Why don't people realize the problems with cloud mining?

[squatz1]

I fail to understand how it's hard to notice that people aren't just going to give you access to their rigs and ASIC miners and pay you profit from it (without it being a scam) or that these lifetimes contracts are actually going to lead to profits, as companies like gensis mining are only going to pay out if its PROFITABLE FOR THEM AS WELL.

What's so hard to understand here and why are people, joining into this cloud mining scam?

[1714009301]

1714009301

[1714009301]

1714009301

[1714009301]

1714009301

[krishnapramod]

It's quite obvious, greed. People who simply want to earn some quick bucks without any effort fall for these scams, cloud mining, HYIP, Bitcoin generator, doubler. They do know they are investing into a scam, but still  believe they would be lucky enough to double/ROI their investment and in the process drag other people into the scam, referrals. No need to own any equipment, making money on the cloud, that's the lure, simple common sense is more than enough to grasp why would someone lend their hardware when they are making enough profit.

Apart from greed, newbies fall for cloud mining scams, they don't do any research, someone recommends and they blindly accept it. There are a couple of posts every week on this section, newbies asking whether this cloud mining is legit/profitable, they simply want yes or no, rather than researching or understanding how the cloud mining model works.

[h0lybyte]

These fake schemes are not really easy to understand for newbies, they actually have no experience realistically in such bitcoin dubler, cloud mining and some more similar fake offers. Rather than investing in legitimate companies, they prefer to earn profits overnight without researching whether it is give them return or not. People realize only when once they lose their money and time following fake doubler schemes

[pugman]

Well, not only newbies anybody who is in a state of mind filled with greed and hunger for more and more money would fall for unrealistic, quixotic and starry-eyed schemes and what not. No one wishes to do due diligence, they just see the offers the websites are "willing" to provide to their very good and loyal customers and they fall for it and later they come whining and bitching about it. People use internet as a medium to get scammed instead of learning something new and something that would benefit them. Two types of decisions that people make that either ruin them or build them up. 

[sunsilk]

What's so hard to understand here and why are people, joining into this cloud mining scam?

Lack of knowledge and everything that they are searching out is all about profiting in cryptocurrency or mainly with bitcoin.

As the popularity of bitcoin starts to pop the entire world, they starting to search what bitcoin really is and how to earn it. And the result is they ending up reading beginners guide and the first on the list of earning is through mining.

They are not aware that cloud mining is different from the real one so they end up being a victim and investing to these scams.

It's quite obvious, greed.

True!

[Slow death]

What's so hard to understand here and why are people, joining into this cloud mining scam?

well have you seen how many options there are to increase your bitcoin? there are many options but many of these options are complicated and because these options are complicated people choose the easiest options, such as cloud mining.

cloud mining is telling people the following: deposit 0.02btc that you will receive forever and payments are made every day for your wallet. Dude, this solve many problems and still you earn bitcoins every day... is perfect. this is what many people think! years ago I thought so. with the passage of time you realize that this is not benefit, on the contrary is bad business. It's no use saying "cloud mining sites are ponzi scheme". People will not listen, unfortunately.

[TATTICEO]

For a lot of people who have never mined to made rigs, mining coins is a bit technical. They realise that the best way is to mine but then the profit depends on electricity cost, the mining pool and the hardware. To avoid all this hassle people start looking to buy into cloud mining. The part they fail to understand that  their return is lower than if they handled all the mining themselves.
Also, People are always looking for others to do the tech stuff so they don't have to deal with it. May be in their minds they compare it to email hosting

All the tech guys I know do their own mining. In my opinion, Its only the people who don't understand crypto well go after Cloud Mining. (correct me if I am wrong)

[TommyZ]

This is really hard for me to understand either. Is it greed, misinformation, laziness, all three? I think that some people are not willing to do research. Perhaps high returns from crypto are suppressing common sense and newbies think it's also relative to mining.

On top of that, stupidity? It's maybe off-topic but look what's happening with BitconnectX ICO. People know it's the same team as Bitconnect, they don't even hide it. There is a thread on this forum where veterans are trying to explain to new users that this is a scam and still, so many post are saying they will invest.

