Quote from: liquidcryptos on December 16, 2017, 12:48:38 AM

Some more of my thoughts on Envion for those who are interested. I'm working in the field of renewable energies and therefore have been following this ICO regularly.

Today I told my coworker about the current hype with ICOs and he, who has been working with banks for the last 20 years, told me that it reminded him of 1999/early 2000s when people were throwing money at anything. He told me there was e.g. a company from Hongkong that said had invented tracking systems for trucks and were already selling products with a cash flow worth millions.

In the end it turned out the company had faked a great percentage of sales to their "customers" and hadn't even bothered to set up letterbox companies with the respective names they allegedly had sold these products to. The formerly acclaimed global yearly turnover of 93 million $ turned out to be more something like 1.5 million $.

I agree, there are a lot of bogus ICO's out there, with some horrible white papers, Envion is not one of them

With Envion what I have seen so far is that they don't have a working product yet.
They don't have a working product? I saw videos of their mining unit working, and also they mentioned testing it in a few environments

Therefore there a few factors to consider if you want to assess the potential of their product:
First, it's just a prototype at the moment, which therefore cannot have been tested under the many different working conditions yet that it has to endure if it is to be distributed globally.
What about dusty, dry, hot, cold environments or everything in sequence within 24 hours, which happens if you put up a container next to a solar power plant in the desert.

Then the costs:
- of the Envion mining equipment itself
- the costs for transportation
- the costs for maintenance if something stops working

So I do GPU mining personally, and its pretty profitable and I don;t get good prices for my units.
Envion will be getting much better pricing and also ASIC units that are more profitable in general, so they are off to a good start,
I also pay horrible city prices for electricity and i still make good money. So Envion will at least be cutting costs from electricity and from hardware

The availability of:
- cheap electricity
- of trained people who maintain the equipment

and if there are no trained mainentance staff available:
- the costs to hire and transport the staff to and from the mining site

Not even considering the initial investment cost, the advances in new mining hardware or the possible increase in network size and difficulty increase for many cryptos, the overall costs for running and maintenance will decide the profitability.

I agree, the one cost i dont incur that they will is the cost of staff and of transportation, and it is up to management to keep the minimal. I know for myself, i have barely touched my miners, they are fine once they are up and running, i do everything from remote management

In my eyes this is why mining companies are located in Iceland and China. There is cheap electricity AND trained personnel available that does not have to travel around the globe to provide their service.

- And if there are other spots with even cheaper or nearly free electricity, why is it that they haven't been claimed yet? They have to be small niches which until now have not been interesting enough for the major players.

Perhaps Envion is first to market in this regard, and even if they cant claim these cheap energy spots, they can just park the units where the other mining companies have their units and incur no additional costs, right?

So either the niches Envion wants to exploit are small and if they are not the other factor, the costs for providing proper maintenance, is the reason that no one else is there yet.

If they put up their containers in Europe or the US they will find enough people capable to keep the systems running, but then, how are electricity prices there?
as I said, even with high city prices of electricity i am making decent money, it actually amazes me how much money is in mining, there are not many businesses where u make back all of your liabilities in less than a year and then some

If you truly want cheap electricity it has to be produced at the lowest marginal costs possible, which in the long run means you have to go for renewables. However, medium and large power plants, like solar and wind, are only built if the demand or state subsidies will make this project economically feasible. In Germany, for example, the ROI for photovoltaic plants is around 12-14 years with the current state subsidy of around 0.11 /kWh if you sell the electricity to the grid or even lower if you do not meet the criteria to receive the subsidies, which depends on the size of the plant.

So I wonder why a plant owner, at least in Germany or Europe, would want to sell electricity to Envion at a price which is lower than the one guaranteed by the state, which still is above market prices. And even if he doesn't receive the subsidies there is still a huge market he can sell electricity to at current market prices.

There is no reason why the plant owner should sell Envion electricity below market prices. Envion, of course, could buy at market prices but what would thein their edge be compared to other miners?

Im not sure of the energy companies' motives either, but Envion already has LOI's from several companies, unless they are flat out lying which i find hard to believe given the quality of well known people involved

The next question is, how many plants there are that are desperate enough to sell their electricity below market prices or even below their marginal costs? This would entail e.g. power plants that were built without meeting the conditions of economic feasability in the first place, state projects that had to be abandoned due to increased costs, for example.

again, im not sure about this, i guess this is the gamble we are taking, but its not much of a gamble because they can just park the units anywhere,
as i said the profit margin is high... unless im missing something.. instead of 100% ROI in 8 months it will be 10 months.. not so bad

Envion doesn't provide any information where they think these potential niches are located. And if they know where they are, how big are they? As Envion wants to reinvest 25% of the returns into growing their infrastructure how long will it be until they run out of these yet unclaimed sources of cheap or free electricity.
not sure, but im happy with my return even if they only fill the $130ish million

Of course, if new niches appear on the planet, they can ship the containers to the other side of the globe. But how much is this going to cost compared to the earnings generated by their equipment during the available amount of time until that niche is closing again, e.g. as local demand in electricity goes up and the owner of the plant can charge other consumers higher prices than Envion? Does Envion hedge against this kind of risk or do they simply pack up under these circumstances and move somewhere else, which in turn causes new costs for transportation and set up at the new location?
They have confirmed contracts of lengths sufficient enough that if the circumstances changed they are still making heafty profits

The only long term feasible solution I can see at the moment is that Envion's (and any other) cryptomining is only profitable if marginal costs are driven as low as possible and stay that way. And places where these conditions are met are already occuppied (at least to a certain extent). So if Envion wants to be more profitable than other miners, they have to have lower costs than others and they have to avoid the additional costs, like moving and setting up equipment over and over or costs of transporting trained staff for maintenance.

Therefore, I see Envion's advantage against other miners, the mobility of their system also as its biggest Archilles heel as these additional costs will bite into their earnings. But if they want to reduce these costs, they will lose their advantage against other miners and will be just another mining company that moves to Iceland and buys electricity at market prices.
again, that was my whole point.. go to iceland then, its crazy progit margins still

The only other feasible solution I see for profitable cryptomining is that Envion ensures low electricity prices by owning the power plant themselves and running their equipment on their own power. This would be the solution with the lowest marginal costs.

But then, why should you even bother with long term crypto mining using your own electricity when you could as well sell the electricity itself?

For me these questions are not answered or even asked.

What is definitely true is that the founders/members have already made a huge amount of money so far and I have to congratulate them on it. And if their product will prevail only time will show. It's just like in the good old dotcom times.

Bottom line is the profit margin is huge.. so any further benefits they deliver from just baseline mining is just a bonus. Im mining in a garage with cards bought from the local radioshack, per se, and my profits are a joke compared to other businesses (ie: not a 10% profit margin per year). I look forward to any further comments. I realize you are the energy expert, but they have experts on their team as well and i dont think they could have gotten this far and lied about contracts if they dont have something substantial and they have declared they are ready with assembly line and contracts

As I said before, Envion are not the first one, producing Mobile Mining Units - Bitfury are long ago in the business.
Second, the hardware - they are planing to use Antminer 9S, the most popular ASIC miner, but more than year old model. New miner producing company will flood the market with new 16 Terahashes miner in March 2018, which means Bitmain most likely will be ready with Antminer 11S around that time. That means Envion will spend their money for old equipment.
They were very optimistic they can beat Bancors ICO, but it is not so easy...
One little red flag - why you need to send your money BEFORE the KYC process. The rest of the world is doing the opposite Wink

B0bares

Posts

Merits