Which is the very definition of a Ponzi scheme.

From Wikipedia, the free encyclopedia:
"A Ponzi scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned by the operator. Operators of Ponzi schemes usually entice new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent. The perpetuation of the high returns requires an ever-increasing flow of money from new investors to sustain the scheme." [1]

[1]  "Ponzi Schemes – Frequently Asked Questions". U.S Securities and Exchange Commission. U.S Securities and Exchange Commission. Retrieved 23 June 2012.

If it turns out that Cloudhashers is operating along the lines of this model then they have been disingenuous at best in their marketing pitch. After all, they advertise themselves as providing a guaranteed return investment opportunity, not an opportunity to participate in a gambling venture (which all Ponzi schemes are). Cloudhashers claims the ROI on deposited capital comes from their scrypt mining operation and then elaborate on why they can offer such high payouts (proprietary hardware, advances algorithms and cheap electricity). Perhaps they're truthful, perhaps not. The reality of the situation remains to play itself out. Either Cloudhashers will resume paying on an altered schedule and activate the promised mining multipool or they won't. We'll see.

Well, guilty as charged as to being a bitcoin novice.



That, however, is not correct. I'm fully aware of the inherent problems associated with hourly payouts. Perhaps I didn't make myself clear; my concern is that Cloudhashers is using that as an excuse to fold up their tents and steal away with everyone's deposits. From a programming standpoint, there's no reason to suspend payouts while you work on changing the payout algorithms. The coding and testing is done off-line and the only interruption should occur when you have to take the system down to implement the changes.


You might want to check the status of your caps lock key before carping about my stridency.

Signed on June 24, stated getting payouts right away, every hour until 7/7/14 at 6:18 AM EST. Nothing since. Why suspend payouts while rewriting scripts? Totally unnecessary. And who are all the complainers about transaction fees? Sounds like a crock of sh&t to me. I'm feeling more than a tad scammed right about now. Serves me right I guess for turning a blind eye to the "if it sounds too good to be true..." maxim.