I have a few shares of CFIG. I just checked out their website at https://www.cryptocapital.co/
They do have a couple of new customers listed and have indeed recently revamped the look of the website. IMHO it still looks like a legitimate venture.

It is hard to have faith after the NEOBEE fiasco, but there is not much we can do but wait at this point (Fingers Crossed).

+1

I have been waiting for months now for any substantial update on CFIG. I am not certain how long they plan to remain in Beta mode.

One thing that I find curious is the huge increase in BTC hash rate a couple of weeks ago, followed by the current dip. I have no proof but I suspect that many manufacturers were "testing" the miners for a couple of weeks before sending them out. If you think about this it makes perfect sense as they now have taken the miners offline in order to ship them, thus the current lull in BTC hash rate. Once customers receive their miners the hash rate will abruptly rise.

The problem is that the BTC mined during testing should belong to the customers and this BTC is crucial to a customer being able to make a profit from the miners they purchased in good faith. They are essentially stealing from their customers by doing this. The problem is that they can justify this by saying that they need to test the equipment. I believe if a customer has pre-paid for any chips or mining equipment, then any BTC mined during testing should be the customers and taken off the price of the equipment. What do others think about this?

I think that trying to profit by mining in general is now a lost cause. CryptX has little to do with the fact that the model in general is one that currently guarantees losses. Let me explain as follows:

Whenever the "next" greatest mining chip is being planned, you have to pre-order months in advance. Your estimate of profits is based on getting the chips exactly in time and the network hashrate going up in set intervals. The problem is that there are always delays and hashrate (from existing chips still coming online) will be much higher when you get your chips. If you look at any mining projections the first few weeks are crucial to whether you break even, let alone make a profit. Once a set of chips are released then this immediately will cause a huge jump in hashrate when this new technology comes online.

Another thing that I find curious is the huge increase in hashrate a couple of weeks ago, followed by the current dip. I have no proof but I suspect that many manufacturers were "testing" the miners for a couple of weeks before sending them out. If you think about this it makes perfect sense as they now have taken the miners offline in order to ship them, thus the current lull in hashrate. Once customers receive their miners the hashrate will abruptly rise. The problem is that the BTC mined during testing should belong to the customers and this BTC is crucial to a customer being able to make a profit from the miners they purchased in good faith. They are essentially stealing from their customers by doing this. The problem is that they can justify this by saying that they need to test the equipment. I believe if a customer has pre-paid for any chips or mining equipment, then any BTC mined during testing should be the customers and taken off the price of the equipment.

Yet another issue is the perceived profitability of mining shares based on the annual yield. The problem is that hashrate is always going up, which in turn causes dividends to drop, which in turn causes share price to drop and this of course causes the annual yield to again go up. The problem is that the annual yield is now based on a LOWER share price! You are in reality simply paying yourself a dividend by eating away at your initial investment capital. The fact that the mining chips will never generate enough BTC to pay for themselves, let alone provide for profits, means that the current BTC mining model is a losing proposition for investors.

Even if you take the most advanced liquid cooled mining chips in an area with the lowest electricity cost you still could be in for failure. There simply is no guarantee that the equipment will pay for itself. Currently the BTC network is designed to produce 6 blocks per hour @ 25 BTC/Block. This means 3600 Bitcoins per day no matter how much mining equipment is directed towards this goal.

Do not base the current BTC mining situation on what happened in the past!!  The easy mining days are over. If you want to profit from BTC simply invest in BTC and not the insane dog chasing its tail that mining has become!!

I think that trying to profit by mining in general is now a lost cause. CryptX has little to do with the fact that the model in general is one that currently guarantees losses. Let me explain as follows:

Whenever the "next" greatest mining chip is being planned, you have to pre-order months in advance. Your estimate of profits is based on getting the chips exactly in time and the network hashrate going up in set intervals. The problem is that there are always delays and hashrate (from existing chips still coming online) will be much higher when you get your chips. If you look at any mining projections the first few weeks are crucial to whether you break even, let alone make a profit. Once a set of chips are released then this immediately will cause a huge jump in hashrate when this new technology comes online.

