Bitcoin and cryptocurrencies have been in the news this year, virtually non-stop… because “it’s hot”. Total cryptocurrency valuation recently leaped over an enviable Market Cap threshold: over $100 Billion.
But, with the unprecedented interest in this innovative and relatively new asset class comes the inevitable… sophisticated and ruthless Ponzi scheme artists, ready to pounce and prey on the unsuspecting.
Bitcoin has already witnessed its fair share of those kinds of operators, with many more emerging almost daily… all disguised and representing themselves as savvy and successful investor/businessmen.
A common sign of an unscrupulous “program” is anonymity and ambiguity… websites with no real explanation of their product, where does the company reside, who are the owners, or how can you reach them? The “product” they offer is commissions earned by recruiting others into the “program.” Suspect buzz words include FOREX trading including cryptocurrencies, Bitcoin Binary Options, Bitcoin Trading Platforms as the order of the day, with no “proof of work.”
Gladiacoin and Empower Coin (eCoin)…
In the last couple of weeks two Pyramid Scheme “bitcoin programs” have suddenly closed their doors, with no warning, absconding with millions of dollars in Bitcoin, now in the pockets of the “owners” of these schemes - Gladiacoin and Empower Coin (eCoin). Tens of thousands of unsuspecting enrollees enthusiastically invested their own money and then encouraged their sphere of influence to do the same, only to find out in a few months that they had been duped, with many losing a considerable amount of money.
What about Trade Coin Club (TCC)?
Trade Coin Club (TCC) is still operating, with all the benchmark signs of another Ponzi, but only time will tell. http://behindmlm.com/mlm-reviews/trade-coin-club-review-cryptocurrency-exchange-ponzi-rois/
Some of these brazen operators are not content with the millions they have already grabbed, so they re-package themselves overnight, masquerading as the latest and greatest “new program”, when in fact it is the same people at the top, promising yet higher profits with a new “twist”. Their offer is a bigger and shinier jewel that will be even better than the previous scam, too irresistible for many to ignore or decline. One of the latest to re-package itself appears to be JetCoin - so buyer beware.
How is it that this is so prevalently occurring? One reason is that most people do not understand how Bitcoin really works; therefore, they do not know what to look for when evaluating the legitimacy of the “program” – thus providing fertile ground for chicanery and the proliferation of Bitcoin Ponzi or Pyramid schemes in this financial asset class.
Simply stated, Ponzi schemes pay supposed “profits” to their investors from the new money that comes into the company from new enrollees. “This fresh money is then used to pay off the earlier ‘investor’. The whole structure collapses when the cash outflow exceeds the cash inflow. That also means the entire system doesn’t work when there is no longer new ‘investors’.”
Click here for an article on how to identify and avoid Ponzi Schemes...
Because people do not understand this financial sector, the Ponzi’s are hard to recognize, but the-end-result is inevitably the same… the scammers eventually make off with the victim’s stolen Bitcoins, leaving them high and dry. With the massive penetration and proliferation of social media into our lives, there is no shortage of fresh prospects.
How Can You Protect Yourself?
Like any get-rich-quick scheme, Bitcoin Ponzi’s thrive on the lack of knowledge of its victims. Just because it is a digital currency, and value is increasing rapidly within the international financial markets, does not mean you can acquire wealth quickly, over days, weeks or 3-4 months. As with any legitimate investment, it takes time to build wealth, even if you are receiving an attractive yield from the company, and you choose to compound your returns.
The “latest and greatest programs” have now resorted to “holding” your money for a period-of-time, based on your level of participation, presumably because it is being invested on your behalf - with a promise to pay an astronomical return on investment (ROI) at a future date into the near future. It will be interesting to see how those “programs” turn out when payments are due to their investors.
A word of advice, don’t trust anyone claiming they will “give” you or “help” you mine Bitcoin. That is not how legitimate mining companies do business.
Unquestionably, there are internationally known and fully transparent Bitcoin mining companies. Some of them share their profits with their investors. However, none of them offer you “free” Bitcoin. Nor do they “help” you mine your own coins because mining is their expertise and business model. They invest tens of millions of dollars to set up and operate mines around the world.
What some of them do offer is an opportunity for you to purchase a Bitcoin Mining Contract, which is much like an annuity… you make a purchase of a Mining Contract as an investment, in exchange for the mining company sharing a pro rata portion of its daily profits with you - in a fully transparent manner. Their names are readily seen on the public Hashrate Distribution Records click here to view, along with how many Bitcoins they mined on any given day.
Above is a picture of one room within a legitimate Bitcoin Mine
Having written about all this gloom, the fact remains that investing in Bitcoin is a viable and potentially profitable vehicle to help you increase your “wealth” portfolio, as-long-as you safeguard it by investing with legitimate and fully transparent companies.If you believe you are currently in a questionable “program” consider moving some or all your Bitcoin portfolio into something that is vetted and transparent: Cryptocurrency Mining with trusted and recognized mining companies.
Average profits are 15%+ per month.
Zaydee Rule
Co-Founder: Bitcoin Investment News