Wonderland Mining revenue source

General Discussion
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Scope:
Invest in Goldshell KD6 miners to create additional revenue streams for Wonderland’s treasury and give Frogs the chance to invest in mining.

Link/Info for Goldshell KD6 Miner:

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Objective:
Help diversify income streams by adding adverse mining resources to our portfolio. Revenue streams will help benefit the Frog Nation.

Provide a High Level Overview:
Mining has been around for a long time now and has opened up many opportunities for generating sources of passive income. Many have the belief that it’s become “inefficient and unprofitable” within the last couple of years which is completely false if done properly. With the rapid growth of Frog Nation and the want for additional revenue sources, this could help fuel large amounts of additional revenue.

About the Miners (Goldshell KD6):
Goldshell is a reliable Cryptocurrency mining company that provides high-performance miners and application fields. They’ve released many different miners that can mine a variety of different coins. In April of 2022 they will be realeasing the Goldshell KD6 which is the newest of their miners providing a hash rate of up to 26.3 TH/s. (more numbers will be provided below)

Low level details

  • Goldshell KD6 miners mine a coin called Kadena (KDA), the “ecosystem powers real-world use cases for enterprises and entrepreneurs, providing the security of Bitcoin, virtually free gas (transaction fees), unparalleled throughput, as well as Pact – the most secure smart contract language with built-in bug detection.”
  • KDA’s project is reliable with a great management team
  • KDA’s current price is around $10 with highs of $24. Which enables room for growth by mining the coin
  • KDA Market Cap: $9,621,642,790
  • KDA Supply: 166,948,072.28

Revenue Breakdown

Price of Goldshell KD6 miner (Prices vary based on supplier and amount bought): $50,000

Price of Warehouse: $250,000 (Again rough estimate due to size and location, but a large one will not be necessary do to the amount of miners you can pack in a small place

Management mining team: ? (Wonderland mgmt would decide)

Below is a breakdown of prices if 100 Miners were bought (could be more)

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Timeline
February: Speak to Goldshell suppliers and meat with Wonderland Management to decide on number of miners :desktop_computer:

March: Resolve costs, locations and mining management team :man_teacher:

April: Rollout shipment of miners and begin Warehouse procedure and prep :inbox_tray:

May: Management team will start assembling devices and coolant machines within the warehouse :electric_plug:

June: Fully operational Mining Warehouse that provides revenue to the FROGS :frog: :moneybag:

Additional Clarification/Conclusion

  • This proposal does not have “100” miners set in stone. That number could be adjusted higher or lower if needed

  • Growth of revenue received from miners will grow over time due to price increases with KDA (this is assuming that KDA will continue to rise)

  • Generates passive stream of revenue for treasury and support of various projects

  • Electricity can vary per Country

  • Coolant systems may be appropriate due to the shear size of the warehouse and operation which could be an additional cost

  • Hash rate is the speed at which miners can mine

Thank you for reading my proposal. There are more numbers I am currently crunching to maximize benefits for the mining operation. I will keep you updated with findings and more research along the way. #FrogNation

Profit sharing

I think down the road there can be many profit sharing avenues that we take with mining. Some that I’ve seen in the past are that you buy an NFT and that NFT enables you to receive a portion of the crypto that’s being mined. This could be beneficial because it could add additional revenue sources to Wonderland via NFT sales. Another approach we could take is rewarding wMemo, Memo and Time holders a specific portion. How that is decided could be up to the Dev’s such as “time staked” or “portion of ownership”. Regardless there could be many revenue reward systems put in place to benefit the Frog Nation by mining. Another factor to include is that these miners will be bought in bulk which will drastically reduce price. Meaning, the “days” till breakeven will be a lot lower as stated above. Thanks again and I look forward to hearing more feedback!

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I absolutely love this idea. and can definitely get onboard with this. This would be great. A percentage can go to the treasury as well as pay rebases or revenue sharing. NVM 100 units lets do 500. Bitcoin or KDA would be great to start adding to our treasury. As a miner myself I can say that it is extremely profitable especially on a large scale. If we could make the facilities run off renewable resources would also be a huge plus in profitability and just all around better for the environment.

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Ya good call might as well

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Definitely! I mine myself as well. Built my first computer from scratch about 2 years ago and recognized it’s very profitable! You’re right about the renewable resources as well. That could be huge and possibly even increase profitability.

