“Our fund pays weekly rent”

Gustavo Sánchez Reulet hydrocryp

Interview with Gustavo Sánchez Reulet Founder of HydroCryp By Ariel Bazán

As explained by HydroCryp, mining consists of registering and validating transactions within a network: “If a transfer operation is made from one point A to another B, there is a miner in a computer that is consuming its energy and providing its power of computation to validate and register a transaction ”. In other words, they argue, “mining cryptocurrencies is the set of processes necessary to validate and process transactions with them.” In a dialogue with El Economista, Sánchez Reulet explained how HydroCryp works and the mining business.

How does an investor enter HydroCryp?

The investor contributes his funds to a company in Canada that buys mining equipment. Weekly these mining equipment produce “x” amount of BTC fractions and from that, one part is separated to pay expenses (electricity, operation and housing) and the rest is distributed to the shareholders according to their ownership. It is very attractive for the investor to know that the following week will be collecting, in addition to that they can audit the entire process by connecting to a mining pool address that shows the amount of connected machines and what they are generating daily.

How often are the equipment being renewed?

The fund always reserves money for technological renewal. With the money of those who enter today you can buy machines that in 15 months will generate 1 BTC, but by then they will already have a lower performance. The value of the equipment is closely related to that of the BTC, it is not that they are sold at cost plus a profit. Thus, if bitcoin is for example US $ 20,000, computers can cost US $ 7,000, but that value can fall to US $ 3,500 if bitcoin also drops to US $ 3,500. The more depressed the BTC, the equipment has a value more similar to the real one.

Why did you choose Paraguay as the base of operations?

Because of the low cost of energy, since mining is super-demanding in electricity and a cheap cost and abundant energy availability is needed. These two things have to be guaranteed because otherwise the risk of having US $ 2 million in machines without producing is very high, in addition to very expensive.

 

Does the mining business point to the medium and long terms?

Yes, if someone wants to get in and out in two months, it is not convenient for them to get in, but if they believe in the crypto world and want to have a long-term position, it is better for them to invest in mining than to buy cryptocurrencies. That is, with US $ 8,000 you can buy 1 BTC to save or invest with us after 15 months also have 1 BTC more than the bitcoins that come later.

Is it expected that the value of the BTC will continue to climb over time?

Yes, as it is known that there will only be 21 million BTC and that over time the miners will be paid less and it will be increasingly difficult to mine, it will be necessary to put increasing computing power for mining and all that will be giving higher value to the cryptocurrency. There is an upward trend over time, since the BTC is something increasingly difficult to obtain. It is as if for example it was known that there are only two tons of gold left in the world: in that case, the value of that metal would skyrocket.

A lower value per mining will not discourage the business?

In this business, as has happened in previous “halvings” (when the reward for mining falls by half every four years), always what accompanied up was the price of the BTC. So, although the reward for mining was lower, there was a much higher bitcoin value. In addition, there are certain projects on the institutional side that predict that the volatility of the BTC will go down: for example, there is an official entity of the NYSE administrator, the BAKKT, which is an official Wall Street trading for cryptocurrencies.

Is mining very centralized today?

Yes, there are five mega manufacturers in the world of equipment. One is the Chinese Bitmain, which in addition to manufacturing equipment for sale to others has its own mining centers and manages almost 40% of the world’s mining. We buy the equipment from another supplier to avoid doing business and there is a tendency among miners not to buy from them because they are direct competitors. In the beginning, mining was home, but that is over, basically because there is no home energy to the values necessary for this to be profitable.

 

SOURCE: https://www.eleconomista.com.ar/2019-11-sanchez-reulet-hydrocryp-nuestro-fondo-paga-renta-semanal/

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