Are all "hosted mining" services necessarily scams?

Question

In 2014 or something, I paid a smaller sum of money to some company called "Cloudhashing" or something, which claimed that I was renting part of their Bitcoin mining pool and all I had to do was to pay that little sum and then wait for the coins to roll in.

I never got a single satoshi, as you can imagine.

But ever since then, I've seen numerous services where you apparently can pay a large amount of money to "rent a miner" which they host/set up, basically the exact same setup as the scam I fell for. That is, I'm not buying a miner that they ship to me which I then plug into my own local power. I never see/care about the unit; it's "abstracted away" from me in the same manner that a "webhost" account is something abstract to me versus ordering a physical server which I keep running in my wardrobe.

It seems to me that it would indeed be possible for such a service to not be a scam. I mean, the argument usually goes like:

If they can just mine themselves and make more money, why would they sell this to you?

I get that argument, but at the same time, what if they don't have the money up-front to pay for that extra miner (or part of it) unless I give them my money? Does it not make sense that they use the customers' money to legitimately order more miners and have them set up in their optimized facility with cheap power and whatnot, which I could never do at home? Isn't it a much more efficient setup that I simply pay them to enable them to add hashing power and then both of us make money, versus me ordering a soon-outdated mining unit which I cannot run here anyway?

What am I missing? Are there non-scam mining services? I want to make Bitcoin but I'm not going to waste any more money on scams.

Answer 1

If you want to mine bitcoin then you should buy a bitcoin ASIC miner and run it yourself. Do the necessary research first.

Almost all cloud mining services are scams. But there have been a (very) few that were not - although they were not profitable for customers.

So there are two possibilities:

1. You pay someone 1.0 BTC and they run off with your bitcoin. This is the most common.

2. You pay someone 1.0 BTC and they later give you back 0.9 BTC. They say they mined it for you. But maybe they are just giving you some BTC from another customer? Noone knows.

Cloud mining is a long term scam. There is also a short term option called miner rentals. For 1.0 BTC you can pay someone to do the amount of mining that on average produces 0.9 BTC on a mining pool of your choosing, mining for your account on that pool.

For miner rentals you have two options:

1. Pay someone 1.0 BTC to mine on your account in a big pool, where you will receive very close to 0.9 BTC.

2. Pay someone 1.0 BTC to mine on your account in a small pool with a lot of variance. Maybe you get 5 BTC or maybe you get nothing. But the average is 0.9 BTC, so on average you lose money.

If you like gambling then you could run rentals on a small pool. None of the other cloudmining/miner rental options make sense because you lose money for sure. On the other hand gambling doesn't make much sense either. And even if you like gambling, you may want to gamble in a casino instead.

Answer 2

No there are plenty of legitimate hosting providers they just make a small amount and give you the profit after electricity it's technically instant roi on the unit for the company and the reason it's beneficial is because the contacts entitle the compa y ownership of the hosted machine typically after the contracted rental period is over which they can then upgrade.