FAQ: All you need to know about HAG — Updated in Apr 2024

10 min readApr 25, 2024

Basic Information

1: What is Hashrate Asset Group(HAG)?

Hashrate Asset Group token is the world’s first Security Token that provides investors with perpetual Bitcoin hash power. Hashrate Asset Group Token is also the only Security Token that pays dividends in WBTC on a monthly basis. It has evolved into a true interest-earning asset of innovation in both traditional finance and the crypto industry. The management team consists of senior executives from Goldman Sachs, SoftBank, Bitmain, TSMC, and other institutions. The mining operation started in February 2024 with Antminer S21 mining servers.

2: What is Security Token Offering(STO)?

STO refers to a type of public offering in security tokens, which is issued under the premise of legal compliance supervision. To comply with numerous securities legislation requirements, security tokens must be registered with or filled out through the Securities and Exchange Commission (SEC). Security tokens are only permitted to be traded on licensed exchanges because of the compliance barrier. STO assists the blockchain industry establishing trust from investors, and explores potential supervision methods by integrating digital currency and traditional finance in specific ways to standardize the development of the industry. The issue of HAG is a security token offering, which is fully compliant and regulated by SEC.

3. Background of HAG Team?

The HAG team is composed of industry-leading professionals from Bitmain, Goldman Sachs, and TSMC.

4: Comparison to other products on the market?

The issuance and trading of HAG are entirely governed by SEC as a legal and compliant security token, which means that the risk of investing in HAG is significantly lower than that of other cryptocurrencies. Moreover, HAG provides perpetual computing power for investors, which is also an advantage that other products do not provide. The management team tackle the logistics including but not limited to mining servers negotiation, freights, maintenance, and many more daily routines. Thanks to the management team’s profound experience in the Bitcoin mining industry, we provide the investors with an easy gateway to the mining industry and with the outstanding mining servers among industry players. Furthermore, if you compare HAG with other bitcoin mining companies, HAG has more advantages on bitcoin mining core value in terms of less administrative, marketing, and financing cost. That’s why if you want to hold bitcoin on the cost price, HAG is your best choice.

Bitcoin & Bitcoin mining

1: What are the advantages of Bitcoin as an asset?

Bitcoin is by far the most open financial system. It is decentralized and programmable, and the encryption technology ensures the security and privacy of the network. Bitcoin is deflationary, which means that it generally appreciates over the long term: in the past 12 years, Bitcoin has been the asset with the highest rate of return for 10 years. In addition, the total supply of Bitcoin is fixed at 21 million, significantly different from the fiat currency system nowadays.

2: What is Bitcoin mining?

Bitcoin mining involves solving complex cryptographic puzzles to validate transactions and add them to the blockchain. Miners, or network participants, utilize specialized hardware to compete in solving these puzzles. The first to succeed not only validates the block of transactions but is also rewarded with newly minted Bitcoins. This incentive-driven process ensures the continuous

growth and security of the Bitcoin network. Successfully operating the Miners results in awarding the Miner with Bitcoin. In addition, Bitcoin miners would verify the transactions on-chain and earn the gas fees those transaction applicants sent out.

3: How profitable is bitcoin mining in comparison to purchasing Bitcoin directly or stocks of mining companies?

As shown from the two charts, bitcoin mining revenues > bitcoin purchase revenues > stock purchase revenues of mining companies based on the historical data. Therefore, participating in Bitcoin mining is superior way to capture the growth of Bitcoin and the fruits of Bitcoin mining.

4: I saw an article that said the cost of mining one Bitcoin is about $80,000 after halving, but how much is it actually?

It really depends on the series of mining servers, electricity cost, administration cost, and other direct costs, etc. You may refer to the article that we shared before. 80k would be a very old type machine and relatively high in other costs. Our S21 mining servers’ direct cost is around 20k before halving and might be 40k after halving.

Bitcoin Dividends

1: What are the corresponding assets when purchasing HAG?

Purchasing HAG is equivalent to having the corresponding perpetual computing power, continuously to mine Bitcoin, and earning a monthly BTC revenue split from mining. One HAG corresponds to the perceptual computing power of 1 Terahash per second.

2: How is the revenue from mining distributed?

Excluding operating costs such as but not limited to electricity, Hashrate Asset Group will distribute 70% of the net value of bitcoin mined to HAG holders in the form of WBTC each month. The remaining 30% will be used for the maintenance and renewal of mining machinery and equipment to maintain the computing power level.

3: Why is the revenue distributed in the form of WBTC?

HAG is a token issued on the Ethereum network and meets the ERC1404 standard. WBTC as revenue can be directly assigned to the HAG holder’s Ethereum wallet address. In addition, there are many efficient ways to swap the WBTC to BTC if the holder wish to, including both Centralized exchange and Decentralized exchange.

4: How to convert the subsequent purchase of new mining machines?

Hashrate Asset Group promises to purchase mining servers of outstanding performance, and guarantees that the mining efficiency is equal to 29.5 watts or better. For example, the series that we adopted in the first tranche is Antminer S21 with 3550 watts and 200 TH/s, better than the standard.

Potential Risk and Solutions

1: What are the risks of purchasing HAG? What if the BTC price falls?

Investing in HAG will bring consistent bitcoin revenue, and long-term holding is the best strategy. Of course, any investment involves some risks. With regard to risks, we advise investors to carefully read the risk warning section of our PPM. In extreme cases such as a sharp drop in bitcoin price, the Hashrate Asset Group team may make emergency decisions such as downtime to safeguard the interests of investors.

2: If the mining equipment becomes obsolete or the latest model becomes available, will the cost of replacing it be borne by the investor? How many years will the capital investment take?

