What can go wrong.
This page exists because most of it is left off other operators’ websites. If any of it changes your mind, it should change your mind now rather than after you have wired money.
Contract risk.
Hosting is a term commitment
Facility agreements typically run about three years per unit with a termination fee. When I say there is no lock-in, I am talking about my fee, which you can end at any time. It does not apply to the contract you sign with the facility.
The rate can move mid-term
Facilities generally reserve the right to raise the rate if their delivery costs rise materially, usually on around thirty days’ notice. Your protection is a no-fee termination right with a short election window, often about fifteen days. Miss the window and the new rate is deemed accepted. I will flag the notice, but the election is yours to make.
Your machines and your Bitcoin are collateral
Facilities commonly take a continuing security interest in the equipment and all its proceeds, including mining rewards and resale proceeds, against your hosting bill. They may file financing statements without your signature. In plain terms, if you stop paying the facility, the machines and the coin they produced are what the facility can look to.
You cannot audit the hosting rate
The fee is a bundled service, not a pass-through of a metered cost. There is no underlying electricity bill to check it against, and comparing facilities on dollars per kilowatt-hour alone compares bundles rather than power.
Market and operational risk.
Production falls over time
Network difficulty rises as more hashrate comes online, so the same machine earns less each month. At current prices a deployment can produce less than its own hosting costs. That is a real outcome, not a tail case, and the rational response is to switch machines off rather than run them at a loss.
Price can fall and stay down
Every scenario I model includes cases where it does. If your plan only works above a particular price, you should know that number before you buy rather than discover it.
Hardware has a service life
Roughly three to five years before newer machines outcompete these. At lower prices they stop being economic sooner. Components fail, and fans and power supplies are consumables.
Growth is limited by the facility, not by me
Expanding a deployment means power and rack space at a host, and capacity has to exist before machines can go anywhere. That is the real constraint on how fast a position can grow, and it is planned ahead rather than discovered when the hardware arrives.
If I am unavailable
Everything material is already in your name. The hardware, the hosting agreements, the pool account and the wallet. If I stopped tomorrow you would keep all of it and could appoint someone else or deal with the hosts directly. Nothing of yours is trapped behind me, which is not true of every arrangement in this industry.
Regulation can change
Tax treatment, energy policy and the rules around digital assets all move. Nothing on this site should be read as a prediction about any of them.
The tax answer
comes from your CPA.
Section 179 is capped at your taxable income from active business. Bonus depreciation behaves differently. The passive activity rules can suspend a deduction depending on how your involvement is characterised. All of it turns on your entity, your income and your other activities, which is why the number belongs to your accountant rather than to a website.
What I hand them is the underlying record: machine serials and purchase invoices, hosting costs by site, and monthly production statements in a form they can file from. That is the part I can be genuinely useful for, and it is usually the part that is missing when someone brings this to their accountant on their own.
Find out whether this fits.
Thirty minutes on your capital, your timeline and your entity. If the numbers do not work I will say so on the call.
Book a discovery call No cost. No obligation. No follow-up sequence.