Insurance for miners

If you look at our communication in the terms and conditions, FAQs or Telegram channel, you could see that we repeatedly warn that in this business almost nothing can be guaranteed. We experienced a mining ban in China, power outages, riots and a complete internet outage in Kazakhstan, various migration between hosting centers and ASIC miners were offline for several months in 2021. These are situations that cannot be avoided. It’s just a matter of keeping them to a bare minimum. These are the catastrophic scenarios where we want to offer partial or full substitution of mining revenue when such a situation occurs.

For those catastrophic cases, VERIBI is now introducing a new insurance policy for the loss of the mining revenue. It is not a classic insurance where you have to pay a fee. VERIBI will use its 20% share of the profits to pay for the loss of the mining revenue.

What’s going to be covered?

The insurance does not apply to normal or warranty repairs of ASIC miners. It will not cover minor or short-term breakdowns, which we handle almost every day. As soon as more than 50% of the ASIC miners on a single offer are out of service for more than 48 hours, we will set the affected customers to receive coverage from VERIBI profit sharing. It is about solving the most problematic outages or disasters. For example, long term power outages in Kazakhstan, the riots and complete blockage of the internet in Kazakhstan, the ban on mining in China or even various migrations when ASIC miners are out of service for weeks or months.

How much will be covered?

It depends on how many outages there will be at that moment. At the same time, the more shares are sold on the platform, the more diversification and overall capacity to cover outages will increase.

If a small part of the total hashrate capacity (e.g. 10%) goes down, Veribi’s profit share should cover most of the users losses.

If a larger number of outages occur at once, the part that will be covered by Veribi’s profit share will be proportionally smaller. It depends on how many ASIC miners are currently mining or not mining.

The compensation works in real time, which means that nothing is paid back or in advance. It simply distributes Veribi’s share of the profit from the running hardware to the hardware that is currently not working.

The amount of payout on non-working hardware depends on the current difficulty and how much hardware is not mining at the same time. We calculate how much is mined on all our hardware and then divide it in proportion to the price of the hardware and the percentage of the individual shares.

For how long will the outages be covered?

The maximum duration of coverage is 12 months. In most cases we hope that we will be able to move or repair the miners within one year. But in case of catastrophic event, we will pay out of the reserve pool for 12 months. Please contact us, if you think this period is not long enough, because in the future we are considering the possibility of extending the insurance for a fee, which would be paid when buying a share.

How much does the insurance cost?

Nothing. There is no charge for this insurance. It is only an internal matter for Veribi to allocate its share of the profits as a possible insurance to cover large outages. It also maximizes our incentives to keep all hardware running and online 24/7.

Who is covered by this insurance?

For all shares purchased on the platform, including those in auctions or marketplaces. Except for a few exceptions where this will be mentioned (e.g. old S9 machines, which we do not currently sell).

What are the other benefits?

Veribi will only make money if the ASIC miners are up and running. If some don’t mine (which happens and is the reality of this business) then Veribi is the first to lose out. Users are covered by the profit share that Veribi gets for running this platform.The more shares that get sold, the larger the insurance reserve will be.

Is this a permanent feature?

It’s a new feature we’re testing. We have made the implementation relatively simple to make it as fast as possible. We want to see if users see any added value in this and if we get any feedback.