Cloud Mining platforms: a quick overview about the main providers on the market
Cloud mining or Cloud hashing allows users to rent hashing power in data centers. Basically, user can buy the power from a provider in exchange for some daily or monthly tariffs, without having direct control of the machines. After that the contract starts, the gains from the provider’s cloud mining platforms directly benefit the customer by being transferred in part to his own wallet.
The main advantage of this approach is that it is not necessary to have a thorough knowledge of the mining hardware, nor purchase expensive and difficult to obtain devices. Renting hashing power (usually measured in TH/s or GH/s — Terahash or Gigahash per second) also means not having to deal with the heat and noise produced by the miners.
To make a short list, the advantages of participating in a Cloud Mining are to avoid the following situations:
• Problems related to hardware overheating;
• Availability to move where the data center is located, typically chosen for low electricity costs locations (many of these companies buy their own equipment or build it at low cost and have placed their data centers in countries such as Iceland and China, where electricity is cheap, transferring savings to it);
• To sale equipment when these are no longer profitable;
• Continuous exposure to noise and ventilation;
• Delays in receiving machines from suppliers.
For more information on data centers we remind you to read this article: Comparision between cryptocurrency mining at Home or in a Datacenter
This ease of earning with Cloud Mining can also bring back some disadvantages, such as:
• Dealing with scammers;
• Don’t have enough fun because you don’t perform the operations directly;
• Receive a smaller amount of profits than those due;
• To comply with the directives of the platform (for example, if the bitcoin price drops radically and they decide to cease mining operations or cease contract payments).
To avoid the famous Ponzi Schemes or Scams or any Fraudulent behavior from online platforms that go through Cloud Mining even if they aren’t, it is always necessary to check the company information on their website and on the internet.
There are many Cloud Mining providers who describe their missions without specifying anything against the background of the company, such as owners, founders or executive officers. It is also worth checking in forums where customers can release their reviews. A rich search is required before relying on Cloud Mining, even knowing that many information can be undeclared for security reasons.
For example, many websites never reveal mining-farm locations to protect equipment from damage and theft.
Another clarification is to check platform security level, since a significant amount of money is stored on the website, thanks to the coins mined. First of all, protecting the site from DDoS attacks using CloudFlare is the minimum requirement. In addition, it is advisable to also use 2FA (two-factor authentication) and when possible withdraw from the platform wallet and keep the coins in some external wallets.
Even during registration, if no captcha code or email confirmation is requested, there may be strong indications that there is no concern about the safety of the website.
Services offered by Cloud Mining companies are typically specified for Bitcoin mining with the SHA-256 algorithm. However, there are also companies that offer services for altcoins under algorithms such as Scrypt, X11, Ethash, Equihash, CryptoNight, etc.
Cloud Mining contracts prices are made up of two elements:
- The regular cost for the contract which is a fee that can be paid on a one-off basis or regularly;
- The maintenance fee that covers electricity and cooling costs, which is daily deducted from earns.
The mining cloud price range is very wide. The cheaper Cloud Mining contract on the market costs USD 0.99 per GH/s at OxBTC (https://oxbtc.com/). The average contract price is around 5–15 USD per GH/s.
In the next articles, we will discuss in detail the most famous Cloud Mining platforms currently on the market: Genesis Mining, Hashflare, Hashnest, Hashing24, OxBTC, Eobot and Envion.
CREDITS
This article was originally written in Italian and translated in English by Stefania Stimolo for NovaMining.
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