Why are there no legitimate HYIPs?

[Este Nuno]

Finally, there is also an opportunity to profit by giving out loans. This includes mortgage loans. A business could be set up that allows investors to pool their money together and give out loans. The profits would come from the interest that is paid once the loan is repaid.

zopa.com? lendingclub.com ?
peer2peer lending is a thing already.

As someone who used to lend on Prosper, I'd advise to stay away.  There's a reason a lot of these people can't get loans from banks.

Do banks even loan money out to regular people anymore? Besides home mortgages of course.

[twiifm]

Finally, there is also an opportunity to profit by giving out loans. This includes mortgage loans. A business could be set up that allows investors to pool their money together and give out loans. The profits would come from the interest that is paid once the loan is repaid.

zopa.com? lendingclub.com ?
peer2peer lending is a thing already.

As someone who used to lend on Prosper, I'd advise to stay away.  There's a reason a lot of these people can't get loans from banks.

Do banks even loan money out to regular people anymore? Besides home mortgages of course.

My bank gave me a business line of credit without me asking for it.  Like $50K

[theonewhowaskazu]

Finally, there is also an opportunity to profit by giving out loans. This includes mortgage loans. A business could be set up that allows investors to pool their money together and give out loans. The profits would come from the interest that is paid once the loan is repaid.

zopa.com? lendingclub.com ?
peer2peer lending is a thing already.

As someone who used to lend on Prosper, I'd advise to stay away.  There's a reason a lot of these people can't get loans from banks.

Do banks even loan money out to regular people anymore? Besides home mortgages of course.

I don't know, mine constantly is offering me tons of lending products I have absolutely no need for, whether I want them or not. I swear they've opened an overdraft line on 3 different checking accounts, and a HELOC I didn't ask for. God knows how they got me a HELOC without a single signature on my part, or even an appraisal of my property's price . . . :\

[Ron~Popeil]

Finally, there is also an opportunity to profit by giving out loans. This includes mortgage loans. A business could be set up that allows investors to pool their money together and give out loans. The profits would come from the interest that is paid once the loan is repaid.

zopa.com? lendingclub.com ?
peer2peer lending is a thing already.

As someone who used to lend on Prosper, I'd advise to stay away.  There's a reason a lot of these people can't get loans from banks.

Seconded. Prosper was a pretty decent way to invest early on but the lack of ability to get judgements and ever increasing default rate chased me from it.  The bit coin lending platforms seem too similar for comfort.

[tee-rex]

Every single business following the HYIP model has turned out to be a ponzi scam.

I would think that a "legitimate" HYIP would be possible however. Think of the real estate business. If you have a rental property as an investment, it is possible to make a 8-15 percent annual profit. A business could buy a property and sell shares in the property which would return a weekly, monthly, or yearly profit. Shares could be resold once bought, hence leaving your initial investment intact.

<...>

Got any other ideas?

That would not be a HYIP in the first place. HYIP is a type of Ponzi scheme, that is "an investment scam that promises unsustainably high return on investment by paying previous investors with the money invested by new investors" according to the Wikipedia article about it.

[theonewhowaskazu]

Every single business following the HYIP model has turned out to be a ponzi scam.

I would think that a "legitimate" HYIP would be possible however. Think of the real estate business. If you have a rental property as an investment, it is possible to make a 8-15 percent annual profit. A business could buy a property and sell shares in the property which would return a weekly, monthly, or yearly profit. Shares could be resold once bought, hence leaving your initial investment intact.

<...>

Got any other ideas?

That would not be a HYIP in the first place. HYIP is a type of Ponzi scheme, that is "an investment scam that promises unsustainably high return on investment by paying previous investors with the money invested by new investors" according to the Wikipedia article about it.

HYIP stands for high yield investment program. Any alternate definition written on the wikipedia page is merely the view of the latest wikipedia editor given historical data. I'm not saying that you're going to find a legitimate HYIP, just that re-defining an acronym is an incredibly stupid thing to do, especially considering its an acronym.

[gmx95]

Well, one might say that Maddoff's fund was a legitimate HYIP :-)
Depends what one considers legitimate.

[tee-rex]

Every single business following the HYIP model has turned out to be a ponzi scam.

I would think that a "legitimate" HYIP would be possible however. Think of the real estate business. If you have a rental property as an investment, it is possible to make a 8-15 percent annual profit. A business could buy a property and sell shares in the property which would return a weekly, monthly, or yearly profit. Shares could be resold once bought, hence leaving your initial investment intact.

<...>

Got any other ideas?

That would not be a HYIP in the first place. HYIP is a type of Ponzi scheme, that is "an investment scam that promises unsustainably high return on investment by paying previous investors with the money invested by new investors" according to the Wikipedia article about it.

HYIP stands for high yield investment program. Any alternate definition written on the wikipedia page is merely the view of the latest wikipedia editor given historical data. I'm not saying that you're going to find a legitimate HYIP, just that re-defining an acronym is an incredibly stupid thing to do, especially considering its an acronym.

I know what HYIP stands for, and now this acronym has turned into a euphemism being used in place of Ponzi scheme and meaning a special case of it. In short, the word has by now lost its meaning defined by the words it abbreviates.

[superresistant]

Whatever what HYIP mean for everyone.

