Is Cloud Mining a Scam? How to Avoid the Common Pitfalls
Many people today want to start making money through Bitcoin and other cryptocurrencies. However, it can often be difficult to know where to start, and some people aren’t sure if they want to invest a substantial amount of money in the gear that they will need to do it right. Instead, they turn to options like cloud mining, believing that it will be their way to riches. Others believe that all cloud mining is a scam.
The truth lies somewhere in between. Private cloud mining has the potential to be a fantastic and efficient way for people to start mining Bitcoin and to make money. Yet, there are also a number of untrustworthy companies that are trying to capitalize on the excitement of new investors. Fortunately, there are some things that you can keep in mind when you are looking for a Bitcoin cloud mining company that can help you to avoid the scammers.
Companies that Don’t Offer Photos of the Data Center and Hardware
You need to make sure that the company you are going to be paying for cloud mining your Bitcoins truly exists. Some fly-by-night companies set up shop, gather money from their customers, and then disappear. It happens with many types of companies, not just cloud mining.
Therefore, you will want to be sure that they are legitimate. Look at images on the site for pictures of their data center and the hardware they are using. Make sure that they are not just using stock footage or footage taken from other sites, as well.
No Public Address and an Anonymous Website Domain
Along the same lines, you will want to look for the public address of the company. Make sure that it is a legitimate address that actually belongs to the cloud mining provider. Some have been known to use other peoples’ addresses in an attempt to fool customers.
You will want to check the company’s website domain, as well. You can get information through sites like lookup.icann.org, for example. The tool will let you look up the registration data for the domain, so you can determine if it is legitimate or not. If the domain is anonymous, it’s likely a scam.
A little research will make a big difference, and it has the potential to save you a lot of money and heartache. Only work with a company that you can determine is legitimate.
No Way to Withdraw Earnings
Read the website carefully and make sure that you will be able to withdraw the earnings that you have made from the site. Don’t work with a company that only allows you to sell on their site to someone else. Always look through all of the policies that the company has in place. Do you have to sign a long contract to work with them? How much are you expected to spend each month? Know all of the facts before you decide to work with anyone.
Beware Lifetime Contracts
One of the biggest scams that people do not realize is the offer of a lifetime contract. These contracts might seem like a good deal at first. It will allow you to keep your costs the same throughout your time with the company, and you might feel that this could provide you with greater returns. However, you have to keep in mind that the difficulty of mining is going to keep rising. This means that you will still be paying the same amount of money several years from now, but the amount of profit you will be receiving will be less.
Guaranteed Profits
This is one of the surefire signs that the company you are considering is a scammer. There is no way to guarantee that you are going to make a certain amount of money from cloud mining Bitcoin. However, companies know that this type of language on their site is often enough to entice those who are not doing proper research. If you see a company touting that you are going to make a certain amount of money, it’s a company you should avoid at all costs.
Take the Time to Research
Cloud mining could be a great option for you. However, you can’t simply choose the first company you see and hope that you have found a winner. Instead, you need to take the information we’ve discussed above and make sure that you are only working with a reputable company that has your best interests in mind.
Even with this information, you will want to conduct your research into the authenticity and legitimacy of any company you find offering these services. Never settle for anything less than the best, and always look at the risks and costs of Bitcoin mining with the company you are considering.