How to Avoid Scams in Cryptocurrency Mining?

Many projects are operating in the name of “mining”, but most of them are just scams. How can ordinary investors avoid these scams and find a good project for mining?

With the frequent emergence of digital currencies, more investors have poured into the cryptocurrency market that seems prosperous, and in addition to investing in tokens, more people have chosen the business of “mining”.

However, many projects are operating in the name of “mining”, but most of them are just scams. They use one term in blockchain and apply it to another familiar thing, thereby trying to induce human greed. Among the many scams, there are many about “cloud mining”. These so-called cloud mining scams usually do not have real mining machines or mining farms, and what they sell to investors is just a series of numbers. In the end, what awaits the investors were not the promised high yield, but a shell project with the man behind it ran away.

How can ordinary investors avoid these scams and find a good project for mining?

First, as a project that carries out mining or sells mining power, it must be supported by real mining machines or mining farms. For example, Filet, which focuses on Filecoin mining power, although it looks very similar to other cloud mining projects on the surface, it is actually supported by North American mining farms. There is a real mining machine behind each mining power.

Those cloud mining scams had no real mining farm, but they directly collect cash from investors to buy their so-called “cloud mining power” and flee when the funds were raised to a certain scale. However, Filet mining does not require users to pay cash but to stake FIL to obtain mining power. This is consistent with the logic of Filecoin mining requiring staked tokens, the staking process is completely decentralized, and assets can be checked on the chain. When the staking expires, investors can withdraw them at one time with the principal and profit, and there will be no loss at all. This mechanism greatly lowered the entry barrier and reduces risks for investors.

Secondly, investors need to verify whether the invested funds can be successfully retrieved after the profit is generated. To gain investors’ trust, those mining scam projects fabricate daily profits and show them to investors, but it’s just a string of numbers and cannot be withdrawn. This is completely different from the authenticity of Filet. In Filet, investors can successfully retrieve their funds after their staking expired.

Finally, investors need to be wary of projects that advertise ultra-high yields. These projects are often under the banner of getting rich overnight, which makes investors eager to join, and often ends up with the loss of all assets. Although projects like Filet do not have ultra-high returns like those scam projects advertised, and they cannot make investors rich overnight, their returns have outperformed most of the lending projects, and they are the best choice for stable investment in the cryptocurrency market.

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