How Does Cloud Mining Bitcoin Work & What Are The Risks?

[LiteCoinGuy]

How Does Cloud Mining Bitcoin Work & what are the risks?

Put very simply, cloud mining means using (generally) shared processing power run from remote data centres. One only needs a home computer for communications, optional local bitcoin wallets and so on.

However, there are certain risks associated with cloud mining that investors need to understand prior to purchase.


Pros

-A quiet, cooler home – no constantly humming fans
-No added electricity costs
-No equipment to sell when mining ceases to be profitable
-No ventilation problems with hot equipment
-Reduced chance of being let down by mining equipment suppliers.



Cons

-Risk of fraud
-Opaque mining operations
-Less fun (if you’re a geek who likes system building!)
-Lower profits – the operators have to cover their costs after all
-Contractual warnings that mining operations may cease depending on the price of bitcoin
-Lack of control and flexibility.


As mentioned above, the risk of fraud and mismanagement is all too common in the cloud mining space. Investors should only invest in cloud mining if they are comfortable with these risks – as the saying goes, never invest more than you are willing to lose.

http://www.coindesk.com/information/clo ... oin-guide/

[klaaas]

Cloudhash services are high risk things. Hyip ones will only pay you from your own investment as so called profit till the moment the website will be gone.

[dotthebeats]

I don't think so. lol

For sure he is crying now because hashocean is already a scam way back then in july.

Pretty much. he's just trying to make back his money through referrals. lol

He can't even get money through referrals because the site is dead a long time ago, how can he get referrals?

[Dynamix]

Really awesome post. Your pro's and cons deduct perfectly what are the risks of cloud mining .

[BitcoinNewsMagazine]

Genesis Mining has the highest fees in the industry and you should expect over two years to earn your investment back. You are better off just buying and holding bitcoin. Genesis Mining is in business to make money for themselves first while clients get the leftovers.

If you just have to scratch that mining itch and use a hosted mining provider there are a few in China that have reasonable daily fees. Hashnest is not one of them.

Your choice is between ViaBTC and HaoBTC. ViaBTC has slightly higher daily returns than HaoBTC but you can not sell your hashing power, while HaoBTC has an internal exchange where TH/s trade. If you only have a few hundred dollars to invest you may as well buy from ViaBTC for the higher return. Expect it to take about a year to a year and a half to return your investment.

The only way you can get a higher daily return than ViaBTC is to buy S9 miners and have them hosted at a colocation facility in China. There is one called SinoHash but they were so popular they had to institute a ten miner minimum.

[hulla]

Hi Guys,
i found two cloud mining site CKminer and Hashrev. The question is, is it safe for me to invest in the two site. Thanks

[mjglqw]

It's a shame that who once was a good poster now just posts "Segwit > BU" everywhere. I mean, it's not wrong to have different opinions on things, but it's just sort of pure propaganda now.

[robert4u]

Cloudhash services are high risk things. Hyip ones will only pay you from your own investment as so called profit till the moment the website will be gone.

I agree once do not know when the website will go, its always same case, they always run away.