Cryptocurrency Mining Today: Bitcoin, Zcash, and Cloud-Mining Risk

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Ethereum mining ended with The Merge in September 2022, while Bitcoin and Zcash still use proof of work. Cloud-mining contracts should be evaluated as prepaid exposure to an operator—not as ownership of hardware or guaranteed yield. If hashrate delivery, electricity charges, pool records, termination clauses, and withdrawal rights cannot be independently verified, the advertised return is not auditable.

Which networks can still be mined?

Cryptocurrency mining is the process by which new coins are created and transactions are verified on blockchain networks that use Proof of Work (PoW) consensus mechanisms. Bitcoin, Ethereum (prior to its transition to Proof of Stake in 2022), and Zcash are among the most well-known mineable cryptocurrencies. Cloud mining services like Genesis Mining emerged to make mining accessible to people who do not want to purchase, configure, and maintain their own hardware.

Genesis Mining as a historical cloud-mining example

Genesis Mining was founded in 2013 and became a prominent cloud mining provider. Historical claims about headquarters, facilities, contract availability, or scale should not be treated as current without verification from the operating legal entity. The concept is straightforward: instead of buying expensive ASIC miners or GPU rigs, paying for electricity, and managing cooling and maintenance, customers purchase hash rate contracts from Genesis Mining. The company operates the mining hardware in its data centers and distributes mining rewards to contract holders proportionally.

Bitcoin mining has evolved dramatically since the early days when it was possible to mine with a standard CPU. The introduction of GPUs, then FPGAs, and finally Application-Specific Integrated Circuits (ASICs) made Bitcoin mining an industrial-scale operation. Bitcoin mining is now dominated by specialized ASIC hardware and professionally operated facilities. Solo mining remains technically possible but has extreme payout variance for small operators; pools trade some independence and pool-counterparty risk for steadier distributions.

Ethereum's mining landscape changed fundamentally in September 2022 with "The Merge," which transitioned the network from Proof of Work to Proof of Stake. Prior to this, Ethereum mining was predominantly GPU-based, using algorithms designed to be ASIC-resistant. After The Merge, ETH can no longer be mined; instead, validators stake ETH to participate in block production. Former Ethereum miners redirected their GPU hardware to other PoW networks or repurposed it for AI and machine learning workloads.

Zcash (ZEC) uses the Equihash mining algorithm, which was originally designed to be memory-hard and ASIC-resistant. However, ASIC manufacturers eventually produced Equihash-compatible miners, shifting the mining landscape similar to Bitcoin. Zcash's distinguishing feature is its privacy technology: using zk-SNARKs (zero-knowledge proofs), Zcash allows fully shielded transactions where the sender, receiver, and amount are all encrypted while remaining verifiable by the network.

Model the contract instead of projecting price

Cloud mining, while appealing in concept, comes with significant risks and caveats. The most fundamental issue is whether revenue can exceed the upfront price, electricity or maintenance charges, pool fees, and taxes before a termination threshold is reached. Difficulty and network hashrate can rise or fall; block subsidies halve on protocol schedules; fees and asset price vary. Model adverse scenarios and compare the operator's records with public pool payouts. Many fraudulent schemes have used mining language without operating verifiable equipment.

Genesis Mining should not be confused with the unrelated Genesis Global Capital, a crypto lending subsidiary of Digital Currency Group. In January 2023, the SEC charged Genesis Global Capital in connection with the unregistered sale of securities through the Gemini Earn lending program, and the company subsequently filed for bankruptcy. Genesis Mining is a separate company not involved in those proceedings. Nonetheless, similarly named crypto businesses are not evidence about this operator. Confirm the exact company, governing law, audited entity, and contractual counterparty before evaluating a service.

Hardware, pool, and operational checklist

For those interested in mining in the mid-2020s, several alternatives to cloud mining exist. Mining pools allow individual miners to combine their hash rate and share rewards proportionally, reducing variance. Owning hardware makes power draw, uptime, pool shares, heat, and resale value observable, but adds noise, electrical, cooling, fire, firmware, and regulatory obligations. Calculate break-even with measured wall power, delivered electricity price, realistic uptime, pool fees, current difficulty, and no assumed price increase.

Treat energy as a measured input, not a narrative. Record delivered kWh, demand charges, curtailment terms, cooling overhead, and the marginal emissions and grid rules that apply at the actual site. Preserve invoices and pool records, isolate management networks, verify firmware, and test thermal shutdowns. This is an operational risk analysis, not a return forecast or investment recommendation.

Primary and consumer-protection references

Mining, Ethereum, BitCoin, Zcash

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