In fact, the newer version does not necessarily mean the better chance to win the computation contest but could mean better efficiency in terms of electricity usage. According to our tokenomics, the remaining 30% of net yield is the resources to maintain/replace the hash power from mining equipment. We have provided the potential replenishment plan in our financial outlook. Usually, the service life for mining equipment could typically range from 3 years to 5 years. Therefore, this is the conservative outlook that does not necessarily mean the result. To be honest, there are many old versions still in use by other miners that are still profitable to them.

Future Plans

1: Are there any plans for HAG to be listed on more than one exchange in the future?

Our short-term plans are to first close several tranches on INX, set up the mining servers, and start our mining distribution. Your thought might be the potential long-term one.

2: If there is a possibility that HAG’s mining business will withdraw or end in the long term, what do you think will happen?

One possibility is that the price of Bitcoin will fall and if it continues to fall below the maintenance costs, the business will struggle.

Are there any other possibilities?

Also, will there be any guarantee for HAG token holders if HAG’s mining business ends?

Your question is great. We do consider what you mentioned, so we keep reserving 30% of net yield every month to maintain and reinvest new mining servers.

As the Bitcoin prince might potentially turn down in the mid term, the price to reinvest/acquire mining servers will also get down. These are changes of multiple factors, not single factors. That is, the price of mining servers will have a high chance to fall given the fall of BTC price. At this moment, we get a high chance to have our mining servers at a better position to keep mining with profits.

Of course there is no guarantee that the BTC price will not fall below the mining cost. However, the hash rate provider is the fundamental supplier to the stability of Bitcoin network. If we die, the Bitcoin network is endangered. This is the point of view that you could consider.

As for HAG aims to peg to 1 TH of hash power, there is fundamental value to each HAG token. That is, even if we sell the mining servers, there is still salvage value. We do mentioned that when there is Capital event happens what will we do on PPM. You could refer to the Capital event segment for details.

How to buy HAG?

1: How to purchase HAG?

Please watch the video tutorial: https://www.youtube.com/watch?v=9uTQNMd2T6I

2: If I invest $5000 in the first tranche, does every following investment need to be $5,000?

HAG just got permission from INX about your potential minor investments following your initial investment that passed the minimum requirement on investment. INX mentions “On the Invest page, the investor will not be able to enter a lesser amount. However if they send a lesser amount in FIAT to the bank, or in crypto to your wallet, this is not something that will be rejected.”

For example, if you have committed a $5,000 investment to HAG. You could invest an additional $2,000 to HAG. Such $2,000 should be directly sent to HAG’s official bank account or wallet address, same as the one you saw on the investment page on INX. In fact, this logic could be applied to HAG’s subsequent tranches. To be more specific, if you invest $5,000 in the first tranche, you could invest $2,000 in the second tranche using the method we mention above in this paragraph.

1st Tranche Questions

1: Can you give a summary of the 1st tranche of HAG STO?

HAG closed the first tranche of STO on November 30, 2023 and was confirmed to adopt Bitmain’s world-leading S21 as our underlying hash power source, which underscores our commitment to staying at the forefront of industry advancements.

Feb 1st, 2024 marked the official deployment of our S21 mining machines and the commencement of our Bitcoin mining operations!

On March 7th, HAG completed our first net yield WBTC distribution through INX, marking a significant step forward in our commitment to enhancing the value and benefits for our investors.

We update the monthly distribution report on our website: https://www.hagsto.com/ir

2st Tranche Questions

1: If I invest $5000 in the first tranche, does every following investment need to be $5,000?

2: Will the HAG tokens from this additional investment be distributed after the second STO ends?

Or, if I participated in the first STO, will I receive a dividend for April or May, for example?

The token will be allocated after a period of time when the second tranche is closed. It might not need 45 days( the duration we have in the first tranche) after we close the second tranche, but it will happen after we close the tranche. In fact, the benefits to join the second tranche instead of buying HAG from the market is to make sure you acquire HAG at the same price. Of course, it takes longer to get your HAG tokens. This is open to your decision.

3: I think it will take some time for the second tranche to close, so is there any difference between investing now during the second tranche period and investing after HAG announces that the tranche will close soon?

Currently, one HAG token costs $71, but will the price go up?

During the period which second tranche is open, there is no price difference to invest earlier or later.

You mentioned a good point. There might be a surge in crypto, so does HAG fundamentally. HAG aims to peg 1 TH hash power for every HAG token. In addition, the price of hash power is highly correlated to the BTC price. The surge of the crypto market will push the acquiring cost of hash power to raise. In this scenario, we might close the second tranche quickly(of course with certain periods of time before close), and start another tranche with a new price. The reason for this is to acquire sufficient hash power to fulfill our commitment. This also points out that HAG fundamentally is highly correlated to Bitcoin. The situation that HAG price low but Bitcoin price high is fundamentally not stable.

In addition, just want to remind you that to acquire HAG in the second tranche could make sure your acquisition price is the same at 71 not the market price. At the time I replied to you, the lowest ask price for HAG is 100 dollars.

In fact, we could deliver HAG token to second tranche investors given that the tokens are minted and reserved, so we do not wait for the tech team to complete the minting again. With more ppl knowing more about us, we could reach the scale of the economy to close this tranche.

Of course, we appreciate any kind of investment methods. Feel free to ask any questions if you think could help make your decision.

4: The deadline for ending the second tranche will be depending on either the amount of funds raised or an increase in the price of BTC? Or has the end date already been decided?

The date has not yet been decided! You are a great investor, and basically such two factors are the critical one for us to decide when to close. The more people participated in the early stage, the faster we could close the round.