ASICMINER: Entering the Future of ASIC Mining by Inventing It

[minerpumpkin]

The question will be when this circle is being broken, since every batch needs to be funded. And every single one is bigger than the last one, yet sells for less (difficulty increase). Thus, very little remains to be issued as dividends, if any. FC may very well decide to keep the income in order to ramp up for gen 4.

I expect mining/franchise dividends will begin to trickle in very soon, which would make the picture rosier while profits are being reinvested  

How much do you think is going to be reinvested and how much will be paid out as dividends? According to my approximations, the income form the April batch almost exactly paid for the May batch, which in return paid for the June batch. Which may or may not pay for further batches.
My point is: The income seems to be reinvested completely into further batches.

Plans from April 21st: If we took the pretty big June batch of 80.4 PH/s (at 0.2$/GH/s it'd cost about $16m (2x the revenue of the May batch - thus it may not even be possible!!!) and forward the complete revenue to the shareholders at a price of $0.5 (probably not achievable in late June) we'd see a dividend of 0.15 BTC/share. And AM was completely out of money then.

More realistically, yet best-caseish: We spend all the money we have $8,7m and produce a June batch of 43.5 PH/s, sell those chips for 0.4$/GH/s and end up with $17.4m. At a BTC price of $700 we end up at 0.062 BTC/share. Again, AM would be out of money. If we now paid out half of the revenue, and reinvested the other half ($8.7m) we'd see 0.031 BTC/share. The newly funded batch would likely sell for a lot less and we may see an additional, say 0.025 BTC/share.
Since the difficulty is ever-increasing and the competition is ramping up as well, this can't go on forever and at some point it becomes unfeasible to continue. We also may see an increased BTC price. That being said, it seems pretty difficult to achieve anything exceeding or even approaching 0.1 BTC/share now for all of gen 3. Yet, gen 4 needs funding money as well (most likely significantly more than gen 3)

Please do your own research, though - this is no trading advice. I may be wrong or significantly off. Please feel free to rectify those calculations. When it comes to divs, they're giving me an headache, though.

[Another User]

I'm going to assume you're very young and thus educable, rather than a differently-enabled adult.  This assumption might be unreasonable (and I'm a bit worried that it is), but noblesse oblige dictates I err on the side of kindness.  So here's ur learningz for the day:

While certain philosophers insist that reality doesn't exist outside of perception, this concept is for grownups, so don't try to think about it just yet.  While you're still young, this is all that you need to know:  When NotLambchop is reasonably sure, bet your life on it.

Unlike drool, scribbles and malformed thinkings you make with your own brain, NotLambchop's reasonable assumptions are, indeed, reasonable.

Take NotLambchop's word for it and stop acting out.

Kids these days

Bravo, sir. I suppose when you have nothing else to use, it's quite pathetic to finally resort to name calling and then to follow it up with only reaffirming your "reasonable assumptions." Although that is to be expected, isn't it? You don't have anything else. It's ok though because you'll eagerly come back, type out another post to proclaim your ill-conceived thoughts, tack on some mild insult, and take false comfort in that what you say actually matters. Go on, we're all waiting.

[Equilux]

The question will be when this circle is being broken, since every batch needs to be funded. And every single one is bigger than the last one, yet sells for less (difficulty increase). Thus, very little remains to be issued as dividends, if any. FC may very well decide to keep the income in order to ramp up for gen 4.

I expect mining/franchise dividends will begin to trickle in very soon, which would make the picture rosier while profits are being reinvested  

How much do you think is going to be reinvested and how much will be paid out as dividends? According to my approximations, the income form the April batch almost exactly paid for the May batch, which in return paid for the June batch. Which may or may not pay for further batches.
My point is: The income seems to be reinvested completely into further batches.

Plans from April 21st: If we took the pretty big June batch of 80.4 PH/s (at 0.2$/GH/s it'd cost about $16m (2x the revenue of the May batch - thus it may not even be possible!!!) and forward the complete revenue to the shareholders at a price of $0.5 (probably not achievable in late June) we'd see a dividend of 0.15 BTC/share. And AM was completely out of money then.

More realistically, yet best-caseish: We spend all the money we have $8,7m and produce a June batch of 43.5 PH/s, sell those chips for 0.4$/GH/s and end up with $17.4m. At a BTC price of $700 we end up at 0.062 BTC/share. Again, AM would be out of money. If we now paid out half of the revenue, and reinvested the other half ($8.7m) we'd see 0.031 BTC/share. The newly funded batch would likely sell for a lot less and we may see an additional, say 0.025 BTC/share.
Since the difficulty is ever-increasing and the competition is ramping up as well, this can't go on forever and at some point it becomes unfeasible to continue. We also may see an increased BTC price. That being said, it seems pretty difficult to achieve anything exceeding or even approaching 0.1 BTC/share now for all of gen 3. Yet, gen 4 needs funding money as well (most likely significantly more than gen 3)

Please do your own research, though - this is no trading advice. I may be wrong or significantly off. Please feel free to rectify those calculations. When it comes to divs, they're giving me an headache, though.

