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Author Topic: How can I tell if a cloud mining business is not a scam?  (Read 77 times)
vit05
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March 27, 2018, 07:50:22 PM
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Contract deals for cloud mining are very old in Bitcoin. Just like Ponzi schemes. And usually, these two are related. The vast majority of companies that offer mining cloud only work on the basis of trust. There is little evidence that these are legitimate and audited schemes of large mining farms.

Companies that offer this service: Hashflare, Genesis Mining, Minex, viabtc, antmining, hashnest. Some of these companies are known for their pools, for their mining-related products, and for their large mining farms.

But there are several other small businesses that are offering such services. My question is: Is there any checklist to check if it is a legitimate business? Could I ask to receive Bitcoin directly from a newly generated block? Could I request that the blocks be generated with a contract batch signature? Are there technical possibilities to ensure that they are actually mining Bitcoin rather than managing a Ponzi scheme?


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March 27, 2018, 07:54:18 PM
 #2

Pretty much there is a simple rule:

1)  If they offer cloud mining, they will make money, you may or may not. 

Look at the fairly recent Kodak farce:  Relabeled S9s, you pay over $3000 (more than the cost of the units), they run them, you get half the PROFIT (so amount made after their electrical cost, if any).  Pretty silly.

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March 27, 2018, 08:11:50 PM
 #3

Do some research, there are lists of known scammers, ask yourself if their offer is appropriate which menas is their offer serious or are they promising to much. Check for payment proofs, generally I would say as older a cloud mining device is as more reliable it tends to be. I hope I coulkd help out.

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March 27, 2018, 10:00:42 PM
 #4

I think you can verify the cloud mining if their business is registered company in their country or if their business is licensed.
For me, if i see the mining farm in front of my eyes i could say that they are legit but if not they are scam.
And i experienced many cloud mining sites but no sites that actually gives you a real profit profit.

I suggest, if you want to mine bitcoin buy a mining hardware instead like antminer or GPU mining for low budget.

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March 27, 2018, 10:03:10 PM
 #5

My recommendation is if you have money and want to invest; buy cryptocurrency directly.

Cloud mining is probably the worst investment at this time. This is because we are in a bear market. The Bitcoin price is lower now than in November/December and the difficulty has increased so the returns are low. The returns are smaller at the moment due to the lower price of BTC so keep that in mind.

It's simple if you believe Bitcoin surpass the $20,000 of November/December 2017 invest.

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March 27, 2018, 10:25:21 PM
 #6

This should do...

  • Promises the following: overly high returns; No risk; (Too good to be true in other words)
  • No/poor reviews; Newly-created; Anonymous (A simple whois lookup will do: https://www.whois.com/)
  • No maintenance fee
  • Has the following on their site: a. false information b. copy/pasted info c. poor grammar

Still, The best way is to completely ignore every cloud minings  Wink. They're not even profitable anymore so why bother? Instead of buying contracts, it'll be more worth it to hodl a few promising coins.

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March 27, 2018, 10:50:23 PM
 #7

This should do...

  • Promises the following: overly high returns; No risk; (Too good to be true in other words)
  • No/poor reviews; Newly-created; Anonymous (A simple whois lookup will do: https://www.whois.com/)
  • No maintenance fee
  • Has the following on their site: a. false information b. copy/pasted info c. poor grammar

Still, best way is to completely ignore every cloud minings  Wink. They're not even profitable anymore so why bother? Instead of buying contracts, it'll be more worth it to hodl a few promising coins.
I agree on this list. It's too good to be true and most of the new existing cloud mining are promising too high daily percentage and it's unbelievable, unreal so if you have found one start to think again. Most of them aren't really profitable anyway and the first time that I invested with it, I got scam so I never invested on it again.
I suggest, if you want to mine bitcoin buy a mining hardware instead like antminer or GPU mining for low budget.
GPU mining for altcoins, there will be people who will say that mining is dead but it isn't.
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March 28, 2018, 01:52:52 AM
 #8

There's a forum thread around here that used to judge cloud mining websites based on many categories to determine a "scam level" for the website. Things like signed addresses, proof of mining, confirmed hardware purchases and things like that. Bitmain's cloud mining is legit, but it being profitable or a good decision is a different story  Grin
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March 28, 2018, 03:20:26 AM
 #9

Pretty much there is a simple rule:

1)  If they offer cloud mining, they will make money, you may or may not. 

