There are many people that want to earn bitcoins but do not have enough knowledge about the cryptocurrency or how it is generated. These types of investors are easy prey for scammers as we shall see with the Satominer scam.
I came across Satominer in a Bitcoin Facebook group and was curious because there were many members promoting it. What struck me about the scheme is the name which made it obvious that it was another crypto mining scam that claims they are mining bitcoins with hardware or through a cloud.
A visit to the site did not bring up anything surprising but the usual sales pitch of scammers that want to leverage people’s natural instinct to do the little they can get away with and make the maximum gain out of the little they did.
Satominer is Not A Bitcoin Mining Pool
For instance, the “About Us” page claimed that Satominer is a leading Bitcoin mining pools even though every experienced BTC enthusiast would tell you that this is a blatant lie.
According to the web copy, “Satominer is an industry leading Bitcoin mining pool. All of the mining power is backed up by physical miners. Mining with the latest algorithms allows to make as much Bitcoin as possible. We aim to provide you with the easiest possible way to make money without having to do any of the hard stuff.”
Who is Behind Satominer?
As expected, the owners of the project did not reveal their identities. Scammers never do because they are aware some people that lose their funds would take legal action to recover them.
Interestingly, on the About Us page, the project gave a link to a certificate of incorporation of a company, Newstack Limited registered in Cyprus even though there is no obvious link between the said Newstack and Satominer.
Satominer Not Mentioned in Certificate
The company was registered on May 30, 2018 which shows that it may have been registered as a cover for the scam (if the certificate is authentic). The certificate obviously did not prove links to the Satominer as it was not mentioned in it as a subsidiary.
Obviously, the people behind this project are taking advantage of people’s ignorance and greed to build an army of affiliates to promote the scam. Even if they make payments to the early investors using the funds of new affiliates, the scam would soon generate hundreds of thousands of dollars or even millions through the clever scheme when they shut down and steal deposited bitcoins.
Fake Registered Office Address
Scammers usually go out of their ways in the quest to prove that they are legitimate businesses by posting documents like certificates and office addresses to create impression with investors that they are a legitimate business but a little extra effort at research would easily reveal that these are misleading information.
Cryptoinfowatch investigation discovered that the Satominer registered address as posted on its website belongs to another business “Hit Hypertech Innovations”. The address is Agiou Nikolaou, 33 5th floor, Flat/Office 502 Egkomi, 2408, Nicosia, Cyprus.
This means that the company does not have an identifiable physical address yet it have an army of affiliates promoting financial products to gullible Bitcoin investors.
Further Background checks on Newark Industries by Cryptoinfowatch showed that the owner has a South African registered address but did register the business in Cyprus. So we assumed that this South African, Robert Wayne Pothier is the person behind Satominer or that some scammers used his company as front for the scam.
Whois shows that the domain was registered on September 7, 2018 and updated on November 6, 2018. This is a clear indication that the site is a new one and like all scam sites is bidding its time to accumulate enough bitcoin funds from unwary investors.
Why Satominer is A Scam
Bitcoin scams are not too difficult to identify. A site that promises a high interest rate on bitcoin deposits should raise a clear red flag. This happening at a time the value of Bitcoin has plummeted is a sure sign of scam.
There are no miners that are makeing such profits through bitcoin mining that they can afford to pay 5 percent daily profit to investors.
Debar the other issues surrounding the Satominer scam such as fake address and possible fake certificate of incorporation, the company is offering investors three unrealistic mining plans.
The least of the plans gives investors profit of 5.35 percent daily. This is a whopping 160 percent in just one month. This is practically impossible for any cloudmining business to accomplish in view of technical and market realities.
The situation of bitcoin cloudmining in the recent market condition is that most genuine cloud miners have stopped mining bitcoins because of its mining difficulty and low price.
Another fact is that big mining pools as claimed by Satominer do not have time for affiliate recruitment because it is strictly a technical business in which hardware are rigged to generate bitcoins.
Satominer has been recruiting affiliates promising them 10 percent of their recruits’ ‘investment’. Where are these funds coming from? The answer should be obvious by now.
A Ponzi Scam
Satominer is a ponzi scam that is paying the older investors with funds brought in by new ones. The purpose of the scammers since December that they updated the website is to lure in many investors. As soon as they have enough bitcoin horde, they’ll exit scam with the stolen funds.
Investors are advised to be wary of all high yield investment schemes because they are meant to steal people’s funds. Ponzi, pyramid schemes and the like are not sustainable because you do not have enough people on earth to make them sustainable.
Scammers are aware of this so what they do is set up these schemes in a way that all the participants contribute money to them.
In the case of Satominer, the purpose is to use affiliate promotion to garner enough deposit then in a few weeks or months the site would shut down exiting with all accumulated bitcoins.
This is why I always recommend a service with good antecedence.