What about all their inventory? I believe there were siginificant entries in the financial reports that suggest they have a lot of stocked up chips and other hardware?

[Franktank]

I'm going to assume you're very young and thus educable, rather than a differently-enabled adult.  This assumption might be unreasonable (and I'm a bit worried that it is), but noblesse oblige dictates I err on the side of kindness.  So here's ur learningz for the day:

While certain philosophers insist that reality doesn't exist outside of perception, this concept is for grownups, so don't try to think about it just yet.  While you're still young, this is all that you need to know:  When NotLambchop is reasonably sure, bet your life on it.

Unlike drool, scribbles and malformed thinkings you make with your own brain, NotLambchop's reasonable assumptions are, indeed, reasonable.

Take NotLambchop's word for it and stop acting out.

Kids these days

Bravo, sir. I suppose when you have nothing else to use, it's quite pathetic to finally resort to name calling and then to follow it up with only reaffirming your "reasonable assumptions." Although that is to be expected, isn't it? You don't have anything else. It's ok though because you'll eagerly come back, type out another post to proclaim your ill-conceived thoughts, tack on some mild insult, and take false comfort in that what you say actually matters. Go on, we're all waiting.

I would kindly ask that you please take this debate elsewhere, thanks.

[minerpumpkin]

The question will be when this circle is being broken, since every batch needs to be funded. And every single one is bigger than the last one, yet sells for less (difficulty increase). Thus, very little remains to be issued as dividends, if any. FC may very well decide to keep the income in order to ramp up for gen 4.

I expect mining/franchise dividends will begin to trickle in very soon, which would make the picture rosier while profits are being reinvested  

How much do you think is going to be reinvested and how much will be paid out as dividends? According to my approximations, the income form the April batch almost exactly paid for the May batch, which in return paid for the June batch. Which may or may not pay for further batches.
My point is: The income seems to be reinvested completely into further batches.

Plans from April 21st: If we took the pretty big June batch of 80.4 PH/s (at 0.2$/GH/s it'd cost about $16m (2x the revenue of the May batch - thus it may not even be possible!!!) and forward the complete revenue to the shareholders at a price of $0.5 (probably not achievable in late June) we'd see a dividend of 0.15 BTC/share. And AM was completely out of money then.

More realistically, yet best-caseish: We spend all the money we have $8,7m and produce a June batch of 43.5 PH/s, sell those chips for 0.4$/GH/s and end up with $17.4m. At a BTC price of $700 we end up at 0.062 BTC/share. Again, AM would be out of money. If we now paid out half of the revenue, and reinvested the other half ($8.7m) we'd see 0.031 BTC/share. The newly funded batch would likely sell for a lot less and we may see an additional, say 0.025 BTC/share.
Since the difficulty is ever-increasing and the competition is ramping up as well, this can't go on forever and at some point it becomes unfeasible to continue. We also may see an increased BTC price. That being said, it seems pretty difficult to achieve anything exceeding or even approaching 0.1 BTC/share now for all of gen 3. Yet, gen 4 needs funding money as well (most likely significantly more than gen 3)

Please do your own research, though - this is no trading advice. I may be wrong or significantly off. Please feel free to rectify those calculations. When it comes to divs, they're giving me an headache, though.

What about all their inventory? I believe there were siginificant entries in the financial reports that suggest they have a lot of stocked up chips and other hardware?

No more than $8.7m enough to fund said 43.5 PH/s of the June batch.

[vortex1878]

0.2$/GH was cost for batch 1. Following batches are much less. All your calculations are way off.

[NotLambchop]

I'm going to assume you're very young and thus educable, rather than a differently-enabled adult.  This assumption might be unreasonable (and I'm a bit worried that it is), but noblesse oblige dictates I err on the side of kindness.  So here's ur learningz for the day:

While certain philosophers insist that reality doesn't exist outside of perception, this concept is for grownups, so don't try to think about it just yet.  While you're still young, this is all that you need to know:  When NotLambchop is reasonably sure, bet your life on it.

Unlike drool, scribbles and malformed thinkings you make with your own brain, NotLambchop's reasonable assumptions are, indeed, reasonable.

Take NotLambchop's word for it and stop acting out.

Kids these days

Bravo, sir. I suppose when you have nothing else to use, it's quite pathetic to finally resort to name calling and then to follow it up with only reaffirming your "reasonable assumptions." Although that is to be expected, isn't it? You don't have anything else. It's ok though because you'll eagerly come back, type out another post to proclaim your ill-conceived thoughts, tack on some mild insult, and take false comfort in that what you say actually matters. Go on, we're all waiting.

