BTC Fall, Higher Hashrate Force Genesis Mining to Cancel Unprofitable Contracts

The recent Bitcoin (BTC) downtrend and higher mining difficulty have taken their toll on cloud mining services provider Genesis Mining forcing it to cancel contracts.

Cloud mining services provider Genesis Mining has warned that it will terminate unprofitable cryptocurrency contracts unless clients switch to a five-year subscription plan. The firm cited a combination of declining Bitcoin (BTC) prices and higher mining costs in recent months.

“Unfortunately, Bitcoin went into a downward trend around January. This trend combined with the heavily rising difficulty around April and May reduced mining outputs even further. As a result, some user contracts are now mining less than the daily maintenance fee requires to be covered, and thus they entered the 60 days grace period, after which open-ended contracts will get terminated,” Genesis Mining said in a blog post on Thursday.

The Iceland-based company offered customers to continue using its service, upgrading their existing Bitcoin Mining contracts to Radiant contract terms with a premium discount. The recommended plan is now being converted from open-ended to five-year with no termination option. The fee for every trillion hashes per second (TH/s) will drop from $285 to $180. The maintenance fee will also be reduced to $0.14 per day.

“The idea behind this offer is to show that we are well aware of the situation. As strong believers in the industry and its potential, we are certain the market will soon recover. We want to help you to keep mining,” Genesis noted.

Less than a month ago, Genesis Mining claimed that it has enough hardware to ensure profitability. Its statement came as rival HashFlare announced that it was shutting down its Bitcoin mining operations and suspending users' contracts, because the payouts were lower than the maintenance fees for 28 days in a row. HashFlare has since resumed its services, with existing contracts operating on the previous terms. However, new contract sign-ups remain disabled on its website.