In my last post about Bitcoin faucets I thought I would stop updating you on my progress. However I’ve gotten so many requests to keep on posting my earnings that I’ve decided to do a monthly update on all of my faucets every month. If I’ll have something valuable to share I will, and if not, I’ll just update you on how things are going.
Side note: If you’re totally new to this concept of Bitcoin faucets start with this post.
Last month I’ve launched 99Satoshis. It’s a Bitcoin faucet similar to Milli with one small difference – it’s self hosted. Meaning, I’m not using a 3rd party like Faucetbox or Paytoshi to manage my payments. In the beginning I thought this would only be good for saving the 2.5% fee I pay these sites and also to become less reliant on 3rd parties, however I found out something much more valuable…
The way things work with 3rd party sites is like this: You deposit funds into your account, people claim small amounts of Satoshis from your faucet and that amount is deducted from your balance on the 3rd party site.
If you take Faucetbox for example, they only pay out to addresses with over 13K Satoshis. This is probably due to the fact that the minimum Bitcoin transaction allowed on the network should be at least 5430 Satoshis and some other factors. So all of the people who claimed up to 13K Satoshis and never cashed out aren’t actually paid but their claims are still deducted from your balance, and that makes all of the difference.
From the short time I’ve been owning a faucet I’ve learned that there are 2 main types of faucet users – the power users which will claim around 20K Satoshis a day, and the temporary users that just come out to try the faucet and most of them will not even pass 10K Satoshis in their lifetime.
For example, at the time of writing this post even though the total payouts for 99Satoshis are around 0.27BTC, the number of eligible payouts (that exceed 13K Satoshis) creates a total of 0.14BTC. So almost half of the payouts are not sent. But all of the ineligible users are still making you money through Adsense, so you’re generating revenue from this traffic without any expense.
So if you use a 3rd party as your provider they get to keep all of these idle accounts and the balance connected to them. If you own your own hosted faucet then it’s pure profit for you. My guess is that most faucet owners don’t think about this and for a good reason..
When you’re starting out with your very own faucet you should be focused on making sure “the money machine works”. Meaning, if you put in traffic on one end, money will come out of the other end. You also want to test this out as quickly as possible, and the best way to do that is by using 3rd party code. So if you’re just launching your faucet I still suggest using Faucetbox. But as you grow you have to move away from them.
Keep in mind that hosting your own faucet isn’t all sunshine and rainbows. It means you’ll need to create your own management system (and that costs money). You’ll also have to take care of the payouts yourself, protect the faucet from scammers and secure the funds you are using for your payouts.
So that’s my two cents on faucet management. And now for April’s report.
I’ve created a Google spreadsheet that I will embed on these posts to expose all of my earnings. This is the same sheet I use for my own management so you’re not missing out on anything. On the top you can see my revenue streams in USD and in BTC, on the bottom are my expenses (also in USD and BTC). The bottom line is the profit.
There’s a different column for each of my two faucets. Keep in mind that 99Satoshis was in Beta for the two weeks it was active in April so it hasn’t managed to accumulate a lot of revenue. However I can tell you that next month will probably be a pleasant surprise :)
Also many people can be amazed by the amount of revenue the Captcha service “SolveMedia” provides. Even though they got really great results in March and April the revenues from SolveMedia seems to be decreasing and will probably flatline around $300 a month in May, but we’ll wait and see.
For May I’m planning to move Milli away from Faucetbox and make it self hosted just like 99Satoshis. Hopefully this will increase my overall profit due to cutting down the expenses. As always if you have any questions or comments feel free to leave them in the comment section below.