Your reply, young man, is sadly typical of today's youth:  brash, uncouth, confrontational and yet ...so sensitive and easy to wound.  Which part of my edifying discourse offended your delicate sensibilities?

[bones]

I have never seen this  information before, you made it up?
Cost was said to be $0.20   no mention of production costs going down AFAIK.
Sales prices would go down yes.

0.2$/GH was cost for batch 1. Following batches are much less. All your calculations are way off.

[Another User]

I'm going to assume you're very young and thus educable, rather than a differently-enabled adult.  This assumption might be unreasonable (and I'm a bit worried that it is), but noblesse oblige dictates I err on the side of kindness.  So here's ur learningz for the day:

While certain philosophers insist that reality doesn't exist outside of perception, this concept is for grownups, so don't try to think about it just yet.  While you're still young, this is all that you need to know:  When NotLambchop is reasonably sure, bet your life on it.

Unlike drool, scribbles and malformed thinkings you make with your own brain, NotLambchop's reasonable assumptions are, indeed, reasonable.

Take NotLambchop's word for it and stop acting out.

Kids these days

Bravo, sir. I suppose when you have nothing else to use, it's quite pathetic to finally resort to name calling and then to follow it up with only reaffirming your "reasonable assumptions." Although that is to be expected, isn't it? You don't have anything else. It's ok though because you'll eagerly come back, type out another post to proclaim your ill-conceived thoughts, tack on some mild insult, and take false comfort in that what you say actually matters. Go on, we're all waiting.

Your reply, young man, is sadly typical of today's youth:  brash, uncouth, confrontational and yet ...so sensitive and easy to wound.  Which part of my edifying discourse offended your delicate sensibilities?

  Thanks for confirming that.

But I'm sure you're quickly typing something else in retort but w/e. I'm done, I had fun doing this and hope you did too. Bye!

[Jutarul]

Gentlemen,

don't get carried away by speculating on the quality of communication by friedcat. As pointed out multiple times, due to the nature of the operation there is little incentive to do extensive IR, other than the necessary accounting and communication through shareholder representatives (board). Instead the focus is on the core business. Friedcat decided to not pass the statements by the board first, but instead releasing them to the public directly.

Regarding the often quoted "aggressive dividends":
Let me take the blame here, because these are not friedcats words. Also I think there is massive confusion about what "aggressive" actually means. Thus let me remove any ambiguity by posting the text from the respective communication:

Code:

(BoardMember1) so I underatand that the next payments to the shareholders shoudl happen in May....
(BoardMember2) regarding dividends, do you have a target for retained earnings vs. dividends?
(BoardMember2) if retained earnings is high we need to consider the security mechanisms for the company treasury.
(FC) At most 1:2. Most retained are for short-time spendings (license, wafer/components order). There are no long-time plan of retaining since we won't buy land/bond/etc.
(BoardMember2) Alternatively AM could get "invested" in related businesses
(BoardMember2) If no opportunities exist I agree to an aggressive dividend schedule

As you can see there is no determination of timing other than FC's statement that short-term spendings need to be covered. The "aggressiveness" describes the overall split between retaining and paying out. That said, even board members assumed that dividends would resume in May with a 1:2 split of retained:payout.

Finally, I am shocked by the amount of outrage caused by what could be considered an uneducated interpretation of some raw data. The resemblance of this being a deliberate attempt to prey on the lack of insight and patience of new investors is strong. As pointed out previously, the financials are hard to read without context and further explanations.

I am committed to provide further information as it becomes available. However, some of the information which is important for company valuation is actually also crucial to pricing sales and thus falls within the realm of confidential information. Thus you cannot expect that this kind of information be released to the public. Anything else would be a level of transparency which is rather uncommon in these industries.

[Franktank]

Much needed clarification, thanks again Jutarul.

[kibblesnbits]

I am committed to provide further information as it becomes available. However, some of the information which is important for company valuation is actually also crucial to pricing sales and thus falls within the realm of confidential information. Thus you cannot expect that this kind of information be released to the public. Anything else would be a level of transparency which is rather uncommon in these industries.

From someone who's willing to ride out the storm, I thank you.

[IPO Magic]

I am shocked by the amount of outrage caused by what could be considered an uneducated interpretation of some raw data. The resemblance of this being a deliberate attempt to pray on the lack of insight and patience of new investors is strong.

That's some classy talkin'!  You must live in one of them fancy double-wides!

[Franktank]

Gentlemen,

don't get carried away by speculating on the quality of communication by friedcat. As pointed out multiple times, due to the nature of the operation there is little incentive to do extensive IR, other than the necessary accounting and communication through shareholder representatives (board). Instead the focus is on the core business. Friedcat decided to not pass the statements by the board first, but instead releasing them to the public directly.