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Can’t we colo these in an existing DC so we don’t need a warehouse?

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With more study on other mines and with proper data I think the management may give a yes to this but this is where our “not being a complete DAO” may help as Dani and sifu may be able to give good points as to why we should not. but I think Dani may approve. I feel that it may not be a huge revenue generator but deffo a passive stream and steady that will blow up in coming years. I’d be ok for it. but lets see the opinions of other experts.

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Appreciate the response, and I agree it needs a lot more research but could be a huge benefit for additional revenue streams. Especially taking into account the growth of the crypto being mined. Like you said it’s a great “passive” income strategy it’s not meant to be the main source of rev for the treasury.

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this could be very good to have a steady and safe passive income, love this idea!

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I like it, but I would add the possibility that the project would be linked not only to improve the treasury but also to facilitate the entry to mining to the FrogNation members who are interested. The numbers you lay out are impressive, if we take into account that the price of the previous CK6 model has a cost of $10,199, according to the numbers laid out, in two months the initial cost would be covered. I would be happy to join the mining but I would only do it with the support of a community like this one.
This way, a joint order could be placed and at the same time educational videos could be created to help the FrogNation become miners. I’m sure it would not only help the treasury, but it would help the community in a way that no other DAO has done before.

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Agreed! I think it could be a great concept. Also I think the investors of frognation could benefit by implementing a type of “partial” ownership with a miner. So you receive some interest from the miner that you invest in. I think it’s a different approach than other DAOs

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I think this could be pretty interesting. This also brings back the issue of legal entity and ownership that others have raised in other proposals involving “real assets”.

Might be a way to “buy/invest” these machine into an already existing mining company. If we’re looking at green energy, Iceland is doing some crazy mining that way already.

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Agreed, I know there’s many companies that are doing a type of “sharing” model where you basically pay for the miners but are managed by other mining companies then pay a small fee. I think this could be possible on a large level if you find the right company.

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Can you name a few ones in here? mlmight be good we all familirize with it

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I think having a steady stream of income would be a very nice addition to the wonderland project. We would be technically generating our own wealth straight from the source. We could rev share a part of the earnings and the rest go to treasury and backing price of time. I think it would help stabilize our price a little as well.

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Yes of course! This is one I’ve looked at specifically. It’s called Greenhashes

They offer “investment packages” where you can invest a certain amount and receive crypto from mining in return. I think this one is especially cool because they offer eco friendly alternatives unlike other mining companies. With the use of wind turbines and solar panels they’re capable of powering a large portion of their miners with renewable resources. Additionally, they offer something called “Cloud Mining”, a service that uses 100% renewable energy.

Another mining host company is https://compassmining.io/ that offers various amounts of different options and warehouses to invest in

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The idea that this is safe passive income is a huge stretch from my point of view. There are a lot of assumptions made in this post. Absolutely everything would have to go perfectly right for us to breakeven in 250 days.

Here’s a couple of issues that I see with going down this path.

Those who say this are incorrect in theory, but technically not wrong either. For established farms and miners, these times are fantastic, rivaled only by the run-up in 2020 and maybe late 2017. Newcomers on the otherhand are playing with fire by getting in right now. So much can go wrong so quickly.

  • Supply chain issues: unable to get enough hardware to stay competitive
  • Price/token value issues: If we are coming into a macro scale bear market, you should expect to breakeven or ROI on a much longer timescale than any calculator will lead you to believe. Not to mention - following a bear market, many chains do not survive. Look at the top 100 coins from December 2017 and find where they are today relative to their ATH. Alternatively, going in this direction ties the mining farm to the success of Kadena, so if Kadena drops to 1/4 it’s price, so does our profitability & breakeven is 4x as long.
  • Mining difficulty issues: Any calculator you use to give yourself an indication of what your daily income will be a month from now will never be accurate. This is the biggest mistake rookie miners make. They see what they will make today and expect it to continue this way forever (or at least a few months) which is never the case. If you think you’ve stumbled on a goldmine, think of how many other people have had that same thought, then try and estimate the impact to the mining profitability if the difficulty to mine the tokens increase by 2x, 4x, 8x.

