This is a contributor content by Andrew A.Chief Marketing Officer at Weltrade.
For fintech, this is one of the most important KPIs-user retention. The more actively users return to an app, the more likely they are to create savings accounts, buy some cryptocurrency, or even take out a crypto backed loan.
Therefore, the more profitable a company is in doing so, the more DAU, WAU, and MAU it will have. However, for achieving high retention rates, companies must compete with each other, out of their mind, to implement solutions to make their products more attractive to their customers. user.
One of the results of such an approach is the Synthetic cloud-based Bitcoin mining that we implemented at YouHodler.
The Birth of the Synthetic Mining Idea
When I was working at YouHodler, we were looking for new tools to engage users and at the same time introduce them to cryptocurrencies. Real Bitcoin mining requires a large investment in equipment and electricity; thus, it is not suitable for mass market adoption.
We decided to create a simplified “synthetic” mining model. From the user’s perspective, it looks like this: they open the app, tap “Start Mining,” and then wait a few hours while the countdown runs. At the end of this period, they receive a small amount of satoshi. No computing resources are required—everything is virtual. Meanwhile, the user felt as if they were engaged in real mining, which became interested in the world of cryptocurrency.
Why We Decided To Give Out Satoshis
Giving real money doesn’t make much sense at first glance, because, well, it has a direct cost. But our point is to give people a free starting point. It is common to have many fears before buying cryptocurrency: someone is afraid of losing money, someone does not understand how everything happens technically. Synthetic cloud mining has helped to exclude these obstacles. Even if a person earns only a few satoshis, they feel that a piece of Bitcoin is already theirs.
These micro-rewards gave rise to curiosity-a desire to see what else was possible with the app: opening a savings account, exchanging cryptocurrency, or getting loans against existing coins. It is impossible to spend satoshi outside the app because the value is too small, but on the platform, they have created a place for experimentation. So, users gradually realized the value of our services.
The Spike in Key Metrics and Early Problems
When we first released synthetic cloud mining, our metrics went through the roof. Users sign in multiple times a day to not miss the end of each mining cycle. We started running ads introducing this new feature with catchy slogans like “Mine Bitcoin for Free” and “Try Risk-Free Crypto Mining.” Inbound user growth has accelerated, while CAC, the cost of acquiring a user, has shrunk.
But problems arose. These seemingly trivial payments proved to be a heavy expense when spread across thousands of users. Worse, many new participants stayed for the free satoshis only, without showing interest in any other product. This caused financial stress and undermined the economics of the mining program.
Freebie-Hunters and Their Impact
It soon became clear that making synthetic mining too easy was building a massive audience that wasn’t ready to take real action. These “freebie-hunters” create dozens of accounts to maximize their rewards. Our budget took a hit, and we saw no increase in conversion to paid products. In addition, moderating and blocking fake accounts has become increasingly difficult.
We realized that if we don’t make adjustments to the mechanics to have access to more generous payouts even harder – then cloud mining will remain popular with people, just not financially friendly for the company.
Tiered System: A Solution to the Problem
We decided that there should be an eight-level loyalty system, from Newbie to VIP. Each such level provided the user with different mining settings, such as a limit on the number of “blocks” (sessions), per block speed, and the payout amount. At the Newbie level, a user is only entitled to four blocks, each for eight hours. This has greatly slowed down earnings, reducing profitability for those just looking for easy money.
Exchanging currencies, opening a savings account, or making deals, then actively using other services will gradually let users switch to Silver or Gold. Accordingly, their available mining volume will increase, and waiting times will be shortened. And it worked as a psychological driver: “Do you want to mine faster and earn more? Then trade, get a loan, and bring real value to the company.”
Economic Balance and Its Impact on the Audience
Immediately after we introduced the tiered system, strictly “freebie” users fell, but the rest brought more value. We have retained the appeal of a “free” mining feature while tying it to the real use of other products. So, too many disinterested users is no longer a red flag—what matters is that those who stayed engaged and became more loyal.
Our DAU has fallen from that peak, but only because our user base hasn’t “grown.” Other good news for us includes increased transactions, increased profitability, and decreased fraud. In other words, the system corrected itself: while at new levels it was easier—and more profitable to—mine.
The Rise of “Tapper” Apps and How They’re Different
Then, for a long time, fintech was flooded with “tapper apps,” where everything boiled down to pressing a button and waiting for virtual rewards. The most notable example is Hamster Kombat, but not the only one—amazingly, it has gained millions of users that it often struggles to earn properly.
The thing is, the rewards in such services usually stay in the game and do not convert to real money. Users tap for fun, but the link to financial products is often weak. This is what sets them apart from our cloud-based mining format: even if the amounts are small, our rewards are tied to Bitcoin. Users understood that they could use the satoshi they earned in payment services or savings. This allowed us to create real value, not just an incentive to play.
The Power of Gamification in Fintech
Gamification turns tedious financial operations into compelling tasks. People love the feeling of accomplishment, and mechanics involving timers and rewards effectively boost activity. The key is to make sure the “game” doesn’t become an end in itself—just tapping buttons for virtual rewards.
Our example showed that synthetic cloud-based mining can be sustainable if it is built on an economical system. Engagement is high because people feel they are actually “mining” cryptocurrency despite its symbolic value, while the platform can guide them to use its core products. This delivers the desired business results of increased conversion to real transactions and stronger loyalty.
Lessons and Future Prospects
Cloud mining speaks to how new gamification mechanics, combined with well-thought-out product economics, can result in explosive growth in retention and reach. Distributing microscopic parts of Bitcoin makes perfect sense in cases when those parts are woven into the app ecosystem.
This is a key to success—the tiered system that balances “free access” with the need for real user interaction. If a user wants unlimited mining, he needs to be a real customer: make some transactions and provide income for the company. That’s why this gamification is more than just a “lure”; it provides a clear way in which each participant can become more experienced and active. Although new “tapper” apps and other formats continue to emerge, only those that offer real value—not just a game—will survive in the long term.
Also read: Empowering Communities: The Social Impact of DePIN
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