What is Cloud Mining?
Want to know what Bitcoin cloud mining is?
Just know ahead of time:
The truth about cloud mining in the year 2024 isn’t pretty.
Key Takeaways
- Every cloud mining company we could find is trying to scam you.
- There is no profit in cloud mining as of 2024.
- The smartest way to get bitcoins is to buy them.
What is Bitcoin Cloud Mining?
Bitcoin cloud mining is a concept where individuals can participate in Bitcoin mining without owning or operating the physical mining hardware themselves.
Instead, users purchase or rent mining power from a company that owns and maintains the mining equipment in a remote data center.
The idea behind cloud mining is to make Bitcoin mining accessible to people who don’t have the technical knowledge, space, or capital to set up their own mining operations.
In theory, it allows anyone with an internet connection to participate in the Bitcoin mining process and potentially earn rewards.
How does Bitcoin Cloud Mining Work?
Cloud mining means a host company owns Bitcoin mining hardware and runs it at a mining facility.
You pay the company and rent out some of the hardware.
Based on the amount of hash power you rent, you will earn a share of payments from the cloud mining company for any revenue generated by the hash power you purchased.
At least…that’s how it works in theory.
In most cases, though, there is no mining facility or hardware.
There is just a guy taking your money and paying part of it to someone who signed up before you did. Eventually he runs away with the money, and you are left with nothing.
Most Bitcoin Cloud Mining Companies are Scams
Like the heading says, most cloud mining contracts are scams.
Why?
Because it’s easy for companies to take peoples’ money, and then not pay out.
A company can claim to be a cloud mining company without any proof of actually owning any hardware.
So remember:
99.999% of cloud mining companies are scams.
Which Companies Are Not Scams?
We can’t recommend any cloud mining companies at this time.
The closest thing to cloud mining that is not a scam is something called “colocation mining”.
Bitcoin Cloud Mining Scams History
The reason there are so many cloud mining scams is because it is very easy for anyone in the world to setup a website.
Once the website is set up, it can claim that the company has a large mining facility.
The company can act legit by sending initial payments to its customers. But after that it can just keep the already received payments for hash power and then make no further payments.
Two of the most famous cloud mining companies have already been exposed as scams:
Even as recently as October 2021, cloud mining scams are stealing people’s money.
The SEC equivalent of the Philippines even issued a warning to customers of Mining City to get out now and have told promoters of the company that they could go to jail for up to 21 years if they don’t stop immediately.
Cloud mining scams are not a thing of the past.
They very much so still happen today, so be vigilant or, better yet, just avoid them.
Cloud Mining Viruses
There have been viruses that land on computers and then use the computers’ power to mine bitcoins.
This is particularly common with Monero since it is ASIC resistant and can be mined with GPUs.
Run a malware detector on your computer if you think you may have come under attack.