Genesis Mining Yield Data

I’ve been comparing the mining yields of different crypto currencies over the past few weeks, and I’d like to report on the yield of Genesis Mining. Genesis is a “cloud miner”, which I think means reselling and sharing their mining profits with investors (clients). I have a limited amount of data from my short experience with Genesis, but here are the results so far.

I purchased a two year contract of the X11 Algorithm hashpower of 20 MH/s on September 20th, 2016 for $160 USD.  The price of BTC was 599.47 USD/BTC on the day I purchased my mining share in USD. I was able to pay with a USD Visa and my share started accruing coins the next day, which showed up on a transaction report within the Genesis Mining user interface transaction report. The coins mined were held by Genesis and not released until Oct 22nd (30 days) because they wanted to confirm my credit card payment was received. I assume they have had to deal with fraud since the credit card payment could be reversed while the bitcoin payment could not.

So I started earning bitcoins right away, and I told Genesis to send my bitcoins to my bitcoin wallet address. On Oct 22nd I received the accrued coins from the past 30 days, and then started receiving bitcoin payments each day.

Here is a record of the payments I’ve received to date:

The lowest amount I’ve received is 0.00020154 and the highest is 0.00037486. The mean amount received is 0.00027198.

I think there are two ways I could consider the yield of this investment. Either based on USD or BTC. Buying Genesis mining shares are kind of like buying a forward swap, where you give up USD today for a series of BTC cash flows in the future. To find a yield, we could apply a NPV to the future cash flows using a discount rate. But I’m just going to do a simple yield calculation to get an idea of how this investment is performing.

From October 23rd to Nov 27th, I received a total of 0.00870324 BTC for 9.64% of a year. I invested 0.26690243 BTC equivalent for a two year term which makes the yield -32.40%.  A summary is found below. The only thing that would make this a better investment is if the price of USD/BTC rose dramatically. As you can see the yield based on USD is better than the yield based on BTC because the value of the BTC cash flows has increased since I made the initial investment. I used a rate of 730 USD/BTC to calculate the value of the USD cashflows from BTC.