My Hashflare Cloud Mining Experiment

Since the start of the year, when the Bitcoin price was at over $17,000, I’ve had an interest in Cloud Mining. Unfortunately, due to high prices of Bitcoin and the limited amount of mining hardware available, the prices of new contracts were excessively high. Back in January, the price was $2.20 per 10 GH/s.

The Bitmain Antminer S9 provides 14 TH/s of hashing power but back in January the average price for one of those was around $4000. To obtain that same amount of hashing power with Hashflare at the time would have cost:

January 2018 Hashflare BTC Price - $2.20 * 1400 = $3080 per year

I had friends who had bought contracts back in November for only $1.20 per 10GH/s and those were lifetime contracts! At $3080 per year, the price of Hashflare in January was beyond my means and I felt like I had missed out.

But, I’ve been keeping an eye on Hashflare and due to the correction in the price of all Cryptocurrencies, the cost of mining contracts has come right down. Last week (21/03/2018), the price on Hashflare was only $0.60 per 10 GH/s. At that price I was prepared to give it a shot. Even better, when I logged in (I had created an account previously but just never used it), a 25% discount code was available to me bringing the cost down to $0.45 per 10 GH/s!

Given such a low price, I signed up for 10 TH/s for a total cost of $450. If I can’t make a profit at that price, then I doubt anybody could ever make a profit with Hashflare.

My 10 TH/s Price - $0.45 * 1000 = $450 per year

When you log into Hashflare after buying your hashing power, you are presented with a profitability calculator that predicts your returns for 1 day, 1 week, 1 month and 1 year. You need at least one day of mining profit before the calculator shows the correct figures. Here is what my estimated returns are today.

However, the estimates provided do not take into account the maintenance fee that Hashflare charge for electricity. Currently the maintenance fee per 10 GH/s is $0.0035 per day. So, for my 10 TH/s the maintenance fee is as follows:

Maintenance Fee - $0.0035 * 1000 = $3.50 per day

So based upon the amount of hashing power I have purchased (10 TH/s) and the current revenue forecast, I should actually be making just over $2 per day based on the current Bitcoin price. This is corroborated by my actual payout for the last week which is also shown in your Hashflare dashboard.

So, only $2 per day. That doesn’t sound like it is going to make me rich any time soon, but at current prices, so long as Bitcoin difficulty doesn’t increase massively, I should make a profit over the course of the contract.

However, I wouldn’t be invested in Cryptocurrency if I didn’t believe the price of Bitcoin was going to rise over time. Bitcoin was specifically engineered to be a deflationary currency, where the supply increases at an ever-reducing rate and with a maximum ever supply of 21 million. As the adoption of Bitcoin increases, the supply decreases that causes an upward pressure on the value of the coin. This is why the value has gone up so much.

Back in 2012, I actually purchased two bitcoins in order to buy a subscription to oznzb.com, which was a Usenet indexing site for downloading movies, games, etc. That was my first ever contact with Bitcoin and those two coins cost me less than $20 at the time. The subscription cost $7.50 for lifetime access and at the time, that was 0.75 BTC. Oznzb.com only accepted Bitcoin because it was anonymous and untraceable, today the owner of that site will be sat on a fortune in Bitcoin.

Many investors and commentators have made very bullish predictions for the future price of Bitcoin. Most famously, John Mcafee (of anti-virus fame) has publicly stated that if the price of a single Bitcoin isn’t over $1 million by the end of 2020, then he will cut off and eat his own dick.

So, how much might my $450 investment be worth based on the value of Bitcoin? The following table is my estimated earnings from this contract based on the value of Bitcoin increasing over time. It is based on the estimated BTC per day that I am currently earning of 0.00061132 BTC less a daily maintenance fee of $3.50 .

I think we are likely to see a $25,000 Bitcoin by the end of this year, so I am fairly confident of making a profit on my $450 investment. Bitcoin could stay where it is or even dip further so there are no guarantees, but over the long term I am confident it will go up in value considerably from today’s price of approximately $9000. If you decide to invest in Hashflare then please use my affiliate link which will give me a small amount of extra hash power:

https://hashflare.io/r/377AC3CA-STEEMIT

I’ll post further updates throughout the year on this experiment so you can see how my investment develops. The price of new contracts on Hashflare has gone back up since I bought mine a week ago, and it is now listed the price as $1.20 per 10 GH/s. That is a considerable increase on what I paid.

I don’t know think I could recommend you sign-up at those current prices, but if the Bitcoin price continues to rise, even $1.20 could prove to be a bargain. After all, it is half what it was back in January this year.

Note, I am not a financial advisor and the opinions expressed in this article are my own opinions and views on the market. Do your own due diligence and investigations prior to making any investments.