AFAIK (corrections are welcome), pbmining prior to today always paid the theoretical yield down to a few digits. Perhaps some of you who have not recently purchased a contract, can dig up some older payments and dates and post them so we can check.

Or the buyers bought their hashrate over the course of this week?
But  that wouldnt explain why the sum of payouts is substantially less (equivalent to 3.8PH) than what you'd expect from the total hashrate on the stats page even at the start of the previous week (4.4PH, growing to 4.6 by the end).

3.8/~4.5 = ~85%


It cant be out of money, pbmining is sitting on a gigantic pile of coins. It just doesnt make sense to pay several 100 BTC and ruin the only asset a ponzi has (misplaced trust) in one go.

Interesting. Can anyone confirm they got the full theoretical yield of their contract or did everyone get only ~85% of what they were owned?

If confirmed, I have to admit being a bit baffled. And that is despite my prediction that "fees" could be introduced as a way to wind down this ponzi. Its just that I would not expect gradual and relatively mild fees since that would completely kill credibility of the issuer (and thereby, his revenue stream),  while only moderately diminishing his obligations.

A (possible) difficulty decrease and a "more cautious release schedule" for (completely unproven) hashrate.
Could there possibly be a relation ?

I edited the OP to make clear that hashie's entry is about what they call "gen 1". Thats hashrate they have been selling since inception, and still sell,for which there is no shred of evidence, and no endorsement from anyone. In fact, its quite remarkable how hashie tout the provability of AM1 and remain utterly silent on the question of provability of their own hashrate. Unless you accept their logic that because they charge maintenance fees, it has to be legit (Im not kidding).

AMhash have stated they will back the contracts sold through hashie, so your main concern there is AMhash's credibility. Although you should wonder what happens when you place an order through Hashie and they dont pass it on. I sure would ask that question to Amhash before placing an order.

(this is a self-moderated thread to avoid being spammed. Every post that contains a referral link to any cloudmining site will be deleted, for reasons explained below).

Cloudmining 101

Everyone here is focused on ROI, hardly anyone seems to care if these companies are legit. The majority of cloudmining websites dont do any mining whatsoever. They pay out old customers via coinmixers from revenue that comes from recruiting new ones. This is the common definition of a ponzi scheme. No surprise, to keep the game going they usually heavily emphasize referrals and signature campaigns to make you do their dirty PR work.

Now why would you care if these companies are mining or not? All that matters is they pay out, right?
Wrong.

If the company (or more aptly: scammer) isnt mining, then its impossible on average for the investors to profit. Early investors might, but only at the expense of later ones and only if the ponzi can survive long enough.  If no mining is going on, then there is nothing to generate those profits. So dont be fooled by low prices or high payouts. Ponzi miners will drop prices as low they need to keep the game going until one day they vanish.

And dont think because its been running for 10 months, that it has to be legit either. Unlike traditional ponzi's, mining ponzi's dont risk a bank run. You cant get your money out if you begin worrying, so they can run a fairly long time.

Take PBmining,  they have been around since the beginning of 2014 and havent failed to pay so far. Does that prove its not a ponzi? Hardly. Based on their own stats, in the past month they sold ~1.5  PH worth of contracts. Good for around ~2200 BTC. During that same month they paid around 1600 BTC in dividends. A net profit of  ~600 BTC or nearly a 1/4 of a million dollar. Just for running a website. So the fact they are still paying out doesnt prove they are legit, its actually far more likely they are still paying out because it maximizes their profits ( update: pbmning meanwhile collapsed: https://bitcointalk.org/index.php?topic=887871  qed.).

Of course that cant last. At some point the new sales will slow while the owed dividends keep going up. Once the latter becomes bigger than the former, guess what the anonymous operator will do? The same thing lunamine, coinsoncloud, pirate, bitcoin-trader and countless other (mining) ponzi's before did.



Be smart. Think before you invest. Dont trust *anyone* with a referral link in his signature.