Another thing that I find curious is the huge increase in hashrate a couple of weeks ago, followed by the current dip. I have no proof but I suspect that many manufacturers were "testing" the miners for a couple of weeks before sending them out. If you think about this it makes perfect sense as they now have taken the miners offline in order to ship them, thus the current lull in hashrate. Once customers receive their miners the hashrate will abruptly rise. The problem is that the BTC/LTC mined during testing should belong to the customers and this BTC/LTC is crucial to a customer being able to make a profit from the miners they purchased in good faith. They are essentially stealing from their customers by doing this. The problem is that they can justify this by saying that they need to test the equipment. I believe if a customer has pre-paid for any chips or mining equipment, then any BTC/LTC mined during testing should be the customers and taken off the price of the equipment.

Yet another issue is the perceived profitability of mining shares based on the annual yield. The problem is that hashrate is always going up, which in turn causes dividends to drop, which in turn causes share price to drop and this of course causes the annual yield to again go up. The problem is that the annual yield is now based on a LOWER share price! You are in reality simply paying yourself a dividend by eating away at your initial investment capital. The fact that the mining chips will never generate enough BTC/LTC to pay for themselves, let alone provide for profits, means that the current BTC/LTC mining model is a losing proposition for investors.

Do not base the current BTC/LTC mining situation on what happened in the past!!  The easy mining days are over.

NotLambchop is correct. The only ones making any profits are the chip manufactures. All these mining companies will be lucky if they cover their initial investment. The hash rate is simply going up too quickly.

The only mines that might make a small profit will be the ones in the places with the cheapest electricity. Washington State has rates as low as $0.02 a kwh. I believe BTC mines will move to those areas until ultimately they end up actually driving up the power rates in those areas. Mine operators will also need to be very efficient for their share-holders to make any profit.

The price graph for LTC is basically showing that its demand has fallen relative to BTC. Every week LTC is dropping. This means lower and lower dividends until ultimately only the hosting fee is covered.

I read it over and it sounds simply like a theoretical miner in which you are paying $5.00 for 1 GH/sec. You could simply buy B.MINE in which each share represents 5 GH/sec. One share of B.MINE (on Havelock) currently sells for a dollar equivalent of $10.54, so you would be paying only $2.10 for 1 GH/sec. You can sell your B.MINE shares at any time also.

IMHO there are too many hidden details for Divcoin. Vault of Satoshi volume has dropped since CaVirtEx has lowered its fees. I suppose VOS is trying to drum up business. In Canada I have used CaVirtex for just under 3 years now and I have found them to be reputable and trustworthy in all my dealings with them. CaVirtex is a Bitcoin/Litecoin exchange.

In this case Puppet and NotLambchop convinced me to accept my losses and get out. The numbers just don't look good. In 3 months time the increase in hash rate will make it such that the Bitcoins mined only cover the hosting fee. Unless the reinvestment ratio is changed to at least 95/5 the loan will not be paid out till mid August. That only leaves one months time for a small reinvestment fund to build up. Like I said in some of my earlier posts, Bitcoin Mining is like a dog chasing its tail.

Good luck to all of you who are in this project. Let's hope that Bitcoin rises to the $1000's so that mining will again become profitable.

HA HA - We definitely do not need another loan. It simply comes down to a question of how low will a SUSTAINABLE yield go before new BTC mining projects decide it is not worth it to hop on the mining bandwagon. Theoretically it will come down to the most efficient chips, mining with the cheapest electricity, and with the most efficient hosting (lowest cost). The only mines that will ultimately be sustainable and profitable will have these factors in their favor.

I am fine with short term tanking. I believe what is wrong with BTC miners (shareholders) is they expect unrealistic dividends for a quick buck. We are simply cannibalizing our own project to the point were it will indeed become unsustainable. A 95/5 strategy if successful will provide a sustainable (although much lower weekly dividend).

If 95/5 is not successful, then 99/1 would provide a 2% annual yield. It simply comes down to a question of how low will a SUSTAINABLE yield go before new BTC mining projects decide it is not worth it to hop on the mining bandwagon. Puppet is correct, the hosting fees and electricity costs also come into play in these equations. If the price of Bitcoin goes up it will help in these regards. One analyst I follow called Enky expects to see BTC around $3000 by the end of the year. Search on "Bitcoin Enky" to read his blog.

