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RE: What $20,000 of Bitcoin Mining Power Looks Like!
It's a huge risk but
''The biggest risk is not taking any risk... In a world that changing really quickly, the only strategy that is guaranteed to fail is not taking risks''
I don't think this can be considered a risk, more of a poor decision due to not considering all the variables.
Variable 1) price of bitcoin collapses next year (just a theoretical situation, not bearish on the market)
Doing so greatly decreases the amount you will receive from month to month.
Variable 2) Tax implication of cryptocurrency is still in its infancy. In any case, short term capital gains are not favorable for investments.
Variable 3) - overall power of the hashrate over time. My cousin and I run a small business mining, right now we are just trying to break even. That being said, when we started, an antminer with 13.5 ths/sec, got us $18 a day, now we are down to $12 a day. Over a 3 month period we are seeing a collapse of 33%.
Antminers are being pumped out on a daily basis and as such, are inflating the overall hashrate in the entire mining industry. Not to mention, the future miners that are expected to come out that offer even more hashrate. Therefore, a hashrate of 134 ths/sec will most likely not get as much of a return one year from now as it is today.
I'm not saying that this is a bad investment, however, I am saying the returns are inflated. After the first year you may or may not get your money back (at the current price amount). Of course, Returns will follow after that (again, considering the price stays the as high as it currently is or increases to a higher amount) however, as to how much you will get after that, is up to the market.
The really troubling part is the $47 mining fee. If its percentage based, you'll be ok. But if its a flat fee, the company is ensuring that they will always make money on you.
What happens when the reward is smaller than the fee? do you have to pay them back?
Just to let you know I have actually already made my money back from this as well as a large chunk of profit. To keep ahead of the difficulty you simply reinvest a certain amount of times per month
Ok, so you are already admitting that a straight $20,000 investment, without reinvestment will not receive the gains you are promising. Thank you for admitting that much. I kindly request you change your article to address that mathematical flaw.
In retrospect, in order to stay ahead of the difficulty and the inflation of new antminers, you will have to invest anywhere from, $25,942 dollars to $33,554 over a year's time based on very conservative increases of .5% and 1% reinvestment increases each week for 52 weeks.
The numbers get staggeringly higher should a higher amount of reinvestment be required each week.
What are you even on about? I showed you the amount of power I have... guess what? It is $20,000 worth! Including reinvestments.
If you invest $20,000, to get 134 ths/sec. and such a hash rate gets you $105 per day, and each week you have to reinvest $100 in order to continue getting a similar reward, how much have you invested after the first week? Is it still $20,000? No, it's $20,100.
Now, you still have the same buying power as before (after considering difficulty increase) but you are also beginning to increase your investment to see such gains.
Do you understand what I'm on about now?
Stating that a $20,000 investment will get someone a $35,000 return, while leaving out the required reinvestment needed to maintain the reward level over time is misrepresentation.
You are not investing JUST 20,000. You are investing 20,000 PLUS regular, most likely weekly, investments in order to maintain your reward amount to get to $35,000.
Also you are 100% talking out your ass about investing anywhere between $26k to $33k. Where did you get this from?
hash rate inflation and difficulty increases of .5% each week shows 26k, hashrate inflation and difficulty increases of 1% each week shows 33k.
As such, my only argument is that you cannot receive a straight $15,000 profit over a years time with just your current investment, unless there is additional reinvestment, and as such, you have done absolutely nothing but agree with me.
I'm simply asking you to stop misrepresenting your return, which you have already agreed is misrepresented.
"It is $20,000 worth! Including REINVESTMENTS."
"To keep ahead of the difficulty you simply REINVEST a certain amount of times per month"
After today you will continue to reinvest. And in a years time you will not have $20,000 invested, but far more, anywhere between $26,000 to 33,000 based on my own numbers. Thus, overall profit is grossly overvalued.
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