Many users felt that LTCGear was ‘different’ to other cloud mining companies in that the site’s owner (Chris S) had successfully developed his own specialised chips to efficiently mine Litecoin.
If fact, using the litecoin talk forum (and latterly his own website) as a conduit he partially succeeded in developing retail versions of his boards.
When cloud mining came to the fore in mid-2014 he began to sell shares in in own farm in the form of qAsics (each qAsic being the equivalent of 100 kh). Some unfulfilled hardware orders were converted to these qAsics which paid out in the form of weekly payments. Rewards were outstanding with ROI claims of 6-8 weeks.
Understandably many new users were attracted through affiliate schemes and special offers. During Summer and Autumn of 2014 the products were frequently out of stock. This gave the site more plausibility and dispelled a lot of murmurings about the site underpinning a ponzi scheme.
Around the time of Black Friday/Cyber Monday 2014 there was a huge sale of discounted qAsic packs. It is now claimed by the site’s owners that a hack occurred whereby the proceeds of these sales were diverted to rogue BTC addresses leading to the loss of a considerable amount of BTC and also a large amount of fake shares. Most of these fake shares ‘could’ then have been sold on to other users using the open trading system that has since been terminated.
The last reported payments to users was on December 19th. Since then there has been minimal contact from Chris and the ponzi claims have once again been rife. (As a caveat – many respected users of the Litecoin forum have steadfastly stuck by Chris and the site in the midst of the storm that has been created). The ruours were not helped by cryptic messages posted on the site. ETA’s were posted regularly and deadlines came and went. The site went down, came back with black screen and new ETA. New servers were deployed. Mysterious maintenance tasks were reported. The database that has been ‘completely scrambled’ was undergoing manual repair.
All the non-communication was fuelling the negative sentiment across the forums. Just last week on 13th Feb, Chris appeared online to host a Q&A session with his concerned customers. He reiterated the severity of the hack and claimed all was nearly resolved and that users would see their balances within 7 days.
The saga appears to be reaching a conclusion with even hardened supporters accepting that this could be the deadline that needs to be met. We shall see. Check back next week for an update.