Based on the current decline in weekly dividend the loan will indeed be paid off. The network seems to be increasing at about 11% every week on average. This means that every week the dividend will be adjusted by a factor of 0.9 (1/1.11) and also the amount paid to the loan will by adjusted by a factor of 0.9. This gives the following table of projected total available for dividends or repayment each week:

                                     Total
                                     Weekly
                                     Dividend
                                     (50/50)    Remaining Loan/Reinvestment Sum
June 27 110.729 * 0.9 = 99.65    (427.62)
July 4      99.65 * 0.9 = 89.6       (327.97)
July 11    89.6 * 0.9 = 80.7         (238.37)
July 18    80.7 * 0.9 = 72.6         (157.67)
July 25    72.6 * 0.9 = 65.3         (85.07)
Aug   1    65.3 * 0.9 = 58.8         (19.77)
Aug 8      58.9 * 0.9 = 53.0           33.23
Aug 15                        47.6           80.83
Aug 22                        42.8         123.63
Aug 29                        38.6         162.23
Sept  5                        34.7         196.93
Sept  12                      31.2         228.13
Sept  19                      28.1         256.23
Sept  26                      25.3         281.53
Oct     3                       22.7        304.23
Oct   10                       20.5        324.73
Oct   17                       18.4        343.13
Oct   24                       16.6        359.73
Oct   31                       14.9        374.63
Nov    7                       13.4        388.03
Nov  14                       12.1        400.13
Nov  21                       10.9        411.03
Nov  28                         9.8        420.83
Dec    5                         8.8        429.63
Dec  12                         7.9        437.53
Dec  19                         7.1        444.63
Dec  26                         6.4        451.03
Jan    2 2015                 5.7        456.73


Based on the above I believe PETA could indeed be profitable if we simply adjusted the Dividend/Reinvestment ratio to 95/5. That is 95% reinvestment and 5% for dividends. The weekly per-share dividend would immediately drop to 1/10 what it is now, but that would be sustainable indefinitely once the loan is paid off (by July 18 in this new scenario). This basically will enable double the amount for re-investment to build up and we could indeed keep up with network difficultly.

DON'T BE GREEDY PETA SHAREHOLDERS. We need the funds to re-invest and the loan needs to be paid back ASAP.

Personally I own hundreds of shares and would like this project to succeed. If we did adopt a 95/5 strategy this means the weekly dividend should stabilize at around 0.000075 per share sometime near the end of August as we quickly build up re-investment funds. At a price per share of 0.035 this would provide around 10% annual dividends forever as PETA would indeed keep up with difficulty. With this 95/5 strategy, if we more than offset difficulty increases then the dividend would increase naturally in a sustainable manner through our excess capacity resulting in our % of network share increasing through time.

What do others think about this strategy?

Thank you Puppet, Korbman and anyone else who answered the questions I posed. It seems that like the gold-rush in the 1800's, the sellers of the mining equipment benefit the most from the mining.

Puppet,

I am starting to think that all BTC mining operations are like a dog chasing its tail in terms of turning a profit. Let's assume that difficulty will go up as you say and that PETA will not make a profit. Do you think that all Bitcoin mining operations will also end up in the same situation?

What is your take on DTMA & DTMB? (a couple of other mining funds soon to be offered on Havelock)

Do you foresee them being a success given their 6 month window till deployment?

Lots of emotional trading going on today. It will be interesting to see how high the dividend can go before people realize what they are doing. 

Actually you are WRONG as well. Bitcoin miners will themselves render Bitcoin mining unprofitable or just marginally profitable. Last December PETA was looked at the same way. The mine was to start in mid-January and everyone should have had their shares paid for in full just by dividends alone at this point. I am happy with the performance of the mine and I think Cryptx is doing an excellent job given that manufacturing delays are out of his control.

It will be the same with every mining technology that is the next greatest thing to come out. There are many problems that can occur with immersive cooling in addition to manufactures delays for the chips themselves. Hash power will continue to go up. DTMA has a timeframe of 3 to 6 months to get started. I would rather have 3 to 6 months of dividends from PETA, a currently proven successful mine, than a 3 to 6 month wait on something unproven.

Bitcoin mining has become like a dog chasing its tail. You can bet that as long as there are large margins that more miners will start up until the margins are gone. BTC mining as a whole currently sucks back 120 Megawatts of power. If the rates of increase continue by the time of next block reward halving it will consume the output of a Nuclear plant. In four years it would grow at a rate that would require a Nuclear plant to be built every month; just to supply power for BTC mining. Areas with cheap power will attract huge mining farms, until those very BTC farms begin causing shortages in those areas and the government begins enacting legislation to stop such activities or at least tax them for being wasteful.

