Razer Inc. is a globally recognized brand that manufactures gaming hardware, but recently, it is trying a new business model — mining cryptocurrency. Except for one thing, Razer wants you to mine it for them.
This week Razer introduced the desktop app Razer SoftMiner, which enlists the user’s GPU to mine cryptocurrency when their computer is idle. On the surface, this seems like a move by a reputable company to make cryptocurrency mining easy for its customers. Unfortunately, it’s not.
When you use the Razer SoftMiner, all the cryptocurrency mined goes to Razer, and users receive Razer Silver, which is not a cryptocurrency. It’s a reward program currency that can only be redeemed for products in the Razer store.
Okay, that’s strange but maybe it’s worthwhile. In order to discover what was really going on, we ran the numbers.
Razer proudly advertises that you can “Earn 500 or More Razer Silver in a Day,” but it turns out Razer Silver has historically been worth about .00077 cents toward Razer products. This works out to about 38 cents a day in exchange for devoting a top of the line graphics card to Razer SoftMiner.
Mining profits are always fluctuating, so it is hard to quantify exactly how much can be earned as it depends on many factors. Depending on what is being mined and its value, this could be significantly less or even more than the natural mining profits.
This deal is bad either way: the user has to pay the power costs, wear out their own hardware, and lock down their own computer. Razer is expecting its customers to foot the power and hardware costs so that they can mine cryptocurrency. It’s likely when the cost of electricity and replacing hardware is accounted for, the user is losing money not earning it. To add insult to injury, after the user pays all of the real costs, Razer is able to accumulate assets which have the potential to substantially increase in value while the rewards they pay to their miners will always be worth pennies.
An educated cryptocurrency miner would never use this product, but Razer likely isn’t marketing this to real cryptocurrency miners. Instead, it is taking advantage of the lack of education surrounding cryptocurrency and the mining process. It is able to make a bet that most of its customers won’t grasp the true costs associated with mining.
This is particularly disappointing because if a global hardware manufacturer like Razer were to simplify the mining process, it would be a huge boon to the entire cryptocurrency sector. Instead, it seems like a cash grab.