We have had so many examples of cloud mining scam and people are still joining it. I don't think it will ever die.

[BitHodler]

Greed is an important factor as described by above posters, but what really makes people look to get involved in cloud mining, is the hunger for a passive income based revenue stream.

It's in people's nature to try and obtain income that doesn't require any effort, and also because of the fact that basically everyone can do it since it doesn't require proper understanding of what cloud mining is.

From that perspective I can actually understand people, but it's their stupidity to achieve passive income without doing research or paying attention to how bad the overall profitability of cloud mining is that makes them look bad.

How much of a brainless person can you be when you ignore all red flags?  

[olubams]

I fail to understand how it's hard to notice that people aren't just going to give you access to their rigs and ASIC miners and pay you profit from it (without it being a scam) or that these lifetimes contracts are actually going to lead to profits, as companies like gensis mining are only going to pay out if its PROFITABLE FOR THEM AS WELL.

What's so hard to understand here and why are people, joining into this cloud mining scam?

Sometimes people just decide that they have to do something the same way some other people do it and be expecting different result. Its an outright a foolish decision but its because of the normal nature of humans to be greedy by putting small amount and expecting some maximum return without having to do anything at all. So, the cloud miners will continue to have their ways, newbies will continue to flood the market and until when they are bitten, they don't learn.

[buwaytress]

I think it's too simplistic to put this down to greed, ignorance, laziness, etc. though I too believe that it is usually a mixture of all these. As h0lybyte says, we've got to remember that understanding how Bitcoin itself works represents a steep learning curve, never mind the complexity of how mining works. I am meeting and talking to people who've only just started using Bitcoin and the world of online hyip schemes, doublers, "cloud mining" is very new to them.

Take this for context. They've just read the news of how Bitcoin made 1,000% gains in a year (if they entered in December, this would have been twice that!). So a cloud mining scheme that promises to return 100% profit in little under a year actually makes sense. A disguised hyip Bitcoin scheme that makes them 5% a month also seems to make sense. They cannot distinguish how, they can only correlate numbers.

Now if you did basic research on cloud mining, you get Google showing you some of these legitimate companies... Genesis, hashflare. Even surfing to bitcoin.com (which newbie wouldn't, right?) and you get shown an offer to participate in cloud mining for profit.

Not saying users shouldn't shoulder the blame. But we can always expect newcomers to fall for these early on. And as TETTICEO points out, we might have legitimate users curious to mine but can't access the tech or expertise needed. Cloud mining seems like a good start for them to enter the business - especially when it's recommended as an option by "reputable" sources (such as Bitcoin.com. I quote from them: "Cloud Mining. Start mining immediately with our cloud mining contracts! 100% guaranteed uptime."

[maeusi]

Many newbies begin with cloudmining, because they simply don't know, where to buy cryptocurrencies as I experienced. They see ads on emails, websites and also contracts on a popular online auctions platform.
It is often more difficult for a noob to find an exchanger, where they can buy Bitcoin without need for a long and difficult verification process or to find a fair seller.
So for them it seems much easier to just buy a contract on cloudminer
Citizens of some countries like Austria are lucky to have Bitcoin ATM, so it is easy to buy Bitcoin.
Fortunately there are a few legit and trustable exchangers, which I can recommend them and also great sources here on bitcointalk for getting them intodruced into the basics of cryptocurrencies.

[BrewMaster]

it is because these companies don't tell you "we are gonna scam you, ha ha ha"! instead they are giving you all kinds of promise and showing all kinds of security and give you a lot of assurances. on top of it there are numbers showing "profit" and when people want to believe something, ofttimes they do believe it.

and in the end they are mining BITCOIN. this thing they don't even understand and only see the 20x rise in 1 year stat and think about getting rich by getting paid 1 satoshi per day...

[reflector]

I fail to understand how it's hard to notice that people aren't just going to give you access to their rigs and ASIC miners and pay you profit from it (without it being a scam) or that these lifetimes contracts are actually going to lead to profits, as companies like gensis mining are only going to pay out if its PROFITABLE FOR THEM AS WELL.

