Genesis Mining Crypto Cloud Provider Drops Unprofitable Clients As Bitcoin Price Declines, Moves to Radiant Tech

Genesis Mining, a popular cloud-based cryptocurrency mining service, is giving up on its low tier Bitcoin mining contracts. According to the company, these contracts have not been profitable anymore after the price of Bitcoin fell, so they have become pointless.

On a blog post, Genesis Mining stated that it will not continue to support its lower tier clients. The downward trend in the Bitcoin market has made it unprofitable for the company to continue to support these contracts, it claims. Combine this with the rising difficulty in mining since April and there is simply no profits for the company anymore.

1/3 Thank you everyone for your feedback! Our business model is to produce and deploy the latest hardware, then rent its hashpower and keep it running as long as the BTC price and difficulty enables. Your hashpower is bound to a set of hardware/infrastructure.

— Genesis Mining (@GenesisMining) August 16, 2018

2/3 Our latest #GMRadiant tech has enabled us to significantly cut down the maintenance fees. When you're asking us to upgrade you for free, technically you're asking us to connect you to the new set of miners we built out and unplug your current hardware. This isn't sustainable.

— Genesis Mining (@GenesisMining) August 16, 2018

3/3 With this offer we want our old customers to get a fair price for new capacities, but we also understand if this is not feasible for everyone. We really hope the Bitcoin price will recover, and with it, your open ended BTC contracts. Thank you.

— Genesis Mining (@GenesisMining) August 16, 2018

As a result of all these factors, Genesis Mining decided to terminate its low tier Bitcoin mining contracts because some contracts are now mining less than the maintenance fees. Because of this, the company will grant a grace period of 60 days for clients and then open contracts will be terminated for good.

This is not a surprise for anyone who actually read the FAQ of the mining company before it invested in it. A section states that the client agrees when signing the contract that, as soon as the gains of the company start to be higher than the maintenance fees, a 60-day grace period will be given to the clients and then the contracts will be finished.

After the period of 60 days starts, the company will watch the market and determine whether it is still profitable to keep mining or not according to future events that will happen during this time span.

Some other companies have been facing similar problems lately. One of them is HashFlare, the main competitor of Genesis Mining. HashFlare has started to terminate unprofitable Bitcoin contracts last month (at the time, Genesis Mining was still profiting from them). Litecoin, Ether and Dash contracts remained unaffected, though.

The Bitcoin bear market seems to be affecting all the major mining companies in some way as the prices are not going up as expected during 2018.

However, if you are a Genesis Mining user that does not use a low tier contract, there is no need to be afraid just yet. The company has offered to all its clients whose contracts will be terminated soon the opportunity to get a $105 USD discount if they want to upgrade to the premium service of the company, Radiant.

The company made the announcement on Twitter and it stated that the Radiant program has been helping the company to reduce maintenance fees, so it is offering the discount for the clients willing to upgrade.

There is a catch, however, as you will have to sign a 5-year contract with no opportunity for termination if you decide to move. So, it will be up for the users whether they believe that Bitcoin will still be profitable in the future for such a big commitment or if they simply want to jump off this train right now.

Genesis Mining vs MinerGate vs HashFlare vs NiceHash [Mining As A Service]

Similar to Notcoin - TapSwap on Solana Airdrops In 2024

origin »

151 +