Why would the value of KDA increase? PoW coins don’t simply increase in value due to more people mining them. Investing heavily in mining this token is speculative mining (mining something in hopes that one day it moons so that you can cash out). Why would this chain stand out versus every other PoW blockchain? If you strongly believe KDA to be the golden goose - we are much better off spending that 5 mil buying about 540k KDA coins and hoping for the best. Else, the only way to generate passive income is mining and dumping - which would put sell pressure on the ecosystem, which if enough people do, will progressively bring down your daily average profits of your mining farm investment over time.

The income generated will change drastically once these miners are released. As stated on their website, the miners are coming in April 2022 so their live profitability calculator is bait to hook people into pre-ordering the hardware. Total network hashrate is 216PH. If they sell 8000 of these miners at 26.3 TH, you have doubled the total network hashrate (cutting the profitability in half). Not to mention that this is 1 supplier. Assuming there are competitors launching, you can imagine where this is going. The $ per KW is going to take a massive hit.

That’s an insanely high upfront cost. Top of the line ASIC miner on Bitmain is 11k USD for Bitcoin and that’s on the most established network in crypto. You mentioned they would do bulk discounts - but unless you can get them to come down to 1/10 of the price, we are getting fleeced.

When an ASIC is programmed to mine a specific algorithm, that’s all it will do. This means that it will only mine the Blake2s algorithm exclusive for Kadena (as per their website). Therefore these machines will have 0 value outside of the Kadena network. So if Kadena doesn’t live up to the expectations, there’s no alternative, you’re stuck with the hardware on that network. On a semi-related note, this versatility is probably the only advantage GPU miners have over ASIC miners. ASIC is stuck to 1 algo - GPU can go anywhere. I know that’s a tangent, but anyone who is reading this without the fundamentals of cryptomining under their belt will not be aware of it. So if Kadena drops in value, these machines won’t be worth the raw materials they are made with, you won’t even be able to resell them to recoup part of your costs.

Having dealt with GPU suppliers and had lengthy discussions with large scale ASIC miners over the course of the last 5 years - the ETA on delivery times are rarely met in this industry especially considering the remaining logistical/supply chain issues due to the pandemic. I think it would be safe to say that any order made can expect some level of delays. Optimistically - 1 month delay, worst case 4+ months (if they even fulfil the order in it’s entirety).

In conclusion, I don’t believe this will be nearly as profitable as the calculations you’ve shared have made it out to be. I think there could be value in exploring PoW chain investments, but committing ourselves to a speculative mining venture with dedicated ASIC hardware is a major red flag for me. Even the most optimistic estimates given via the calculator only get you to a 250 day breakeven point. For reference, GPU mining from Jan-April in 2021 you could breakeven at scalper priced GPU’s in under 75 days (closer to 40 days at MSRP). I would advise looking at alternative projects and being more conservative in our breakeven estimates if you really want to push PoW mining ventures.

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Thank you for the in depth feedback! I agree with some of your statements, mining is not an easy task especially now a days. I think with the mass amount of treasury that we’re capable of using we would be profitable regardless imo. I don’t think supply chain issues would be to large of a problem since we would be purchasing so many, the company would want to honor our purchase. I’ve contacted multiple ASIC companies before and it’s based off of the size of order, cause obviously to them it’s more money.

What are your thoughts on host mining? I’m starting to think of shifting this proposal towards that more. One, host mining could be beneficial because it takes away liability, legal issues, and mgmt. Secondly, if we find the right sustainable company willing to make a good deal with us we could have more of a broad choice of cryptos to mine from. Lastly, we would most likely breakeven in a very short amount of time, if not months. I could do more research on specific companies and have some in mind, but want to know if you all would be interested in that. Thanks again!

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I would rather mine bitcoin then KDA

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problem with bitcoin is profitability. Some coins have larger difficulty to mine and bitcoin is one of them. The mining is highly diluted. We just gotta find the right coin that fits our portfolio.

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Yea I get what your saying. But I think Bitcoin has the most potential to gain massive profits. I would be good to mine any crypto though. I just want it to have a very good potential future growth. We know Bitcoin will hit 100k at some point so the question is not if its when.

We also Know bitcoin scarcity is a real thing. And there is not many more coins to mine. Especially at the next halving date in 2024.