Look at the fairly recent Kodak farce:  Relabeled S9s, you pay over $3000 (more than the cost of the units), they run them, you get half the PROFIT (so amount made after their electrical cost, if any).  Pretty silly.
Yeah one way or another but mostly their way lol. Cloud mining isn't worth it. It even has a discussion that shows how bad cloud mining is even they are legit. OP don't make the wrong move or else you will have huge losses that you did not think about or imagine about.

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March 28, 2018, 06:30:18 AM
 #10

Contract deals for cloud mining are very old in Bitcoin. Just like Ponzi schemes. And usually, these two are related. The vast majority of companies that offer mining cloud only work on the basis of trust. There is little evidence that these are legitimate and audited schemes of large mining farms.

Companies that offer this service: Hashflare, Genesis Mining, Minex, viabtc, antmining, hashnest. Some of these companies are known for their pools, for their mining-related products, and for their large mining farms.

But there are several other small businesses that are offering such services. My question is: Is there any checklist to check if it is a legitimate business? Could I ask to receive Bitcoin directly from a newly generated block? Could I request that the blocks be generated with a contract batch signature? Are there technical possibilities to ensure that they are actually mining Bitcoin rather than managing a Ponzi scheme?

Any small cloud mining businesses that have no apparent relationship with any major pools should be considered to be a scam, unless otherwise proven. That's just how it is, scammers love to open scam sites under the name of it being a "cloud mining site". If it's promising any kind of minimum returns, then it's for sure a scam as well.

Since even legit cloud mining companies will mine from pools instead of solo mining, it'll be hard to ask anyone to send BTC from a newly generated block, let alone the scammers.

It's just common sense, really. Avoid cloud mining as much as possible, even for the big names, a lot of them have shady pasts. If it's too good to be true then it probably is - as the old saying goes.

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March 28, 2018, 07:32:43 AM
 #11

  • Promises the following: overly high returns; No risk; (Too good to be true in other words)
  • No/poor reviews; Newly-created; Anonymous (A simple whois lookup will do: https://www.whois.com/)
  • No maintenance fee
  • Has the following on their site: a. false information b. copy/pasted info c. poor grammar
Add this one

  • Offering stable income.

Based on my research and my experience, usually scam cloud mining will offering stable income like 0.002/days. Even bitcoin difficulty doesnt affect this.

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March 28, 2018, 08:28:45 AM
 #12

  • Promises the following: overly high returns; No risk; (Too good to be true in other words)
  • No/poor reviews; Newly-created; Anonymous (A simple whois lookup will do: https://www.whois.com/)
  • No maintenance fee
  • Has the following on their site: a. false information b. copy/pasted info c. poor grammar
Add this one

  • Offering stable income.

Based on my research and my experience, usually scam cloud mining will offering stable income like 0.002/days. Even bitcoin difficulty doesnt affect this.

That should be the first sign that the cloud mining site you're researching is a scam. Why? Because nothing is stable. But stability appeals to everyone, so scammers will often exploit that to their advantage by offering cloud mining plans which guarantee you a fixed amount of profit if you invest. In that case, it's definitely a ponzi scheme in disguise. They are not actually mining. Either they are running a ponzi that will eventually collapse, or they're just going to take your money as soon as you put in any.

Scams are actually getting more advanced these days, so I doubt it'll be that useful to have a checklist. For instance, I've seen shady sites that I would never invest in that showcase their mining in real time or in video format with a real person on camera walking through.

