Safety · Guide

Is cloud mining legit? A 3-test check for any offer

Some of it is. A lot of it isn't. The good news: you don't need to investigate the company to catch most scams. Three numbers from the offer itself are usually enough.

Updated 8 Nov 20266 min readBy Tallyhashs

Why fixed daily returns give it away

A mining machine earns its share of each block reward. That share is set by network difficulty, which changes every two weeks, and its dollar value is set by Bitcoin's price, which changes every second. Real mining payouts go up and down. A platform that pays "1.3% to 1.5% every weekday" whatever the market does is paying from somewhere else, usually from newer depositors.

Test 1: the revenue test

Divide the promised daily payout by the TH/s you're told you're buying, then compare the result with hashprice, the network's revenue per TH/s per day.

Example: $1.40 a day on 25 TH/s is $0.056 per TH/s per day. In November 2026 the entire network paid about $0.032, before anyone paid a power bill. The offer promises 1.8 times what mining can earn.

Test 2: the hardware test

Divide the price by the TH/s. Efficient new ASICs cost roughly $18–22 per TH/s in late 2026 (an Antminer S21 XP: 270 TH/s for about $4,800 at retail). Older used machines sell for less but burn far more power.

Example: $100 for 25 TH/s is $4 per TH/s, a fraction of what the machines cost. A short-term rental can legitimately cost less than hardware. "Lifetime" or "no term" hashpower at that price can't.

Test 3: the return test

Annualise the promise: daily payout × 365 ÷ price. Then compare it with what brand-new hardware grosses at today's hashprice, before electricity. That's about $0.032 × 365 ÷ $20, or roughly 58% a year, and the power bill takes a big bite out of that.

Example: $1.40 × 365 ÷ $100 is 511% a year. No mining operation on Earth produces that from hardware.

Seven red flags

1. A fixed daily or weekly percentage. Real mining income moves with price and difficulty.
2. Payouts above hashprice. If they pay more per TH/s than the network does, it's impossible.
3. TH/s cheaper than the hardware. Machines cost money; "25 TH/s for $100" doesn't add up.
4. You deposit stablecoins into their wallet. If they hold your money and your "earnings", they decide whether you can leave.
5. No serial number, no pool link. An honest host can show you the machine's serial and a read-only pool observer page within minutes.
6. Big referral bonuses. Paying you to recruit depositors is the classic Ponzi engine.
7. The story and the paperwork don't match. Check the company registration date against the "founded in" story, look up the team independently, and look for a named auditor rather than the word "audited".

What regulators have said

Regulators have acted against exactly this pattern. The Texas State Securities Board moved to halt an alleged cloud-mining scheme that advertised daily returns of 1.6% to 2.8% over 120 days, calling the promises unfounded (Finance Magnates). The Philippine Securities and Exchange Commission warned the public about cloud mining contracts that promised daily or weekly payouts plus recruitment commissions, and said unregistered contracts were illegal (ABS-CBN).

Questions to ask any provider, including us

• Which serial-numbered machines does my hashrate run on, and is that in my agreement?
• Can I have a read-only observer link to my pool sub-account?
• Do payouts go directly from the pool to an address I control?
• What is the all-in power rate per kWh, and what does it include?
• What is the contract term, and how do I leave or take the machine?
• What is the legal entity, where is it registered, and since when?

If you've already deposited

Stop adding money, including any "fee" or "tax" you're asked to pay before a withdrawal; that's a common pattern in investment scams. Save screenshots, wallet addresses and transaction IDs. In the US you can report to the FTC at reportfraud.ftc.gov and the FBI at ic3.gov. Elsewhere, contact your national securities regulator or the police.

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