Quote from: Epoch on November 25, 2012, 06:08:59 PM

Quote from: Meni Rosenfeld on November 25, 2012, 05:23:26 PM

My argument is weakened by the existence of the upgrade plan, but I still claim that the most natural objective measure for the worth of such a share, which doesn't leave any party disadvantaged, is in proportion to hashrate.

Meni, this is the second time you mention hashrate in this conversation. I let it go the first time, but I think a clarification is in order.

I mentioned it completely intentionally.

Quote from: Epoch on November 25, 2012, 06:08:59 PM

Under the original contract terms of BFLS (which existed long before BFLS.RIG was even proposed), it was made clear that purchasers were buying shares of hardware, not hashrate. 1 share of BFLS represented exactly 1/200th of the cash value of a Single (that is, exactly $3).

It did not represent 1/200 of the cash value of a Single. It represented 1/200 of a Single. The two are not the same. If the value of a Single is >$600, the value of a BFLS share is >$3. Likewise, if for some reason the value of a single was now $50 (e.g., no upgrade plan with the advent of ASIC), the worth of a BFLS share would be $0.25.

Quote from: Epoch on November 25, 2012, 06:08:59 PM

If I had enough BFLS shares, I could ask Inaba to convert them to a Single and ship it to me today.

Right. Now let's assume there were no ASICs, and FPGA BFL devices were sold out or only available with delays. A single would be worth, say, $700. A mini-rig would be worth about $21000. So if 200 BFLS shares can get you a Single, each is worth about $3.5. If 6058 BFLS.RIG shares can get you a mini-rig, each is worth $3.46. If Inaba were to merge the two, he should do it based on their worth, not based on some past ticket price.

Why do I think a mini-rig would be worth about $21000? Because both devices exist to generate hashes. What you can get out of a device is proportional to its hashrate, so what it would go for in the market is proportional to its hashrate - with some slight discount to the rigs, because the coarser granularity makes them less attractive for some customers (on the other hand, they are more power-efficient and much easier to deploy by big players).

Quote from: Epoch on November 25, 2012, 06:08:59 PM

And I could get a $600 discount under BFL's upgrade program for an ASIC upgrade today. Which makes a BFLS share worth exactly $3 today ($600/200 = $3).

And here is the crux, that ASICs are coming, there is an upgrade plan, and FPGA BFL devices are worth anything only inasmuch as they can be traded in. So their worth is whatever they can be traded in for. If these are the original ticket prices, there is a point in saying that this is their worth.

However, by offering trade-in values equal to original ticket price, BFL is unfairly disadvantaging mini-rig purchasers. And I think it would be good for Inaba to correct for this, making sure that BFLS.RIG buyers are not disadvantaged compared to BFLS purchasers. And again, the objective measure of worth (in absence of market data) is proportional to hashrate. One can argue that to make sure nobody receives less than the letter of the contract, Inaba should credit all of the merged shares at $3 per share (so BFLS owners are par and BFLS.RIG owners get a bonus).

You should also keep in mind that the upgrades aren't happening right now. There are still some dividends to be paid until then, which will on average be proportional to hashrate. By crediting BFLS.RIG owners at less than 1:1, they will get less dividends than the contract describes.

So I guess the simplest solution that is fair for everyone is to wait with the merger until the upgrades; credit $3 per BFLS share; credit as much as possible (typically between $2.52 and $3) per BFLS.RIG share.

Quote from: ciuciu on November 25, 2012, 06:17:06 PM

Meni loves math, only when it is in his favor.

As said I have no stake in this debate, and I assure you my love for math is unconditional.