Over the course of the past few years, the cryptocurrency mining sector has started to gain a lot of mainstream financial traction. For example, market research firm Technavio recently released startling data claiming that the global mining hardware market is all set to grow by a whopping $2.8 billion between 2020 and 2024. This incredible surge was attributed to the rising popularity of mining pools, most of which are currently concentrated in China.
Not only that, over the course of the past few months, companies like Btc.top have been seeking to redefine the concept of Bitcoin (BTC) acquisition, for example, via the use of a technology called “joint mining,” wherein users can mine crypto remotely by buying a certain amount of hash power from a third-party player. According to Btc.top, the new technology will help mitigate many of the risks that are currently associated with popular cloud mining products by allowing users to have more financial as well as operational flexibility.
Commenting on the matter, Jiang Zhuoer, the CEO of Btc.top, told Cointelegraph that the company will make it easier for individuals and institutional clients to participate in cryptocurrency mining due to the firm’s “infrastructure, strategic industry partnerships and low electricity rates.”
The concept of joint mining is not entirely new
Even though Btc.top’s use of joint mining is being hailed as a significant step forward for the crypto mining sector, it’s worth pointing out that many local mining farms and companies in China have already been using of this business model. One of the major advantages of using this service framework is that electricity can be sourced at cheaper prices. Moreover, profits depend on the ASIC model and farms’ efficiency — while the underpinned revenue lever being risk and profit-sharing. Commenting on the subject, Thomas Heller, the global business director at F2Pool mining pool, told Cointelegraph:
“Many of these kinds of mining farms are located in the Sichuan region of China, which has an abundant hydroelectric power source. But one downside is that Sichuan is prone to many natural disasters such as earthquakes and floods.”
Furthermore, it is worth noting that Btc.top is currently charging around $0.033 per kilowatt-hour to its users for facilitating their mining operations. However, it seems as though electricity costs can keep fluctuating substantially during the rainy season in Sichuan — a locked province in Southwest China where the company has its farms. This is important because users are billed for the electricity their equipment consumes throughout the duration of the entire program per a predetermined contract. So, in reality, even though this model appears lucrative due to lower electricity prices, such inconsistencies are always present for any miner operating in this region.
Addressing the aforementioned concerns, Zhuoer stated that his firm launched its mining service within China in March, long…