Mining Crypto: The Horror Stories Are Real!
By Tim Mandell and Crystal J. Milburn
Miner Beware
Mining crypto and exchanging money for cloud mining services are real but so are the horror stories. As cryptocurrency has exploded, it has drawn the attention of legitimate investors as well as con artists. That’s typical of nearly an up-and-coming industry.
You’ve probably heard the stories and maybe you’ve even known someone who lived them. Over the years, we’ve seen it all: scams, disappearing companies/miners and completely unresponsive data centers, which are likely mining farms (there is a difference).
We’ve received machines from other facilities that were so filthy or rusted, that they couldn’t even be turned back on.
ASIC Miners sent in for repair that never came back (scammers posing as the manufacturer).
We’ve talked to people who sent $100,000 to $500,000 worth of miners to a data center/mining farm and, not only were they never turned on, but they never saw their machines again.
Our COO was even subpoenaed once because a client was working with a data center that was indicted for stealing money in a cryptocurrency scam.
These aren’t just international scams, either. Many of them happen right here in the U.S. with sometimes unsuspecting businesses. Crypto is the new cash ransom; unmarked Bitcoin, please.
What can you do to protect yourself?
Ask good questions and be suspecting of everything! Below are just a few of our suggestions. What would you add to the list?
Ask for referrals from long-time customers.
Ask about typical response times and how they communicate.
Can you reach your rep directly?
Find out if the facility you want to work with is insured. Do they require proof of insurance?
Are they filtering their air? This is important so your miners remain in good, working order.
Where are they located? We’ve seen rusty machines which tells us they came from seaside environments. There are also temperature and natural disaster concerns to think about.
How long have they been in business? Watch out for those who are brand new and wanting in just because it’s hot. Experience matters.
How will they ensure your machines are constantly and consistently running?
We never enjoy being the bearer of bad news but, at the same time, we want to protect you. For more information on crypto mining scams and how to avoid them, contact us.