Hashflare Payouts Disrupted

In the recent time, a significant number of new cloud mining companies have entered the scene. Today, let’s investigate a popular cloud mining service hashflare.io. This service is a creation of a group called HashCoins which claims to based in Estonia.

 

Their offer seems superior to many in comparison with other competitive cloud mining companies. They have got lower prices for most product options, and their Scrypt mining is open-ended.

 

Nevertheless, not everything is as simple as it seems at first glance. Before we answer the key question, we should know a little bit about the company itself and its history.

 

There is not much information available about the company. This service is owned by a company called HashCoins. The location of their servers farms is unknown. There is not any sort of information about the hardware they use and other important technical details.

 

Hashflare Payouts in Detail

 

I decided to invest a small sum of around hundred dollars of Bitcoin just in testing hashflare payouts. It is important to note that Hashflare only accepts Bitcoin.

 

I registered for a 5 Megahash per second on Genesis Mining  to see if I could finally claim to have hashflare payouts disrupted.

 

I was tracking the payments every day in order to find out what their month/megahash payout is. Here are my results at the very beginning:

 

The amount I paid was $13.50 for Megahash per second, a contract with a daily fee for maintenance on an open-ended basis

 

The 1st day: 2.29 USD Megahash per second a month

The 2nd day: 2.41 USD Megahash per second a month

The 3rd day: 1.68 USD Megahash per second a month (the hashpower was raised to 8 Megahash per second)

The 4th day: 1.73 USD Megahash per second a month

The 5th day: 1.64 USD Megahash per second a month

The 6th day: 1.58 USD Megahash per second a month

The 7th day: 1.27 USD Megahash per second a month

 

I thought it was very suspicious when the day I increased the hash power, the profits decreased significantly and never returned to the previous number. This steady decrease has been occurring ever since then, with every new day bringing less and less, and no hints of recovery in hashflare payouts. With that rate, it requires a year in order to get my money back.

 

To be more precise, I calculated my potential return on investment like this:

 

13.50 USD x 8 = 108 USD

 

$1.28 for Megahash per second profit * 8 Megahash per second = $10.24 a month income (if we assume the BTC price doesn’t change)

 

10.24 USD * 12 months = 122.88 USD

 

Total profit = 122.88 USD  – 108 USD (the amount I invested) =  USD 14.88 in potential profit

 

In two years, if we assume no changes payouts = (122.88 USD * 2) – 108 USD = 137.76 USD in potential profit

 

Nevertheless, this calculation would be correct in case I would keep receiving hashflare payouts at the rate of the 7th day for the rest of the year. My final payment was even lower. If it continues decreasing, I may never occupy my investment.

 

The only possible way I could achieve my ROI was in case the price of Bitcoin increased enough to compensate the shortfall. That may happen, however, it would be smarter to simply buy Bitcoin right away. I also have to add that though they are based on Scrypt, the profits are paid out only in Bitcoin.

 

On the last day of my experiment, the 7th day, Bitcoin cost $2550, and I got a total payment (subtracting fees) of 0.00013 BTC. The final payout was for just 0.0001 BTC, a 24% decrease.

 

Hashflare Fees

 

Many people accuse Hashflare of having the highest commissions among all the competitors.

 

On the 7th day, I had to pay a commission of  0.00003124 for maintenance, or a 23% commission. To compare, HashNest charges a 5% commission.

 

Although it seems at first glance that HashFlare has lower fees than Genesis contracts on an open-ended basis, you should take into account the rest of the fees they charge.

 

Hashflare has a terribly high withdrawal fee of 0.0006 BTC, which for me constituted  my mining profits for an entire week.

 

This makes its users leave their profits on the site for longer periods to avoid suffering from this unbelievably high withdrawal fee.

 

With my insignificant hash power, I might be able to make a withdrawal once a year. Otherwise, I may lose a large portion of my money. Hashflare doesn’t permit receiving payments in a cryptocurrency with smaller transaction fees like Litecoin or Dogecoin, which could easily fix this issue.

 

If you take their Bitcoin fee and compare it to that of localbitcoin.com, which has recently been 0.0001 BTC, you will see that hashflare has some of the highest fees in the industry. The only way to tackle this problem is to avoid signing up for any contract that is paid in Bitcoin, which involves Scrypt.

 

The Conclusion On Hashflare Payouts

In general, I am not so sure if I can declare hashflare payouts disrupted.

There are certain things they excel at in comparison with Genesis. I am not sure if I should recommend the service to my friends or do the opposite.

 

The key thing is you need to investigate the costs and fees before you decide to sign up for any service of this kind.

 

I also suggest that if you do decide to sign up, you run a small test of $100 or less and then calculate how long it would take to get your investment back.

 

The Pros

  • Simple Interface
  • Daily hashflare payouts

The Cons

  • Extremely high withdrawal fees
  • Inconsistent hashflare payouts
  • Slow website
  • Little info about the company is available
  • Once again, an incredibly large withdrawal fee – it is so high that it is worth mentioning here once again!