NODE Haven Production Development Vehicle

The Texas Attorney General stated that after Hurricane Harvey ravaged Texas in 2017 people paid up to $99 for a case of water. This type of price gouging during high demand for or shortage of essential materials is the hall-mark of companies that value profit-margins over its customers. These types of companies will be referred to as “Profit-Seeking Companies.”

You might be thinking, “Where is he going with this? Don’t all companies seek to turn a profit? This is America right? He’s not a communist is he?”

NODE Haven, a startup electronics manufacturer focusing on Bitcoin mining equipment, proposes that it may not be the shop’s fault that they charged $99 for a case of water. It may have most to do with where the shop’s capital is coming from. (High Net-Worth Individuals, Investment Banks, Venture Capitalists, etc)

Part of the reason why NODE Haven Mining was founded was to provide relief to Bitcoin and other Cryptocurrency miners. Because of a blatant shortage of mining equipment, customers in this space have been bending over backwards buying equipment well in advance during the pre-sale. If that wasn’t bad enough, some of the the pre-sales “sell out” in less than two hours. To add more pain to injury, in December, prices charged for the pre-sale of equipment doubled and in the secondary market, equipment was going for five-fold increase of original purchase price. This sounds a lot like the $99 case of water and NODE Haven believes neither the manufacturers nor the customers are fully culpable. It may very well be that the centralized, accepted business model that values profits above all else is operating in a decentralized crypto space where it does not belong.

Unlike traditional Profit-Seeking Companies that seek funding strictly through traditional financing, NODE Haven Mining will fund development and production of next generation ASIC miners (Bitcoin, AI, Etc) using an alternative, novel Product Development Vehicle (PDV).

The PDV is capitalized by the sale of NODE tokens to customers. The NODE tokens are in reality a prepayment of goods received. The majority of the funds from customers during the NODE Token Sale will be used to develop and produce a 7nm ASIC Bitcoin Miner amongst other products. When production is complete, the Bitcoin Miners will be redeemed using the NODE tokens.

The most immediate benefit of using a token sale is the acceleration of the product development process by quickly funding engineering heavy design. This method bypasses the bureaucracy of traditional financing by going directly to the customer.

In addition to acceleration of development, there are other more subtle albeit monumental shifts in accountability that are quickly changing the tech landscape. The framework of the NODE Haven PDV and other true Utility Token systems decentralize accountability and have a family resemblance to the Consumer Co-Operative. Although a digital token sale may be a new idea, the Consumer Co-Operative family is not.

“America’s first successful co-op was formed by Benjamin Franklin to provide insurance for homes. Today, more than 100 million Americans participate in cooperatives.”(Consumerfed.org)

The PDV model incentivizes the manufacturer to sell quality goods and services at the lowest cost to the consumer. This is in stark contrast to Profit-Seeking Companies that sell products at the highest price that the market will bare.

Why is this? Don’t both companies seek to produce products with the most value at the least expense?

I’m glad you asked! The difference lies in the relationship between how management is compensated and how products are priced.

Management compensation in a Profit‐Seeking Company is based on profit-margin in tandem with number of units produced. The profit-margin is the difference between the cost to produce the product and the price the consumer pays for that product. As shown before, the sale price is not considerate of the customer’s needs.

Within the NODE Haven PDV ecosystem, the managers are rewarded with the same tokens that will later be redeemed for products they are producing. In essense, this makes the PDV managers also consumers whereas the managers of the Profit‐Seeking Company are incentivized to exploit a sky-high market demand for maximum gain.

The buying power of each NODE token is maximized by creating valuable products and services at a lower cost. There is no incentive to charge more tokens for same product as that decreases the inherent value of the token. Less NODE tokens per product equals more value per NODE token.

Consequently, if managers of a PDV were to charge more tokens for the same product, the value of their token position would decrease. By creating a framework where managers are simultaneously consumers these effects create efficiency of capital, discourage waste and ensure a quality product.

The cooperative arrangement of the NODE Haven PDV incentivizes management to act in the best interest of their fellow consumers rather than serve the best interests of a capital provider. The PDV token model effectively decentralizes the power that financial institutions have over companies and places it back in the consumers’ hands. The net result guarantees a quality product delivered at the lowest cost, providing the highest value achievable to all.

If you are interesting in learning more about NODE Haven Mining, the Product Development Vehicle or our upcoming Token Sale please visit our Telegram or Website.