[2018-05-26] South African Police Investigate $80 Million Bitcoin Ponzi Scheme

[timerland]

The people invested in this was not scammed. If someone promise you 2% interest a day, you should have already realized that it was a Ponzi scheme or something illegal. They continued investing, because they were greedy.

Some friends of mine in South Africa Skyped me about this and asked me if this was Bitcoin. I investigated this and then warned them in advance that they should warn people that it was not Bitcoin. I explained to them that it was a Ponzi scheme and that they must report this to the authorities.

They contacted me again and said that these people know that it was a Ponzi scheme and that they are going to risk it. So I washed my hands and warned my friends not to get involved with this.  

SHITE like this, gives Bitcoin a bad reputation.  

Not everyone who invests knows that it's a ponzi scheme, but I agree with you.

It's these scams that taints the reputation of bitcoin. People confuse bitcoin with ponzi schemes that are named similarly to bitcoin, and newbies don't know how to distinguish them.

I need to give credit to the South African police here, for at least attempting to investigate this. A lot of ponzi schemes, even after they collapse, face no consequences whatsoever even though they are obviously not lawful investment companies. This is where crypto regulation can be useful, in stopping scams, not restricting access to bitcoin itself.

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[richardsNY]

A lot of ponzi schemes, even after they collapse, face no consequences whatsoever even though they are obviously not lawful investment companies.

The thing is that in these cases we only read what news sites release. If they don't choose to release or at least try to obtain more information from authorities, we won't find out how everything plays out behind the scenes after scheme busts. In most cases we only read about these schemes initially because that's what people want to read and it directly also attracts clicks. Criminals being prosecuted for their actions is too positive in nature, and for that reason will likely not get covered. Especially when it comes to the mainstream media channels, they are only out to keep their anti Bitcoin campaign up and running. Bitcoin plus negativity equals user interest and income for them.

[Kakmakr]

A lot of ponzi schemes, even after they collapse, face no consequences whatsoever even though they are obviously not lawful investment companies.

The thing is that in these cases we only read what news sites release. If they don't choose to release or at least try to obtain more information from authorities, we won't find out how everything plays out behind the scenes after scheme busts. In most cases we only read about these schemes initially because that's what people want to read and it directly also attracts clicks. Criminals being prosecuted for their actions is too positive in nature, and for that reason will likely not get covered. Especially when it comes to the mainstream media channels, they are only out to keep their anti Bitcoin campaign up and running. Bitcoin plus negativity equals user interest and income for them.

Well to be fair, most of these scams and hacks get a lot of media attention, especially when there are large amounts involved. We got a blow by blow analysis of the "Silkroad" incident and also MtGox and also the MMM Ponzi scheme and the death of Sergei Mavrodi. <The mastermind behind MMM, possibly the biggest Ponzi scheme in the world>

I would give it to you that the smaller incidents are not covered from beginning to end, but most is so small that it is not news worthy for them to cover it. <There are too many other things going on in this world> 

[1Referee]

One of the people who was invested in this was a medical doctor, so I doubt if greed makes any distinction based on IQ.

It's important to understand that being a doctor has zero meaning when it comes to actions outside your comfort zone. Your doctor (medical) IQ might be sky high, but your IQ in other fields can be incredibly low, especially when it comes to investments and risk/reward ratios.

Greed is destructive, and it shows time on time again. If you can't prevent yourself from taking extreme risks, which these ponzi schemes are, then something is actually wrong with you. Investing in ponzi schemes, and especially when it is this obvious, is only a matter of you having a low IQ, at least in the investment field.

The thing that we lose in the end is credibility and a decline in adoption, fuelled by people who lost money in scams. Bitcoin is the unfortunate "collateral damage" in this scenario.  

Nope. It only exposes how retarded people are. Bitcoin keeps growing as always. If we go by your logic, we wouldn't be where we are today.

[Kakmakr]

One of the people who was invested in this was a medical doctor, so I doubt if greed makes any distinction based on IQ.

It's important to understand that being a doctor has zero meaning when it comes to actions outside your comfort zone. Your doctor (medical) IQ might be sky high, but your IQ in other fields can be incredibly low, especially when it comes to investments and risk/reward ratios.

Greed is destructive, and it shows time on time again. If you can't prevent yourself from taking extreme risks, which these ponzi schemes are, then something is actually wrong with you. Investing in ponzi schemes, and especially when it is this obvious, is only a matter of you having a low IQ, at least in the investment field.

The thing that we lose in the end is credibility and a decline in adoption, fuelled by people who lost money in scams. Bitcoin is the unfortunate "collateral damage" in this scenario.  

Nope. It only exposes how retarded people are. Bitcoin keeps growing as always. If we go by your logic, we wouldn't be where we are today.

Do you want to tell me that Ponzi schemes are good for Bitcoin? I have spoken to several people who got burnt by scam ICOs and Bitcoin Ponzi schemes and the majority of them does not want anything to do with Bitcoin after they lost their money on these scams. These people are from all walks of life and they always blame the technology and not themselves.

They even take it a step further, by warning people against "Bitcoin" investment. This has a much wider impact than simply one individual that got burnt, because every person that this individual come in contact with are poisoned by his or her anger and resentment towards this technology. <not the scammers/criminals that used the technology> 

You do not grow adoption by exposing people to scams and Ponzi schemes, where they lose money!  ^hmmmmmm^

[1Referee]

Do you want to tell me that Ponzi schemes are good for Bitcoin? I have spoken to several people who got burnt by scam ICOs and Bitcoin Ponzi schemes and the majority of them does not want anything to do with Bitcoin after they lost their money on these scams. These people are from all walks of life and they always blame the technology and not themselves.

Instead of trying to force through your own opinion, try to be a bit more open minded and understanding. I never said it's good for Bitcoin. I just try to point out that long term speaking, these cases aren't a problem at all, and the proof for that is the growth we go through. If people are stupid enough to invest in a ponzi and blame Bitcoin for that, then it's their problem. It only shows their true nature, and shows that they shouldn't be here in the first place.

They even take it a step further, by warning people against "Bitcoin" investment. This has a much wider impact than simply one individual that got burnt, because every person that this individual come in contact with are poisoned by his or her anger and resentment towards this technology. <not the scammers/criminals that used the technology> 

You do not grow adoption by exposing people to scams and Ponzi schemes, where they lose money!  ^hmmmmmm^

Underlined.

I'm out.