The point and the truth about cloud-mining

I decided to write this article on cloud-mining in order to twist the neck to many that receive ideas issued against it and whose main arguments are:

  • Cloud-mining is not profitable
  • Cloud-mining is a waste of money
  • Cloud-mining is a scam
  • Cloud-mining is crap

Moreover know that before going further this article is aimed mainly at those who believe in the potential of bitcoin and crypto-currencies in General and who wants to invest in a mining contract with a minimum of financial intelligence.

This article is therefore not recommended to people:

  • who do not believe in the potential of bitcoin and other crypto-currencies (ethereum, ethereum classic, monero, zcash,...)
  • who have no patience and who seeks to enrich themselves overnight
  • who are afraid of losing money or afraid to take risks
  • who do not want to make a minimum effort to put in place an investment strategy and understand the key factors related to the mining of crypto-currencies
If you do not fit in this category of people then you can continue reading this article and understand the interest of cloud-mining. 😉

This article is intended to provide you with ways of thinking to help you best in your investment choices regarding mining in the cloud to effectively undermine crypto-currencies.

Use the code 0Guezh when you purchase to receive a discount

Reminder of the benefits of cloud-mining

I have already explained in several articles of this blog but the main advantages of cloud-mining are the following:

  • Mine crypto-currencies without owning a mining rig
  • Do not have to manage the maintenance and configuration of the mining equipment
  • Electricity costs generally cheaper as mining farms are located in countries where electricity is clearly cheap
  • The possibility offered by some mining companies to switcher and undermine another crypto-currency while retaining the same contract

The 5 factors to consider before purchasing a mining contract

  • The duration of the mining contract : it can be from 1 year to unlimited
  • The difficulty of mining the crypto-currency to undermine through the contract : the harder the difficulty is the more complicated it is to undermine the crypto-currency. (yield decreases as the difficulty value increases)
  • The price of the crypto-currency : represents the value in euro or dollar of the cryptocurrency mined via the mining contract.
  • Maintenance and electricity costs : you will have to pay a certain amount each day in order to afford the electricity consumed by the leased equipment (ASIC or GPU) through the mining contract.
  • Mining reward: this rather unperceived factor relates to the amount of remuneration granted to the minor when they manage to resolve a new block. The amount of the reward can evolve (usually downward) depending on the updates of a crypto-currency or according to a period well defined in the source code of the crypto-currency as is the case for bitcoin.

Most of the time you go for most of you buy the crypto-currency and wait for its course to rise.

This strategy has a name and it is called "Hodl" which means to keep a quantity of crypto-currencies over the long term see the very long term.

Now if you have an investor spirit and believe in bitcoin or another crypto-currency (ethereum, ethereum classic, monero, zcash,...), positive positive evolution of the course can allow you to the amount invested in the purchase of the mining contract.

In this connection, it is important to know that mining companies generally propose to undermine cryptocurrencies which have a strong potential for growth and which are therefore safe values of the market among all known cryptocurrencies (+ 1000).

They do not wish to take unnecessary risks and want to make sure that they have an interesting financial impact on their customers and that they are making the most of their mining contracts.

For if there was no money to be made nobody would buy their mining contracts.

Of course some contracts may not allow you to recover even your initial bet.

At this point it may seem more interesting to buy directly a crypto-currency that we will keep in his wallet rather than undermine via a mining contract that might not be profitable.

For example if I invest the equivalent of 1 bitcoin in a contract and I do not recover my initial bet of 1 bitcoin at the end of the contract then this is not interesting.

But it depends on whether you evaluate your profitability in terms of invested euros or bitcoin invested (if you buy your contract with bitcoin).

Because a positive evolution of the price (in euros or dollars) of the crypto-currency mined can make the mining contract profitable (you will understand better when we do the mining simulation in the cloud towards the end of the article).

So you have to see if you prefer to mine cryptocurrencies or buy and store.

If the contract is more than 1 year and it allows you to get profitable in terms of crypto-currencies (as well as if its value in euros progresses positively) then the mining may be even more interesting.

