ASICMINER: Entering the Future of ASIC Mining by Inventing It

[drafy]

It's time to say goodbye , and take care everyone .
Also thanks to friedcat.

[1714997607]

1714997607

[1714997607]

1714997607

[1714997607]

1714997607

[1714997607]

1714997607

[bitcoin.newsfeed]

Yes. I've taken out what's left (lucky you, buying my shares at an all time record low of 0.24), and thus my failure is complete. It wasn't enough to learn some lessons with Neo & Bee, Ukyo (12 BTC lost to him and I've been told from a reliable source that Ukyo had indeed gone fractional reserve), CaVirtex (110 BTC invested and all I have to show for it is a PDF with a small fraction of 1% of the company and no idea what the shareholder agreement really is), Havelock Mining Fund last year, AsicMiner (I know I can wait even more and it could go up, but this was my cut off point -- you can reap the rewards, it is OK with me, no risk -- no reward), 47 BTC sent to Butterfly Labs for a day 1 Monarch pre-order that still hasn't shipped and might POSSIBLY make me back 2 BTC if I am lucky, etc.

Holy shit ... this is crazy sad roadmap man maybe I am crazy but still HODL-ing AM, anyway 80% stuck in directs, so what can i do, no way selling at 0.2, when bought at 2.5. Something is wrong here. Misinterpreted, lost in translation or something. Few weeks ago we've been told about aggressive dividends, self mining again. Hmmm would like to see complex update. Time for next round of shareholders questions?

and again who can answer this : what is that 4M CNY in expenses on exchange ... for what? Friedcat was buying BTCs? For what?

[shawshankinmate37927]

Yes. I've taken out what's left (lucky you, buying my shares at an all time record low of 0.24), and thus my failure is complete. It wasn't enough to learn some lessons with Neo & Bee, Ukyo (12 BTC lost to him and I've been told from a reliable source that Ukyo had indeed gone fractional reserve), CaVirtex (110 BTC invested and all I have to show for it is a PDF with a small fraction of 1% of the company and no idea what the shareholder agreement really is), Havelock Mining Fund last year, AsicMiner (I know I can wait even more and it could go up, but this was my cut off point -- you can reap the rewards, it is OK with me, no risk -- no reward), 47 BTC sent to Butterfly Labs for a day 1 Monarch pre-order that still hasn't shipped and might POSSIBLY make me back 2 BTC if I am lucky, etc.

Hoarding is definitely a much safer way to go.  I did have some success investing in Just-Dice, but that was a bumpy ride too.  Everything else just looks too risky for me.  Good luck to you.

[sngwinner]

[bitcoinarnold]

[Franktank]

Per-share equity is low. If we subtract current losses, it's about 0.03BTC/share.
And that is if they manage to sell everything at current prices, and does not include potential cash conversion problems.

Because of cost principle, inventory should be reported on balance sheet at its cost to produce/acquire, not its market or selling cost. So presuming AM can sell their inventory at a profit (IMO very likely), the net will be a multiple higher than the current inventory asset. How much higher is the question.

Well stated, if folks cannot understand grasp this concept, you have simply thrown away your BTC. friedcat did NOT pay 0.49$/G-0.99$/G to produce, rather that is price he is selling at. Those who acted irrationally by making unfounded associations to the numbers provided will soon wish they had not.

[kibblesnbits]

I'll be optimistic.

[explorer]

Per-share equity is low. If we subtract current losses, it's about 0.03BTC/share.
And that is if they manage to sell everything at current prices, and does not include potential cash conversion problems.

Because of cost principle, inventory should be reported on balance sheet at its cost to produce/acquire, not its market or selling cost. So presuming AM can sell their inventory at a profit (IMO very likely), the net will be a multiple higher than the current inventory asset. How much higher is the question.

Well stated, if folks cannot understand grasp this concept, you have simply thrown away your BTC. friedcat did NOT pay 0.49$/G-0.99$/G to produce, rather that is price he is selling at. Those who acted irrationally by making unfounded associations to the numbers provided will soon wish they had not.

