Bitcoin Forum

https://i.imgur.com/mOgoQn4.jpg
Image orginally from this post by izanagi (https://bitcointalk.org/index.php?topic=924424.msg10175810#msg10175810)

I thought I would give a brief explanation of what a Ponzi scheme is and the dangers in investing your money in them.

What is a Ponzi scheme?

A Ponzi, HYIP or pyramid scheme are generally promoted as investments, sometimes the people running them will say they are investing in the Stock Market or selling a new hot product or on this forum they will say they are investing in Bitcoin or Mining.

The truth is they are lying and they aren’t investing in anything.

The way Ponzi scheme works is the people running the scheme will ask for an investment and offer a return on that investment, but because they aren’t making any money (by selling something for example) the only way they can pay the interest is by using the money invested.

So for example;

The promoters offers to give a 10% return per month on investments of $1000.

Someone invests $1000 and waits a month.

The promoters takes $100 (10% of $1000) of the original $1000 and gives it back to the investor.

The investor is happy because it seems to be working.

But all the promoter has done is used some of the original $1000 to pay the interest.

So now the promoter has $900 of the original $1000.

If the promoter keeps paying interest on the $1000 he will run out of money in 9 months, since they have already paid the first month interest.
For the scheme to keep working the promotors needs more money from more investors. If no one else invests, the scheme will fail.

At this point though, the promoter will generally ask investors to tell their friends or make posts on forums telling people it works, because the more people who invest the more money there is to pay the interest.

But all Ponzi schemes fail eventually, either when the promoter runs off with the money or the money runs out.

This is the harsh truth of Ponzi schemes.

So why do people invest in them?

Because some people don’t know it’s a scam.

But there are other people who will invest even when they know it’s a scam because if they get in early they can make money.

For example;

If someone invests $1000 and the scheme runs for a year, they will get 12 payments of $100 (10% per month for 12 months) so they will now have $1200. They would have made $200 profit.

But it’s extremely risky since no one knows how long the scheme will last or if the promoter will continue to pay the interest.

Most people have heard of Bernie Madoff who ran a billion dollar Ponzi scheme. The people who invested with him early would have made a good return on their money, but the people who invested near the end would have lost it all.

Ponzi schemes are extremely risky and most people will lost their money.

It’s up to you to decide if the risk is worth it, but be careful.

bitcoin prize go to deep
people want recover their money
and they look for new way for earning money
because of this ponzi's are populer this season

True, but people should understand the risks, since they will probably lose any money they have invested which will make their problems worse.

Not true.

If 10 people invest $1000 each and the promoter runs off with the money, everyone loses their money.

And even if the promoter pays out interest, they will have to make 10 payments before the investor breaks even.

If people want to invest, it's their money they can do what they want with it, but there is no such thing as a honest Ponzi; they are all scams.

Yes we know ponzi's are scams. But there is money to be made if you ride the train early. Thanks for the warning but most of us know what were doing :) those that don't lose money just as they would on a dice site.

Again this is not true, even if you invest early, you can still lose if the promoter runs off with the money or if they don't pay back more than what was invested.

Like I said before, if people want to invest in Ponzi schemes, its their money. But this thread is for people who don't know the risks involved in Ponzi schemes.

For people who read this and are on the fence about investing. People will tell you money can be made if you're fast, others will tell you their Ponzi is "honest" but the truth in both cases is they're lying. They need more people to invest so they can make money before the scheme fails.

They want you to be the one that loses your money and not them.

Although I agree with some points I disagree with others. Unfortunatly when risks and gambling is involved, SOMEONE has to lose money. Not everyone can win. Its the same with a dice site. Yes of course they can run off early, but like many people know if you ride the train early there is money to be made at the start(for the investors) and big money for the site in the middle. Of course people will lose money but thats what happens in order for others to make money.