It is also important to know that mining contracts whose duration is indefinite (lifetime mining contract) are very popular and increasingly rare because they allow double profitability and inevitably assured (this was the case on genesismining which proposed lifetime bitcoin mining contracts and are currently out of stock).

This is how the first to invest is always best served. 😉

After it is not possible to predict in advance:

  • the evolution of mining difficulty (as you cannot predict the weather 😉)
  • the evolution of the price of the cryptocurrency mined (in euros or in dollars)
  • The costs of electricities and maintenance
  • The mining award which can evolve according to the updates of the crypto-currency mined or in a predetermined way

Therefore it is not possible to predict in advance the profitability of a mining contract , whatever its duration.

This is a risk to be taken because you may not know in advance how will evolve (in the future) the different factors presented above except the duration of the contract that is fixed and indicated during the purchase.

It is up to you to be aware of the risk and to act by understanding the key factors that come into line.

The difficulty of mining

Some say yes but the difficulty of mining increases suddenly it does not allow me to make my contract profitable.

This argument is wrong since a positive evolution of the course can help to cover an increase in the difficulty.

And remember that the progression of the curve of difficulty of mining of bitcoin for example is not necessarily exponential as some say but rather in the form of a staircase and as evidenced by the graphic representative below:

You will be able to visualize the evolution of bitcoin mining difficulty on the BitcoinWisdom website

This also means that the curve can drop at certain times and therefore allow you to win more crypto-currencies (and thus make more winnings).

Indeed on the graph we can see a pretty violent fall of the difficulty between August and September 2017 which allowed to increase the yield of bitcoin mining during this brief period.

Of course this difficulty curve is specific to each crypto-currency, in the case of bitcoin it has a stair form but it may be different for other crypto-currencies.

Indeed here is for example the difficulty curve of mining Zcash in the image below:

The mining difficulty curve of the zcash tends to stagnate unlike the bitcoin mining difficulty curve which it progresses further upwards over the months

But know that this curve varies mainly according to the interest of miners for mining the crypto-currency, in plain plus there will be minor to undermine the crypto-currency and the more the curve will progress upward.

The less there will be a minor to be interested in the mining of the crypto-currency and the more the difficulty curve will tend to SAG.

Is cloud-mining profitable?

It's the question that everyone is asking whether cloud-mining is profitable or not.

I would answer Yes and no.

Yes it is profitable because as long as the price of the crypto-currency mined via the mining contract is favorable and rises enough.

Then you can make your contract profitable faster as the course will compensate for the increase in the difficulty to undermine (which I recall decreases the performance of the mined cryptocurrencies).

difficulté minage cloud-mining

Since 2013, the price of bitcoin has continued to grow, despite notable declines during certain periods

What is currently the case for bitcoin that is progressing very positively and which is not close to stopping in such a good way.

And not it is not profitable if for some mining contracts you will only recover the sum invested at the end of the validity of the latter, after all depends once again on the evolution of the difficulty (whose progression can not be Ant in advance).

That is to say that if for 1 bitcoin invested you recover 1 bitcoin of mined (which you can not yet anticipate beforehand) this has no great interest and it is then more interesting to keep your bitcoin in your wallet (and therefore better to invest euros when purchasing the mining contract as bitcoin).

But this argument is not necessarily true because an ascended of the price of the crypto-currency mined makes the mining contract profitable.

It is up to you whether you prefer to mine crypto-currencies via cloud-mining or keep them on your wallet, it all depends on the key factors that must be analysed beforehand before investing.

Simulation to be performed to estimate the profitability of a mining contract

To illustrate the arguments I make in favor of cloud-mining I decided to present this case study necessarily practical.

You will be able to rely on this case study to make your own predictions and whether it is worth investing in a mining contract.

We'll take as an example the purchase of a mining contract on Hashflare to undermine bitcoin and we will simulate the winnings from october 2016 until october 2017.

You will clearly understand the interest of cloud mining.