Criteria to help you spot a cloud mining scam/ponzi.

1) No public mining address / no user selectable pool.
A cloud mining company that wont let you direct the hashrate to your pool of choosing and cant prove its actually mining bitcoins itself, is very likely a scam. There is no reason to hide mining address or not sign blocks. None.

2) No endorsement from any asic vendor
Asic vendors will gladly make a simple post to show the company in question is a significant customer of theirs. Its free advertisement for them and it helps their customer grow their business, so there is absolutely no reason they wouldnt. If a (cloud) mining company cant get any asic vendor to post such endorsement, you should assume they dont have any hardware to mine with.

3) No relevant pictures of their hardware and datacenter
There is no reason not to provide such pictures, except of course, if there is nothing to take pictures off. Mind you: pictures can be faked. Picture dont prove current ownership. So like all criteria listed here, by themselves they are by far insufficient proof.

4) Open ended IPO / fractional reverse mining risk
Unless the cloud mining is operated by the asic vendor himself, you can not sell an unlimited amount of hashrate. Hardware takes (usually a long) time to order, arrive and deploy. Any company that doesnt limit sales or make public how much hashrate they sold vs what they have (provably) deployed should be considered  suspicious.

5) Referral programs and social networking
Referral programs, especially ones that pay almost 10%, are a huge red flag. The mining market is cut throat with razor thin margins. No real company can afford to pay 10% referrals on below market cloudmining prices. Referral programs almost always serve only to feed the ponzi and provide financial incentive to posters to lie about the true nature of the company. Never trust anyone with a referral link in their sig.

6) Anonymous operators
If the operators are hiding behind whoisguard, provide no provable identity and especially when, like in some cloudmining cases, they use demonstrably false ID or company registration information, you have to be nuts to trust them with your money.

7) No exit strategy
If you cant sell your position, you cant get your money out. Thats the ideal case for a ponzi and allows it to run for a  long time.

8 ) Bonus point for "guaranteed profit"
So far, Ive only seen bitcoinmaker.ch do this. If anyone guarantees you a bitcoin denominated profit, and especially a 30+% one, you can be sure its a ponzi, all the other criteria become unimportant. There is no such thing as certain profit when it comes to mining, no one knows how the network will evolve, or what btc exchange rate will do. If anyone could somehow be certain of making a 30% profit, they wouldnt need your money (and they wouldnt give the profit to you).

Application of these criteria to some cloudmining companies

Feel free to post corrections or additions.

Ponzi's that have already collapsed as predicted:


Likely Ponzi scams that have yet to collapse:

Rest:

Obsolete or suspended:


Proving a ponzi

A ponzi is defined by the absence of a mechanism to generate revenue or profits (in this case: mining hardware). Proving something is a ponzi would therefore require proving a negative. You can not prove a negative, so in theory its possible any of the companies I labeled as "ponzi" are in fact mining. But thats like saying in theory its possible unicorns do exist or that its possible that Nigerian Prince who emailed you yesterday, really inherited a $500M gold mine concession and wants to share it with you. You can not prove thats not true either, but to most sensible people the complete absence of evidence is a very compelling reason to dismiss the claim, and thus certainly reason enough not to invest there.

Success rate so far

Recently imploded cloudmining scams that where  rated as (very) suspicous or ponzi: 14/14 (100% hit rate)
Companies that were rated as probably/legitimate yet substantially failed to honor their contracts: 1*/7 (86 % hit rate)
(*) Amhash which may yet resume payments, though I wouldnt bet on it

Overall hit rate: 95%

Want to help out ?

You can help out by reporting new ponzi's and preparing the assessment.

You can tip me on this address: 15YNTMoAzTCve64rveEka75qCeJMZpmDCx
Anything I receive there will be used to further this cause, like doing signature campaigns to raise awareness.

