A while back I wrote of my venture into mining bitcoins from some rigs in my back shed … actually it was the result of what turned out to be a bad investment decision.
Bitmain had released their new USB SHA256 Miner & thinking that everyone would appreciate the bargain, I imported 500 of them… Of course I hadn’t figured on the sudden influx of imports from Hong Kong & China at costs below my purchase price. Rather than lose I set-up about 400 in the shed along with another few miners I had, resulting in around 2 TH/s that produced a reasonable return.
Then BTC price crashed, my power bill was astronomic and I ended up selling the lot and investigating other avenues.
Like everything else on the internet, you have to be wary … despite my background research I was stung a number of times – https://cex.io/ & their mining pool at https://ghash.io/ who happily charged more in fees than earnings whilst boasting about being the biggest mining company in the world – someone’s making money out of CEX.IO but it sure isn’t the miners. (At this time their cloud mining activities are suspended)
Leancy, Rockwell Partners & Hashie.co all looked legit & paid generously – for a while … then turned out to be giant Ponzi schemes – the last in a very weird fashion, with the pool administrator changing his name to “Queen Elsa” & directing all enquiries to a rendition of “Frozen’s” best known song – “Let it Go“.
The jury is still out on Gawminers & their innovative Hashlets – Touted as ‘the most powerful SHA-256 miner ever sold, as it grows more efficient over time and never becomes obsolete‘, I have a large number currently sitting idle after GAW followed the rest of the Crypto crowd & ceased mining operations.
But GAW had bigger plans … Paycoin (XPY) – The People’s Coin!
We were all encouraged to turn our Hashlets to mine ‘Hashpoints’ which were to be converted to Paycoin (XPY) at a rate of 4 Hashpoints = 1 Paycoin with a guaranteed floor of US$20 per coin upon public release. This ‘floor’ held for a couple of minutes as huge numbers of XPY were dumped and the coin value now hovers around the $0.70 – $1.00 mark.
Despite the best efforts of a huge array of anti-paycoin detractors, XPY refused to die and, whilst not yet at the heady value originally promised, seems relatively stable. Controversial CEO, Josh Garza, appears to have
taken a back seat disappeared amid reports of SEC Audits & other Federal Authority investigations and non-profit group team paycoin has taken over development of the coin. So far very few of the promised features, mainstream acceptance or value have arrived – but there seems to be a determined group making sure that it does.
(At the time of this update, there has been a MASSIVE drop in Paycoin value – as low as US$0.02 during one large ‘dump’. Many are pursuing charge-backs and/or legal action for fraud & misleading advertising. A Group Litigation is gathering ‘victims’ prepared to outlay the retainer required by a Attorney prepared to navigate the murky waters of commercial litigation & punitive damages)
A further update (September 2018) …
U.S. Attorney’s Office District of Connecticut has announced Homero Joshua Garza (Josh Garza) has been sentenced to “21 months of imprisonment, followed by three years of supervised release” … also ordered to pay restitution of more than $9 million.
However I doubt that any of that will be making it back into the pockets of his unfortunate investors
So what of Bitcoins?
The massive drop in value has certainly had its effect on investors and providers alike but there still seem to be a few ‘lights at the end of the tunnel’.
Mining Sweden’ is a start-up that has an interesting approach … they are basically crowd-funding to an anticipated 1 peta-hash of mining power – investors can currently purchase VIP shares which entitle you to a number of mining shares that currently payout weekly & also a percentage of the start-up’s annual profit. Will it work? Well their ‘build it slowly’ approach should keep the costs down & perhaps benefit from a recovery in BTC value.
UPDATE: Another one bites the dust!
Profits suddenly disappeared & ‘Tommy’, the purported owner of the site, was cited as claiming to have paid ‘more than he should’ & that ‘Mining was hard’ … The latest news had Swedish Electricity Companies chasing ‘millions in unpaid bills’
It’s often been said that manufacturers of mining products keep the best for themselves – pocketing the returns from increased mining efficiency before releasing to the public.
This may be true – I’ve seen no proof to support it – but one provider Zeus is offering access to the latest products with their Zeushash releases.
Their Batch III release is currently selling at $0.889 for GHs on a lifetime contract and returns are positive despite the languishing BTC value. I particularly like the AutoBuy feature which allows you to spend your returns purchasing further mining power thereby creating a compounding effect.
This one has petered out as well … In a strange way.
There were some contracts ‘transferred’ to OXBTC.com – a Chinese site that still seems to be operational, even growing in 2019. Whether anyone has actually made a ‘return on investment’ is unknown, but they are paying & continuing to sell contracts.
So I’d argue that mining isn’t dead … but it’s getting harder to get a return from home rigs unless you have particularly cheap power rates and you have to investigate any online offers and invest carefully.
As always, never invest more than you can afford to lose!