Li Kuang: I once sold coins to pay for electricity and missed out on 400 million. I regret not knowing that I could do this…

In the first half of 2017, the mine sent me an electricity bill for the whole year. Yes, you read that right, my electricity bill is postpaid, and it is paid one year later. The mining machine is a 370 graphics card, which I bought with Shenyu a year ago, and the hosting is also placed together. I mined ETH for a year, about 40,000. During this period, ETH rose from 70 yuan to 140 yuan, and then fell back to 70 yuan.

After getting the bill, I used a calculator to calculate that if I sold all the ETH at this time, I would still have a small surplus after recovering the cost of the mining machine and paying the electricity bill. Since we bought the mining machine together and mined together, I asked Shenyu how to deal with it.

Then, Shenyu added, "Your 40,000 ETH is really not much. I sold 200,000 ETH when it was 20 yuan!"

I said thank you, but another two words came to my mind. So I started selling coins to pay for electricity and recover the cost. In a few months, the price of ETH exceeded 10,000 yuan, and I missed 400 million yuan. I made up my mind that I must hoard coins for mining in the future.

Back to today, the bitcoin production has not been halved, but the price has been halved. However, as long as the profit is greater than the electricity cost, mining still has to be done. Of course, the premise is that you have money to pay the electricity bill. My electricity bill model is still post-payment, but it has become a monthly payment. The bill styles of each company are different, and they are much more professional than a few years ago. I will list them here to see what style everyone likes.

(Bill 1: 129,000)

The mine in this bill is from Wayi Technology, an IDC in Xinjiang, with an electricity fee of 0.42. The mining machine is Langshen A1. As mentioned above, after selling ETH, I had cash in my hand. I thought, don’t I have to mine (I am destined to be a miner)? Around April 2017, I asked (grabbed) a few thousand units from Shenyu’s reserved shares. It was the early stage of the bull market. If it hadn’t been reserved, it would not be available in the short term. Where is the hosting? Ask Peicai. This question made Peicai want to buy it too. Damn it! Let’s give half of the original price to Peicai. A few months later, the price of ETH exceeded 10,000 yuan, and no coins were sold. I sold half of this batch of graphics card mining machines to Peicai (at a high price). This bill is equivalent to a quarter of the original mining machine. I have been mining until now, and I have recovered my investment many times.

(Bill 2: 263,000)

After getting the bill, I used the calculator to press a few times. After ruling out the idea of ​​waiving the electricity bill, deliberately defaulting on payment, and regretting not selling the coins earlier, it seems that the only options are:

• A Cash: All the money was used to buy mining machines, and the remaining money seems to be not enough for living expenses.

• B Sell coins: The price has fallen too much, and it will be halved in two months. Let’s wait and see.

• C Pledge loan: Annual interest rate is 9%. I don’t really care in a bull market, but now...

Emmmmmm, it seems that I can only choose C. After making this decision, I started to find reasons for myself:

• The money spent on buying mining machines can be considered a sunk cost, but the money spent on electricity is an operating cost. As long as the mining machines are running, the mining income will definitely cover the electricity bill and have a surplus. Therefore, it can be deduced that the mined coins must be sold.

• The price of the currency has just completed an epic drop, and the probability of rising is greater than the probability of falling. Selling the currency to pay the electricity bill may repeat the tragedy of missing out on hundreds of millions in 2017. So the currency must be sold, and it is best to sell it later.

• The ancients said: mining in a bear market and trading in cryptocurrencies in a bull market.

Let me introduce myself first: Li Kuang, co-founder of Bitmain. I started mining in 2012 and was responsible for the marketing and sales of Antminers in 2013. I joined Matrixport in 2019 and was responsible for customer service.

