Bitcoin mining involves creating new bitcoins while the miners are verifying transactions on the blockchain. The mining equipment solves intricate mathematical problems to determine the legitimacy of a transaction. This process needs either CPU, ASIC, or GPU hardware to run uninterruptedly. If you want to venture into the cryptocurrency mining business but you want to avoid the heat and noise associated with mining hardware, bitcoin cloud mining is a perfect opportunity for reaping the profits of engaging in mining. With cloud mining, you do not have to worry about the maintenance costs associated with mining rigs.
What Does Bitcoin Cloud Mining Entail ?
Bitcoin cloud mining is a strategy of mining bitcoin without necessarily owning a mining machine. Simply put, you purchase some shares of renowned mining power, such as a mining pool, and share profits with the pool. Therefore, you must enter into a contract with an individual investor or a company that provides trusted cloud mining services.
Tips for selecting a genuine bitcoin cloud-mining platform
The cryptocurrency market is full of numerous cloud-mining platforms that provide a broad range of services. However, you must exercise extra caution when it comes to selecting the right platform since many scammers in the market specialize in building a Ponzi scheme or openly stealing bitcoins.
1. Check the website of the prospective service provider
When searching for potential cloud-mining platforms, it is always imperative to visit their website and check the About’ section. This page can be instrumental in differentiating between an honest and dishonest service provider. For instance, scammers may leave the About’ page blank. If somebody is striving to conceal crucial information from the public in a sector where trust is a fundamental principle, it should be an indication that the firm might not be offering legitimate services. A trusted cloud mining site should have detailed mission statements and background of the company coupled with details of the executive officers, founders, and owners.
2. Conduct extensive online research
You must carry out a quick search to determine if the cloud mining platforms are appearing on first pages of leading search engines. A good bitcoin mining firm should have a strong online presence. The company should have a well-designed and optimized website. Search for reviews and testimonials about potential mining platforms uploaded by both new and existing clients. Avoid providers that have many unresolved complaints and negative reviews. Choose those that demonstrate a willingness to address the needs of clients by promptly dealing with the few complaints that may arise.
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3. Proof of existence of a mining facility
The mining facility is the center of operation of all bitcoin mining platforms. Here, they can earn or lose the client’s trust forever. Many cloud-mining providers choose to conceal the precise locations of their facilities to safeguard their machines from theft or damages. However, if the firm declined to offer even the city where the mining machines are based, that is a warning sign that the hardware, which should offer the cloud hashing power, may not be available. As proof, most service platforms usually upload pictures of mining rigs. These pictures require careful observation. They can pass a lot of information concerning the environment of the mining facility, such as whether there are sufficient electricity and regular adjustment of heating. They can also avail information about the general scale of the mining business since the presence of many mining machines translates to more hashing power sold over the cloud.
4. High level of security
A trusted cloud mining platform should have sound security measures in place. This is because mined coins stored on the website attract a large amount of money. The site should have CloudFlare to keep DDoS attacks away. It is wise to utilize two-factor authentication and to minimize the amount of mined bitcoins in the platform’s wallet. Before joining the service platform, new users must enter a captcha, use genuine emails, and come up with strong passwords.
5. Costs of the mining contracts
Cloud mining contracts are priced based on two important elements. One is the fixed fee for the contract to acquire the cloud mining service, which can be a one-time charge or paid regularly. The second element is the maintenance charge that covers electricity costs and expenses incurred when cooling the mining rigs. It is subtracted from the earnings daily. You should know that higher prices do not translate into better services. Therefore, you must always look at the services offered by prospective mining platforms holistically, not only their prices.
Engaging in cloud mining is an essential strategy for earning some side income and an interesting way of acquiring cryptocurrencies. However, you need to be cautious when signing up for sites that offer cloud-mining services. That way, you will avoid Ponzi organizations and scammers available online.