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What is Bitcoin Cloud Mining and is it a Good Investment?

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Bitcoin Cloud Mining

Bitcoin mining refers to the use of your computing power to process transactions on the bitcoin blockchain for which you get returns (in the form of new bitcoins). Bitcoin Cloud Mining refers to the process of ‘mining’ bitcoins with the use of a remote datacentre that has a processing power that is shared. With cloud mining, you don’t need to manage mining hardware. The miner might get lower returns as cloud mining is a service, hence there is a cost involved. Cloud mining enables to people earn bitcoins without the hassle of having to buy and maintain mining hardware.

Genesis Mining is currently the largest provider of bitcoin mining. It is the safest way to purchase hashpower as it doesn’t require any software and hardware set up.

Some of the advantages of bitcoin cloud mining are:

  • No excess heat to endure.
  • Zero costs of electricity.
  • No problems of ventilation when handling hot equipment.
  • There will be no cases of suppliers failing to deliver on time.

One of Genesis Mining’s most popular cloud mining contracts is the unlimited bitcoin mining contract, which will run indefinitely as long as the price of bitcoin does not drop to a level where the costs of mining exceed the revenues it generates. If that occurs, machines are shut down and the mining contract ends. Hence, cloud mining is only profitable as long as the price of bitcoin maintains an upwards (or at least sideways) trend.

WATCH OUT FOR SCAMS

Unfortunately, it is important to note that mining scams are on the rise like the possible $500,000 bitcoin cloud mining Ponzi scheme that was uncovered. Potential buyers of cloud mining services need to be extremely careful before purchasing any bitcoin mining contracts as companies posing as bitcoin cloud mining providers are one of the most common scams in the bitcoin economy. Hence, when choosing a bitcoin cloud mining operator, you need to be very careful and always consult community forums, such as bitcointalk.org, to receive information about the cloud mining company you plan to use.

One of my favourite bitcoin publications, BTCManager, has an excellent bitcoin cloud mining comparison site that can help choose a bitcoin cloud mining service, should you decide to purchase cloud mining contracts.

IS BITCOIN CLOUD MINING A GOOD INVESTMENT?

Well, the answer is yes and no. Since the mining difficulty of bitcoin has increased substantially in the last few years, mining at home using bitcoin mining hardware has become unprofitable for individuals as they can not compete with large international mining operations that own warehouses full of bitcoin mining machines.

In terms of bitcoin cloud mining, since the price of bitcoin has continuously increased in recent years, cloud mining contracts have been profitable investments and will stay profitable as long as bitcoin continues to gain in value. Having said that, historical data shows that investors who simply bought and held bitcoin made higher returns than those who invested in bitcoin cloud mining contracts.

Hence, it is up to you to decide whether you prefer to invest a larger amount once to then receive smaller daily or weekly bitcoin payouts “indefinitely” or do you prefer to buy and hold bitcoin and benefit purely from the capital gains of the digital currency?

There is an excellent article on how long it will take you to generate a return on investment using the most prominent cloud mining provider Genesis Mining by 99Bitcoin’s Ofir Beigel on Finance Magnates. If you are considering investing in a cloud mining contract, you should read this post first.

WHY I CLOUD MINE BITCOINS

Personally, I cloud mine bitcoin using Genesis Mining for idealistic reasons. I purchased their cheapest lifetime bitcoin mining contract (for $30) as I want to play my small part in ensuring that the bitcoin network continues to operate effectively. To get a return on investment it will take me well over a year, provided the price of bitcoin stays stable. Having said that, I am not too fussed about $30 should I not break even on this “investment” anytime soon. 

While you may like the idea of receiving regular passive income payments in bitcoin (I know I do!), you will most likely generate a much better return on investment by investing bitcoin peer-to-peer loans or simply buying and holding various promising cryptocurrencies (such as Dash, ether or everyone’s favorite bitcoin) as long-term investments.

 

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Binance Launches Fiat-to-Crypto Exchange in Uganda

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Binance Launches in Uganda

Global bitcoin exchange Binance has launched a new fiat-cryptocurrency exchange in Uganda. The exchange will also be offering a reward of 0.5 BNB to the first 20,000 users that register on the site as part of its promotion in Uganda.