True, I think there has been a lot of emotional responses to this Statement.  I was expecting an "agressive" dividend, or at least a moderate one this month.  If we don't see something in the next few weeks I will have to sell shares for liquidity - and that is a poor proposition about now.  Such is life!   

[stompysteve]

Per-share equity is low. If we subtract current losses, it's about 0.03BTC/share.
And that is if they manage to sell everything at current prices, and does not include potential cash conversion problems.

Because of cost principle, inventory should be reported on balance sheet at its cost to produce/acquire, not its market or selling cost. So presuming AM can sell their inventory at a profit (IMO very likely), the net will be a multiple higher than the current inventory asset. How much higher is the question.

Well stated, if folks cannot understand grasp this concept, you have simply thrown away your BTC. friedcat did NOT pay 0.49$/G-0.99$/G to produce, rather that is price he is selling at. Those who acted irrationally by making unfounded associations to the numbers provided will soon wish they had not.

[atx.btc]

so he just paid all income from batch 1 for producing batch 2, and all income from batch 2 will be used for producing batch 3 etc?

Looks like that's the plan. How else would FC pay for those massive batches?

You guys sound pissed, but let's think about this. Mining is an arms race, so you can only sell these chips for so long before the demand is gone and with another company. We can see that demand is currently there based on the multiple companies who are using AM Gen3 chips. We need to push these batches out as fast as possible, then reap rewards later.

Presumably some of the costs of the first batch will not be there with the second and third - CAD Design and device samples stick out, but obviously I do not know the inner workings that well so I may be mistaken on this.

It would also seem that a lot of the costs will be upfront with the first batch and that it should be cheaper to make batches 2 and 3.

Just my thoughts - not looking for an argument, just a discussion.

[tempestb]

I think people are confusing the costs of the chips to produce and their value in the inventory vs what they actually get sold for.  They will be sold for profit, so the value will be much higher than what is listed here.  He's not creating and selling chips to break even.  It just looks that way on a financial report right now, likely because the profits from sold chips weren't many compared to what was produced and sit in inventory.  As those start selling in greater numbers, the profits will come in.  It's just that right now, the money isn't there because of the initial production cost.

[RoadStress]

Seems people are not happy that this months divs went towards next months production costs.

You don't say...

[bitcoin.newsfeed]

so he just paid all income from batch 1 for producing batch 2, and all income from batch 2 will be used for producing batch 3 etc?

Looks like that's the plan. How else would FC pay for those massive batches?

Seems people are not happy that this months divs went towards next months production costs.

You don't say...

I don't think they went...

Something is wrong, look(only 1 month ago) :

This is to inform that friedcat met with the board today and provided some updates.

General Update
==============
The dividend schedule will be aggressive, as AM will not require large sums of retained capital. The rationale is that AM doesn't need to invest large sums into infrastructure and that the majority of chip production costs will be covered by the business partners on a contract schedule. The new round of dividends are scheduled to begin as soon as the first large purchases have concluded and should precede or coincide with the publication of the updated financial statements.

[explorer]

so he just paid all income from batch 1 for producing batch 2, and all income from batch 2 will be used for producing batch 3 etc?

Looks like that's the plan. How else would FC pay for those massive batches?

You guys sound pissed, but let's think about this. Mining is an arms race, so you can only sell these chips for so long before the demand is gone and with another company. We can see that demand is currently there based on the multiple companies who are using AM Gen3 chips. We need to push these batches out as fast as possible, then reap rewards later.

Presumably some of the costs of the first batch will not be there with the second and third - CAD Design and device samples stick out, but obviously I do not know the inner workings that well so I may be mistaken on this.

It would also seem that a lot of the costs will be upfront with the first batch and that it should be cheaper to make batches 2 and 3.

Just my thoughts - not looking for an argument, just a discussion.

