A search for “free crypto mining” brings about an array of apps which claims to award coins without any effort on your side whatsoever. All such claims turn out to be false once you take a closer look at what the term actually means, since it can refer to either real mining, cloud mining, or simulated mining. And distinguishing between them is the only way to avoid wasting time or money on something that was never going to pay off.
Real Mining: The Original Model
Crypto mining is a physical process, not some kind of abstract endeavor. Cryptographic puzzles are solved by specialized equipment: either ASIC machines for Bitcoins or GPU mining machines for other proof-of-work cryptos. These are real investments: the mining equipment is expensive (hundreds or thousands of dollars), and it consumes lots of electricity 24/7. The success of this venture depends on local power rates, difficulty level of the network, and the price of the mined cryptocurrency. Nothing about this mining is free. It is an honest enterprise which costs money, and it ceased to be profitable for private individuals years ago as mining farms gained the upper hand in the competition for the block rewards.
Cloud Mining: Where Most Scams Live
Cloud mining attempts to circumvent the hardware issue through renting out computing capacity from a company that claims to have legitimate mining rigs. There is a cost involved, but you receive a proportion of the mining outcome as compensation. This is sound thinking on paper. The reality, however, is that the space is full of scams. A lot of cloud mining companies do not have any physical hardware; they just deposit money received from later users to earlier users. Even though many of these services might be technically legal, they offer terms and conditions that render any profits mathematically impossible for the client. These are the ones who tarnish the reputation of free cryptocurrency mining in general, as the “free” period or the extra mining power offered is simply marketing to get the initial deposit.
Simulated Mining: A Different, Safer Model
Simulated mining, in contrast, adopts an entirely new approach: rather than faking the execution of real mining hardware for you, it makes the entire mining idea into a kind of game. For instance, this is how free crypto mining via RollerCoin works. You join an online game which involves setting up a virtual rig, playing mini games, and getting on to leaderboards in order to get small cryptocurrency payouts without having to spend any money on mining hardware/electricity payments or any deposits for mining contracts. The reason is that there is nothing to lose on the ground of hash power transfer or mining rig ownership. In other words, no one can use the “we have lost your mining rig to a mining farm crash” trick used by online mining scams. This means that the risk factor is much lower in this case.
How to Tell the Three Apart
With any “free crypto mining” scheme you come across, a couple of questions will help distinguish the legit schemes from the shady ones:
The Bottom Line
A “free crypto mining” term doesn’t refer to one kind of service at all. The term includes three types of services totally different from each other, and only one of them can be called “free.” Mining costs some money, cloud mining is always associated with losses, and the last one is the only one of them that deserves its name: no hardware, no required investments – just a gaming that gives crypto rewards.