Quote from: Blitzboom on May 13, 2011, 03:58:53 PM

Ive noticed your calculation for 50 shares is wrong, it should be 14.8 BTC.

Whoops, thanks for catching that error!

Quote from: Blitzboom on May 13, 2011, 03:58:53 PM

An 15% investment in growth per month seems low to me, as the difficulty is rising much faster.

Yes, this was just a number I pulled out of thin air, and I haven't really decided on an exact number as of yet. It would really depend on the changes in difficulty, so that the business would continue competitively mining. That would probably be something that would be discussed and decided by investors.

Quote from: Blitzboom on May 13, 2011, 03:58:53 PM

Could you provide an update of those numbers with current exchange rate and difficulty?

Sure (@ $7.42/BTC, 157426.20629 difficulty):
Proposed rig ~$710
Theoretical power: ~710 Mhash/se
4,999 shares issued @ .75 BTC/share
~$27,819 or ~ 39 rigs
30*710 = 27690 Mhash/sec
Generate 50 BTC in ~6h 45m
~177 BTC/day, ~1244 BTC/week, ~4976 BTC/month (or ~$36,921 USD/month)

**Something I didn't take into account when calculating power costs: I have a variable rate where 10am-7pm is charged at ~15 cents / kWh and 7pm-10am is charged at ~8 cents / kWh, so that drastically lowers operating costs**

Rigs operate ~700 watts
504 kWh/day = ~$54/day operating cost
~$1500/month
Profit = ~$35421/month
45% growth = $15,939
Net Profit = $19,481 / month

10 shares = .001 stake
2625 BTC ($19,481) * .001 = 2.63 BTC ($19)
50 shares = .005 stake
2625 BTC ($19,481) * .005 = 13.13 BTC ($97)
100 shares = .01 stake
2625 BTC ($19,481) * .01 = 26.25 BTC ($195)

Once again, I think it is important to stress that I will be striving to have investments pay for themselves in 4-8 months.

Quote from: Blitzboom on May 13, 2011, 03:58:53 PM

Also, a projection of 1) difficulty and return of Bitcoins and 2) more details on future competitiveness (others have advantages such as free electricity or power-efficient custom hardware) would be interesting. Perhaps upgrading to a location with lower electricity costs, more efficient hardware etc.

As far as projecting difficulty increases, I'm no expert on the subject, but from studying several graphs as well as the effects of difficulty jumps on network power and the exchange rate for BTC, I think that even if the total number of Bitcoins generated falls (which is to be expected), the actual worth will be more than enough to compensate for the difficulty increase. In the future (very long term here, thinking decades), mining will switch from Bitcoin generation and be about fee collection. Less Bitcoins will be generated, that is a given, but more people will use fees and the worth of individual Bitcoins will increase to offset this.

As far as staying competitive, I believe that this is a relatively unique idea at this point, simply because of the scale proposed. It's one thing to have a few computers running in your apartment where you aren't paying for utilities, but when the landlord realizes that you're using a whole lot more power than was calculated into rent, that will quickly end. As far as power-efficient custom hardware, that would definitely be something worth looking into, and part of the growth fund taken from profits may be invested into R&D for something along those lines. Once again, that might end up being something to be discussed among investors. Eventually, as the business grows, the power consumption will overcome the current supply and will need to be upgraded, at which time the costs will drop (this is how my power company works, with larger consumers getting better prices.) Once again, I think that discussion between the shareholders about new and more efficient rigs to use would be an excellent way to keep the business from going stale.

Quote from: Blitzboom on May 13, 2011, 03:58:53 PM

Thanks for doing this, I'm definitely interested in investing in such a venture. My only real issue here is trust, as you aren't very reputable on this forum yet.

This is by far my biggest road block: I've lurked for far too long. I am open to suggestions on how to help alleviate the trust issue, I think that it is very important and that this won't pick up off the ground until we can get past it. A logical argument would be that I have much more to gain from following through with the deal than fleecing a bunch of people, because the money to be made is better than the money to be invested.