You can never be sure, but it never hurts to ask the support of the site what pools they mine with and ask them for proof that they are mining, two very important pieces of info. If they ignore you or do not give you a good answer, then they are probably scammers.

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March 28, 2018, 09:38:05 AM
 #13

Genesis mining like big mining farms might be registered somewhere or have audits but I doubt on their total mining power. I think they are selling more mining power than they have  in their mining racks. Most of the cloud mining platforms have high minimum withdrawal threshold to encourage users to buy more power from them from which they can buy more hardwares which will ultimately end up being companies' without a single investment from their side.

Actually I can't give any checklist to check legitimacy of a cloud mining, simply I don't believe in them.
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March 28, 2018, 04:18:47 PM
 #14

there is an old topic about cloudminings and Ponzi schemes that they run here: https://bitcointalk.org/index.php?topic=878387.0 which is a little outdated since OP doesn't seem to be around but the general information there and the "checklist" you are looking for is a good enough information.

if you want my experience I say they are all either already Ponzi schemes or will turn into one at some point without any exceptions. the good/legit cloud mining services closed down a long time ago and never reopened. the existing legit ones will not make enough profit so they have to do other stuff to make profit and they end up wrecking everything.

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March 28, 2018, 06:24:51 PM
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But there are several other small businesses that are offering such services. My question is: Is there any checklist to check if it is a legitimate business? Could I ask to receive Bitcoin directly from a newly generated block? Could I request that the blocks be generated with a contract batch signature? Are there technical possibilities to ensure that they are actually mining Bitcoin rather than managing a Ponzi scheme?

To answer this question about that checklist theres none but you would be the one to create. Checking out such business would really need some research, you say small businesses can be somehow considered or trusted as long they do really have an actual miners but in my side I wont really risk up into those small time businesses,if you are really eager on making such investment then go always for the bigger ones,you might able to get some assurance that they wont ran off to early but on general speaking I wont even consider on putting up money into these cloud mining companies,profitability would always be the issue.
 

 
 
 

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March 28, 2018, 06:41:40 PM
 #16

[...]

you ask many things, but you need to realize the following: even legitimate cloud mining companies hide the location of their mining equipment. The reason for this? I believe it is fear of governments.

see this video:
 
CEO Bill Rowell visiting one of Genesis Mining Farms in Iceland.


see that they do not show images of outside the place where the equipment is, they only show image of the inside of where the equipment is. as I said before, I believe it is a fear of governments.

the same thing happens with hashflare, people lie because they want referrals, so far the hashflare is not being profitable ... I've seen a lot of post and said that it is not being profitable.

Hashflare is not profitable yet, i have everyday 40-50% miningfees. (59TH/s) And the dificulty grow so fast. For good earning the bitcoin must go up to 15-20K.

the rest of cloud mining is the same thing. If you want to know more things, go to YouTube and do research





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March 28, 2018, 07:19:56 PM
 #17

Contract deals for cloud mining are very old in Bitcoin. Just like Ponzi schemes. And usually, these two are related. The vast majority of companies that offer mining cloud only work on the basis of trust. There is little evidence that these are legitimate and audited schemes of large mining farms.

Companies that offer this service: Hashflare, Genesis Mining, Minex, viabtc, antmining, hashnest. Some of these companies are known for their pools, for their mining-related products, and for their large mining farms.

But there are several other small businesses that are offering such services. My question is: Is there any checklist to check if it is a legitimate business? Could I ask to receive Bitcoin directly from a newly generated block? Could I request that the blocks be generated with a contract batch signature? Are there technical possibilities to ensure that they are actually mining Bitcoin rather than managing a Ponzi scheme?

Yes there is site in online to find the best projects and to confirm whether it is legit or not scammy one. Please use the below to find it dude.
http://badbitcoin.org/thebadlist

If you want to block these kind fake site ads while you browsing there are add ons in the Google chrome.
Install and enable that to stop the spammy ads.

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