How to identify crypto cloud mining scam

Today I stumbled uppon another new cloud mining company named # YouHash.
At first glance, everything looks promising:

• Get 100 GH/s free hashpower
• 1000 GH/s Hashpower for only 14.38 USD
• Up to 14% daily earnings on invest
• Return on investment after 10 days
• Low minimum investment from 0.001 BTC
• Minimum withdrawal amount: 0.0002 BTC
• Up to 10% affiliate bonus

In fact if it sounds too good to be true, it ain't true. Let's have a closer look:

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The first suspicious thing:

(For comparison, I take the current prices and values of Hashflare)

If you want to buy 1000 GH/s (1TH/s) of real mining power you have to pay 220 USD.
If we assume that the BTC price stays at 10000 USD, we would get around 0.64 USD a day.
It would take 344 days to get our investment back, not only ten!

You can play with these numbers @ coinwarz.com

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Other strange things:

• If you look up their address it's a residential building in London -> Google Maps
  Where do they hide their offices and mining rigs?

• There is no further information about the company

• Their Facebook page is nearly empty

• Their Website is up and running since two days and they are hiding behind namecheap and cloudflare -> InterNIC Whois

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Good questions: How can they be profitable? Are they legit?

In short, they are not. They only collect money as fast as possible, then close the site and disappear. It's not possible to sell mining power with this cheap prices. You would have to buy mining rigs, pay electricity and rent for buildings etc. It's more or less a ponzi scheme (old investors get paid by new investors).

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Summary

Most of these scamming mining sites use the same scheme:

• Free hashpower
• Extreme high daily earnings
• Low investments and extreme cheap GH/s prices
• Return on investment after 10 days
• They operate and pay for about 20 - 30 days
• They disappear after 30 - 40 days

The important part is: through the payout in the first days all users who registered early, believe that they are legit and spread their affiliate link. If they have some luck, they even get their money back or make a slight profit. In their early days even Scam Checking Sites think they are legit and paying (but it's not too hard to make them believe this). -> viral-alert.com

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Conclusion

Ignore your greed and stay away from too profitable mining companys. Save your money for more secure opportunities or spend it with your beloved ones. That's way more profitable ;)

Don't nail me down on this, but I think they will disappear by the end of March. They remind me of SierraHash.com (those were the ones who scamed me during my first days in crypto, fortunately I was early enough to get some of my money back).

Always stay safe on your crypto journey
Chris