Kodak unveiled its own bitcoin miner at CES, will let you rent it for $3,400 for two years
If you thought Kodak news couldn't get any stranger following the company's debut of a "photo-centric cryptocurrency" called KODAKCoin earlier this week... you were wrong. In a further attempt to cash in on the cryptocurrency mania currently spreading across the world, Kodak has debuted its own bitcoin mining machine at CES.
The bitcoin miner is called the Kodak KashMiner, and you can rent it for just $3,400 and keep a share of the profits you make mining bitcoin for the next 2 years.
We'll give you a moment to let the absurdity of those last few sentences soak in before we attempt to put this madness in context.
Ready to move on? Okay.
First of all, here is the Kodak KashMiner in the flesh at CES 2018:
🎶 Ohh, I'm gonna getcha with the Kodak KashMiner 🎶 pic.twitter.com/IX5zy5vtCf— Jeremi M Gosney (@jmgosney) January 10, 2018
The deal, according to the pictures of Kodak's pamphlet about the KashMiner, is that you can rent the machine on a 2-year contract for $3,400. From there, contends Kodak—who clearly know their stuff, having been publically interested in cryptocurrency for a full 48 hours now—you will earn approximately $750 per month, half of which you get to keep while the other half goes to a company called Spotlite Energy Systems in California.
At that rate ($375 per month), you'll make $9,000 in 24 months, or approximately $5,600 in profit.
There's just one problem with that line of thinking. Okay, actually, there are a few, as many people with actual cryptocurrency mining knowhow pointed out on the twittersphere as soon as news of Kodak's bitcoin mining machine hit the headlines.
There is no way your magical Kodak miner will make the same $375 every month, unless Bitcoin mining difficulty stays the same. It is currently increasing at around 15% a month, so mining output should drop around 15% a month, too. Good luck to everyone who bought this deal! pic.twitter.com/0xA2HNtHFc— Saifedean Ammous (@saifedean) January 10, 2018
Basically, bitcoin mining will not produce the same output month after month for 2 full years, even in the unlikely even that the price stays at $14,000 per bitcoin. According to bitcoin economist Saifedean Ammous, mining difficulty is increasing by about 15% per month, which means your total output after 24 months will be a lot less than the advertised $9,000+. But even if Kodak's numbers were correct, there's one other problem.
It seems the KashMiner that Kodak is so graciously offering to rent you for $1,700 per year is just a rebranded Bitmain Antminer S9, an industry standard bitcoin miner that you can buy outright for just $2,320—a full $1,080 less than Kodak's 2-year rental fee.
|The Bitmain Antminer S9|
Kodak's initial cryptocurrency and blockchain announcement on Monday seemed, if a bit strange, at least not entirely crazy.
Using the blockchain for copyright registration and tracking makes sense (and has been done before), and if Kodak wants to create its own cryptocurrency for photographers, it's a risk the company is more than welcome to take. In fact, at first, it seemed like a risk that was well worth taking, as Kodak's stock more than tripled on the news.
But this bitcoin mining rental scheme feels like something else entirely. If the bitcoin experts speaking out about this online are correct, either Kodak has no idea what it's doing, or this is a full-blown bitcoin mining scam.