Mining tokens are digital assets backed by mining power that guarantee their owner daily mining income. The mining tokens segment is quite narrow, since such projects require not only expert knowledge in the field of blockchain technology and a high-class IT team, but also a highly developed infrastructure capable of ensuring a high level of mining profitability. Desire and marketing alone are not enough to create such an infrastructure. It requires a combination of capabilities, including administrative and financial ones, and the ability to implement long-term strategies. It is much easier to create a token that is not secured by anything and invest as much as possible in its marketing, rather than deal with time-consuming logistics issues and maintenance of expensive equipment.
However, while the market favored crypto startups, several projects appeared offering mining tokens to generate mining income with no physical equipment purchase required. We provide a list of such tokens and discuss their viability below.
1. BTCST (BTC Standard Hashrate Token)
The BTCST token (Bitcoin Standard Hashrate Token), which was listed on the Binance exchange on January 7, 2021 is one of the best-known projects . The project’s initial data was very convincing, so it is not surprising that the token soared 60-fold, fell 20-fold and soared again. Listing on the Binance exchange and working in the Binance pool spoke for themselves: the project was seen as affiliated with Binance, which made it seem absolutely safe, because Binance is the largest and most respected exchange in the world.
Here's what you can read about the project by following the link from the Binance exchange:
What is Bitcoin Standard Hashrate Token (BTCST)?
Bitcoin Standard Hashrate Token (BTCST) brings liquidity to Bitcoin mining. Each BTCST is collateralized by 0.1 TH/s of real Bitcoin mining power. By staking BTCST, holders will receive daily Bitcoin distributions that correspond to the mining power staked.
BTCST creates an efficient market among Bitcoin miners. By trading BTCST, market participants can freely enter and exit Bitcoin mining exposure in any size, at any time, and with low costs. Miners without mining power tokenized by BTCST can also make use of the token to hedge against the risks of mining machine cost price fluctuations.
The project team and the partnering mining pool, Binance Pool, will form a governance board that collectively decides on material issues of the project, which include new token issuances, cost level adjustments, surplus profit distribution, and future development. The governance board will have three seats upon launch, two of which to be occupied by the project team and one by the partnering mining pool.
However, despite the apparent reliability, 1.5 years later the project stopped making payouts. It is difficult to say how Governance, declared in the White Paper as a decision-making center, influenced this decision, since the project team disappeared from the public space and has not manifested itself in any way since. The token itself continues to be traded on Binance, but has turned into an ordinary speculative asset, whose viability is supported exclusively by its holders and small speculators, as is often the case with the securities of bankrupt companies.
Here is a warning given by the Binance exchange if you want to look at BTCST quotes, offering to agree that it is extremely risky to trade this asset:
So, the reward payments have been completely stopped, and the project team has disappeared and does not comment on the situation in any way. It should be noted that project profitability, even at the best of times, was quite small (about 10-20%), and unpredictable token price jumps further aggravated the long-term perspective. Today, there is no question of the project’s viability: even if its team ever resurfaces, it has already lost any and all trust.
The BTCST token could not survive the market downturn, mining became unprofitable, or the team did not want to make an effort to maintain the project, appropriating all the income.
The Mars Poolin project also offered mining income through the purchase of its tokens, both in BTC and ETH. In the project description we find all the same beautiful words with slight grammatical errors:
Mars is the first Ethereum-based, decentralized standardized hashrate protocol. Mars Project combines standardized hashrate product and liquidity mining together, packing PoW mining into an on-chain protocol. It provides a consistent PoW mining output which could be acutely calculated in the very beginning, offering an edge for users on mining stability. No more complicated variables on daily mining from now on. On the other hand, MARS would be distributed to users in this project. Earning reward from staking and liquidity providing (LP), shorten the distance of DeFi to Bitcoin community.
What is Mars Project?
The protocol consists of pBTC35A and MARS. Each pBTC35A represents 1TH/s hashrate with pre-determined power ratio, mining rigs would be in Poolin Superhashrate’s custody during life cycle. While net profit on wBTC would be distributed per block.
In the first batch, Poolin Superhashrate would provide 50,000 pBTC35A (approximately 50PH/s) hashrate certificates for Bitcoin (output with wBTC) mining in this protocol and lock up more than 50PH/s machines physically.
Two ways to obtain pBTC35A, inhouse store or Uniswap (token address: 0xA8b12Cc90AbF65191532a12bb5394A714A46d358). ETH and other PoW mining hashrate certificates coming soon but no firm schedule yet.
Alongside the pBTC35A, Mars Project will unlock its governance token, MARS (2.1bn MARS in total, linear released from Jan 1st, 2021 to 31st, Dec 2024), distribute to the community as a reward for staking and liquidity providing.
