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How to identify Cloud Mining Scam?

Today I will list the basic principles that I use in my reviews of cloud mining services. They help me distinguish a scam project from a service that can last long enough to meet user expectations.


It is important to understand that even if the service looks like a reliable one, you are still not insured against the fact that the site will close and no one will return your money.


Cloud Mining Review

  1. Trustpilot.

  2. Whois

  3. Free offers.

  4. Discounts when buying large volumes.

  5. Prices and level of profitability

  6. Payment methods

  7. Accruals must depend on the difficulty of the network.

  8. Calculator on the site and the promised profit.

  9. Agreements and documents

Trustpilot

Trustpilot is a site where you can write a review for any web resource. CloudMiningInfo has its own profile and you can see what reviews we have left about various cloud mining services.

If the cloud mining service starts not paying money to its users, reviews will immediately appear and the rating will fly down (example - IndigoCoin). You can read the reviews and see if there are any messages about fraud and scam among them.

If there are at least a few such reviews, you shouldn't register and buy a hash rate.

But if the reputation is perfect - all the reviews are positive, and it seems that all users have solved all their life problems as soon as they bought service packages there - this does NOT mean that the service can be trusted.

It is necessary to check further, because it may be that:

  • The ponzi scheme has not yet reached the crash point.

  • The reviews are fake.

For example, you can see our review of the Shamining service. They have impeccable reviews on the Trustpilot, but the project is undoubtedly a scam.

Whois

This website helps me to see the date of creation of the domain on which the service is located, and sometimes even the country when scammers feel completely unpunished.


As it was in the Shamining review - they wrote about themselves that their service has been operating since 2019, and thanks to the who.is website, we see that the registration was made only in May 2020 and from Russia. Despite the fact that there is not a single Russian person on the "Team" page. I could save their photos from the site and search the social networks of these people through a neural network to prove that these people have nothing to do with the world of cryptocurrencies, but I just got lazy. There was already enough evidence of scam.

Free cloud mining offers

Some services offer free capacity packages upon registration. They are supposedly created in order for you to understand how the service works.

Not. You must understand one thing:

Nothing is free. Everything has a price, except air.

And if you are offered to receive a certain amount of TH/s for free upon registration, ask yourself questions:

  • If everyone signs up and receives the hashpower as a gift, what will they be left to sell?

  • How will they keep records if free hashpower is received, but it is not enough to reach the minimum withdrawal amount?

In honest companies, they never gave anything for free, at most - promotional codes for a discount on purchase, but this is completely different. This is how they adjust the price during fluctuations in the Bitcoin exchange rate.

Discounts when buying large volumes

There is no reason to give discounts when purchasing large hashpower packages.

Each unit of hashpower has the same profitability.

No one will sell you hashpower at a price that would be disadvantageous to the seller. Does this mean that the price for a smaller volume is too high? Perhaps, but most likely the project is a scam. They want to take as much money as they can, counting on your greed.

Prices and level of profitability

Prices for mining plans should be moderate. There are sites that offer you 1TH/s for almost $ 130. Such plans will be unprofitable even if there is no increase in netword difficulty. For an example, check out the review - "Hashing24 mining contracts analysis: they are all unprofitable!"

On the other hand, some sites offer you 1 TH/s for $ 19.5. For example, see the "Acton Mining Review: Scam".

Here, on the contrary, the profitability is too high, which would be disadvantageous to the seller.

Any price must be justified.

The correct mining plan should be such that, in a pessimistic scenario of increasing the difficulty of bitcoin, the buyer will lose part of the money, in a realistic scenario, he earned a little, and if the difficulty grows insignificantly, he earned a lot. The seller insures himself against the unpredictability of the growth of network difficulty by selling contacts for mining.

An example of correct pricing can be found in the "ScryptCube Mining contracts Analysis: New calculator!"

Payment methods

If there are no other payment methods on the site other than transferring bitcoin or other cryptocurrencies, this should also be alarming.

If cloud mining service does not even have a bank payment system, most likely they are not registered as a company.

Accruals must depend on the difficulty of the network.

In reliable cloud mining services, the level of charges varies slightly every day, and after changing the difficulty of the network, it changes by the amount inverse to the change in difficulty.

For example, if the difficulty has increased by 5%, then your daily charges will fall by 5%.

Some services in the prices tab write how much the contract earns per day, while the value is stable and unchanged. This cannot be. In addition, the promised charges must be adjusted each time depending on the change in difficulty.

Calculator on the site and the promised profit

If the cloud mining service has a profitability calculator, then it should:

notify the user that the profitability level may change depending on the change in the difficulty of the network.

This is ScryptCube calculator:

scryptcube cloud mining calculator

And compare with the calculations presented on the scam service:

cloud mining scam
scam service calculator

There is no word about the difficulty that can change and income levels fall.

Thus, the service misleads you about the expected profit.

Agreements and documents

For example, you can read the Scryptcube service agreement. All aspects of the relationship between the buyer and the seller are clearly spelled out there, in addition,

there are warnings that in case of an increase in the difficulty of mining, income may fall.

There will be no such agreement on scam services. They will either not respond to such a request, or will only promise to show it.

Conclusion

Today we have discussed with you the basic principles that help distinguish a scam service from a reliable cloud mining service.

I'm glad if I helped someone save money.

Thank you if you decide to share this article on your social networks!!


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