How to Evaluate Cryptocurrency Mining Rental Services
It’s hard to ignore the overwhelming talk of cryptocurrency and bitcoin mining. However, with eminent supply chain issues, chip shortages, and shipping delays, ASIC and bitcoin mining companies are taking a hit. These hurdles are turning crypto miners to look into mining rental services, like Prudent.io.
Mining rental services, also called cloud mining, are a way users can “rent” mining equipment and computing power from a large-scale operation. This can be a good alternative for crypto enthusiasts who can’t get their hands on a miner, or crypto beginners who are looking for passive income but don’t necessarily have the knowledge or time to run their own machines.
There are some factors you should consider when evaluating a mining rental or cloud mining service. These include:
- Security & Maintenance of Machines
- Start-Up/Rental Fees
- Electric Rate
- Length of Contracts
- Pay Out Method & Frequency
- Company History & Legitimacy
Many mining rental companies, like Prudent, host their machines at a location where they are monitored and maintained by staff 24/7. Big-scale mining farms like this typically also get a lower electric rate than your normal residential electric rate. A lower electric rate means that it costs less to run, and the user can typically get a quicker return on their investment since their electric costs are decreased.
Mining rental services are also attractive to some customers because there’s no start-up wait time or delays in getting set up. Typically companies who rent their equipment already have it set up and ready to go. With Prudent, for instance, you just choose your equipment, sign the contract, and you can start mining.
You will also want to evaluate how frequently you’re paid out by the company. Prudent, for instance, pays out their customers daily, so you always have a form of passive income coming in. Make sure to evaluate the frequency and method of payouts with any mining rental service you choose to work with.
Evaluating Prudent.io
Prudent has a one-time start-up rental fee and an 8% transaction fee on all of their transactions. Looking at their website, at the time of writing this article, they have 33 Goldshell HS5 units available for rent. The start-up fee to rent the equipment is $12,000 per Goldshell HS5, and the minimum rental period is 720 days (about two years).
Per their website, the HS5 currently mines ~850 Siacoin (SC) per day. So over the course of 720 days, you’d get paid out about 612,000 Siacoin. At the time of writing this article, Siacoin is $0.01, which means your payout would be $8.50 per day. Prices will always fluctuate in the crypto market, but for the purposes of this evaluation, let’s say Siacoin stayed at $0.01 for the entirety of your 720 rental period. That would mean you would make about $6,120 over the course of two years. Not bad! However, keep in mind, after paying your $12,000 rental fee for the machine, you are still down $5,880.
Personally, I’m not sure this is a good investment. However, others may disagree. Some could justify the cost of maintenance, knowledge, and running the equipment for two years. Some could view this as an opportunity to HODL and hope the coin goes up. However, if that’s the case, why not just invest your original $12k into SiaCoin directly?
These are all factors to consider when you are evaluating a mining rental service company. You will also want to verify the mining rental service is legitimate before you make an investment. We have never worked with Prudent, nor are they endorsed by VoskCoin. We did ask for proof that their mining operation was real, and they were able to provide us with pictures of the operation as well as an invoice from Goldshell for hundreds of machines.
Let us know your thoughts in the comments below! Are mining rental services worth it? Have you worked with or evaluated any before? Did you ROI?
Thank you to Prudent for sponsoring this article. We have never used Prudent’s services before, nor is this an endorsement. Please do your own research before you decide to do so. This is NOT financial advice. Subscribe to the VoskCoin YouTube Channel to stay up to date on the latest cryptocurrency and mining news and reviews.
