Quote from: jaysabi on January 16, 2017, 02:28:36 PM

Quote from: wetsuit on January 16, 2017, 04:49:46 AM

I am sorry to announce that the new feature that we were working on will not be released in the near future. I'll try to explain what we were trying to do.

I was trying to create a mining investment program for users where users would be able to invest their bitcoins with us and we would use it to purchase bitcoin miners and generate profits. The way that I had designed this was that it would carry absolutely no risk to the user (other than us running away with their money, which is always a risk with any investment) and users would be guaranteed a fixed return on their investment (around 8-10% APR) measured in bitcoins, regardless of the BTC price. It would eliminate most issues with "cloud-mining" schemes and users would not have to worry about the difficulty and price, we would assume all of that risk. We would also provide proof of our mining hashrate to show that we were not running a fractional mining scheme.

To do this, we had already installed about 2 petahashes of mining power with another 2.5 petahashes planned to be installed soon. However, the main issue is that there simply isn't enough stock of efficient miners available to make this viable. There is no point in raising investments if we are unable to expand quickly and currently it seems like that will not be possible to do soon. Also, the recent price volatility has made it very expensive to reliably hedge against some uncertainties (which is necessary to prevent us from going bust in case of some unexpected circumstances). So I have had to put the project on hold, we will continue with expanding our mining operation but will not be opening it up for investments unless we are sure that it can be viable long-term. We have everything ready to go so if there is a possibility that this can be done in the future, we shall implement it

I'll contact the first two users who correctly guessed what the feature was to reward them their prizes. Sorry for hyping this up and then disappointing people who were waiting.

I'm super skeptical of any mining investment program. Bitcoin is far too volatile to to be able to guarantee any kind of return. The only way it's long term profitable it seems is if a pool operator collects his fees for running a pool from people who supply their own miners. The key breakdown point for me is always that if you have excess mining capacity that you are "renting" out, or allowing people to buy a share of, you either have to be losing money by doing so, or the mining power will never generate the principle amount of the investment, otherwise you'll have lost money by offering it as an option. It doesn't make any sense to me that someone would rent out mining capacity or "profit share" something they already own that would end up reducing their income over the long run. Also, Bitcoin mining is far too competitive to be able to guarantee an 8-10% return, even if standardized by denominating in btc.

Profitability all depends on the price paid for electricity. Returns of up to 40% p.a. are possible if the price of electricity is low enough. If such returns could be generated, it would make sense to raise investments and pay 8-10% on them and make a 30% profit even after doing that. Long-term I had plans of investing in a small solar farm just for the purpose of mining since solar prices are falling rapidly and having zero-cost electricity would keep miners profitable for a lot longer than even the cheapest electricity.