Bitcoin Cloud Mining Guide: Scam or Legit?
Cloud mining is a very hot topic, both for industry insiders and outsiders. It is portrayed in many different ways, and can sometimes be confusing. The mining space has been flourished by illegal and unethical players in the past couple of years, but cloud services still thrive. It is time to take a closer look at platforms today that play an important role and determine whether this mining model is still legit.
Cloud Services History
This mining model is almost as old as mining pools. It has been almost a decade since the first cloud users and we’ve seen people getting huge profits from it, but also those who went completely bankrupt due to scams. However, it is important to know that you are still able to join the mining community through cloud services and come out with a profit. Get more information about it here: https://truely.com/cloud-mining-providers
It is important to mention that cloud mining basically describes outsources who offer contracts of hashrate to mine BTC. Therefore, you as a buyer don’t have to spend a ton of money on mining hardware beforehand – you can simply rent their computing power for a certain price. Usually, the buyer will pay the service also in BTC and will get a set amount of hashrate in return over a certain time period. In other words, you pay a fixed rate before you get in and hope that you’ll get more than you’ve originally put in.
So, if you’re someone who has no financial or technical ability to purchase your own machines, renting a machine could be a perfect choice for you to get into crypto mining. You can avoid all the capital expenditure and hassle that is obligatory when it comes to traditional mining.
What are some Potential Concerns?
Over the past 8 years, we could notice that plenty of cloud mining platforms actually turn out to be a scam. A company would promise a really good hashrate, but they end up delivering way less than what buyers expected. This resulted in no rewards for buyers, while the companies who did the scams got a lot of money.
This is why it is very important for you to do your own research before you put money into any service. In addition, make sure you read the contracts very carefully, talk with other users of the platform, and read reviews to be sure you’re not on the wrong path. A general rule of thumb is to put in only what you’re already willing to lose, especially if you’re new.
Marketing tactics these companies use can also be very deceiving; it is part of the reason why they have been so successful throughout the years. You will regularly notice that these services promise a large percentage return on investment, but you have to be careful with it. This can be a huge red flag. It is unethical to put out an aggressive return profile since none of us can predict the future, especially in an industry that’s shifting its course daily.
These are some of the main concerns regarding cloud services, but you should also pay attention to the opaque pricing these companies will put, and you should always check whether the service actually has adequate mining hardware.
Still, there are plenty of good sides to this mining model, and plenty of notable platforms you can join. There are varying options, but there’s no doubt that huge platforms play the most important role in the mining ecosystem.
One of the largest and oldest cloud mining companies is Genesis Mining. They offer different types of algorithms and they have their own mining equipment on their bases. This company is a great example of a legitimate and traditional cloud services company.
Another very interesting company to look at is Bitdeer. This innovational company allowed us to reimagine how we can trade hashrate between platforms, pools, buyers, and farms. Both of these platforms will continue to grow, and you can get in contact with people who are currently using their services to determine whether they are a good option for you.
Hashrate Marketplace and Cloud Mining
You can easily make a mistake and classify a hashrate marketplace as a cloud mining service. It is important to know that there are a few very clear distinctions between these, and you should go over them if you want to make sure everything is legit.
Hashrate marketplace has plenty of independent miners that connect their hardware to the market. On the other hand, cloud services offer their own hardware for rent that is then used to produce the hashrate you can sell on the platform.
In addition, the price in the hashrate marketplace is set by the demand and supply of the hashrate. This is not the case with cloud services where the platform itself determines the price. Buyers are allowed only to accept it or leave it as it is.
One of the main differences between the two is that the cloud mining platforms don’t offer the buyers to choose which pool to use, which coin to mine, or where to send the hashrate. In contrast, hashrate marketplaces allow the buyer much more flexibility in these terms – acquired hashrates can be used by the buyers as they please.
Cloud Mining Future
It is expected that these platforms will continue to grow in countries all over the world. This mining model is preferred by a lot of companies since retail users really enjoy what they have to offer, it is a great niche. However, some more experienced traders will say that models that have market pricing forces and that don’t target retail are much better for the whole ecosystem.
The advantages are very clear – you don’t have to waste a ton of money to get into the mining game. You lease it from a mining farm and start collecting your rewards. Still, there are some very serious concerns about it. But, with good research and careful investments, you can come out with huge profits from it.