Post
Topic
Board Securities
Re: [HAVELOCK] PETAMINE - NEW IPO, NEW HARDWARE, 1,500 TH/S HASH RATE
by
xe99
on 18/05/2014, 22:52:30 UTC


My post further up covered this a bit. The chart you are looking at has a category named Dividends to be paid after IPO or something along those lines. What that number is is the total amount of dividends CryptX will not payout to shareholders and instead use them to pay back the company he bought the hashing power from. It also doesn't show what happens if 0 shares are sold and that is 1957 BTC worth of dividends to be withheld.  So when will the dividends start being paid back to investors? After CryptX pays off all his debts is the answer. We can do a quick estimation that is extremely optimistic at the time frame of when you will start to see a single Satoshi paid out to investors right now.

200 BTC was mined last week so tripple hash rate means triple the coins to 600 BTC expected to be mined. 25% is still gone to hosting fees so that leaves 450 BTC left to be paid out as dividends and reinvestment. But what CryptX did was force all shareholders to give up dividends to pay back the company so it's now 100% reinvestment.

Best case scenario and what you should all hope happens: All 33k shares are sold in this IPO and dividends start to be paid out next month.

Worst case scenario no IPO shares are sold and shareholders are stuck with the bill and must pay 1957 BTC. 1957 / 450 = 4.34 and that number is the amount of weeks until the hardware is paid off from shareholders. It will take just over 4 weeks, but remember this is an optimistic calculation as it doesn't take into account the difficulty increase that will happen. That is 4-5 weeks AFTER IPO ends for a total of 6-7 weeks.

If 1 batch of 10,000 is sold only 1007 BTC need to be repaid and that will end up taking 1007/450 = 2.23 weeks of no dividend payments to pay back the company. But again overly optimistic because it doesn't take into account difficulty rise so in this case it will take 4-5 weeks total to start seeing dividend payments again.

You can see that if all the shares are not sold how bad this will be for shareholders and how outraged you should be about CryptX forcing the bill onto holders via holding dividend payments. But he still gets his 25% hosting fee for his pocket. Start asking questions as to why shareholders have to foot the bill and not just use the 35% reinvestment like how the prospectus says. Ask why there was no shareholder vote on the change in direction of the mine when the prospectus says shareholders have voting rights and a few paragraphs away says that shareholders should vote if they want the dividend/reinvestment %'s changed. I am no longer a shareholder because if I still held any shares in this mine I wouldn't see a penny in dividends until at least a month - month and a half out from now. Shareholders have voting rights, it explicitly says it in the prospectus so use your voting rights to keep the mine how it was and only allow CryptX to use 35% reinvestment to pay back the company, not your dividends.

Thank you MrSike. That explanation was very helpful.