Why should miners establish a currency-based way of thinking? ——"Mining Coin Network Celebrity Awards"

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Please introduce yourself.

Li Yang: Hello everyone, I am Li Yang, the account manager of Matrixport. I am currently responsible for the product sales and customer service of Matrix. I have worked in the mining machine sales department of Bitmain (2017-2019). Matrixport (hereinafter referred to as "Matrix") is a one-stop financial service institution in Singapore. I am very happy to have an online discussion with you today and learn together. Thank you.

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The topic of currency standard and gold standard is often discussed in the industry. A few days ago, I saw that there were disputes between new and old miners in the group. The old miners taught everyone that if you always use legal currency to calculate and evaluate whether your investment is correct, it means that you may not be suitable for investing in digital currency, while the new miners think that this is a trick used by old people to cheat newcomers. As a senior in the industry, can you tell me why miners should establish a currency-based way of thinking?

Li Yang

I personally believe that the currency standard is relative to long-term investors. If it is a short-term transaction, it is natural to focus on the fiat currency standard and clear profits in a timely manner.

For miners, since mining has a certain payback period, and as the price of the currency stabilizes and the output is halved, the payback period will tend to be longer. Therefore, miners are long-term investors.

After the investment cycle is extended, only by holding Bitcoin for a long time and increasing the number of coins can greater returns be obtained. There are two reasons:

First, throughout the history of Bitcoin, its price has been on a continuous upward trend. As long as the cycle is long enough, the coin will definitely increase in value. Short-term selling of coins is equivalent to losing part of the future rising profits, but we do not encourage holding on to them. It is reasonable to sell or mortgage them appropriately to pay the electricity bill.

Secondly, using the currency standard thinking can more clearly understand the payback issue of mining. The short-term rise and fall of the currency price has a huge impact on the Yongfa currency standard to measure the payback of mining, but it is much simpler to use the currency standard. Assuming the total investment is 1 million yuan, it can be calculated how many BTC can be bought at the current market price; if a mining machine is purchased, how long it will take to mine back a considerable amount of BTC. Here, the future growth of computing power, machine power consumption, electricity prices, operating costs, etc., compared with the predicted currency price, the predicted payback period is clearer and can reduce errors.

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In summary, the essence of the coin standard is to pay more attention to the number of coins, not the short-term price. After clarifying the idea, we should take action next. Several guests happened to represent different vertical fields. Mr. Li, please analyze and suggest from your own field. As a coin standard miner, how should you operate to keep your own coins, and even let the coins in your hands hatch more coins?

Li Yang

In my personal opinion, if you have sufficient knowledge of K-line trading, then buying low and selling high is naturally the best choice. However, under normal circumstances, we cannot analyze the market very well. Therefore, some safe ways of value-added are very necessary, such as some financial products.

For example, taking the matrix product as an example, the figure below is a product that expires on March 27. On the expiration day, the coin price is less than 8,000 USD. The coin standard can obtain a 1.05% return. According to the current market conditions, it is unlikely to rebound to 8,000 in less than 2 weeks. If it exceeds 8,000, the coin will be sold at 8,000, but an additional 1.02% USD return will be obtained.

Of course, if you have a higher risk appetite, you can also choose the following option, betting that the coin price on March 27 will not exceed 5,500. If it is lower than this price, you will get a coin-based return of 8.15%.

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Some friends say, I have to care about the price of fiat currency, because I need to use this money at any time. But if you have the pressure of gain and loss, you can't hold the currency through the bull and bear market. Countless bloody experiences tell us that short-term may allow you to successfully escape the top or bottom on a certain opportunity, but in the long run, the result is that the number of coins is getting smaller and smaller, and you miss the next bull market. The recent plunge has terrified everyone and triggered a round of chasing ups and downs, so that major exchanges have experienced varying degrees of network congestion. I think Mr. Changan should have a deep understanding of this. Can you plan some hedging plans for novices?

Li Yang

For miners or investors with low risk appetite, Matrix has also developed some capital-guaranteed and fixed-term products.

In my personal opinion, if you don’t want to face any risk at all, you can choose some fixed-term products with 100% principal protection. Depending on the market fluctuations, the returns generally range from 0% to 8%, and the principal currency is fully protected.

Of course, you can also choose a fixed-term product with a 99.5% principal protection rate. Depending on the market situation, the returns generally range from -0.5% to 40%. This can be understood as using 0.5% of the currency to leverage the fully principal-protected product to expand the returns.

For the above two products, the higher the coin price goes, the higher the yield will be. You can earn both coins and the price difference brought by the increase in coin prices. It is a financial management with double returns.