How to risk and win, betting on cloud mining? KuCoin and Bitdeer answering

  • Ultramining
  • 16 June, 2023 09:00
How to risk and win, betting on cloud mining? KuCoin and Bitdeer answering

Cloud mining is more than a disputable topic in the community of cryptocurrency adepts. Some think it will conquer the market in the nearest future, some find it too risky. We discussed the issue with two big players on the market.

KuCoin, a cryptocurrency exchange and bitcoin trade. The company has recently added cloud mining as a new client service.

Bitdeer, a crypto mining company that offers mining management system, one-stop data center support, and cloud mining services for years.

Cloud mining is a remote mining model. Users purchase cloud mining contracts from the platforms through which they effectively rent hashrate from actual mining machines. Throughout the term of the contract, users regularly receive mining rewards.

Who should consider Cloud Mining?

Companies working in cryptocurrency field

Cloud mining services address the growing market demand by providing a convenient solution. Traditional crypto mining requires technical expertise, substantial capital for hardware, and access to cheap electricity. However, with cloud mining, you can start mining for as little as a few dollars, making it accessible to a wild range of users.

We believe that mining is fundamental to many cryptocurrencies, and it’s important for the general public to be able to participate in order to better understand cryptocurrencies.

Cindy Feng, Global Marketing Manager at Bitdeer
Global Marketing Manager at Bitdeer
Cindy Feng, Global Marketing Manager at Bitdeer

Users planning to dive into crypto mining

Cloud mining is considered a more accessible, cost-effective, and convenient way to mine cryptocurrencies than home, or solo, mining. That’s the list of points to prove the position.

Accessibility, or Low entry barrier for mining

Cloud mining allows anyone to participate in crypto mining, regardless of their technical knowledge or financial resources.

On average, the minimum entry threshold, or the rent for capacity, is $500. But you can also find some companies that are ready to take you in starting from $50. This approach frees users from concerns about site hosting, energy expenses, and the maintenance and troubleshooting of mining machines.

Cloud Mining machines boast top-notch quality and superior mining efficiency, shielding users from risks associated with equipment depreciation and replacement.

Jolie Du, Head of KuCoin Mining Pool
Head of KuCoin Mining Pool
Jolie Du, Head of KuCoin Mining Pool

Adjustable investment scale

Cloud mining allows easy expansion or reduction of hashrate. It enables users to conveniently adjust their investment scale in response to market fluctuations. The services usually offer a variety of plans to suit different needs, so users can start small and scale up as needed.

Streamlined operation

Users aren’t required to comprehend the intricacies of mining machines, hardware, or software. With a straightforward one-click subscription, they can quickly begin cloud mining. The services take care of all the technical aspects of mining, so users can focus on other things.

Is Cloud Mining reliable?

Every investment carries its own set of risks. Therefore, it’s crucial for users to at least briefly understand the Cloud Mining process, including the associated risks and benefits. When it comes to this sphere, risks such as market fluctuations and technological changes need to be considered. 

Before making an investment, the principle “Think before you invest” is essential. It’s better to comprehend these risks and ensure that you’re financially prepared to handle any potential losses. When choosing a cloud mining service provider, prioritize high-quality service and opt for trusted brands.

Users can conveniently subscribe to cloud mining products from the company website with few clicks and select the desired amount to spend.

Jolie Du, Head of KuCoin Mining Pool
data centre in Tennessee, USA
Bitdeer’s data centre in Tennessee, USA

Risks that you as a client should consider

Cloud Mining is considered as a particular kind of mining. However, it’s associated with the same risks.

Reliability of providers

Sad to say, not all providers have their own data centers or plans to establish one, so conducting thorough research is important. Opting for well-known and established providers generally offers a safer choice.

Lack of control

Users have limited control over the mining operation. There’s no opportunity to customize the mining hardware or software, and you rely on the service provider’s decisions and strategies.

Security and fraud risks

Cloud mining requires you to provide personal information and often involves financial transactions. There is a risk of data breaches or unauthorized access to your data.

Bitcoin price volatility

Cryptocurrency prices can fluctuate, affecting mining profitability. Clients should stay informed about the market trends and adjust their investments accordingly.

Mining difficulty changes

Bitcoin difficulty adjusts every 14 days. Lower difficulty can result in higher rewards, while higher difficulty can reduce rewards compared to previous cycles.

Policy risks

Changes in government policies related to cryptocurrency mining may impact the cloud mining industry.

data center in Texas, USA
Bitdeer’s data center in Texas, USA; one of the largest in the world

Possible risks management

Any risk to be if not previewed than effectively managed. The KuCoin expert shared some advice with the readers on the needed set of actions.

  1. Stay informed about market dynamics and make reasonable predictions regarding bitcoin price trends.
  2. Diversify investment portfolio to avoid relying solely on cloud mining.
  3. Choose reputable and reliable cloud mining service providers to minimize risks.
  4. Make investment decisions based on personal risk tolerance and investment objectives.

If you want to migrate the risks, you have to bet on a good hosting. Do your own research about the provider and thoroughly study the terms and conditions before signing it.

Cindy Feng, Global Marketing Manager at Bitdeer

How do Cloud Mining Companies work?

Choosing a safe partner

As previously mentioned, it’s important to remember that not all service providers engage in unfair practices. Cindy Feng, a representative from BC, sheds light on why her company stands out as a trustworthy and reliable mining option.

  • It’s a publicly listed company backed by multiple organizations.
  • It has several data centers and a steady hashrate around at least 10 EH/s.
  • The platform sets clear fee and payment structures upfront, without any hidden costs.
  • Users can monitor mining activities through their account, accessible from anywhere at any time.
  • All mining payouts are directly sent from the mining pool to the user’s nominated wallets.

Don’t forget about welcoming bonuses

If you find yourself uncertain about whether cloud mining is the right choice for you, there are always opportunities to explore special offers. Platforms like Bitdeer offer a “welcome offer,” allowing you to participate in a mining trial at a little cost. This trial period enables you to gain a deeper understanding of the mining process and its mechanics. If you find the experience favorable, you can then consider transitioning to standard plans that offer longer-term mining options.

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