The Rise of Cloud Mining Scams

Back in early 2013, we saw a bunch of cloud mining companies pop up, claiming they had mining rigs but mostly just scamming folks out of their cash. Now, there's this exchange promising to double your investment within a week to three months, plus some are even offering 100THS of free mining just for signing up. It’s like they’re messing with crypto users’ heads with these ridiculous promises to get people to buy in. In the end, these schemes just take off with everyone’s crypto under the guise of generating profits, either by closing accounts or hitting you with endless KYC checks. I’m trying to track down these scammers and could use some help from you guys to expose these crooks who just want to drain the crypto world dry and leave poor people in developing countries to suffer the most. Cloud mining has been a scam for ages, and it looks like it’s gonna be that way for a long time. In my next post, I’ll share what it really takes for anyone to start a mining business worldwide. Remember Cointellect? Those days are behind us, but we’ve got more scams like Moneybux on the brink of collapse that need to be shut down. There’s no such thing as a get-rich-quick scheme that lasts. Eventually, the payouts stop, and people end up losing their money; usually, only the early investors come out ahead. The biggest losers are those who keep pumping money in after making a bit. And honestly, the lack of innovation in crypto just leads to the same old mistakes happening over and over again.

Cointellect, wow. I don't know what they were mining, but they paid the miners regularly and very well. But the project did not last long.

Cloud mining is just counterparty risk with a hash-rate hat. If you can't see workers on a public pool under names they control, map shares to your payout address, and verify power and capacity with third-party audits, you're buying an IOU. ROI in "days or weeks" dies the second you run difficulty and fee math. The maintenance-fee clause usually eats the yield, then KYC shows up when withdrawals thin. If you must touch it, point rented hash to a pool you choose, withdraw daily, and treat it like musical chairs.

Cloud mining can now be profitable if you know how to rent devices and mine new coins like Neptune Cash (NPT). The first renters earned $10 per day with a single 5090 GPU.

Sure, I don't deny that early renters on brand-new GPU coins can print for a few hours... that's a different animal than custodial cloud mining contracts, though. Pointing a rented 5090 at your own wallet with a kill switch is short-horizon speculation. On the other hand, sending money to a provider who promises "X TH/s for Y months" is an IOU with counterparty risk. Two separate risk stacks we've got here.

Rental services allow you to sign contracts for equipment rentals of 12 hours or more. You don't have to sign annual or monthly contracts. If it's profitable, you renew the contract; if not, you lose access to the mining equipment.