Latest Update: March, 17, 2014
An Interview by the CIO Jeffrey Smith. Now CEX.IO offers futures on GHS Mining.
For next month April 26th 1 GHS is now at 0.008 BTC and for 26th of May, 1 GHS trades at 0.004 BTC. Today the price for 1 GHS is at 0.0129 BTC.
Currently the price for 1 GHS today on CEX.IO is 10.76 USD (0.017193 BTC / Bitstamp: 626USD / BTC). If you buy a KNC Miner with 3 THZ for 13 000 USD you will pay 7 USD/GHS which is just lower than 3.76 USD/GHS on CEX.IO . However on CEX.IO you do not have to look after the equipement and you can sell your GHS at any time. The price for 1 GHS used to be 4 times higher on CEX.IO versus bying your own equipement now it is down to 1.537:1. At this ratio you are better of trading GHS on CEX.IO . It looks like we are hitting a bottom in price on CEX.IO as miners will very likely not sell their GHS on CEX.IO below or at the same level as their equipement costs .
Status of my investment in January: I am below my investment due to the drop in prices per GHS on CEX.IO. Please see the list of cautions at the end of this post.
Status 20. January 2014: As it stands of today I am about to make around 199% on my investment in Bitcoin Mining at CEX.IO .
On the platform CEX.IO you can instantly buy so called hashrates (GHS) of computer mining power or if you do not need those sell them again.
I bought 1 GHS on January 17th and after 3 days mining I am currently at a 199% return of my investment. I paid 0.0455 BTC for 1 GHS. And I will continuously update the calculation.
At CEX.IO you are not only mining Bitcoin BTC but at the same time 3 other cryptocurrencies are mined. These cryptocurrencies are Namecoin NMC, IXCoin IXC and Devcoin DVC.
After 72 hours of mining I have:
0.001148024 NMC (Namecoin)
0.00578684 IXC (IXCoin)
0.21625056 DVC (Devcoin)
After converting the NMC (exchange rate on CEX.IO) and the other cryptocurrencies IXC and DVC (exchange rate on www.cryptsy.com) into BTC I mined so far 0.00074321.
Based on the current amount of BTC mined I would make a 199% return of my investment in 1 year. What I have not calculated is the effective interest rate. The payouts of the mining is immediately, therefore the effective interest rate should be above 199%. As you have a constant payout of the BTCs mined – a fraction at least once per hour, the payout now has always more value than if you get paid in the future. As an example if you invest in shares and hold them for a year you will only get paid once per year the divident of the share and only realize any gains of the share price after you have sold you shares.
Also if I would sell my 1 GHS now I would also make a small return as the current price for 1 GHS is now at 0.04367. Plus if I would change the BTC back into USD I would make an additional return as the rate for BTC against the USD recently went up.
Before you get too excited there are some words of caution.
Please consider these risk factors:
With the increase of mining power added continuously the return from mining Bitcoins BTC with 1GHS could decrease over time. This might be the case also for the other cryptocurrencies.
The value of 1GHS can decrease.
The value of 1 BTC can decrease against the FIAT currencies.
Theft. Your account could get hacked.
The provider needs to stop services due to legal constraints or goes out of business.
Your assets are not secured nor is the legal framework fully cleared.
Also consider there is 0.0001 BTC fee for withdrawal of BTC from your account at CEX.IO.