Since you want to borrow money, our company also has this business. After a brief understanding: If the currency price is 40,000, I have a BTC:

• Assuming the pledge rate is 65%, the amount that can be borrowed is: 40,000*0.65=26,000 yuan;

• Assuming an annual interest rate of 9%, repayment after one year: 26,000 + 26,000 * 0.09 = 28,340 yuan;

• Assuming the warning line is 75%: 26000/0.75=34666,000, it will drop to 35,000 to prompt a margin call;

• Assuming the liquidation line is 90%: 26000/0.9=28888, the position will be liquidated at about 29,000, commonly known as a margin call;

Because I am in charge of customer service and have come into contact with many mortgage loan customers, my personal feeling is that the strategy must be chosen well. Strategy 1: Low pledge rate, you can also choose the margin call service provided by Matrix within a few hours to avoid losses caused by a flash drop and rebound. Strategy 2: Choose a high pledge rate and no margin call. In a sharp drop, close the position at the high point and buy it back at a low price.

Since I have chosen a mortgage loan, the only thing left is to enter the business phase and negotiate the interest rate. It would be best if the interest rate is waived for me. Is this really possible?

Zero interest lending, no margin call, crash protection, flexible customization.

This picture looks more intuitive:

Just do it, open the Matrixport official website (www.matrixport.vip) immediately, click on Borrowing → Zero Interest Loan, and you will see the following table:

(Screenshot of zero-interest lending on Matrixport’s official website)

The US dollar price is hard to see, so convert it manually in Excel:

(Zero interest loan plan on March 18, 2020)

Let's look at plan A first. (It's a bit long, but you will definitely understand it if you read it slowly. If you understand this logic, you will basically surpass 90% of miners.)

• The term is 102 days: that is, 3 months, this is the general premise.

• Stop profit price 56,000: On the day after 102 days, if the price of the currency exceeds 56,000, for example, it rises to 60,000. It will be sold at 56,000 and the remaining money will be returned.

• The protection price is 18,800: that is, the current currency price of 37,700*0.5 (pledge rate). If the price is lower than 18,800 on the day after 102 days, there is no need to repay the loan, which means that the collateral has been sold.

• Let’s talk about the deadline: within these 102 days, if Bitcoin drops to 10,000, your position will not be closed and you will not need to add margin; if it rises to 100,000, you will not be able to repay in advance.

• After 102 days, the price of the currency is between 18,900 and 56,000. You can repay the loan normally and get back the collateral without any interest.

• Service fee 0.00%: Service fee (interest) is 0

• Pledge amount 1-100 BTC: If it is 200 coins, it can also be done, divided into two orders, 500 coins can be divided into 5 orders.

As for plan B, a service fee is charged and the stop-profit price is much higher.

Any solution that is divorced from customer scenarios and needs is a false proposition.

My scenario is that electricity bills are generated every month, and I must sell coins to pay for them. I can hoard the remaining coins after paying the electricity bills, so there is no pressure. Taking a step back, even if the coin price is now, I will sell it. Taking a step back, even if the coin price drops again next month, I will still sell the coins for electricity bills. I can’t retreat anymore.

However, after such a drop, it will surely increase in 102 days (three months), right? ? I was going to sell the coin at 37,700 today. Even if it rises to 60,000 or 70,000 in three months, I will sell it at 56,000, which is better than selling it at 37,000, right? If the coin price is between 18,900 and 56,000, I can save interest.

Anyway, I have decided to sell my coins to pay the electricity bill. If I choose to borrow coins by ordinary pledge, if there is another wave of panic in the market and there is another flash crash within one or two months, there will inevitably be some risks in covering or closing my positions.

In summary, this time I chose zero-interest loans to pay the electricity bill. If you want to do the same as me, please scan the code (if you don't want me to serve you, I'll ask a lady to help you), and flexibly customize the term, stop-profit price and other parameters.

Postscript: When Bitmain was selling mining machines, many people asked me, mining is so profitable, why do you still sell mining machines? This time, I must ask, the interest on loans is zero, how do you make a profit ? When Bitcoin was 10,000 US dollars, who bought options (insurance)? Why can US dollar financial management have an annualized return of 8%? Is it a brainless choice to buy high every period for dual-currency financial management, or is there a skillful choice? Why do many mining pools and exchanges choose your wallet hosting system? I will slowly update the above questions. If you are anxious to get the answer, add me on WeChat.