Texas: Security agency shows Cloud mining company the yellow card

Texas State and Securities Board has warned AWS mining cloud mining company. In an injunction order of 6 November , the agency accused the cloud miner of selling “unregistered securities” behind the back of the state. This refers to mining contracts, which according to the official paper would promise a gain of 200 percent on every investment – a promise that the mining company, however, did not have to keep.Because according to the mining contract carry the “risk alone the investor.”

A “Cease and Desist Order” is an instruction to companies to “cease” illegal activities immediately and not to resume them (“desist”). The injunction against cloud miner AWS Mining accuses the company of trading securities in Texas but has not registered as a broker. Nevertheless, the cloud mining company uses a kind of multi-level marketing to market their own products. Moreover, the promise of at least a “200% return on investment” would not have to be kept, as the contract places all risks on the shoulders of the client.

The security agency finds more dubious details

In addition, customers would need a wallet at MyCoinDeal to join AWS. Here again they would have to pay fees to use the Wallet fully. MyCoinDeal, however, is said to belong to the miner itself – information that AWS Mining deliberately withholds from customers. But that’s not the only thing the company keeps silent about the customers; Information on the safekeeping of paid-in cryptocurrencies is just as little known as a statement of security protocols to protect customers from malware, let alone a deposit insurance.

AWS Mining now has 31 days to respond to the charges. Otherwise, the company must end its activities in Texas.

Ponzi schemes are widely used in the crypto world

Nothing has yet been proven for the cloud mining company and caution is advised not to put anyone in the corner too quickly. But the described course evokes associations with a snowball system, With these offers, it pays to look twice and not only to be guided by your own wishful thinking. Because the temptations of such systems are often great. Through a one-time investment and the recommendation of some, less friends, can build a passive income. This story is likely to be familiar to many people who have unknowingly invested in a Ponzi scheme. After all, it has recommended a good friend. And he is known to be trustworthy. Unfortunately, the knowledge of the conditions in the mining industry is still not widespread: It is in reality hardly possible to compete against industry giants like Bitmain and to earn quick and easy money with a small investment.

However, it is precisely with mining contracts that people can easily be lured, especially since the fraudsters are becoming more and more professional. Unfortunately, the beautiful appearance often deceives and it is worthwhile to check beforehand, whether the own income can actually come about by mining alone or whether the system relies on the recruitment of new members.

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