This post is more of an observation about something I have noticed more frequently over the last week. I am in no way endorsing the use of cloud mining nor am I going to try and dissuade you from it. That isn't the point of why I am feel the need to write about this. However, on a personal note I have been burned by these kinds of sites before I knew that some operators are nothing but scammers and some are legit with strings attached. As a new crypto investor their flashy banner adds and high return rates are very eye catching. I am sure that I am not alone in feeling that they are attractive, but we do have to be careful when dealing with these entities.

I believe that we as crypto investors and enthusiasts need learn both how they operate and how to spot those that are scams. That isn't always an easy task with so many of them out there claiming they can make you boat loads of crypto with no effort on your part. I like many of you would love to have lots of nice shiny Bitcoin coming in without having to go through the effort to build and maintain a farm to get a decent ROI. For many of us it just isn't practical for many reasons beyond just equipment and power cost. Even if I could theoretically build such a mining rig(s) there is just nowhere to put them where I live currently nor is power bill cost something I want to think about in state of California. It would be one hell of a bill at the end of the month! That's where cloud mining becomes an attractive option for some.

There are a few reputable cloud mining options out there that have stood the test of time such as Genesis and Hashflare. However, no cloud mining is completely safe as an investment. Some cloud mining outfits are just out there to take your cash and run with it a few months down the road. They may in fact pay out at the beginning, but most being the good old Ponzi. By that Bob pays his $6 in Bitcoin for some hash power and they use that to pay out Peter. Bob seems to be making something and brings in his friend Paul and Bob gets paid with Paul's investment in hashes. I know that the example is a bit over simplified, but I think you get the idea. Eventually, even Bob doesn't get as much in returns. Now say Peter is savey and knows when to grab what he's earned and skip town before things get dicey. Unfortunately, many of those involved don't have experience with scam cloud mining and fall victim to the classic downfall of any Ponzi and lose everything they put into the scheme and are left high and dry. A proper Ponzi scam run by a competent crew is harder to spot than you think unless you know exactly what to look for.

I did mention that I've seen a lot more adverts for cloud mining over the past week or so right? Normally I wouldn't pay them any mind or in some cases ever see them thanks to Brave that generally blocks such. There are a few sites that I do go to that I've turned the add blocking feature off on because it blocks items I need on the site or in the case of Amazon I prefer to see their suggestions of similar products. Alright, I'll get to the point here sooner or later. Several adds just about made me laugh at the idea anyone would be gullible enough to believe that they could make a 1000% ROI in just 24 hours. That would be just crazy if it were remotely true. The reality is that no cloud mining service can do that without out right being a scam. Most reputable cloud services aren't going to shell out more than 20% A.P.Y on your investment for their services. Exceptionally high yields daily or yearly should be your number one red flag to take a closer look at who and what they are. I made that mistake and just went for it the first time not knowing what I do now. Yes, I lost everything, but thankfully it wasn't a lot of BTC like some may have lost when the site went dark. First they claimed to have been hacked and then said they were moving their equipment to a new location. The reality is they shut it down and ran with all the Bitcoins to who knows where.

Cloud mining is hardly the only avenue crypto scammers lurk looking for your coins and cash. It's the wild west when it comes dealing with cryptocurrency. I am going to leave out the gambling sites since it a conscious choice to risk your coins and more than likely if you do use them you already know what you've signed up for. For those of you that are newer to this like myself we need to be careful and figure out how much we are willing to risk. There are lots of sites willing to help find and root out scams. It always pays to do a little digging before its too late. In writing this piece I came across an interesting site that posted a helpful quiz that may help some of you when thinking about cloud mining, coin doubles and the like. I hope this set of questions helps everyone if you chose to check it out. In the mean time do your homework and stay safe out there with your currencies.