The rapid recovery of Bitcoin (BTC) above $ 46,000 has many traders clamoring for a price of $ 100,000 by the end of 2021, while the effects of China’s repressive measures on the mining industry are slowly beginning to wear off already. that the hash rate of the Bitcoin network shows signs of recovery.
One of the co-benefits of China’s measures is that it has lowered entry barriers to the Bitcoin mining space, which has proven profitable in both bull and bear markets.
Bitcoin mining is one of the few ways that investors can acquire BTC without buying it directly from the market and it is fast becoming an industry dominated by large economic interests that can afford to pay high energy costs and necessary maintenance. to operate a cryptocurrency mining “farm.”
Here are some options available for the average cryptocurrency stacker to acquire more BTC through cloud mining contracts, cryptocurrency lending platforms, and centralized exchanges.
Cloud mining contracts
The cloud mining industry has been around since the early days of Bitcoin, offering users interested in mining Bitcoin who lack the necessary space, equipment, and electricity an opportunity to delegate their production.
Some of the most popular companies offering cloud mining services are Genesis Mining Y HashNest, But the demand for their services has exceeded their capabilities, causing all of their Bitcoin mining contracts to be exhausted.
One of the current mining operators with available contracts is Shamining, a UK-based company that has been active since 2018 and claims to have data centers around the world with locations in California, Mexico, Cape Town, South Africa and England.
Through this service, users can rent mining equipment and pay the costs associated with the use of the units, while the company takes care of the physical accommodation, operation and maintenance. Once up and running, the revenue generated can be withdrawn to a user-specified Bitcoin wallet.
Current leases include two options for GPU miners, costing about $ 283 for 23,580 gigahashes per second (GH / s) or $ 1,066 for 94,340 GH / s, and another option for ASIC miners with a current cost of $ 2,571. for 235.849 GH / s of mining power.
All contracts indicate that they have a profitability that part of the 143%.
Another option that allows users greater flexibility regarding the parameters of their mining contract is ECOS, a company that emerged from the Free Economic Zone located in Hrazdan, Armenia, and operating since 2017.
As seen in the graphic above, A 50-month contract for 9 terahashes per second currently costs $ 1,668 and is predicted to result in a 272.82% profit at a BTC price of $ 70,000.
It is important to note that all cloud mining services offer warnings about the high risks involved and that no level of profit can be guaranteed due to various circumstances such as fluctuating electricity prices, volatility of the Bitcoin price and advances in mining technology leading to a substantial increase in the difficulty of mining, which makes older equipment obsolete.
Cryptocurrency loan services
A more traditional option available for hodlers to get more Bitcoin using their current holdings that does not require any additional investment such as mining is through loan services that offer a return on deposits.
Nexus Y Celsius are two of the best-known lending platforms that allow cryptocurrency users to borrow funds against their holdings or earn rewards for deposits.
At the time of writing, Celsius offers users an annual percentage return of 6.2% for Bitcoin deposits, and Nexo offers a standard return of 5% on flexible term deposits, while time deposits that go a minimum of one month can earn. 6%.
A third option offered to users a profitability of 4% about BTC deposits is BlockFi, a crypto asset service provider offering crypto-backed savings and loan accounts and also recently launched a Bitcoin rewards credit card.
Earning BTC from centralized exchanges
Several centralized exchanges (CEX) also offer Bitcoin holders a return on their deposits, albeit at lower rates than those mentioned above.
Binance, the largest CEX by volume in the crypto ecosystem, offers users an estimated annual percentage return of 0.5%, while the third largest exchange in the market, Huobi, offers 1.32%.
The best performance offered by a US-based CEX can be found at Gemini, where users can earn 1.65% on their deposits.
KuCoin offers a freer market approach to BTC loans in which lenders can set the parameters of the loan terms, choosing from contract lengths of seven days, 14 days and 28 days, while managing to set their own daily interest rates to compete with other lenders in the market.
The lowest rate currently offered on KuCoin is an annualized rate of the 1.82% in a seven-day contract.
As seen from the data provided, there are many ways to get more Bitcoin instead of just buying on the open market, but they are becoming more and more rare as time goes on.
With large institutions, energy companies and governments beginning to develop Bitcoin mining infrastructures, smaller market participants are increasingly left out, as cloud mining facilities are unable to keep up with demand.
Bitcoin lending is increasingly emerging as the main way that BTC holders will be able to earn a paid return in BTC in the future, while Bitcoin-backed loans offer a way for users to access the value of their tokens. without the need to sell and create a taxable event.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Each investment and commercial movement involves risks, you must do your own research when making a decision.