estimates of hashrate
- estimates of hardware sales
- any news about new competitors

which is why the share price bobs around like a cork in the ocean, as I'm sure it will continue to do until something changes. I think that's now a bigger factor than the lack of capital compared to investment opportunities.

I know this is hard to believe, and then hard to concede, but I can honestly say that I have yet to learn any special info from being a board member and then traded on that. I'm the newest one, so maybe there were times in the past where that wasn't true for others, but I recall hearing similar sentiments from a board member back then too.

If anything, being in the thick of it simply makes Friedcat's publicly provided info and timelines more believable. When you see a delay, that's when we see it too. We don't have our fingers on Friedcat's pulse like some might like to imagine.

The fact is, we all know the share price has more to do with speculation, fickle sentiment and panic more than anything.

Furthermore, the amount of info coming out of AM to the public is not any worse than your average corporation. To be candid, the forum and its 24-hour F5 mashers distort reality with a hunger for info (read: trading signals). Some of you pretend like info is something that is vastly needed and lacking for some kind of transparency or relief, but mostly they just want to know if they should buy/sell in their short-term trading efforts.

All the info you need to make trade decisions is already out there. Anything that is uncertain after that, is simply that.

[Vycid]

I think his main critique is mainly pointed towards the recent decrease in share price. I don't think the decrease in share price is a failure of the pricing mechanism. It's rather the outcome of a liquidity crunch (more investment opportunities than capital, causing chronic undervaluation), combined with the deployment cycle of ASICMINER miner and their dividend policy.

I expect the share price to stabilize above 2 BTC/share. If it does not, it provides an incentive for previous owners to move back into the market.

I know you are an early investor and I presume a board member, so you have access to lots of information that most people don't have. But that is part of the problem with valuing AM as a run-of-the-mill investor. The market occasionally get short updates from Friedcat that give a general idea of where the company is going, without too many specifics.

Last week was a case in point. The dividend was low, so everyone dumped their shares in a panic. Then we were told some BTC was held back for gen 2 chips. What we *don't* know is:

- how long has Friedcat been holding back dividends
- how much has he held back
- how much more does he need to pay for the next gen
- how much stock is still on hand

etc etc

When the market operates in a near-vacuum of information, the only things we can go on are:

- the dividend
- the estimates of hashrate
- estimates of hardware sales
- any news about new competitors

which is why the share price bobs around like a cork in the ocean, as I'm sure it will continue to do until something changes. I think that's now a bigger factor than the lack of capital compared to investment opportunities.

I know this is hard to believe, and then hard to concede, but I can honestly say that I have yet to learn any special info from being a board member and then traded on that. I'm the newest one, so maybe there were times in the past where that wasn't true for others, but I recall hearing similar sentiments from a board member back then too.

If anything, being in the thick of it simply makes Friedcat's publicly provided info and timelines more believable. When you see a delay, that's when we see it too. We don't have our fingers on Friedcat's pulse like some might like to imagine.

The fact is, we all know the share price has more to do with speculation, fickle sentiment and panic more than anything.

Furthermore, the amount of info coming out of AM to the public is not any worse than your average corporation. To be candid, the forum and its 24-hour F5 mashers distort reality with a hunger for info (read: trading signals). Some of you pretend like info is something that is vastly needed and lacking for some kind of transparency or relief, but mostly they just want to know if they should buy/sell in their short-term trading efforts.

All the info you need to make trade decisions is already out there. Anything that is uncertain after that, is simply that.

TAT, were you eb3full's buyer?