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Serious question: why would Avalon sell these things, rather than just mine Bitcoins themselves? at the very least, the cost of the device seems far too low at
by Osmium 14y ago
Serious question: why would Avalon sell these things, rather than just mine Bitcoins themselves? at the very least, the cost of the device seems far too low at current Bitcoin conversation rates.
- xhrpost 14y agohttp://news.ycombinator.com/item?id=5142274 http://news.ycombinator.com/item?id=5142274
- wmf 14y agoDiscussed extensively two weeks ago: http://news.ycombinator.com/item?id=5142021 http://news.ycombinator.com/item?id=5142021 Summary: They probably didn't have the money to build anything, so they funded it using Kickstarter-like preorders.
- shocks 14y agoThe opportunity to make huge profits is closing (very fast). In fact, if you were to buy an ASIC miner now it wouldn't arrive until May and by then the bubble will have (mostly) popped. The Avalon ASIC miners were pre-ordered which gave them enough cash to R&D and then produce them - but even if they had found cash somewhere else and made lots of miners for themselves it wouldn't be long until other people were selling ASIC miners and they were not so profitable. It's better for Avalon to make a name for themselves as a good place to get ASIC miners so they get all the business in the future. I wouldn't be surprised if this user mining at 1.2 Thash/s is Avalon or one of the other ASIC manufacturers.
- SlipperySlope 14y agoHa! I can see Avalon or Butterfly testing their boxes for a week or so before shipping each one.
- millerc 14y agoBesides the reasons discussed elsewhere, I see many reasons: - The device in itself disrupts the mining hardware market. Should they mine by themselves, others would take notice and make their own ASIC hardware. They're in a much better place if they position themselves as the standard supplier for mining hardware, at least in the long run. - I would see this ROI collapse as soon as this catches on. The market will be flooded with bitcoins, their individual value will diminish, and the bounty will likely decrease compounding the decrease. History says that the return will eventually (and soon) decrease to match the cost. Assuming the hardware is fairly priced (which it seems, given the current low volume), I would say the money value of those 122.83 bitcoins will come down to the same money value you would get out of $14k invested elsewhere. - Whoever is operating the rig for user 67117, he's doing a hell of a marketing job for Avalon, just by being there. Is there any other offer in the world that can deliver on the promise "Give me $14k and you get $3k a day"? Sounds like a short-term proposition, but there's surely a good amount of money to make while it lasts.
- Tuna-Fish 14y agoAsic economics dictate that the cost of making the masks needed for prodution is hundreds of thousands. Once you have the masks, the cost of making chips is ~$10k per wafer. Depending on the size of their chips (I don't know), you can build high tens to hundreds of chips per wafer. They gathered the money for masks by selling the first batch. Now they own the masks, and they can make more of them relatively cheaply. I suspect that they are building their very own mining pool as we speak.