The project product line is very ambitious, and the profitability figures indicated on the website to this day, can impress any potential client:
However, it is worth paying attention to the message in Chinese:
Its meaning boils down to the fact that hard times have come for the pBTC35A token, and mining is teetering on the verge of profitability, so if this continues, the team will take some actions in order not to allow a loss.
But maybe an Ether mining token would be more successful? Maybe the Merge and the Ethereum fork will breathe new strength into the project? Alas, the reality is that without going into deep analytics, the result is predictable:
Payments have been stopped, and it no longer matters which of the products the user intends to choose. Whatever the team's intentions, it failed to prevent the project’s collapse and maintain at least minimal confidence.
3. GMT Token
The project declares a low profitability: 0.00000147 BTC was paid on September 08, 2022 at 1000 GMT (1.86 TH/s), which is equivalent to $0.0158 per 1 TH/s.
The current value of 1 TH/s = 537,92 GMT = $58.
In total, the current annual profitability is less than 10% with the condition that payments will not decrease (which is impossible), the actual profitability is no more than 5% per annum.
However, despite the beautiful wrapper, the following questions arise after careful consideration:
- Where are the project's data centers located and why did online broadcasts disappear from the site? There is only one remaining:
- Hence the next question - is this the project's data center that collects investors' money?! It's scary to ask which network it uses to power up and how long-term this solution is. One day, the local administration will decide to build a kindergarten in this courtyard, and what will then happen to these miner-filled containers sheltered in a quiet city quarter, and the GMT tokens generated by their “incessant” work?
- The third question is no less important, and the absence of an answer is discouraging. From which wallet are mining rewards distributed? Without this information, it is impossible to understand whether payments are actually being made. Just one link is enough to see these transactions in the blockchain, however, it seems to be kept a secret.
- Where have the deductions to the insurance fund and to the project management disappeared? Let's say everything is so bad that management agrees to work for free. But the insurance deductions are declared in the WhitePaper, therefore either the fund has already been exhausted, or the WhitePaper is not a key document for the management that remains on a dry ration, which means that further liberties are possible.
The presence of the token on several CEX and DEX leaves a chance for the holder to receive some compensation, but the promised mining payments are not confirmed by anything either in the present, or even more so in the future. In other words, some payments do not mean that the project actually receives income from mining and honestly distributes it among GMT token holders, since it is impossible to track related transactions by any means.
Thus, from all the available information, it is worth highlighting the highest risks of equipment vulnerability and its shutdown due to administrative, regulatory, political, climatic and any other reasons, and the lack of payment transparency casts doubt on their mining (but not marketing) viability, which is the first sign of a financial pyramid.
Conclusion: you can work with the GMT token only at your own risk
4. TMT (The Mining Token)
In addition to more or less well-known tokens, you can find dwarf projects on the market trying to repeat the success of their bigger brothers. As an example, consider the so-called The Mining Token, which offers the following miraculous conditions:
Leaving aside the probable Ethereum fork on PoS and PoW, we only note that the project's website is a one-pager, and that there are just over 600 people in the project’s Telegram chat. A microscopic amount of TMT tokens is staked. The token is absent from CoinGecko and CoinMarketCap (although its namesakes are listed there), it is not traded on any exchanges, including DEX. The project’s profitability is not confirmed by anything and no one, its provision also remains behind the scenes. There is no evidence that this project really has anything other than a one-page website.
Conclusion: There is nothing even to be binned
5. Zetta ETH и BTC (ZETH, ZBTC)
You can also find this project on the market. It doesn't make sense to spend a long time discussing it: the project is dead, as CoinGecko eloquently warns.
And finally, a few words about Minto that keeps working, working and working.
Minto pays every day
Minto is an absolutely transparent project where everyone can not only earn money on Bitcoin mining, but also get full information about accrual history and blockchain operation, watch a live broadcast from its data center, check the project hashrate on the pool's website, and verify the quality of audited smart contracts.
In the current conditions, Minto offers a 18.78%, APR a 20.65% APY, and also continues to connect additional hashrate to the project, ensuring an increase in the profitability for all token holders. The current token issue is 5,500,000 BTCMT, which corresponds to 55 PH/s (55,000 TH/s). The Minto team has enough opportunities to gradually bring the project hashrate up to 3 EH/s (3 million TH/s) and even higher, taking into account the community opinion about further development by voting.
For more information:
The project's website https://minto.finance/ also contains information about Minto smart contracts audit, a presentation, payment history, the latest news, and about joining the Minto community.
Conclusion: Join Minto and get ready for market growth with us!