How to Identify a Bitcoin or Ethereum Cloud Mining Scam

How to Identify a Bitcoin or Ethereum Cloud Mining Scam

In every industry there appear from time to time scam projects. The services that allow a user to mine cryptocurrency are becoming very popular nowadays. Of course, a miner that has only recently began earning cryptocurrency doesn’t know that much about this industry. He/she has a long way to go. Consequently, he/she, due to the lack of knowledge, is very likely to fall a victim to a scam mining project.

It’s not a secret that those who develop such like unreliable projects use a whole set of tricks that a newbie won’t pay much attention to. In this article, we’ll discuss the things that help you to determine which of the projects is worth your trust and which of the projects you’d better avoid.

We choose the mining companies that appear on our list of trusted projects later on very carefully. We scan lots of websites on the Internet that are devoted to mining projects. If there is something that seems suspicious to us, we’ll never add a mining contract to the list of trusted projects. The same can be told about the recommendations we give in terms of mining equipment. Before recommending any equipment, we test it or look for the evidence that this very equipment is worth investing in with the view of mining. We also aim to warn you as far as scam or suspicious projects go. That’s why we also have a list of the companies that look rather suspicious.

Let’s say you find a mining project that seems reliable to you. You see that there is a number of reviews saying that the project is worth your time and money. The crux of the matter is that those who develop a scam project pay money to the websites that advertise their services.

That’s why we don’t recommend to rely too much on the information you can find on certain websites that compare different mining projects. Remember that some of them may be interested in lying to you due to the profit they get.

The first mining pools appeared back in 2015. Actually, the popularity of mining rigs that allowed a user to mine individually significantly decreased in 2014. This happened because it became to expensive for miners to mine alone. Apart from the special equipment the had to buy there was also a need to pay a lot for electricity. When the first mining pools finally appeared, they were immediately considered to be a great alternative.

Of course, high popularity of mining contracts made scammers pay attention to them. They quickly realized that they can make a lot of money on selling fake contracts. The thing that we want you to keep in mind is that it can be difficult to define whether a mining contract is fake because they are sold all over the world. Still, it’s not impossible to do it. Below we provide a short list of recommendations for you that’ll help you to successfully avoid fake mining contracts.

  • Fake companies have a domain name that’s not registered. You can’t see who the real user is because it’s hidden.
  • In some cases, a fake company is registered. For example, such like companies are often registered abroad and their CEOs are registered as foreign residents. This way it’s easy for them to fake personal data.
  • Actually, potential miners can request a proof of the equipment used by a cloud mining service with which they’re going to buy a contract. As a rule, fake companies don’t provide this proof. They’ll say whatever they can to avoid showing the proof.
  • The funds that they accumulate are never used to make payouts. As a rule, they are made from the sums that new clients give them. As amazing as it may be, but the fact is that such an approach never seems suspicious to newbies. They don’t even think that there is something wrong because they see a bitcoin address from which the payouts were made. This address is verifiable. Then all of a sudden, the company just stops paying.
  • Fake companies often run big advertisement campaigns that allow them to attract as many users as possible. Once again, when showing videos and presentations they don’t care to provide any proof of the equipment they use to carry out the process of mining.
  • Fake companies often use comparison websites to advertise their services. The thing is that such like websites don’t check the reliability of the companies. Moreover, those responsible for the development of a fake project may promise them some profits in exchange for advertising them. As a rule, the reliability of a company, according to a comparison website, is based on the fact that their bitcoin address used for making payouts is verifiable.

All in all, before deciding which of the mining companies is the best for you, take some time to check whether its reliable and worth your trust. This is quite easy to do. Just find the list of scam and suspicious mining projects that’s published on our website. Remember that it’s better to double check rather than being sorry later on.

How to identify a Bitcoin or Ethereum cloud mining scam

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