For example a dice site. Someone has to lose money for the site to get profit and the owner to get a payday. It sucks but someones gotta lose.

problem is this "early" end very quick and You wait too "long" to jump out of the train  ::)
btw the train  ;D ;D ;D

https://www.youtube.com/watch?v=3MLp7YNTznE (https://www.youtube.com/watch?v=3MLp7YNTznE)

Why join/consider a PONZI...when you can BUY Bitcoins now for approx 200$!!!!!!!!??????

PS: I love too see retarded people loosing their money on an obvious SAM
PS: I hate to see retarded people starting an obvious SCAM and scamming retarded people

This is not true either.

Investing is not a zero sum game where someone has to lose for someone else to gain.

Any investment should create value, when their is no value created then that investment is a scam.

Even when someone plays at a dice site they are getting value from playing.

While they might lose money they may win and it's the risk they enjoy, the value is the enjoyment and excitement they get from gambling.

If gambling was truly a zero sum game which created no value, then no one would play.

People don't put a pile of money on the ground and burn it because that does not create value.

LOL

There are honest ponzi games. If the operator declares that his/her game is a ponzi and the last investors will lose money, then every participants will know what going to happen and then they can  invest accordingly. Sites where the operator babling about external profit sources and investments are the really dangerous ponzis.

I am doing more some little gambling on dice or small games as a classic ponzi. Warning on ponzi is like warning on cigarettes. Addictive and no fun at all.

What happens if the operator pays interest but stop just before the first investor breaks even?

In that case everyone loses, including people who invested first.

There is no way to know the operator isn't going to run off with the money before paying interest and no way to tell if the people claiming to be paid interest are not the operator or working with the operator.

Just because an operator is open about the scheme being a Ponzi doesn't make the scheme honest or any less risky.

The truth is that some time in the future the scheme will collapse and/or the operator will run off with the investors money.

A "honest" scam artist is still a scam artist.

If the operator is a crook then of course everybody going to lose. But that can happen with pretty much everything if money gets involved.
Everybody knows (or should know) that a ponzi scheme going to collapse sooner or later. However if the participants know that they are "investing" into a (honest) ponzi instead of thinking that they've invested into some sort of trading or whatever business operations (hidden ponzi) then they know what can they expect and plan accordingly. I they still willing to gamble that's their responsibility.
BTW you are right on that this "honesty" is only a limited kind of honesty and should be used as "relative honest in comparison with some others" :).

Yes, but they can short or dump BTC on the exchanges to make money. Holding is losing money, BTC is currently bearish, we had better not play ponzi .

People are playing ponzi because they are desperate. They see the Bitcoin value drop and in panic they invest in these stupid things like Ponzi scene's..

Yep. Everybody took huge hits because of this Bitcoin fall. Now They are desperate.

Even bitcoin fall, I never invest into ponzi.
Better gamble it away


Since bitcoin price is down, ponzi overhelming it




If they keep investing into ponzi, hope they are not commit a suicide if something gone wrong  ;D

It's so awful that this year is started full of ponzi's and more over, the bitcoin value is like falling like a rock in the deep water.

yeah it seems that this year will be even worse than 2014

oh, its the year of the ponzi. Good to know hahaha

Its getting extremely annoying actually. All these ponzi threads should be moved to a new separate section, the 'gambling' forum became a complete joke.

They could make a child board for Ponzi and HYIP. Although I'm not sure if they makes them liable legally, since it could be seen as condoning illegal activity.

They should just close all ponzi threads, or make a sub section. But, then again you cant save everyone on this forum being scammed.

People will do this regardless, only to see small possible profits.

Is it just me, or does that not make sense?

Great advice, investing in one of these even if early would require you to know enough about the creator to judge that its going to run for a decent length of time.  I doubt there are many people who start these who are worth the risk.

I just hope the ponzi phase gets over soon on bitcointalk. Else, it will get crazy here .

IT's real

They all dream to be like Cryptodouble :)


They will run  ;D

How are the prices affected by more  number of ponzis around ?

