Since i was a young boy i have always been adventurous. A risk taker at heart, an innovator and an early adopter. It places me on the cutting edge of risk and uncertainty.
I’ve been told that when something is “TOO GOOD TO BE TRUE” the only truth is that its not true.
Fast forward 31 years to Cloud mining crypto currency.
The promise of mining my own ethereum or bitcoin or litecoin or various other crypto currency by renting server space in iceland, where geothermal energy powers the servers and pays me real time currency 24/7 from the comfort of my own home without all the trouble. No massive rig set up, expensive electricity bills, No need to worry about all of that!
Okay lets give it a go. Lets test it out with $300 and see how profitable it is!
Yes I signed a contract with Genesis Mining LTD and payed $300 USD to mine Ethereum at a rate of 10MH/s for 2 years (720 days) and for a while i was convinced it was a SCAM. Instead of conceding defeat, i did what i always do, I collected the data. I investigated every metric I could collect so that i could project ahead for the entire life of my contract and see what kind of returns i would actually make.
Let me take you through the analysis……
The metrics I collect daily include the total Ether mined from my 10MH/s, The daily price of Ether, Average daily mined Ether, Number of days until I return my $300 USD investment and the projected total ROI at the end of the full contract term. Here are some visualisations of this data so you can see for yourself:
As you can see my ETH_day is on the decline however not as rapidly as during the first stages of the contract. It seems to be plateauing out. On day 1 my mining rate was 0.01 ETH and 96 days in it is now 0.002 ETH so quite a significant drop in rate.
Mining Rate of Change
This chart confirms the previous graph which showed a sudden decline in the ETH_day earned. The mining rate of change measures the difference in mining rate day by day. If the number is negative this means we are mining less than the day before. If it is positive it means we are mining more than the day before (which would be unusual). What is interesting is that this rate of change started significantly below 0 and is slowly approaching 0 meaning the decrease in ETH mined day by day is less and less. This is good news for the long term and i wonder what factors have caused this.
Price of Ethereum
During the 96 days of my contract the price of the asset has moved widly, swinging from the $400 down to $150 and now on its way back up toward $350. It is this change in price which ultimately makes or breaks this pursuit. After all it doesnt matter how much ETH i am mining per day if the asset has no value then i will never reach ROI. On the flip side, if the price of Ethereum Sky rockets then ROI will be achieved quickly.
Number of days ROI
As you can see from this chart I was originally very concerned and hence why i started to believe this was a SCAM. The number of days to reach ROI was increasing with each day, pushing this horizon further and further away. However over the past week this has now started to reverse and the days are decreasing which is great news and according to the numbers itll take another 3 months until pay back. According to these numbers that will give me an extra 533 days of mining in pure profit!
So in summary how much will i make on this contract? Taking into account my initital investment of $300 USD my returns will be $869 USD (~285%). This is at the current price of Eth $333.68. Some people predict Eth to rise to $500 or even $1,000 by the end of the year. In the $500 scenario my ROI would be 480% and should Eth reach $1,000 in the next 2 years it would be a massive 1058% or $3,177 Profit from a $300 investment.
It makes me feel more comfortable monitoring these stats and has made me realise that nothing is ever as it seems but i was pleasantly surprised that Genesis Mining keeps up its end of the deal and lets come back in 90 Days to confirm that i have payed back my contract. Not a bad option for those that dont want the hasstle of constantly buying Eth and just want to sit back and let the $$ come into your wallet each and every day.
The other factor that i really like it that within my contract, i can switch to mining other crypto currency if i wish. If Ethereum becomes too difficult and my returns are less than ideal, i can easily switch to others. They also run promotions such as the current 11x on Dash. Meaning you get 11x the Hashrate you signed up for on this mining. At any stage in the contract you can also increase your Hashrate by investing more into your contract:
I would recommend Genesis Mining and i dont think its a scam and have the proof to back up that statement. Im excited to see how this progresses and contact me for any questions or advice!
Please continue to Part 2 to find out how my cloud mining contract is going