We need a legit HYIP (hedge fund) for Bitcoin (or any crypto).

[Este Nuno]

Well, one might say that Maddoff's fund was a legitimate HYIP :-)
Depends what one considers legitimate.

In what universe could Madoff's scheme ever be considered legitimate?

[lihuajkl]

Normally the HYIPs are not called HYIPs at the beginning,  they end up losing money then realize they are trapped in HYIPs. We should know how HYIPs work and get away form them. High yield = high  return.

[tee-rex]

Normally the HYIPs are not called HYIPs at the beginning,  they end up losing money then realize they are trapped in HYIPs. We should know how HYIPs work and get away form them. High yield = high  return.

Some HYIPs do not even pretend to be anything but just that, i.e. pyramid scams.

[lucaspm98]

legitimate and HYIP doesnt really go together very often. If someone could make a huge percentage of profit doing some kind of trading, arbitrage, etc. why should they share it with investors. Even if they only had a small amount of capital to start with, if they are making such huge returns on their investments it won't matter in the long term.

[botany]

Well, one might say that Maddoff's fund was a legitimate HYIP :-)
Depends what one considers legitimate.

In what universe could Madoff's scheme ever be considered legitimate?

I am not sure if even Madoff would consider his scheme legitimate. 
He just thought he could get away with it.

[Gargulan]

Two things:

1) You need to have high yield business model to be able to offer high interest rate to attract capital.
2) Business with sound model can get loan cheaper from bank and private equity firms.

[redwraith]

Finally, there is also an opportunity to profit by giving out loans. This includes mortgage loans. A business could be set up that allows investors to pool their money together and give out loans. The profits would come from the interest that is paid once the loan is repaid.

zopa.com? lendingclub.com ?
peer2peer lending is a thing already.

As someone who used to lend on Prosper, I'd advise to stay away.  There's a reason a lot of these people can't get loans from banks.

Seconded. Prosper was a pretty decent way to invest early on but the lack of ability to get judgements and ever increasing default rate chased me from it.  The bit coin lending platforms seem too similar for comfort.

You must be talking about pre-2009, that was when the default rates at Prosper were through the roof.  After they came out of SEC registration in Fall of 2009, loan quality was greatly improved and defaults lowered dramatically.  Today, I'm making a little over 12% there now, a damn sight better than a savings account!

[kerafym]

Finally, there is also an opportunity to profit by giving out loans. This includes mortgage loans. A business could be set up that allows investors to pool their money together and give out loans. The profits would come from the interest that is paid once the loan is repaid.

zopa.com? lendingclub.com ?
peer2peer lending is a thing already.

As someone who used to lend on Prosper, I'd advise to stay away.  There's a reason a lot of these people can't get loans from banks.

Seconded. Prosper was a pretty decent way to invest early on but the lack of ability to get judgements and ever increasing default rate chased me from it.  The bit coin lending platforms seem too similar for comfort.

You must be talking about pre-2009, that was when the default rates at Prosper were through the roof.  After they came out of SEC registration in Fall of 2009, loan quality was greatly improved and defaults lowered dramatically.  Today, I'm making a little over 12% there now, a damn sight better than a savings account!

12% after you factor in the default rate or before?

How does lender go after deadbeat in a peer to peer lending platform?

[Mobius]

Finally, there is also an opportunity to profit by giving out loans. This includes mortgage loans. A business could be set up that allows investors to pool their money together and give out loans. The profits would come from the interest that is paid once the loan is repaid.

zopa.com? lendingclub.com ?
peer2peer lending is a thing already.

As someone who used to lend on Prosper, I'd advise to stay away.  There's a reason a lot of these people can't get loans from banks.

Seconded. Prosper was a pretty decent way to invest early on but the lack of ability to get judgements and ever increasing default rate chased me from it.  The bit coin lending platforms seem too similar for comfort.

You must be talking about pre-2009, that was when the default rates at Prosper were through the roof.  After they came out of SEC registration in Fall of 2009, loan quality was greatly improved and defaults lowered dramatically.  Today, I'm making a little over 12% there now, a damn sight better than a savings account!

12% after you factor in the default rate or before?

How does lender go after deadbeat in a peer to peer lending platform?

I am sure that the 12% is before factoring in the default rate. The expected value of all prosper loans is much lower then this, but still better then a savings account.

The lender does not go after a borrower who does not pay their loan (with prosper), but prosper will first attempt to collect with their internal collection department, and if the loan falls a certain amount behind then it will be sent to a collection agency.

[The Sceptical Chymist]

Yes this is an old topic, but I want to add my 2 cents.

All of the high yield investment plans on this here chat board are all frauds BECAUSE...the morons who advertise such things here have no idea how to manage money and certainly couldn't guarantee the yields they promise any other way than through a Ponzi scheme.  Yes it is certainly possible to earn high rates of return on your money.  It just isn't going to happen by throwing your hard-earned BTC at anyone advertising here.  This board is full of cretins and idiots and scammers.  Anyone with a legitimate plan to earn a high % ROI is going to do it through legitimate channels.

[mrhelpful]

You just havent observed enough lol.

Theres plenty around you on this forum, and it comes in many forms. Some are more obvious then others like HYIP. But, the mining game itself can be viewed as one, since we see all the past "legit" ones collapse. Eg: BFL, etc.