High-yield investment programs , or HYIPs, are one of the hottest investment scams today. The gentlemen who run the website provide an invaluable service to bitcoin novices who are tempted by high-returns promising investment schemes that are in reality just straightforward scams. Just use common sense, how would a company be able to pay you 10 percent or even 1 percent returns per day other than by using the money from one investor and giving to the next as Ponzi schemes do?
In other words, all bitcoin HYIPs are simple and straightforward Ponzi schemes where existing investors are paid with the money coming in from new investors until the scheme collapses and the operators disappear with the funds. In this article, you will find out why all so-called bitcoin high yield investment plans (HYIPs) and MLM schemes that involve bitcoin are outright scams and how to identify these schemes so that you do not fall victim to them. The warning indicated that many of these investment scams are being operated as Ponzi schemes HYIPs have become a growing concern for regulators, as the Federal Bureau of Investigation reported an increase of 105% in new investigations from 2008 to 2009.
The development of crypto currencies and other virtual money has lead to a rapid rise in online High Yield Investment Programs (HYIPs) and creation of HYIP scam variations such as Fake HYIPs and Fake HYIP Monitors. The High Yield Investment Programs or HYIPs are one of the biggest and most succesful scams around the Net. The paper groups scams into four categories: wallet software, exchanges, mining ‘vapourware’ and ‘high-yield’ investment programmes that operate as Ponzi schemes.
People that invest in such programs contribute to make other investors” losing their money to make you getting your investments back. With some HYIPs offering returns from 10% to even 50% per day on an investment of as little as $10, it is easy to see why some people get suckered into them, especially when it is known that some people do make the quoted returns. The allure of HYIPs is the promise of large returns on small investments, the type of investment a lot of potential internet investors may believe they can afford.
HYIPs are an example of what are known as Ponzi schemes which claim to offer huge returns for those that invest some cash in them. In reality, these high-yield investment programs are Ponzi schemes, and the organizers aim to steal the money invested. These people believe that it is possible to make money from high yield investment programs by investing only in new HYIPs and pulling out their money early.
Regardless of the ridiculously high returns promised and whatever other carrots the scammer is trying to use to get marks into the Ponzi scheme, sensible investors should avoid dealing with any company that offers an unrealistic rate of return to avoid potential frauds. While this is a fairly large sum to place at total risk of loss, losses from sending money to HYIPs that turn out to be Ponzi schemes can be just as high or even higher depending on the initial deposit made by the unwitting investor. High Yield Investment Programs or HYIPs have become increasingly popular ways to scam people wanting to participate in the forex market.
Ultimately, the vast majority of bitcoin HYIPs are blatant scams Most investors lose their entire deposit and have no chance of taking any legal action. A Ponzi scheme or HYIP is a type of fraudulent investment where the operator generates returns based on the revenue paid by new investors