I've been scrolling through the NEW section on Steemit, looking for something to post about. Nothing really interested me, but then something caught my eye. A post titled "Proof!--- $400+ yearly profit for life Bitcoin mining...only $11.99 investment! NOT A HOAX!". Not a hoax you say? Well lets see!
Free money?! Sign me up!
As everyone else, I love money. So obviously I had to check it out! But as you learn with time, nothing's free in life. NOTHING! Reading through the post it seemed like this guy was making a pretty nice amount of money through this "Bitcoin cloud mining" service. There are two things that seemed a bit odd here;
- Why sell hashing power to other people instead of using it to mine Bitcoin for yourself? That would be a lot more profitable, right? But OK, lets assume these are some generous people who like sharing their hashing power with the world for a small fee.
- Why even bother? The current difficulty of Bitcoin is 860,221,984,436! You would need a whole facility of small, low power miners for it to even be profitable! So investing into something like this wouldn't make much sense, would it? But okay, lets assume somehow these people can get free electricity and have found some magic algorithm (which, spoiler alert, doesn't exist) to discover new blocks before everyone else.
But I have to keep investing to keep receiving my payout, right?
Well, as it turns out, NO. As stated on their FAQ page "No, your Mining power is permanent and set for a lifetime, it will never expire." Hmm.... So you're saying that I only need to invest a small amount and I get to keep all of the returns for a lifetime?! You're basically GUARANTEEING free money?! I don't know about you, but to me a GUARANTEED payout is a major red flag.
Oh, and also, the only payment method they accept is Bitcoin. I wonder why?...
What kind of hashing power am I getting?
Conveniently enough, they have a "Pricing & Investment" page to calculate your "profits". Lets check it out and lets see what kind of income we can expect. In the post mentioned earlier, the author stated he bought a total of 110 KH/s. For those of you who are at least somewhat familiar with Bitcoin mining you'll know that 110 KH/s is a comically low hashing power, but lets see what MicroHash.net is promising us and most importantly, how much is it going to cost us.
Wow! Look at that deal we're getting! For an investment of only $13.19 we'll be getting a LIFETIME return of $1.32/day or $481.80/year! But lets do a quick Google search, just to make sure.
All it took me was 20 seconds. I Googled "Bitcoin mining calculator", clicked the first link, entered $0 for the price of electricity (assuming ideal conditions) and entered a hashing power of 110 KH/s. And here are the results.
Yes, less than 1 cent per MONTH and they're promising $1.32 per DAY!
But I know how to cheat the system!
During the writing of this post the author of the original post replied to my comment debunking this Ponzi scheme stating that he has a plan to "cheat the system" (my words, not his) and proceeded to explain it. And honestly no matter what kind of plan you have this is still a bad idea. Here's my reply to him explaining why.
I see where you're going with it, but I still have two complaints about it.
In your post, you stated this was NOT a hoax, but judging from your reply you either knew this, but still decided it was a good idea to claim it was NOT a hoax / Ponzi scheme (to profit from referrals) or you believed it yourself and you made up this "plan" to "cheat the system" now that I've pointed it out. Either way, it's a bad idea.
You could make the same (or greater) amount of money if you invested your time into something else i.e. something real. There are plenty of ways to make money in the crypto-world, many of them even more profitable. And by participating in this Ponzi scheme you're just allowing it to live longer, which in turn will cause more unknowing people to loose their money once the operation finally collapses.
Seriously, don't play with fire. You'll get burnt sooner or later.
Hopefully this post helps to save at least a couple of people from loosing their money to this Ponzi scheme.
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