Re: ASICMINER: Entering the Future of ASIC Mining by Inventing It
TLDR; I think they are about to absolutely crush it.
"Guys, where's the money for 0.04 per share gonna come from?"
"Volume!"
Hahahahaha.
"Volume!"
Hahahahaha.
Quoting this for the future.
I do. That's why I'm a buyer again.
Remind me, when were you not a buyer?
Around 4 I was a holder, not a buyer. I'm pretty damn comfortable with 20% annual ROI, but I also have other things I want to invest in.
At 2 btc, its a question of whether Friedcat can mine and sell 5% of the network, and I'm pretty comfortable that he can.
This is an ABSURD statement.
2 BTC/share suggests a company value/market cap of 800k BTC. Typically that means we should see 800k BTC in profit over 10 years (about average for a fairly valued company, factoring in growth).
The block reward will halve to 12.5 in 2016, and again in 2020 to 6.25. Currently there are about 1.3M BTC up for grabs per year. So the potential REVENUE given 5% mining share is around (3 + 4 * .5 + 3 *.25) * 1.3M * 5% = 374k, less than half what we need for fair value.
But we need PROFIT. ASICs cost money to manufacture and take electricity to run. Long term I expect the margins to drop to 20% or below.
If you're gonna give me some crap about "transaction fees" you are not a value investor, you are a speculator. There is no evidence to suggest transaction fees are going to increase to a significant level.
You are ignoring hardware sales, which can increase the bitcoins above what is mined (essentially what ASICMiner is doing right now, making more profit from hardware sales than from mining).
I am not ignoring hardware sales. They are just a suboptimal business decision when you have 5% of the hashrate. People will not intentionally buy hardware at a loss, so it is a better deal to run your own hardware.
FC is leveraging sales at the moment because the margins are insane and he knows he'd better cash in before the competition squeezes him out. Plus he needs the operational cash to make more hardware.
Going forward the prices will drop, margins will thin, and price wars will ensue (we have already seen how much AM has already slashed prices; that is all lost profit per unit).
Also, I just looked at the last 7 blocks. All tx fees between 0.01 and 0.4. I suspect you are full of shit with "0.3 - 5 BTC"
Sorry, I thought it was clear that I meant 0.3 - 0.5 btc per block (which is in line with what you found).
Let me document it this time: prior 7 blocks starting from this one (newest as of right now)
http://blockchain.info/block-index/414784/00000000000000040d3bd18e95ccb4c089bafaa4667f70efec145ae517e73e77
0.07420021 BTC
0.2445046 BTC
0.33552803 BTC
0.25201038 BTC
0.19562 BTC
0.18380026 BTC
0.19215369 BTC
Only one of those is even in the 0.3-0.5 range.
If someone would write a quick script and find the average over the past month that would be much appreciated.