E12: The Value of Investing in Bitcoin Miners Rather Than Bitcoin Itself with Eng Taing

Mining Bitcoin is not as complicated as it seems. Anyone with a computer can do it. But you might be wondering why you should bother investing in Bitcoin mining when there are so many other ways to make money online.

In the twelfth episode of Passive Investing Show, J and Ashley are joined by Eng Taing. They share their insights on the risks and benefits of investing in Bitcoin mining.

Here are some power takeaways from today’s conversation:

●      Keep your costs low.

●      Consider the risks and benefits of Bitcoin mining.

●      Find cheap and renewable energy sources.

●      Be flexible.

Episode Highlights:

[12:29] How Bitcoin Mining Works

Bitcoin mining uses computers to create Bitcoin and validate transactions. Every 10 minutes, 6.25 Bitcoin is rewarded to miners. Miners pool their resources to get a lot more of it.

The current inflation rate for Bitcoin is 3%. With many industrial size capital investments, there is higher value but diminishing return. Bitcoin mining gets you more Bitcoin over time and offers more benefits. Make sure energy prices are down or as low as possible.

[24:38] What to Expect in Bitcoin Mining

You will invest in the profit stream of miners and they distribute those profits as either Bitcoin or cash. Investors can expect a 90% investment return in year one. The life cycle for one investment is five years.

[31:27] Risks in Bitcoin Mining

The risks in Bitcoin mining are regulatory risks and increasing energy costs. Keep your costs low. Find cheap and renewable energy sources. Given the current mining dip, they are buying a lot of machines and deploying capital wisely. The minimum investment is $50,000.

[36:50] Opportunities, Concerns, and Advice

Oil and gas investments interest him. He believes that renewable energy is the future and fossil fuels will be the bridge to get there.

On the other hand, the Federal Reserve is what concerns him the most. He believes that they are taking inflation and reduction of money supply too far to the point of decimating growth. He advises people to be flexible and explore different things.

Notable Quotes from the Episode:

[12:38] “When you add capital and scale, you get better results and outcomes potentially.”

[37:38] “Fossil fuels will be the bridge to renewable. I truly believe in renewable energy being the future. But there needs to be a bridge to get there.”

[39:22] “When you have higher interest rates, you sort of reduce the ability for investors to invest the money in people because now you have a higher demand hurdle for the investment.”

Resources Mentioned:

Touzi Capital

Eng Taing LinkedIn and Twitter

The Passive Investing Show