The freezing bear market in the past two months has finally made some players aware that blockchain investment is barely different from venture capital.

Due to limitations of the technology’s current stage, investments in the ultra-hot projects of public chain, protocols, middleware, Dapp, among others, are likely to undergo prolonged return cycles. 

In the current crypto arena, there are only two industries with truly stable fund flows and income: exchange and mining. In 2018, one of the world’s largest exchanges Binance reported a first quarterly profit of USD 200 million, overtaking that of Deutsche Bank by USD 4 million. By bidding for market leaders like Binance, Huobi, OKEx and Bitfinix, a majority of investors have reaped tremendous returns. Unlike investments in technology projects, such returns are relatively certain and sustainable. As platform token holders of the leading exchanges, you will be continuously rewarded from their commitment to the distribution of income or buybacks with the corresponding profits, which can hedge you against asset depreciation under bear markets to a certain extent.

Driven by the “transaction mining” model pioneered by Fcoin, almost all exchanges have issued their own platform tokens to enable ordinary users to share in their fruits of growth through participation. However, transaction mining has far overdrawn market demand, making it difficult for new entrants to gain the initial momentum by following suit and in turn, lose further investment opportunities.

The mining business, arising ever from the birth of cryptocurrency, has long fallen in the grip of the few. While China enjoys over 70% of the world’s bitcoin computing power with a daily yield of 1,300 BTC, market insiders advise that only no more than 1000 people have effective control of such computing power, meaning that mining in the country is still a privileged game.

This September, Huobi Mining Pool launched the first mining pool token—HPT, which mainly sources income from the mining business on POS and DPOS consensus, such as EOS, rather than mainstream BTC mining. However, HPT has been in good performance since go-live, keeping a strong gain of over five folds until now, which is in essence underpinned by the continued and stable income generated by the platform.

Shortly afterwards, the second-ranked mining pool ViaBTC also issued its native mining pool token—VIAT. In contrast, the sincerity of this token has been seriously under doubt as ViaBTC only uses 20% of its commission income to buy back VIAT, with no reward distribution for VIAT holders. Such operation means that ViaBTC is reluctant to engage external investors or ordinary users in their core mining business and hence only link them to the 20% mining commission. As a result, VIAT hasn’t fared well at any point.

Recently, the top cryprocurrency exchange of Hong Kong Coinsuper partnered with the eighth largest mining pool dpool and mining machine manufacturer Bitfily to launch the first computing power-backed token HRT (Hash Rate Token).

A total supply of 400 million HRT are issued to fully reflect the 900 thousand T of dpool’s own computing power. HRT holders can enjoy the mining rewards of real computing power and BTC giveaways settled every 24 hours.

In the meantime, the platform will also use 20% of its commission income to buy back and burn HRT on a quarterly basis to maintain the continuous increase of computing power per unit HRT. Therefore, HRT blazes the trail for users to own computing power and participate in mining by the same token.

Amid continued BTC appreciation, it might take an investment in the mining industry as quick as half a year to recover the cost. However, mining in bull markets is hefty costs. In early 2017, an s9 mining machine with 14.5 T computing power sold as high as RMB 20,000.

On the other hand, the cost of investing in mining under the prevailing market conditions is rather low. Calculated based on the offering price of HRT, a mining machine with equal computing power costs 90% less, that is, around RMB 2,000.

HRT holders can not only get stable mining rewards in BTC to hedge against the risk of asset depreciation in bear markets, but also preempt bonus for the next bull market. A model of low risks and high returns as such is thus a panacea to tackle both. Sustained rewards from income distribution will also motivate users for long-term holding, instead of benefits from frequent short-swing trading.

HRT is the world’s first token jointly created by exchange (Coinsuper), mining pool (dpool) and mining machine provider (Bitfily) for computing power ecosystem, whose partnership marks a transition from light asset to heavy asset strategy alongside deepened industrial integration, which is favored for enabling stronger control over the industry chain, major cost reduction and strengthened base to better hedge the cyclical fluctuations of the industry and foster long-term growth.

The HRT computing power ecosystem stays open to absorb and integrate distributed computing power resources with rapid expansion; at the same time, thanks to the significant progress in the exploration of low-cost power resources in the Middle East and Asia Pacific, dpool is expecting remarkable decrease in the cost of computing power towards a future of increasing economies of scale.

Everyone is asking when the winter will go and no one knows the answer, leaving survival a new consensus among the crypto community. Probably and as always, what is common sense can only be recognized when the bubble bursts: fund flow is everything.

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