Miner One follow-up – An operation safe to fail

Time to review what has happened since my last post about Miner One.

Initially the company was supposed to start a mining farm in Luleå, Sweden. The marketing of Miner One was painting a picture of certain future success as "The World's Biggest Crowdfunded Crypto Mining Operation" that was going to operate in Sweden. According to Miner One's marketing pitches and white paper the location in Sweden was somewhat ideal for Bitcoin mining because of the moderately cool climate and cheap electricity available in Luleå.

To further build up its credibility Miner One published videos and other material to make it seem that the company really was about to start a mining farm in Sweden.

A letter of intent of renting facilities in Luleå.

Sweden, Sweden, Sweden. A screencap of Google search results of Miner One's Sweden related material.

Despite Miner One continuously used the location in Sweden in its marketing pitches prior the launch of ICO and even during it, the mining never started in Luleå.

Despite not operating in Sweden, Miner One had this on its web page for months, also while it was already operating in Lithuania. The label was removed only recently from the website.

Criticism not accepted

I had already found out that Miner One was not willing to answer any questions about using a blatant lie in its marketing. This was something that a legitimate business simply wouldn't do so I didn't find Miner One trustworthy at all to begin with.

In order to follow what's happening and to get the latest news I had joined the official Telegram group of Miner One. However, I was soon banned from there for no good reason. Apparently the company doesn't handle criticism too well, which alone should be considered a major red flag – in addition to all the false marketing (which also went as far as blatantly lying).

However, I managed to find an unofficial Telegram group of Miner One investors, which was actually a much better channel to get proper information about what was going on.

Mining started but failed – investors dismayed

I was actually surprised when Miner One eventually really did set up a mining farm of some sorts.

Instead of Sweden a location in Lithuania was selected. All the speeches about green energy and the ideal location in Sweden were forgotten in an instant.

Instead of proper facilities for a mining farm, shipping containers were chosen.

Anyway, there must have been great anticipation in the air among the investors of Miner One. – At last money was going to start pouring in!

According to the original plan the mining operation was supposed to start in July 2018, instead mining began in late August. A payout was made on Aug 31 from 770 miners operating for 10 days. There were also payouts for September and October. In total, these payouts came to about a 0.1% return. Mining ceased around November 20 due to the costs to mine exceeding the value of BTC mined. (This chapter was edited on 15 February according to the post in the comments section of this blog post.)

Miner One's white paper was pretty much guaranteeing incomes due a "cushion effect" the company had planned. That means that even in the case that the value of BTC drops, investment in Miner One can still generate returns. What could go wrong?

In reality there was no cushion effect and the income generated to the investors was a fraction of the sums they had been expecting. They were dismayed to find out that by the rate the mining was generating return of invest it would take even tens of years to get the invested sum back. I guess at that point most of the investors considered their money lost.

Considering the lousy ROI the miners were able to generate per investor, I don't think it would matter much even if the value of Bitcoin would double. At the best it would maybe just double the sum of pennies made earlier. – So no lambo!

The World's Crappiest Crowdfunded Crypto Mining Operation?

The mining operation might have been profitable at least for the company to get it going for a month or two. However, according to the information I have received via Telegram, Miner One was forced to shut down its miners soon after starting them due the huge decrease of Bitcoin value in the late 2018.

During these recent two months the investors have been more and more agitated about the situation and demanding proofs that the alleged mining equipment actually exist and presenting criticism towards the company. From what I have read from the unofficial Miner One Telegram group, there are many people who have invested thousands of euros to this scheme and understandably worried about their investment. Many of them already consider their investment lost.

There also doesn't seem to be much trust left towards the company. It doesn't help that even the most trustworthy supporter of Miner One among the investors has been kicked out from the official Miner One Telegram group. I guess he was just asking too many questions and presenting criticism while the company refused to show requested transparency and to share information.

This was recently posted on the unofficial Telegram channel. Word "hater" mentioned there at the end. Funny thing, I don't remember legitimate businesses ever talking about haters. What comes to FUD (Fear, Uncertainty, Doubt), I believe Miner One has always been all about uncertainties and doubts. Fear? I think fear is only a natural reaction of an investor who finds out that he has invested in uncertainties and doubts.

There hasn't been much news what is going to happen next. Pranas Slušnys has been implying about moving his shipping containers to another location where cheaper electricity would be available. Apparently Ukraine is the next target. 

The latest newsletter of Miner One tells us: 

“I take the relocation process very seriously, as the equipment has to be transported in unfavorable weather conditions, and there is no room for doing a show. I am going to the Kharkiv region in Ukraine myself to oversee the assembly process. The relocation was critical, as the electricity prices in the Baltics have increased since January, 2019, and our current supplier was unable to fulfill his obligations to deliver us the price that we have agreed earlier in 2018” – says Pranas Slusnys, CEO of the Miner One project.

Meanwhile the useless miners are kept in the shipping containers – or is there only one container? Who knows? The life span of a Bitcoin miner is relatively short so each month is like equal to one year in dog years, and 12 months equals a dead dog, so to speak. Hence it shouldn't take long before all the alleged miners would be scrap metal.

I personally think that this was already the end of the operation. No point dragging this on. From what I have found out just recently the official Telegram channel doesn't respond anymore to inquiries. Strangely Miner One has also deleted all posts from the official Facebook page that were posted this year. Among other things those posts were somewhat related to the issue of moving the mining farm to another location.

So Miner One became Minor One just as I predicted and now it's about to vanish.