Topic: is cloudhashing.com a scam?? - page 2. (Read 46870 times)

KensingtonLabs purchased mining contracts from cloudhashing back in May of 2013 that were suppose to start in June, then they didn't start until July, and when it started it was only at 25% of full capacity or some crap like that. We spent a total of 3.5 BTC (because back then BTC was the only way to pay) and at this point have only earned back .4 BTC. It's pretty safe to assume that by the time our contracts are up we will have nowhere near close to the 3.5 BTC initially invested.

It was our own fault, we fell for the flashy advertising on the site. They basically said 1BTC would earn 5BTC over the year contract. We should have known better, but we fell for it. We got scammed and would have been better off holding our BTC.

Now...if you are paying with credit card (which is currently an option) you will get a decent service. It's a little bit pricey, but you ultimately will see ROI. Whatever you do though DO NOT EVER BUY BITCOIN MINING CONTRACTS WITH BITCOIN, YOU WILL NEVER GET BACK AS MUCH BITCOIN AS WHAT YOU PUT IN. This company is notorious for delays, and spending all their funds on advertising. They also recently added a customer support team to deal with pissed off early customers like us who constantly e-mail them saying "what the fuck guys...what the fuck"

So in short, cloudhashing is not technically a scam, but anyone thinking they are going to spend bitcoin to make bitcoin should just hold instead.

I know, I was just showing what to expect with some real time numbers and sites to check to help do your own math. Wish somebody showed me before I bought a cloudhashing contract, but I was the same as people here, I was more eager to believe all the lies and deceptions cloudhashing shows on their site and to jump in, then to accept solid facts and numbers.

Two possible rescues for me:
1 - difficulty doesn't go up anymore then the 20% per month max (or max 10% per difficulty jump. The next one later today will be historically low with an estimate between 11% and 12%)
2 - bitcoin price goes up to $2000 or beyond so I make up for the lost dollars. But even then I would have been WAY better off simply holding the BTC

What i was refering to was that you need it to be lower than 20% to make anything back on those contracts if you don't use rrp. Of course the real difficulty goes up much faster and no rrp will be able to compensate so basically nooone will make a return on investment, nevermind profit.

Maybe check here also before you invest: https://bitcointalksearch.org/topic/m.5632280

You can check the difficulty here on this page: http://bitcoinwisdom.com/bitcoin/difficulty
mobodicks 20% rise per month is rather conservative. It's actually closer to 20% two to three times per month instead of just once.

Currently the Gold contract will cost around 6BTC and I'm afraid it will mine not even half that amount during the contract period. So far cloudhashing has yet to come up with a decent reply on these concerns about the growing difficulty.

I had the same curiosity and did it with money I could miss (1 BTC). If you can miss the money, why not?

I switched my silver 20GH/s program to a 100% reinvestment. I just want to see what happens and see the money as lost already. Untill now, it has been enjoyable. I get extra mining power every two weeks and if it is actually profitable, I will benefit from it lateron

For whatever reason, I still can't shake being tempted to purchase a gold plan right now. I don't want to purchase on the exchange and their price may be fair considering the overhead of electricity and cooling etc...
Even if I lose money, the only way I'd end up disappointed is if BTC does not endure as a primary cryptocurrency. Does anyone have an opinion on the odds of this?
Is there anything right with my thinking? I just like being in.

This was a very helpful and well reasoned response. Thank you.

Just remember that in january this year the hashrate doubled, just like that. There is no reason why the hashate would not increase much much more this year unless something dramatic happens. It's an exponential growth curve so whatever we think is a lot today will be almost meaningless in the near future.
Thinking in terms of difficulty staying the same is just wrong on so many levels. You should leave that out of your reasoning completely because it gives you a completely wrong prognosis. Don't use it as a basis because it's absolutely not like the real situation.

With the contract you will likely lose out. Just as a base case, if the difficulty rises only at a rate of 20.00% per month (very slow) and if you do not have rrp then you will make about 7 BTC in a year.
But that is just about the best situation imaginable. It can only get worse and the difficulty will probably rise much faster and you will get much less than 7 BTC...
Just think about it, in 2013 difficulty increased roughly by 100000.00% (!!) . .  And you need less than 20% to make more than 7BTC.. It's not worth it because the risk is way too high.