This fraudulent investment PONZI brings to SHAME Gambling section! Please remove it!

I have burnt my fingers on several different ponzi's over the year, but it's that burning sensation you kind of like
In real life I am quite an adrenaline junkie, so that explains why I get that sensation. ^HeH^

When you get out in time, and you made big profits, it feels great! Then you start to think about all the other people after you, who has to loose for you to win, and the guilt start to eat you up.

For this reason, I donated all my profits from ponzi's to charities. ^Frown^

Yes ponzi's are to unpredictable. I wouldn't suggest plaing in their schemes

Honest ponzis? an oxymoron, imo. You do not know when the cut off will happen, either you will be one of the lasts to receive something (you then call it honest) or one of many not to receive (usual pattern, you will then call it scam). what else to explain?

IIRC, the gambling section was full of ponzi threads as well somewhere around Feb 2014, and the hype died down in a month or so. And it now comes back again, and will probably come back again and again...  :(

I'll try and explain it better.

A Ponzi offers a return of 10% per month.
A person decides to invest $1000.
If the Ponzi pays out for 12 months, the investor would have been paid $1200 in interest.
But they invested $1000, so they actual profit is only $200.

$1200 (interest) - $1000 (investment) = $200 (profit)

But most Ponzi wont last 12 months, most will not last more than a couple of weeks.

Hope this makes it helps.

There can be an "honest" Ponzi game. Weekly ponzi has been doing this on his second game now. He lists a deadline so all know when it will end. He tells you it is a ponzi so everyone knows that at the end the people not paid lose. He did not cut and run on the last one. His second round started tonight and he and an API problem. He spent an hour manually entering the addresses. By the time he was done he had over 100 BTC in his address. He could have cut and run, it would have been the perfect time for something like that. Instead he turned the payments back on and paid everyone that was due. It is a form of gambling. Just like Poker you take money from other players. So anyone that wins at poker is scamming the other players by all of the anti-ponzi crowd out there. As long as rules are followed and everyone can see those rules form the beginning there is no scam in my book. It is just high risk gambling. With that said there are a lot of these ponzi's that are just scams and lie to you saying they are investing and you will get this amount for investing, or they cut and run. Those are scams.

There certainly can , but most of these ponzi sites require no skill to set it up . You just need a script freely available and a web domain, and you could set it up yourself. Now this allows for people to just make a site to scam people. They are paying out fr sometime, and not for most of the time.  They can even skip a few payments, and the comments to claim those txids get buried in the thread.

There are no honest Ponzi, as others have said it's an oxymoron.

All Ponzi are scams.

Just because he has not run off with the money yet, does not mean he won't.

He will run off with the money eventually, this is guaranteed.


Again this isn't true, no one is being scammed in poker unless someone is cheating.

It is a fallacy to claim that gambling is a scam because someone loses, as I mentioned in this post (https://bitcointalk.org/index.php?topic=924424.msg10148801#msg10148801).

all ponzi is always ended with scam
be carefull dont spent your money  :)

Yeah, Ponzi are scam i don't why peeps give their money.(They can gamble if they want to double/triple... their coin lol)

Always protect yourself for it's temptation.

Even they paid now, it will turn scam at the end.

I ever sustain it and I still remember 'till now  :'( ( happen when I know bitcoin early )

anyway here's my "2015 The year of the Ponzi" theme  :D

https://i.imgur.com/7oxegq7.jpg

This is not true. You can run a ponzi game that is not a scam. Yes a lot of them turn out to be one but they dont have to just because it is a ponzi. So far the one operator is showing he is not trying to scam anyone. He has his fees are how he makes his money just like the house rake. The players are taking form each other just like poker. Until you can show cheating with proof then there is no cheating.

ponzis only good on early but in the end it must be scam. so for all referal hunter stop make a bullshit hope for new member who want join it.
so carefull before go to some ponzis.

