Reposting the comment I made on Facebook.

Problem I have with Hashflare, and I'm on it so if it's a scam I'm screwed too, is the reinvestment.

Not that I'm opposed to reinvesting income. But it seems if you're not careful that's a great way to fool yourself. You keep reinvesting and reinvesting, and your hash rate goes up, and you think, "Man look at all the $ I'm making! I'll have passive income out the wazoo!"

But that's not really true with 365 day contracts. If you got to, say 10 TH/s, of hash power by reinvesting 30 GH/s/day, and you turn off reinvestment, you'll only have the 10TH/s for one day. Your Hash rate will lower by that same 30 GH/s/day that you put in.

Now, how profitable would that arrangement really be then? I'm not sure but I'm betting it'll be less profitable than people think it will.

The more I think about it the more that auto-reinvest is a trap. Better to build up for a week or two, bank half, and reinvest half. That way you're at least pulling profit out.