I will probably pick up a few shares of DTMA myself, but I do not blindly believe it will be the end-point in mining.

Cryptx could easily purchase these AM chips and build boards using them for future reinvestments.

I also voted 35/65 (35 Dividend / 65 Reinvest). I also think this ratio should be reviewed at least every couple of months. I would be open to a floating dividend/reinvestment ratio between 10/90 and 90/10. At least for me, the idea is to maintain a relatively constant dividend per share over time. If this does indeed become zero sum in the future (IE The BTC mined only pays for the electricity and hosting fees), then we would need to think about a vote on liquidating the assets.

Ultimately areas with low electricity costs will be more conducive to Bitcoin mining. As mining farms move to those areas I expect that it could actually cause the price of power to go up in those areas as huge BTC mines eat up surplus power. You can work out the details for yourself, but if hash rate continues to increase at 25 - 30% per month, by the time of the next block reward halving the Bitcoin network will be using the total power output of a medium sized nuclear power plant. 

I own a few hundred shares, but far less than 5%. I am very satisfied with how PETA is being run. Cryptx seems to be genuinely interested in making this project a success. I understand the hash rate/difficulty and how it will affect the mining. I am surprised that the current network hash rate is not above 100,000 TH/S. I have owned various mining shares over the past couple of years and understand the importance of updating equipment at crucial times and reinvesting to keep up with difficulty increases.

Basically you will know you are successful in keeping up with difficulty if the weekly dividend per share remains relatively constant over time. It is vital to have a dividend/reinvestment ratio that ensures the dividend will not drop due to difficulty increases. I would have no problem increasing the amount to go toward reinvestment.

It seems that some investors may simply want to see a huge weekly dividend so that the share price will rise and they can sell out and make a big profit at the long term expense of the project. IMO mikemikemike was pumping this project and constantly trying to drive up the share price a month or so ago simply to sell out. Now that he has apparently sold all his shares he has nothing but bad to say about PETA. It is wise to have only large > 5% shareholders vote, so that we can eliminate the self-interested pump and dumpers that do not care about the long term success and are only here for a quick buck.

Hats off to Cryptx for the fine work being done to ensure the long term success of Petamine!!

If Danny did indeed sell most of the BTC on the worst day possible, then that shows he knows nothing about how the markets work and running a business. Why were shareholders not informed of this? Why did he not buy back in when price was shown to be rising in November?

More lies I suspect.

It is possible he sold them to an accomplice or sock account so that he can show that they were sold on the day silk road caused the market to crash. In reality he still was in possession of the coins. As the price went up he was able to really sell the coins and benefit from the price increase.

Think of it this way. If I have 1000 BTC and claim to sell all at $100/BTC then I would have $100,000. If I only pretend to sell those coins and then later sell them at $1000/BTC then I would have a million dollars ($100,000 to account for the fake sale, and $900,000 of pure profit for myself). All the BTC would be accounted for by the fake sale and I would have $100,000 to show investors. I myself would have an extra $900,000 because I actually sold in the future and scammed investors.

TIME FOR A FORENSIC AUDIT ON THE BLOCK CHAIN OF THE ALLEGED TRANSTIONS HE MADE TO SEE WHERE THESE COINS WENT!!!

Seems like most of the inspiring young entrepreneurs that are starting Bitcoin related businesses are mostly douche bags either involved with some criminal element or wanting to scam people. These "free-spirits on other peoples money" need to spend some time in the clink to protect society. A few years spent breaking big rocks into little rocks might give them an appreciation for what it means to have to "earn" money and not scam others!!

Charlie Shrem has been formally indicted; his buddy Mark Karpeles, can join him once found. I suspect that Danny-boy will soon have a European wide arrest warrant for him.

I am still a firm believer in Bitcoin itself, but the daily news about all these scams is NOT good. Of course scammers also exist in the traditional banking system (EG. Madoff), but it is somewhat disheartening when some of the biggest names in Bitcoin turn out themselves to be scammers. They are essentially scamming the people (the 99%) that Bitcoin was meant to help.