DeFi Mining Explained. How Does BTCMT Staking Work?

The term DeFi mining may seem complicated to people unfamiliar with the world of decentralized finance (DeFi). The use of decentralized finance achievements makes the regular process of mining more convenient, less risky and even more profitable. We want to share for you to understand the details.

Smart contracts are the brain

While the token is the heart of a blockchain project, smart contracts are the brain. They are software inside blockchain making sure that the terms of the contract are secured by its source code. The BTCMT token by Minto uses several smart contracts to keep its operation as decentralized and efficient as possible. What are they used for?

1. Defining your assets. Smart contracts are shaping the asset. The set of rules inside them specifies what you get and what you can do with them. For instance, stablecoins like USDT use them to peg themselves to other assets. BTCMT uses the same mechanism to tokenize hashrate. By owning 100 BTCMT, you own 1 TH/s of actively running Bitcoin hashrate.
2. Defining how you purchase. The creation of DeFi assets is defined by smart contracts as well. The process of creating new tokens in a blockchain is called “minting”. BTCMT can be purchased from MDEX or directly on our website. In the second scenario, tokens are minted. The price of the token and the minting process are defined by a purchasing token smart contract.
3. Defining the staking process. There are dozens of implementations of what staking may look like. Smart contracts handle all the technical side of it. BTCMT is not an exception, so smart contracts manage the staking rewards and the other sides of this process.

The main benefit of smart contracts is excluding a mediator for operations. By automatic execution in a blockchain, contracts become cheaper, faster and safer compared to the other tools. A good tone for any project is to have their smart contracts audited. It’s important for the safety of your assets. For instance, smart contracts of Minto are audited as safe by a respected cybersecurity team called Hacken.

The main benefit of smart contracts is excluding a mediator for operations. By automatic execution in a blockchain, contracts become cheaper, faster and safer compared to the other tools. A good tone for any project is to have their smart contracts audited. It’s important for the safety of your assets. For instance, smart contracts of Minto are audited as safe by a respected cybersecurity team called Hacken.

How DeFi mining works

The basics are done, so let’s find out what DeFi mining is. Minto and its BTCMT token is a perfect illustration. By purchasing BTCMT, you purchase a part of an eco-friendly data center that runs BTC mining hardware.

So, how does it look technically:

1. Bitcoin mining hardware is mining bitcoin in our data center. The hashrate and its rewards are displayed in the hashrate watcher of the F2Pool mining pool (network of equipment to share rewards). It’s a special monitoring tool from their team for you to monitor your assets. On the page, there is a chart with the total hashrate updated every 30 minutes and income/payout history below.
2. Rewards are transferred to the Huobi Global exchange. We hold the electricity fee from the reward according to the price written in the whitepaper and the BTC to USD exchange rate at the moment.
3. The profit from tokenized hashrate is sent from Huobi Global to our smart contract using tools provided by Huobi Global. We do it in HBTC which is a BTC in HECO blockchain. Its price is pegged to a regular Bitcoin in a ratio of 1:1. It allows you to perform transactions for less than $0.005 and 3 seconds.
4. The smart contract distributes the whole data center profit only between those who staked depending on how much BTCMT they have. It happens in the specified time and from this moment no third parties can get access to these assets. It’s set by the rules of this smart contract. So you can
5. Clicking a “Claim” button in the dApp transacts a reward to the token holder. dApp is an interface to interact with the blockchain product, including smart contracts.

And how does it look for you:

1. You purchase BTCMT tokens from the MDEX exchange or our website.
2. You stake them.
3. You get daily rewards in HBTC.
4. You claim rewards and trade BTCMT tokens whenever you want.

We designed it to be as simple for you as possible. So you can focus on the income you get, not on the difficulties you may face with any other blockchain tools to make income.

The beauty of DeFi mining

Now you know what it looks like from different perspectives. Recent blockchain tools solve the problems that you’ve been left on your own previously. And the previous generations of mining were never easy. The need to find equipment, location with optimal climate and electricity price. Figuring out the shipping, keeping uptime close to 100% and maintaining the equipment for its maximum performance. And renting a hashrate from cloud mining instances gives you no control over any processes or assets.

DeFi mining solves most of them. You see what’s actually happening with your equipment, can scale your hashrate and call it quits whenever you want. Don’t forget cryptocurrency assets are high-risk. Not only do you get more control, but also delegate risks. Having a token that you can sell in several minutes gives you more options compared to a “contract” or piece of gear vulnerable to any market instability.

Moreover, scalability and other features of DeFi projects can provide you with additional benefits. For instance, the tokenomics of Minto claim that mining rewards from full emission are shared only between those who stake. Projects tokenize more hashrate to fulfill the demand, so not all tokens are staked and you receive several times more than with regular mining.

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