While the Bitcoin price keeps hovering around the US$230 mark over the past few days, Bitcoin cloud mining services are once again facing a serious threat to their profitability plans. As we have seen a few weeks ago, several Bitcoin cloud mining services had to suspend their operations for the time being. By the looks of it, ZenMiner has suspended their cloud mining operations as well.
ZenMiner Disables Cloud Mining
The latest company in a rather lengthy lists of (Bitcoin) cloud mining service providers forced to suspending mining operations is Zenminer. The ZenMiner platform became quite popular in 2014, as they offered very profitable Scrypt & Bitcoin mining options. I myself am a ZenMiner customer for roughly six months now, and have never encountered major issues with the platform.
Things even got more interesting when it was announced that GAWMiners, the company owned by Josh Garza, would create their very own coin called Paycoin (XPY). ZenMiner customers could use their existing cloud mining “hardware” to mine XPY , whereas other people had to actually invest in the Initial Coin Offering before seeing any XPY in their wallets.
Even with a lousy 11MH/s in Scrypt cloud mining power, it was rather easy to mine a total of 20 XPY in a few weeks, all of which was taken care of by ZenMiner. Bitcoin miners could switch their device to XPY mining as well, and business was definitely picking up for ZenMiner. After all, a lot of us invested great returns, which were delivered in the end.
Long story short, ever since Paycoin mining was switched off again at ZenMiner, things went back to normal, which means that the Bitcoin price plays a huge factor when it comes to making a profit. As we have all seen over the past few weeks, it is not worth it to mine or cloud mine, and several companies have to suspend their services or come up with new breakthrough partnerships.
A few hours ago, ZenMiner posted an official message on their cloud mining dashboard, saying how they have disabled cloud mining for the time being. The reason behind this would be “unstable market conditions”, diminishing Bitcoin value and the unbalanced costs of maintenance and electricity. “Unstable market conditions” in the world of cryptocurrency? That’s a first!
Paycoin (XPY) To Blame?
Even though the Bitcoin price is far from where anyone wants it to be, and it definitely will hurt any kind of mining operation, something tells me this is not the full story. Ever since the Paycoin (XPY) debacle began with “promising a US$20 floor” and failing to deliver on that promise, anything even remotely related to Paycoin (including ZenMiner) has been avoided like the plague, except for a few dedicated believers.
Regardless of how you feel about Paycoin, the entire “media campaign (good and bad)” has been hurting business since day one. Granted, Josh Garza has managed to get away with a lot of things so far, and there are still quite a few people who believe he will deliver on his promises. However, the bigger part of the crypto community has no love for what Mr.Garza is doing, as he seems to be dragging several companies down with him.
Odd Choice to Shut Down Right Now
Whereas most Scrypt/Bitcoin cloud mining services have temporarily suspended their services weeks ago, when the Bitcoin price was at US$250, ZenMiner kept on mining even when the price dropped to US$178. Keeping in mind the current price is now US$50 higher compared to that low point, it seems odd to suddenly halt all operations right now, and not back then.
Furthermore, Josh Garza promised GAWMiners/ZenMiner customers that the Genesis Hashlets would always be profitable, regardless of the current market conditions and Bitcoin price. On top of that, the HashStaker, which would stake your Paycoin for 6 months, was released just a month ago, so what happened to those devices?
Playing devil’s advocate for a minute, the ZenMiner Terms of Service clearly state the following :
10.2. Termination by GAW. GAW may, in its sole discretion, immediately suspend or terminate a User’s Account for any reason, including but not limited to: …
However, you cannot look at this as just an “account suspension”, but rather a “suspension of services without any warning advance”. This story will no doubt continue to make headlines over the next few days….