Here is the current signature campaign thread: https://bitcointalk.org/index.php?topic=888864
Feel free to join, you'd be helping a good cause and you might win 0.1BTC

Disclaimer

being legit does not equal being a good investment. By and large, cloud mining has not been profitable historically, and I dont expect it  will.  I do not recommend you invest in (cloud) mining at all, but if you do, at least invest in a company that will actually contribute to securing the blockchain and is not extremely likely to just steal your money.

Also, being rated as legit here doesnt guarantee you anything. All it shows is that said company has provided reasonable evidence it is a real company and your investment is backed by actual hashrate. It doesnt guarantee they wont scam you, and it certainly doesnt imply anything about profitability.

Locking this thread and starting a new topic here;
https://bitcointalk.org/index.php?topic=878387.msg9697654

 because I dont want this to be abused to spam ref links to ponzi's.

Its just not very reliable. Probably built by blackarrow

Fuck off you ref whore.

Which VPN service?

Seems like he paid out ~333 BTC. That corresponds to 3.8PH, not the 4.4-4.6PH I get from the stats.
Can you "reinvest" your payouts before they are actually paid out?

By the way, in the past 5 days, stats went up by 197PH, good for 276BTC.
extrapolated to a week that gives an estimated 276*7/5=386 BTC

Looking at 1Piggy it would seem he got ~420 BTC in revenue.

50-90 BTC loot this week.No surprise he is still paying.

Nothing in there right now that speaks to me (im mostly in to miniquad racing). Would like to be able to order some gear for btc though. THings like miniquad or minihex frames, FPV gear etc.

At last, we have some proof:  you are charging money for it, so its not a scam 

You're right, but its extremely limited (3%, non tradeable and applies only for as long as the referred customer mines, ie, he cant trade his shares either). If you combine that with the skyhigh prices at cex.io that imply a healthy margin, it doesnt really raise a red flag with me.

I recommended to amhash they sell their own shares directly. Having to chose between a shady and likely illegal (outside panama) exchange and a almost certain scam operation, doesnt make this very appealing. Now in practice,  either way should work as amhash should be able to honor the contract regardless if HL or Hashie disappear, but I cant in good conscience recommend either.

I find this so hilarious that people just assume because I warn against obvious ponzi's that I therefore have to be invested in or have some interest in competing schemes. The hilarious part is that if you visit cryptx or amhash threads you will find investors in those vehicles accusing me of the exact opposite, shilling for the competition against their investment.

IOW, maybe you should check my posting history before making insinuations that make you look like a fool. While doing so, you may also discover a thing or two about my batting average making predictions on these matters. Including I might add, cryptx. Go read what I wrote about cryptx that last summer. Here is a starting point:
https://bitcointalk.org/index.php?topic=310783.msg7396854#msg7396854

To answer the question on how its doing: its doing pretty much exactly as I predicted. If you account for the share split, its actually quite scary how close my numbers came. But they are still honoring the basic premises of their contract, something I never gave any reason for to doubt. Unlike this scam.

the rating for hashie is for their own "gen 1", for which no proof whatsoever exists, nor any endorsement from AM.
AMhash itself seems pretty legit, why they are reselling through something as shady as hashie is beyond me.

Because I havent been able to find how many TH they sold vs what they have provably deployed themselves. I havent found the former number at all (maybe if you have an account there you can?) and the pool stats only seem to show a combined total of their own hashrate and other ghash.io pool users mining there. So how do we know they didnt oversell ? Judging by the price they probably didnt, but thats hardly solid evidence.


couldminr? Rofl, fat chance.

No. Is the Red Cross a scam site because my donations dont ROI ?
Its a scam if they deceive you, dont provide what they promised. But an investment that doesnt achieve, or even can't achieve positive ROI is just a bad investment.


The ponzi's generally wont give you a profit either. IN fact they will on average cause a far greater loss than the legitimate sites.  They just appear profitable, right until the moment they run off with all your money.