Quote from: railzand on December 14, 2013, 07:17:05 AM

Quote from: ebritno on December 14, 2013, 06:56:36 AM

Any one have questions, comments, concerns, praise, or even criticism?

Me, I have all the above. Please could you rephrase everything so an ancient dimwitted foreigner might understand
how this model compares to reinvesting groupbuys, mining farm shares and other models
how I might make a bob or two
how you ditto

So basically newer hardware costs about $3-$10 per 1GH/s of mining power. Just the hardware. This is for most of the 28nm units that have released and are continuing to be released.

Unfortunately most of these units right now cost in the thousands of dollars which many of us cannot afford in one go.

There is also the issue of power bill, space, heat, ect...

You very well may be familiar with this, but I'm trying to be thorough.

Basically the current model would sell a 6 month contract for a 1GH/s piece of the hardware at 9⁹⁵... and the option to extend the contract for 6 months at a time for $4⁹⁵

Every day or twice a week, you would receive all the bitcoins that your hashing power created.

When your contract is up, you would be sent $3.50 worth of BTC per contract per initial 9⁹⁵ contract, essentially selling us back the hardware you bought. (The hardware we are looking at now costs 3.50 per 1 GH/s).

So for every 1 GH/s you add to your account you will pay 9⁹⁵ upfront and 6⁹⁵ in the long term.

A 6 month renewal will cost 4⁹⁵ thereafter.

The model works this way, because most offers like this make profits off of their customers. We will make a profit but very insignificant (and reasonable considering space and heat constraints). Most of the profit that will be made off of the service will be from mining with un-contracted hashing power which will vary from time to time.

This is beneficial to customers because they can get cheap hosted hashing power, where they will not be responsible for paying for hardware 2-3x over like other companies and will pay for none of it in the long term.

It is beneficial to us because without offering the service, acquiring the capital to stay ahead of the mining curve on a large scale would be more difficult.

The relationship here is mutually beneficial as it should be.

What can you make off of this?
Well that is hard to say. I've plugged the numbers in on several different calculators against several different scenarios. I have seen a margin of -1.63 to +$60.00 on one contract over the course of 6 months at the current price point assuming difficulty continues to rise almost 2.6% a day.

I encourage you to test scenarios yourself on other calculators, and also try to account for the possibility of such a contract not coming due for another 3-5 months (where difficulty may be higher by some factor greater than or less that 2.6% a day).

Any other questions or concerns?