IIRC, it was implied that production costs were in hand from previous sales, hence the aggressive dividends.  Lost in translation, or simply a change of plans?  Either way it has not been directly addressed.  This is nothing new or panic worthy, but an explanation would still be welcome.  May the aggression begin in the coming weeks as sales increase and mining ramps up!

[jimmothy]

Seems people are not happy that this months divs went towards next months production costs.

You don't say...

What those people don't realize is that even if we did get divs this month, next months divs would be much less.

In other news AM has now sold enough hashrate to power about 10% of the bitcoin network and has ~20PH left to sell (before buying more wafers).

[jimmothy]

IIRC, it was implied that production costs were in hand from previous sales, hence the aggressive dividends.  Lost in translation, or simply a change of plans?  Either way it has not been directly addressed.  This is nothing new or panic worthy, but an explanation would still be welcome.  May the aggression begin in the coming weeks as sales increase and mining ramps up!

AM only had about 5500btc + $1,000,000 in cash. That wouldn't even be enough to cover wafer costs. (maybe for the first batch but definitely not the next)

so he just paid all income from batch 1 for producing batch 2, and all income from batch 2 will be used for producing batch 3 etc?

Yes, that is how I am guessing it will happen. If we guess batch 2 is 20PH being sold at $0.5/gh that would earn ~$10,000,000 which would be enough to purchase 50PH worth of wafers which could then be sold for $25,000,000.

Basically turning $4 million in to $25 million.

*Numbers are extremely approximate but I think it shows why reinvestment is a good idea.

[eiprol]

so he just paid all income from batch 1 for producing batch 2, and all income from batch 2 will be used for producing batch 3 etc?

Yes, that is how I am guessing it will happen. If we guess batch 2 is 20PH being sold at $0.5/gh that would earn ~$10,000,000 which would be enough to purchase 50PH worth of wafers which could then be sold for $25,000,000.

Basically turning $4 million in to $25 million.

*Numbers are extremely approximate but I think it shows why reinvestment is a good idea.

I think the question is, have we entered in an infinite loop of reinvestments, or someday those gains will be paid as dividends?
What happened to those aggressive dividends?

[Korbman]

Having just caught up on the last few pages in this thread, there seems to be an interesting dichotomy between established members and newbies on how they view the recent news. I can't say I have a reasonable view on it all at this point, but I'll still grab the popcorn and watch it all unfold.

[jimmothy]

so he just paid all income from batch 1 for producing batch 2, and all income from batch 2 will be used for producing batch 3 etc?

Yes, that is how I am guessing it will happen. If we guess batch 2 is 20PH being sold at $0.5/gh that would earn ~$10,000,000 which would be enough to purchase 50PH worth of wafers which could then be sold for $25,000,000.

Basically turning $4 million in to $25 million.

*Numbers are extremely approximate but I think it shows why reinvestment is a good idea.

I think the question is, have we entered in an infinite loop of reinvestments, or someday those gains will be paid as dividends?
What happened to those aggressive dividends?

It wouldn't really be an infinite loop of reinvestments in my made up scenario since the reinvestment amount would be doubling per batch.

[explorer]

so he just paid all income from batch 1 for producing batch 2, and all income from batch 2 will be used for producing batch 3 etc?

Yes, that is how I am guessing it will happen. If we guess batch 2 is 20PH being sold at $0.5/gh that would earn ~$10,000,000 which would be enough to purchase 50PH worth of wafers which could then be sold for $25,000,000.

Basically turning $4 million in to $25 million.

*Numbers are extremely approximate but I think it shows why reinvestment is a good idea.

I think the question is, have we entered in an infinite loop of reinvestments, or someday those gains will be paid as dividends?
What happened to those aggressive dividends?

Of course, as time ticks on, and BTC ticks UP  the later the div the lower the BTC denomination.  Maybe even to the point that $10M in BTC NOW will be worth more than $25M in BTC 3 months from now.  Speculation.  But worthy of thought.  Since we don't have all of the information, we can believe that friedcat has maximum shareholder (himself included) benefit in mind, or we can sell to those that do.