I could use $4000 and get about 6 BTC right now. If I use $4000 to purchase a mining contract at 370gh/s I would earn about about 14 BTC over one year if the difficulty remained the same as today. We know the difficulty will increase greatly, but will it increase greatly enough so that under this contract I would not even earn the 6 BTC that I could buy right now?
 

Whether you actually send them bitcoins or dollars is irrelevant. The point of mining is to get bitcoins, so you want bitcoins, right? So you can take that money, give it to them, and slowly get bitcoins over the course of a year, or take that money give it to someone else and get an amount of bitcoins right now. Which way will get more bitcoins for you?

If you are worried about the exchanges, don't trust them for very long. Find one that isn't screwing anyone over right this second, get your bitcoins, and get them into your own wallet.

I don't think anyone who actually does some prognosis will see it as an ok gamble. If you make some graphs you quickly learn that there is no way the winnings can compensate for the lossings.

msc did have a good idea, that is to invest 100% back into rrp for the first, i don't know, 1/4 to 1/2 of the contract time to build up momentum. But you need to do this from start and i guess the new 1-year contracts hurt this strategy. And it is still incredibly risky. I won't take you to the moon and the road is filled with landmines. All the fuckups, like not delivering rrp for a month, have a compound effect on the rest of the contract period. It puts you on a different curve that goes to zero much faster.
I calculated that under current difficulty rising you need to reinvest about 70% of your earnings into rrp to have a constant payout. But that does not calculate in te fact that cloudhashing can deliver the rrp much later. In that case the 70% becomes only half as valuable and you lose for sure.

The real problem here is that cloudhashing has manipulation grips on their system. Basically, by delaying rrp and inventing a price/GH/s they can make you earn as little as they want. This whole rrp business is very very opaque and basically you can't know what they are doing and what effect it will have on your earnings. Turns out the effect is only negative. Your earnings only go down from the projection, never up.

I don't know how much you know about bitcoins, but they are designed to make mining less and less profitable.
By the time the next block halving comes you will be making almost nothing with any current hashrate anyway. It is an insignificant fact from the now perspective.
It's as much a gamble as throwing your money in a toilet, flushing, and hoping you will get more money from that. Sure, some will still float on the surface, but it won't be what you invested and certainly no new money will appear.

Yes, you would be completely crazy because you WILL lose out.
The way it's currently played by cloudhashing noone will get their investment back, never mind profit from it.
Having hope that difficulty stops rising so fast, like msc does, is a very very bad reason to put your money in cloudhashing.
There is just no way to win when the people at cloudhashing reduce the posibility of profit piece by piece. It's called fleecing.

Be aware that they may wait 1,5 months before actually starting, largely decreasing the value of your hashing power. I gambled for the 20GH/s Silver contract at the beginning of January and enjoy looking at getting bitcoins in. It is fun to also be involved in mining bitcoins, but it is a risky investment. Don't invest money you cannot miss.

Sure, they have plenty of customers, and it is a pretty good price.

But there must be many other who believe it is an ok gamble, correct? My contract would just be for one year. I already have a small contract but I can now get many more gh/s for the amount that I paid for the first contract. It's sort of a way of "averaging down". It's makes me tempted. I also find the exchanges to be off putting as I don't want to hook up my bank account to it, etc..

It's a gamble.  The only reason to do it would be if you think mining is a profitable business.  And keep in mind that in 2.5 years, the block reward drops from 25 BTC to 12.  If you just want to buy BTC, I recommend using an exchange.

So, therefore, I would not be completely crazy to consider a contract, correct? There are others who are purchasing contracts with sound reasoning, correct? There may be better ways but it seems easier than going through an exchange and purchasing BTC.

I'm happy with the payout right now, but our only hope is that the difficulty stops rising so fast.  The cost of mining is getting pretty high, so we may not see a whole lot of new miners.  But a lot of existing miners will probably continue investing in hashpower.

I paid in BTC and hope to recover the same amount of BTC.  By investing dollars, you only need a dollar profit, which might be easier if the BTC price rises.  Still, if I had it to do over again, I'd just buy as much BTC as possible and keep it all in storage.

I will not be sending bitcoins. I will pay with dollars and receive bitcoins. Does it seem like a bad deal? They are paying.