Bitcoin Global News (BGN)
September 13, 2018 -- ADVFN Crypto NewsWire -- This bear
market is substantially affecting everyone in the Blockchain
industry, including miners.
As suggested by a recent press
release from Cointelegraph, individual Cryptocurrency miners are
finding it difficult to keep up with massive mining firms like
Bitmain, who seem to continue to succeed, even in the face of
sharply falling Crypto prices.
Because of this difficulty that
individual miners are facing, one can logically conclude that there
is a place for a company that aims to help these individuals
out.
Enter Hashtoro, which claims to
provide a cheap and profitable cloud mining solution. Before we
dive into what Cointelegraph says about Hashtoro in their press
release, keep in mind that press releases are paid for and
therefore, highly biased.
Because this is true, it is
important to look at any press release, especially in the Crypto
space where scams are almost commonplace, with a critical
eye.
Firstly, Cointelegraph starts their
piece by introducing cloud mining to the average reader who might
not understand what it entails as a business.
They directly claim that it is
basically a plug and play solution for the everyman and everywoman
to become a successful Crypto miner without having to own or
understand how to use any specialized technical
equipment.
At face value, this is true, given
that all of the technical work is normally done by the cloud mining
provider, in these cases. Behind the scenes, difficulties still
exist for both the consumers and the provider.
Judging by industry reports on the
subject, many cloud mining providers can be scams simply due to the
understood fact that customers find it hard to prove the existence
of their supposed mining facilities. Doing so should be as simple
as asking the company to prove what they have and receiving an
acceptable answer. Though ideally this would mean physically being
able to see the location, making such information public poses its
own problems like the risk of mining firms being robbed.
Because of this, it is not
unreasonable to decide in the end that you are not comfortable with
any cloud mining business, though if you are still interested,
arguably, a true utility exists in this niche.
As mentioned above, cloud mining
theoretically makes the mining of Cryptocurrencies more of a fair
space because it enables almost anyone to join in and receive some
sort of profit for their efforts. In the case of Hashtoro, their
self-stated differentiation begins with minimizing their costs,
while making their solution as easy to use as possible.
On top of this, they claim to be
the first mover in terms of cloud mining companies going green,
which is substantiated by the knowledge that their mining
facilities are in European countries that are green friendly, as
well as the knowledge that Hashtoro uses their excess energy to
help power local communities that they are in.
In terms of their actual service,
fully examining Hashtoro’s claims on how it works versus the truth
of how it works would call for another piece entirely. For now, we
will stick to a short discussion of the costs for the end users, in
order to attempt to illustrate how the cloud mining space usually
makes its money.
Hashtoro says that to start mining
with them, all that the average user needs to do is pay a minimum
fee of 20 Euros and click through a few screens, which are
logically, whatever agreements are required to run the
service.
On the surface, this appears to be
the lowest average cost in the history of Crypto mining, given that
the average home miner could typically expect to be pay somewhere
in the thousands, in US Dollars, per month.
What beginners to the idea of cloud
mining usually do not quite comprehend at first is that this 20
Euro cost is akin to the idea of a “Freemium” model of an app. With
Freemium apps, you get the basic features for free, but in general,
anything that is actually interesting requires some sort of
payment.
While we have not experienced
Hashtoro firsthand, based on the history of cloud mining, it is
reasonable to say that this space is no different. In cloud mining,
firms try to draw you in with a low initial cost, then keep you
there with small profits and keep you paying with the promises of
being able to buy more hash power in their mining
operation.
To clarify what this means, every
Crypto miner who connects to any Crypto network ends up effectively
running a percentage of that network’s hash power. In a general
sense, hash power is nothing more than the power your computer has
to effectively mine on a particular network.
In the same way that it is hard to
prove the location of a cloud mining company, it is nearly
impossible to prove how much hash power you are using. Logically,
this can be said to be due to the fact that the only publicly
available data on the subject will be related to the company’s
overall hash power and not to that which is being purchased by its
individual users. In response to this, it is possibly a good
strategy to compare your stated hash power to that of other miners,
in order to see if the cloud mining company is paying you
fairly.
Furthermore, buying more hash power
in a cloud mining operation can cost hefty amounts of money, due to
the fact that since the industry is in its infancy, there is no
real accepted standard for what these costs should be.
Therefore, with all of this
knowledge in mind, choosing a cloud mining provider carefully,
including examining all of its hidden costs before signing up, is
worth the time and the effort.
By: BGN Editorial Staff
News:
Cryptocurrency
Mining
Hashtoro
Blockchain