The revolution of cryptocurrencies was one of the most profitable investments of the 21st century with Bitcoin going from $6 in January 2012 to almost $20,000 in December 2017, which is a 33,000% return on investment in more than 5 years. Thus creating a new era of crypto millionaires and billionaires globally. However trading cryptocurrencies wasn’t the most profitable venture for individuals involved in the trade, it was the mining ecosystem that cryptocurrencies created that generated the most significant amounts of wealth. From individuals such as Jihan Wu who is the CEO of Bitmain, which produces miners and owns miners that produce cryptocurrencies. Mining and other crypto related activities has generated Jihan Wu a fortune estimated at more than $10 billion.
Why is mining profitable?
Mining is profitable because it is the ultimate solution to solving supply and demand issues. As more of a certain type of cryptocurrency becomes available in the market, the more difficult it becomes to mine the “blocks” and solve the algorithms to create the cryptocurrency, thus over time restricting supply whilst demand may continue to increase, thus in turn increasing overall value of a cryptocurrency. What makes mining even more profitable is that mining pools which share “hashpower” that involve numerous users produce larger quantities of cryptocurrencies which they keep hold of until prices of the cryptocurrencies become more favorable and then sell them. Usually mining is most profitable during a dip in the value of a Bitcoin as miners at that time become extremely cheap and affordable, but this still doesn’t address issues surrounding political stability and the cost of electricity miner bots consume and it appears many miners are looking towards North America to set up operation as China and other Asian countries begin to regulate mining activities.
Mining in the USA
The USA could be the ideal country to take over from China and other Asian countries to become the next Bitcoin mining hub due to its environment of political stability, less regulations and red tape surrounding cryptocurrencies and the price of electricity in the USA is not more expensive than the price of electricity in China.
However numerous companies are overcoming this hurdle by signing favorable deals with energy companies to provide cheap electricity in abundance. One such example of a company enabling individuals to help supply individuals with cheap electricity would be The Hedge Coin Group that brokers power to large scale miners. Thus giving them all the benefits that the USA has to offer in a politically stable environment whilst also providing potential miners and mining operations to benefit from large scale cheap electricity. The Hedge Coin Group currently has 100-500MW of cheap power and properties that offer cryptocurrency turn key solutions.