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Just because you have a money making machine doesn't mean you'll necessarily want to keep it for yourself. The businesses (technology providers vs the owner of
by nemild 11y ago
Just because you have a money making machine doesn't mean you'll necessarily want to keep it for yourself.
The businesses (technology providers vs the owner of a current mining machine) are a bit different. A technology provider might have the expertise to manufacture the rigs or run the datacenter. The "owner" (quotes because it might be on paper only) provides upfront capital, in exchange for future uncertain returns from mining (uncertain for a host of reasons including the uncertainties of mining success, uncertainties in the speed of depreciation, and uncertainties in the future price of Bitcoin). The technology provider may not want to take these risks - or be unable to provide the capital outlay.
This means there's potential value to both parties in making a trade.
(The question of whether the technology provider is reneging by running the machine for themselves is obviously a separate question)
- xyzzy123 11y agoYep. Also, your customers might have good ways to steal power (e.g. run a miner under a desk at work).
- conistonwater 11y agoThere was another maker of bitcoin miners some time ago that would take people's money, make the miners, run the miners for itself (pushing back the delivery date), then deliver the miners once they stopped making a sufficient profit. What you are saying is generally true, I agree, but the case of (specifically) money-printing machines has the additional complication of having very misaligned incentives, encouraging fraud. For any good other than money (or bitcoin), the producer of machines won't be able to want to do much with them, as you say. Money is unusual in that regard because you don't need to "use" it to make money, which removes a high barrier that the machine maker would normally face. So you don't want to "keep" the money-printing machine for yourself, the incentive is to sell it for the original price after printing some money with it that you keep for yourself. It doesn't guarantee fraud, merely misaligns incentives to encourage it. Setting up such extreme incentives for fraud is such a terrible idea that I am surprised anybody made business with these companies. A somewhat related, legal, phenomenon would be a payment service provider (e.g., Paypal, IIRC) keeping the payments for a bit longer than necessary to earn interest (by investing the money with varying degrees of risk) on somebody else's money while that money is in transit.
- nemild 11y agoTotally agree - without strong controls (internal or enforced by an external party), there definitely is a large risk of fraud.