Many people wished they had not missed the Bitcoin mining bus before the great Bitcoin boom started back in Back then you could mine Bitcoins pretty easily at home and make a very nice profit on the exchange rate. However since then, the mining difficulty has increased immensely and today it is almost impossible to mine Bitcoin profitably at home with your own hardware. The only exception is if you have very low electricity costs and manage to mine efficiently for at least 6 months without any major changes in this competitive landscape.
With cloud mining you can rent mining equipment from a company that will give you back the profits from your rented mining rigs. You do not need to deal with the electricity costs, cooling down the miners or storing them, all you need to do is send out a periodical payment and you are all set.
Of course this cloud mining idea quickly took off as people are always looking for new ways to make money online, however how legit and profitable are these cloud mining contracts?
Well, I run a website dedicated to helping people get started with Bitcoin and every day I get another complaint about another cloud mining company that does not pay and the website seems to have gone away. Even Gavin Andresen, the previous chief scientist of the Bitcoin Foundation who has now been widely discredited because of his involvement with the charlatan Craig Wright, once said: When consider a cloud mining company make sure to due your due diligence on every company you think of investing in.
One the tools created for this task is the Bitcoin scam test.
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If it does not pass the test – do not invest. But even if you do find a legit cloud mining company is it really worth your money? So after one month I make around 0. For Hashflare they are as followed: The MEF is linear and equals 0.
The evolution of a scam
Ethereum contracts are not subject to any fees. Exchange rates will fluctuate and mining difficulty will probably increase. However, the examples given above are actually the best case scenario where the company you invest in actually has mining equipment.