Overview: Cloud Mining
Although in theory, the concept of cloud mining can be structured in a fair and honest way; in practice, most current cloud mining services fall short of expectations. Many of the current cloud mining services engage in deceptive and sometimes corrupt practices.
The current most popular cloud mining services sell contracts for a set amount of mining hashrate per dollar for a predetermined amount of time. The customer holding the contract is given the rewards generated by the purchased hashrate after the deduction of the cloud mining service’s fees. These fees include electricity, cooling, hosting, servicing. Many customers find that their contracts produce returns for the first few months or so, but as the difficulty of mining the cryptocurrency goes up their hashrate earns less and less rewards. Eventually, the rewards returned by the contract’s hashrate do not outweigh the cloud mining service’s fees. When a contract no longer turns a profit, the cloud mining service invokes a clause in the contract that allows them to terminate contracts unable to pay their fees. The customer feels cheated because they were advertised high returns but they didn’t read the terms carefully and now they are receiving little to no returns for their so-called investment in cloud mining.
Historically, cloud mining services have been notorious for being dishonest and often even corrupt. Some cloud mining schemes simply act like a Ponzi scheme, paying the old customers with the money from new customers. These services often offer ridiculously high return rates in order to entice you into ignoring the fact they have zero transparency. They hide or obscure the facts and figures relating their business like the total number of customers, total hashrate of the service, the method of calculating or distribution of mining rewards. Customers are left high and dry as the cloud service runs away with their money. Did they ever mine coins? Where were the mining facilities? Who was in charge of the service? These and many more questions are all that the victims of the scam are left with.
In this article, we want to also focus on a new startup – HydroMiner – that is trying to solve the problems stated above.
How is Hydrominer creating a fair and transparent cloud mining service?
Hydrominer solves the historical woes of cloud mining services by providing an honest mining service with the utmost transparency provided by its smart contract. Hydrominer is changing the face of cloud mining industry by creating the world’s first cloud mining service via smart contract. Hydrominer is hosting an initial coin offer (ICO) for their ERC20 token on the Ethereum network called H2O.
Through Hydrominer’s H2O smart contract on the Ethereum network, token holders will be able to monitor the rewards generated by the Hydrominer mining facilities at a moment’s notice. Fairly and transparently redeeming the mining rewards will be simple. Each token will entitle its holder to the mining rewards for a single watt used. By issuing the rewards per watt instead of per hashrate, H2O will generate and distribute mining rewards evenly. When H2O’s model is compared to historical data of its competitors’ models, it is easy to see how H2O’s return would sustain itself despite the increase of mining difficulty.
The data has been collected from customers of Genesis Mining, Bitcoin.com, hashing24.com in various contracts for Bitcoin and Ethereum Cloud Mining.
Hydrominer also has many other advantages over its competitors. Hydrominer is launching its mining facilities in an ideal hosting environment, inside or next to a power station and a cooling river, and usually in a cool environment in the Alps. The utilization of hydroelectric power plants provides Hydrominer with one of the cheapest electrical cost in Europe.
So if this has sparked your interest, then you should head-up to their website, that offers info on how to participate in their H2O-Token-Sale.
Disclaimer CoinStaker.com has a stake in HydroMiner.
- AgentMile Announces its ICO - Jun 27, 2018
- Problems the CRE Industry Can Address by using Blockchain Technology [Part 2] - Jun 10, 2018
- Problems the CRE Industry Can Address by using Blockchain Technology [Part 1] - May 30, 2018
- Introduction to AgentMile, a Decentralized CRE Leasing Platform Powered by AI - May 22, 2018
- Giveaway: 1x CB Blockchain Conference Ticket - Mar 17, 2018