What's so hard to understand here and why are people, joining into this cloud mining scam?

Even today also I have seen many scam created a thread to spread their ponzi cloud mining projects. Mostly people get caught in these kind of projects are newbies who is not much about the crypto currency as well.
You have mentioned sites like genesis paying properly to people whoever invested on the contracts and hash power. Still many people reported about them in the same section you have written, so none of them are good in cloud mining. Better we can buy the video cards are create our own mining rig.

[UsernameBitcoin]

People want to fool others so that they get referrals.

[mrcash02]

First newbies hears about a profitable currency called Bitcoin, then they search about it on Google and join some Facebook groups and there they find several referral links of legit cloud minings and people saying it's the future's business, it's an easy way to produce passive income. So the newbie connect the points and start dreaming about this, especially after calculating ROI on cloud mining sites (these calculations are wrong and use today's rates as it would last for months or years). The point is that the cloud mining owners and the referrers omit the fact that the income decreases each new day.

In some cases show proofs that the ROI was achieved, but in Dollars and never in BTCs... It's profit anyway, good, but it could be much better if you had bought Bitcoins instead of mining it on the cloud.

I just don't think it's newbie's greed, they see the opportunity to have a legit passive income, so they go for it. Their only fault is to not investigate this kind of investment better.

[KurtR90]

Due to the desperation of acquiring double profits in a short term. For those who just enter the investment is easier to rely on what can afford accessible money faster than what offers less percentage or long-term gain. That is why many fall into debt, scams and endless forms of theft.

[Rahar02]

It's quite obvious, greed. People who simply want to earn some quick bucks without any effort fall for these scams, cloud mining, .

These fake schemes are not really easy to understand for newbies, they actually have no experience

Well, not only newbies anybody who is in a state of mind filled with greed and hunger for more and more money

Lack of knowledge and everything that they are searching out is all about profiting in cryptocurrency or mainly with bitcoin.

I want to quote all of the posts above but some of it is enough to describe the perspective of some people about the cloud mining.
is it true?
Greed, lack of knowledge, stupidity, have no experience, etc.
it may be right in some cases (fake cloud mining).
But, if you ask; have you ever invested in genesis mining or hashflare?
The answer is NO, they have not.
They just read other people comment about how terrible cloud mining is, not get paid, payment delayed, etc.

But, I can say: genesis mining quite fair and it's paying people for their hashrate.
It's not me, but some of my friends, I have asked them about genesis mining and the answer: it's paying and profitable. I don't know about hashflare though.

One thing to note: every investment has a risk, whether you will get profit or lose the funds, in this case; just put some money that you are willing to lose. But don't invest blindly without doing some research about the investment and asks some investors, not just ask "commentators" who never invest.

[pawanjain]

There are only two reasons I can think of, that is making people blind from seeing the obvious scam.
*Knowledge
*Greed

Knowledge is for the beginners who want to earn cryptocurrencies but lack knowledge and get easily scammed by the cloud mining sites.

Greed is again for the beginners and for the others who want to earn more money in a short time. People should understand that there is no shortcut to money. Its an obvious scam.

[timerland]

I fail to understand how it's hard to notice that people aren't just going to give you access to their rigs and ASIC miners and pay you profit from it (without it being a scam) or that these lifetimes contracts are actually going to lead to profits, as companies like gensis mining are only going to pay out if its PROFITABLE FOR THEM AS WELL.

What's so hard to understand here and why are people, joining into this cloud mining scam?

Logically, nobody should be falling for this but realistically, the promoters of these cloud mining sites are just too convincing for newbies. Most experienced bitcoiners won't even look at any advertisement that has the words cloud mining in it.

People think that they can make a passive income from cloud mining, build their portfolio with "strategies" that are drawn up by random nobodies on microsoft excel. In reality it's never that easy, you have to earn your income. There is just no way that you're going to get the promised profits on your investment without the site being a ponzi or bitcoin price going up many times in a year.

Look, to all newbies out there, cloud mining is only consistently profitable for the website, not you. Otherwise, why are they offering this at all??