How this stupid operation works
So, by now, you've probably seen my Crypto Mining With No Investment post here on Minds. It's not very well fleshed out, and that's because I didn't really understand it too well at the time, either! Now that I've had about 5 days at this, I've figured out more of how this whole shindig works, and I've fleshed out my strategy a wee bit more.
Let's start off with the faucet, because that's the one that really is the most sketchy-looking. Here's a shitty MS-Paint diagram of the flow of funds.
The sites that I'm using (Moonbitcoin(Threat Assessment), Moondogecoin(Threat Assessment), Moonlitecoin(Threat Assessment), and Moondashcoin(Threat Assessment) - affiliate links) all look incredibly sketchy when you first look at them. I mean, seriously sketchy. The good news, at least, is that the advertiser that these sites use is not running any malvertising. I checked for background processes, js mining applets, all that fun stuff. Thankfully, none of that crap is in here.
The one thing I dislike about the sites is that they regularly open new tabs and direct you to a new page instead of doing what you want to do on the main site. If this is the worst I deal with, I'm quite fine with that. Sites like these normally run malware out the wazoo.
Anyways, I digress. The ad revenue that these faucets receive is paid in miniscule amounts to me when I claim my cryptocurrency on their sites. It's their little business model, and since I don't have to leave the page open to let it accrue, I'm not nearly as worried about being taken for a ride. I can claim every 5 minutes, though I usually prefer waiting half an hour or more. The reason why? The bonuses.
I have to give them credit, these guys are slick. They have the right stuff to just REEEALLY get you to want to come back and check in regularly. The big one is obviously the loyalty bonus. That's the most consistent bonus. Every day at midnight UTC, the bonus goes up. I don't know where they cap, but even a 5% increase will add up in the long run. The mystery bonuses are a crapshoot, but every now and again you get a 100% increase and you feel really good about your luck for about 30 seconds before realizing you only got an extra 0.0005 cents. Also, thanks to whoever actually used my referral link on the bitcoin faucet, you rock!
So, these drips from the faucets are going into my CoinPot account. (not an affiliate link) In there, I can convert between all four without any charges or penalties. This is a serious red flag to me, because Coinbase doesn't do straight conversions. You have to sell your bitcoin and then buy the litecoin with the equivalent currency. The only thing I can surmise is that CoinPot has all of their user's Crypto stored in a couple of giant vaults, and then divides out as users withdraw. I suppose it makes sense, but would leave them wide open to a database attack. I don't get it, but I'm not spending any money, so as long as I don't fall victim to identity theft or get hit with ransomware, I don't care.
The big thing that I've noticed with the faucets is that it's definitely worth collecting from all four. If you can convert for free within CoinPot, why not quadruple your hourly collections? This mindset definitely helped me in the long run. I'm currently at a point where I can throw everything I have into one cryptocurrency and withdraw from CoinPot if I wanted to. I'm currently waiting, as I want to put a bit more of a substantial effort into the farming operations. That brings me to the second part, which is also accompanied by a shitty MS Paint diagram!
The Farming Services I'm Using (5Star, E&E, and EoBot - All affiliate links) are the second phase. In talking with a friend of mine, I now understand how this whole thing works. Each of these Farming Services are working with a pool of computers (or server farm) to handle the hashing of cryptocurrency. The people who spend $8000 on a mining rig and make $500-$660 a year? These people are the ones that fill out the mining pool. My friend used to be one of these people, running four GTX1080TI's in tandem. The Farming Services will take orders from people like myself to have the mining pools work on my behalf. The miner gets paid for their work, the Farming Service takes their cut, and I get the rest. Which, at this point, is a bunch of f***ing scraps. That's the price you pay when you want to mine without spending money.
Obviously, this mining effort costs money. I dug a little deeper into the goings on of E&E, 5Star, and EoBot. Of the three, only EoBot has any semblance of legitimacy. They actually have a page describing the server upkeep and runtime costs. Their costs are already factored into their payouts when you mine with them. They also let you join their mining pool, should you so desire. Down the line, I may try dipping from both ends, though that will come at a later time. for 5Star and E&E, neither one publicly announce their pricing/maintenance costs. However, they are letting me mine for free and I'm okay with that. Currently, I'm letting both passively mine and giving the funds gained back to the Farming Service. The reason why I'm doing this? I'm buying additional hash power. In the case of 5Star, I reinvested 0.0001 BTC (~$1.75 at the time of the transaction) yesterday morning to buy an additional 19.9GHs of hashpower. The farming service pockets all of that for the time being, with the promise of additional hashing power down the road. I also found out that 5Star's 200GHs lasts for 14 days (good thing I'm automatically reinvesting) and E&E's 100GHs lasts for 30. I'm letting both of them keep the money they mine for the time being, so I can build out my hashing power.
Like I said earlier, this whole thing looks like it should be a scam. I'm probably not going to see much of any returns out of this, but it's the fun of watching things happen that keeps me interested.
As for mining strategy? I'm going to take my earnings from CoinPot and add it to hashing power with EoBot. They're the ones that are most likely to give me an actual return on investment. I'm still keeping my E&E and 5Star accounts active, mainly because of what happened to NiceHash this past week. I figure spreading out my potential earnings will help me in the event one of them gets compromised. I'm still only a week in, but I feel like I have a better understanding of the overall process compared to when I first wrote about this. If you do decide you want to try this out too, have at it! Take my method and run with with it. If you use the referral links, awesome. If not, no big deal. At least you read what I put down. That's better than the people that ignored it.