A few weeks ago I finally created my Hashflare account and purchased 7.5 TH/s of SHA-256 hashing power. Since that time I’ve written a review and posted weekly updates (you can read the review here)
I’ve noticed a lot of discussion on various forums about strategy with Hashflare. Here is mine.
Paper Napkin Plan
On the surface it’s simple. Buy hashing power, earn Bitcoin. And that’s how I approached it. Simply put, I was going to do the following:
- Buy 7.5 TH/s
- Reinvest for 90 days to double my hashing power
- Withdraw BTC for the remaining 270 days
- Withdraw and add to my wallet when my contract ends
Unfortunately, it wasn’t that simple. Even after just a few weeks a lot becomes apparent. Not bad, just not as simple.
Real Life
I’ve said it before in my review, and I’ll say it again. Hashflare is very bullish on their forecasts. And, even knowing that, you can’t help but get excited about the projections they give. One problem, they do not take into account projected Bitcoin mining difficulty and that’s important for 2 reasons.
First, the expected BTC payout is not realistic. My 7.5 TH/s purchase was projected to earn 0.356 BTC after a year. Which is great, I only spent 0.111 BTC for my 7.5 TH/s. That’s a 3x return of BTC. But we all know difficulty will go up, which means that number will come down.
The second reason difficulty matters is it affects my ability to reinvest. When I first started, I was calculated a 90–95 day period to double my hashing power because I was able to buy .05-.06 TH/s a day of additional hashing power which would compound daily. The daily compounding really speeds up the process. But today, I’m only able to purchase ~0.04 TH/s a day. That means my 90 day window is now closer to 120 days.
Final Thoughts — Growing Your Bitcoin Portfolio
It’s easy to get caught up looking at HF as an investment of dollars, I myself am guilty of such thinking. But once you think of it as an investment in terms of return of BTC, Hashflare is a great way to take the existing BTC you have and earn more. Remember, once you think of Hashflare as a channel to increase your BTC portfolio, it does just that. And yes, the some people will argue that you can earn more BTC trading, but that’s a risky game. I still feel my HF strategy is a solid, less risky approach to grow my BTC portfolio.
If you find this helpful and want to take the next step and start cloud mining yourself, please use my referral link to Hashflare here.