The announcement comes nearly two months after Binance partnered with Crypto Savannah, Made in Africa initiative, and Msingi East Africa to promote economic development in the East African country.

Changpeng Zhao and Yi He founded Binance in 2017 and raised $15 million through an initial coin offering for its ERC20 token BNB in July of the same year.

The exchange plans to move its offices to the island nation of Malta after the implementation of stricter regulations in China and Japan. In January 2018, Binance was the largest crypto exchange with a market capitalisation of $1.3 billion.

Binance in Uganda

BinanceBinance will also offer its Ugandan users a month of zero trading fees when trading goes online. The exchange will announce the opening for trading at a later date.

Users can find out if they have won any rewards by logging into their accounts and accessing ‘Distribution History’ in the Account Center. In addition, users will be required to complete ID verification to be able to withdraw funds from Binance.

Ugandan users will enjoy an exchange that offers fast transactions of up to 1.4 million per second and state-of-the-art storage technology for utmost security. The exchange also provides 24/7 customer support and has a user-friendly interface.

The presence of Binance in Uganda aims to boost financial inclusion in the country, which has increased from 28 percent in 2009 to 54 percent in 2013 according to its national financial inclusion strategy 2017-2022.

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LINE Corp to Launch Cryptocurrency Exchange BITBOX in July for Global Trading

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BitBox
Image by linecorp.com

The developers of popular messaging app LINE and LINE Group’s cryptocurrency and blockchain company LVC Corporation have announced that they are set to launch a new cryptocurrency exchange called BITBOX in July 2018. The Japan-based firm made the announcement during the LINE Conference 2018 held in Tokyo.

The New BITBOX Exchange

BITBOXBITBOX will offer over 30 high-demand cryptocurrencies to users globally with the exception of Japan and the US. The exchange will trade coins such as bitcoin, ether, litecoin, and bitcoin cash while charging low trading fees of 0.1 percent. BITBOX will support 15 languages, according to the company press release.

The selected cryptocurrencies for the exchange have undergone an extensive screening exercise and have been picked by an internal committee, promising users a convenient and safe trading experience. LINE will also incorporate its top security standards to the cryptocurrency exchange.

LINE Corporation CEO Takeshi Idezawa said:

“As a key part of LINE’s new financial services, BITBOX shows our commitment to fulfilling the growing demand for more diverse financial options. With BITBOX, LINE users will be able to access cryptocurrencies more easily, while also being assured of state-of-art security measures to protect their assets.”

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Nigerians Have Invested Over $5m in Cryptocurrencies Despite Regulator Warnings Says KureCoin Hub

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Nigerians Invest in Cryptocurrencies

Nigerians have invested over five million US dollars in the cryptocurrency market in the last couple of years according to data from Nigerian cryptocurrency platform KureCoin Hub.

The data shows that Nigerian retail investors are investing heavily in the cryptocurrency market despite warnings from the Central Bank of Nigeria (CBN) and Nigeria Deposit Insurance Corporation (NDIC) against investing in an unregulated market.

KureCoin Hub’s co-founder and CEO Tega Abikure has criticised the stance regulators have taken and argues that the country will lag behind as other countries enjoy the benefits of blockchain technology and cryptocurrencies. Abikure told New Telegraph:

“It is not a matter of whether the government likes it; it is about whether they need it. I am not sure the internet was liked when it first came. […] It is not a matter of whether they are going to embrace it; it is about when they are going to do so.”

Abikure observed that other countries such as Uganda and South Africa have already taken steps towards adopting blockchain technology while Kenya is pushing forward with a functioning blockchain taskforce.

“Nigeria is being left behind,” he noted.

The Blockchain as a Source of Foreign Direct Investments

Abikure also believes that blockchain technology could be a major source of Foreign Direct Investments (FDIs) in the next five to ten years. In addition, he is of the opinion that a lot of money is being made in cryptocurrencies on the continent with most of it leaving Africa’s economy.

On one of the benefits of blockchain technology, he said: “[The blockchain] is completely transparent and cannot be changed; it can be used to create a decentralised system of payment where the taxpayer had an unhindered access to the collector which is the government. It enhances revenue collection and removes the challenges of remittances.”

Blockchain technology can also improve the banking sector, the electoral process, the use of donations in charitable projects, and the supply chain, among many other use cases.

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