For this simulation we will use the following online tool: Bitcoinwisdom

which is a website offering a calculator to calculate the winnings generated by bitcoin mining based on:

  • the difficulty of mining
  • the current price of bitcoin
  • mining power

I recovered the difficulty value during the period from October 2016 to October 2017.

And I made the calculation of the gain generated in bitcoin throughout the mining period and again based on the difficulty value.

We will rely on this data set to perform our investment simulation in a cloud mining contract.

Let's say that I bought for $1245 of mining computational power at the date of 1 October 2016 on Hashflare.

Knowing that the rate of hashflare is $1.50 for 10 GH/s This gives 8.3 TH/s of power allocated for a contract of $1245.

Now we will calculate the profit generated by such power from October 2016 until the end of October 2017:

To do so you have to use the calculator provided by the site Bitcoinwisdom and using the estimated difficulty value for each period like this:

rentabilité minage bitcoin cloud-mining

The website bitcoinwisdom offers a calculator to determine the winnings in bitcoin according to the mining power provided by the contract as well as the difficulty of mining

To calculate the gains generated by the mining of other cryptocurrencies such as ethereum or zcash you can go to the site coinwarz which offers a calculator similar to that of bitcoinwisdom and which is also simple to use.

Results of the investment simulation in a cloud mining contract on Hashflare

HashFlare

Hashrate power: 8.3 TH/s

Contract period: 12 months

Crypto-mined currency: Bitcoin

At the date of 1 October 2016 the bitcoin was worth $704.10

At the date of October 31 2017 the bitcoin was worth $6800

At the end of the contract we have mined a total of roughly 1.76 bitcoin

Knowing that we invested $1245 and that currently 1.76 bitcoin is worth 1.76 * $6800 = $11968

So we made a gross profit of 11968 – 1245 = $10723

The mining contract purchased on Hashflare was therefore largely profitable.

In conclusion

The purpose of this article was to explain to you what factors you should base in order to estimate the profitability of a mining contract.

Before investing in a mining contract analyze and think according to the tracks and tools presented in this article.

This will allow you to avoid the worst of losing money and at best to earn 😉

Usefull links

The best mining sites in the cloud that are deemed reliable and serious (and in which I invested)

Moreover, you will also be able to bitcoins miner many other currencies without material such as litecoin, dogecoin and other crypto-currencies properties offered in mining in a clear and intuitive interface.

Finally you can each day claim a certain amount of satoshis (variable depending on the price of bitcoin) via the faucet of the site and also recover 1 dogecoin for each daily connection.

This allows you to try mining in the cloud without necessarily investing money.
Click on the banner or link to start miner without materialDescription
Genesis mining is the most reliable cloud mining site on the Internet because unlike most cloud mining sites that are pure scams, this site offers real hardware rental in the cloud. Moreover, the site has been in existence since January 2014 and no worries have been reported since that time.

You can start to mine bitcoin without material by investing a minimum of $19 and this for a lifetime lease.

I also offer you a 3% discount code on the purchase of your first mining contract to be entered when ordering: 0Guezh

Eobot has been in existence since 2013 and is therefore one of the very first cloud-mining sites existing to date. Not only will you be able to mine bitcoin without hardware through the cloud but also use a mining software using your free downloadable computer.


Another reliable cloud mining site that has existed since 2014. The site offers mining contracts from $1 especially for bitcoin mining!

This is a good way for you to invest your first bitcoin acquired on faucets or using your credit card. Once the purchase of your contract made the mining starts pretty quickly and you should get your first bitcoin mined in the cloud at the end of the day.

In addition to the bitcoin mining you can also undermine the ethereum, the litecoin or even the dashcoin.

Do not hesitate to invest a few euros to start and you try to mining in the cloud without taking too many risks.

Sesterce is a grouping by acquisition or alliance of several major players in blockchain in Europe. With the intention of creating a global player and a real representative of Europe on this market. Sesterce's (previously known as Bitech Mining) mining department offers the user a wide range of miners. The group has developed a blockchain mining expertise and investment during these last years and it has one of the biggest catalogs of services around mining.