Regarding the often quoted "aggressive dividends":
Let me take the blame here, because these are not friedcats words. Also I think there is massive confusion about what "aggressive" actually means. Thus let me remove any ambiguity by posting the text from the respective communication:

Code:

(BoardMember1) so I underatand that the next payments to the shareholders shoudl happen in May....
(BoardMember2) regarding dividends, do you have a target for retained earnings vs. dividends?
(BoardMember2) if retained earnings is high we need to consider the security mechanisms for the company treasury.
(FC) At most 1:2. Most retained are for short-time spendings (license, wafer/components order). There are no long-time plan of retaining since we won't buy land/bond/etc.
(BoardMember2) Alternatively AM could get "invested" in related businesses
(BoardMember2) If no opportunities exist I agree to an aggressive dividend schedule

As you can see there is no determination of timing other than FC's statement that short-term spendings need to be covered. The "aggressiveness" describes the overall split between retaining and paying out. That said, even board members assumed that dividends would resume in May with a 1:2 split of retained:payout.

Finally, I am shocked by the amount of outrage caused by what could be considered an uneducated interpretation of some raw data. The resemblance of this being a deliberate attempt to prey on the lack of insight and patience of new investors is strong. As pointed out previously, the financials are hard to read without context and further explanations.

I am committed to provide further information as it becomes available. However, some of the information which is important for company valuation is actually also crucial to pricing sales and thus falls within the realm of confidential information. Thus you cannot expect that this kind of information be released to the public. Anything else would be a level of transparency which is rather uncommon in these industries.

Mental imagery of actual board meetings:

[yokione]

Then when we got word that the chips didn't quite spec out as well as anticipated, but we still saw 2 huge IPOs of former AM chinese shareholders still get pushed through to the public. That shouldve been the biggest red flag.

I only know of rockminer which is currently selling hardware. How exactly is this a red flag?

Everything that TAT insinuates in that chat long aligns with the narrative that AM is going to be bled out by rockminer, xtbec, and any other franchised buyer of those chips.

How exactly can AM be "bled out" by its customers?

come on, you're smart. I dont have to spell it out.


Consider any landscape where FC et al. want to wash themselves of AM's shareholders.

Please do spell it out for me. I have no idea what kind of situation you are imagining.

OK, jimmothy:

You own stock in company A, which makes widgets.
I own company A, and want to make your shares worthless.
I form company B, and form a contract to sell it my widgets at laughably low prices.
This bleeds out company A, while I get to keep all muh munyz through company B profits.

So now you know

Well, What if "I", the owner of company A, himself possesses more than 50% shares of company A? And "I" take a risk by collude with all the board members, who possess another 30% shares, only to bleed the rest 20% of the company out...

[houseofchill]

Thanks Jutarul

[arousedrhino]

As always thanks Jutarul!

[NotLambchop]

...
OK, jimmothy:

You own stock in company A, which makes widgets.
I own company A, and want to make your shares worthless.
I form company B, and form a contract to sell it my widgets at laughably low prices.
This bleeds out company A, while I get to keep all muh munyz through company B profits.

So now you know

Well, What if "I", the owner of company A, himself possesses more than 50% shares of company A? And "I" take a risk by collude with all the board members, who possess another 30% shares, only to bleed the rest 20% of the company out...

The TL;DR answer is you don't own 50% of company A, or any company.

What you do own is a few ASICMINER sharez, worth ~50% less than they used to be just a couple of days ago.  That's also bragworthy, in its own way.

Why start with outlandish hypotheticals when equally lulzy personal examples are at hand?

*Now that we're on the same page, what exactly did you wish to know?

[CrazyGuy]

Looking to buy direct AM shares, contact me via PM.

[yokione]

...
OK, jimmothy:

You own stock in company A, which makes widgets.
I own company A, and want to make your shares worthless.
I form company B, and form a contract to sell it my widgets at laughably low prices.
This bleeds out company A, while I get to keep all muh munyz through company B profits.

So now you know

Well, What if "I", the owner of company A, himself possesses more than 50% shares of company A? And "I" take a risk by collude with all the board members, who possess another 30% shares, only to bleed the rest 20% of the company out...

The TL;DR answer is you don't own 50% of company A, or any company.

What you do own is a few ASICMINER sharez, worth ~50% less than they used to be just a couple of days ago.  That's also bragworthy, in its own way.

Why start with outlandish hypotheticals when equally lulzy personal examples are at hand?

*Now that we're on the same page, what exactly did you wish to know?

Sorry, I'm not English native speaker, maybe I failed to express myself clear.
What I really want to mean is: FC himself already possesses more than 50% shares of AM through BitFountain. I don't find any good reason for him to take a risk by collude with all the board members, who possess another 30% shares, only to bleed the rest 20% of the AM out.