No ponzis will live only this month / january , it will not last longer.
After Cryptodouble , there is 1-2 ponzis still running now .In march we will not see any ponzis still alive in this forum.

becareful, every ponzis always scam in the end. just the time when it come we dunno.
so just invest dat u can lose. not all in  ;D

That image is awesome, I added it to the first post of this thread, I hope you don't mind.

Let me know if it is a problem though :)

Yep, everyone know how ponzi is dangerous. After lost a lot of their money, they will hate any ponzy, even it has good interface :D

I have lost btc playing ponzis before when I was tempted and nieve. Lost more than I won. Your money your risk but be warned.

there is haters and lovers for ponzi
it makes ponzi still exist until now :D

the only sure thing you can get in investing in ponzi is the fun  ;D

Wow, ponzi lovers? Their heart will broken if the ponzi that they loved be a scam and lost their money. That's will be a nice love story :D

i am the one that loves PONZI
always SCAM and still played :D

I don't mind at all.
You can take it  :)

---

Expressing my feeling, do you feel it guys  :'(

https://i.imgur.com/tdpL0q4.jpg

as bitcoin gets more publicity this year, people will always be there to take advantage of newcomers with the "easy money" promise.

for newcomers + for greedy people :)

That said, I would like to draw your attention towards a new ponzi named weeklyponzi.com (http://weeklyponzi.com) which had nearly BTC900 circulated during its first week (it started recently), and now, its second week there, and I have seen many claiming that they earned from there. I liked the concept of the admin who actually says that its a ponzi and the ones who will invest the last day will gamble big... I know it's gonna run sooner or later, but seems an opportunity currently as whenever someone takes the txn chain ahead, the chance of you getting paid becomes inevitable... I ain't promoting them, but just saying that beware playing with these ponzis, they may turn you either into a millionaire (only in a very few cases) or may leave you broke...

Maybe if you run a ponzi...  ;D

You can't warn people enough, they will STILL join them. It doesnt matter the top story about how so many people lost money on the latest stupid Ponzie/HYIP scheme promising insane rewards, people still fall for em'.

well, I am warning people in almost every thread of this kind, but as there are thousands of such threads there must be lots of people who still believe they can double their money.

I am suprized people would willingly do this.

Yeah I'm not sure where I stand on approving or disapproving of the ponzis. We all know the risk of someone cashing out the coins is high, but on the other hand it's similar to a gambling game of some kind. You run the same risk with a dice site, to be honest.

yes but those sites such as primedice or satoshibet tend to be more secure.

thing is, most newcomers are greedy; who wouldnt be enticed by the idea of "magic money" that can be mined by computers? my guess is that most newcomers will get into bitcoin for the fiat monetary gain and end up getting scammed

Call a spade a spade, you are promoting it.

You either own that Ponzi or are just hoping enough people invest after you so you don't end up losing your investment.

haha for referal and easy bitcoins.
carefull to others about the ponzis !

because of greed thats why. Let them learn the hardway

The only way they would learn is by losing to scams and losing money by investing late. Thats what caused the decline of ponzis last year in Feb.

well, ponzi authors must have been successful recently, as there so many new threads in the gambling section.
Other threads almost disappeared from the first page of topics.

No, I ain't... I know a ponzi's a ponzi... I liked their ponzi, and I can say that I will have one like the same very soon, but I don't possess one... I have been watching their site and constant investments coming in there, and even same sites with same concept are popping up, so just gave my opinion that it's looking fine, as it's a discussion about ponzi, and if opinions ain't welcomed here, then I'm sorry about that... I'm out... :)

i never believe ponzi ;D

i feel like theres more ponzis now because the btc price is so cheap.

i dont think anyone does.. and if they did they lack a lot of financial sense.

i dont want spent my time and money for ponzi  :)

Thank you very much for such an important information . Now I begin to understand the concept behind the ponzi after reading you op . Great work you are doing for others.

Nice, you can tell the information to your friends so they didn't lost their Bitcoin because the fucking ponzis site :)