Investing in the Cryptocurrency (coin) sector is indeed very profitable, but if not careful in choosing coins can even cause harm and loss of your asset.
Actually to loss (lose the value of the assets we invest) in this sector isn't just because when we're entangled to a coin company that runs its business in a fraud (ponzi) scheme, but there're also a lot of coins where their business pattern is correct, when it fails to answer the market's desire is forced to become the "garbage".
These "junk coins" have even gone to Coin Market Capitalization, but must be satisfied to keep perched in the lowest order and some others came in for a while and then crossed out by the regulator.
But this time we will focus first on the coin which indicates run their business pattern in ponzi scheme or SCAM.
So what is ponzi scheme?
A Ponzi scheme (/ˈpɒnzi/; also a Ponzi game)[1] is a fraudulent investment operation where the operator generates returns for older investors through revenue paid by new investors, rather than from legitimate business activities or profit of financial trading. Operators of Ponzi schemes can be either individuals or corporations, and grab the attention of new investors by offering short-term returns that are either abnormally high or unusually consistent.
Companies that engage in Ponzi schemes focus all of their energy into attracting new clients to make investments. Ponzi schemes rely on a constant flow of new investments to continue to provide returns to older investors. When this flow runs out, the scheme falls apart.[2]
The scheme is named after Charles Ponzi,[3] who became notorious for using the technique in the 1920s.[4] The idea, present in novels (for example, Charles Dickens' 1844 novel Martin Chuzzlewit and 1857 novel Little Dorrit each described such a scheme),[5] was performed in real life by Ponzi, and became well known throughout the United States because of the huge amount of money he took in. Ponzi's original scheme was based on the arbitrage of international reply coupons for postage stamps; however, he soon diverted investors' money to make payments to earlier investors and himself.[6]
And Here Are 3 Coins Which Indicated To Deceive Their Investors, based on data and opinions circulating in the public sphere:
1. Aureus-Bitkingdom (AURS)
What is Aureus-Bitkingdom (AURS) and why I put it in the list? You may consider to read my previous post Failed in Cryptocurrency Market, Aureus-Bitkingdom Will Distribute Back 15,000 Bitcoin to Its Members or just read the crypto traders discussion here: https://bitcointalk.org/index.php?topic=1865911.msg23268608.
2. Bitconnect (BCC)
Everyone may be familiar with Bitconnect, one of the most popular landing coin programs, promising substantial profits to its investor, but a few days ago has collapse.
On January 31 yesterday, the U.S. District Court has officially freeze the Bitconnect asset for the sake of investigation and protect its investors.
The order – granted by Chief District Judge Joseph McKinley, Jr. at the U.S. District Court, Western District of Kentucky – requires the parties to disclose cryptocurrency wallet and trading account addresses, as well as the identities of anyone to whom BitConnect has sent digital currencies within the last 90 days.
The defendants have 10 days to comply with the order. In addition to the disclosures, BitConnect International PLC, BitConnect LTD, BitConnect Trading LTD and Ryan Maasen are prohibited from transferring any assets they may possess until they are granted permission by the court, according to the TRO.
The order comes in response to a second class action lawsuit filed against BitConnect after it shut down its trading and lending platform, alleging that the exchange is a Ponzi scheme.
See: https://www.coindesk.com/us-court-freezes-bitconnect-assets-as-lawsuits-mount/
For more info and deep analysis about Bitconnect, please refer to these posts :
- The BitConnect scam exposed written by @thegrinder ;
- Is Bitconnect a scam? Or could buying BCC actually be a good investment? written by @therealkrsjr ;
- Bitconnect SCAM with PROOF written by @jenny143 ;
- BITCONNECT BCC - SCAM/PONZI written by @berlinmoonlight.
3. Octoin Coin (OCC)
Just released, octoin coin (OCC) has been directly protested by its investors. It happens because unilaterally they have changed all the assets of its members from another cryptocurrency (such Ethereum) into their new coins (OCC), which were previously only securely placed on their digital wallet in octoin.com.
The miners or investors once promised to get ETZ (Ethereum Zero) when placing their ETH (Ethereum) in the wallet of Octoin.com before Januari 19, 2018. But unilaterally, post Hardfork of the ETH, all member's ETH changed to OCC. And unfortunately again, the previously promised OCC will be priced at $ 100 per OCC, suddenly turning into half the price of it.
That's really a very real act of fraud, isn't it?
You can listen to the curse of OCC members on its Official Facebook Page, here: https://www.facebook.com/Octoin-537828886559760/.
That's 3 coins who are already indicated to fraud against investors, based on the facts found in the field so far. So be careful in investing. Do not be easily seduced by the lure of high income, because it could have an impact on losing your money forever.
I've previously heard about ponzi scheme, doing fictitious transactions to interest infestors or just to improve the value of crypto curency. there are some markets that usually used for such frauds, perhaps because of the loosening of rules applied by the market. So please be careful with the new crypocurrency, learn and follow developments before you start investing.
Thank you for completing the information about the ponzi scheme, @zerometal :)
@adly.jailani, Beautiful 😍🧕🏽
awesome...hehehe
this is amazing information
you have saved many people
not too late
thanks for sharing
Thanks for viewing and commenting my post, @alizee. I try to do my best. Tx ;)
have you been fooled by the coin ?
good information, thanks for sharing
Yes, two of them...LoL
but I did not lose much, because just trying...hehehe
Sangat bermanfaat bg @adly.jailani dan Menambah pengetahuan tentang Investasi Cryptocurrency.
Iya bang @munadikiehl. Jangan sampai kita menjadi korbannya...:)
As a follower of @followforupvotes this post has been randomly selected and upvoted! Enjoy your upvote and have a great day!
Thank you @followforupvotes ;)
Thank you adly.jailani for making a transfer to me for an upvote of 1.66% on this post!
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Thank you for sharing. I read several stories of how people lost so much on bitconnect. We have to be careful whole investing on crypto just like another investment. Also avoid the get rich stories as most end up bad.
You're welcome @mutitum. hopefully we all avoid the practice of fraud under the investment.
Ponzi scheme are everywhere... what can you say about ox fina. I did invest into that.
I have not been able to comment further on this matter. But one thing is certain, ponzi schemes usually promise an excessively high profit, which the economic calculation is unlikely to achieve so that it leads to bankruptcies and runs off customers' money.
They promiss some return if the project profit. But if not, investor receive none.
yes. you're alright brother :)
Lol, bitconnect lost a ton of money for a ton of people. However, I think any bit of research would have indicated that bitconnect was a scam. Unless you were watching cryptonick and trevon james. Then you were in trouble.
Hehehe...Thanks for sharing us here @criptodj99 :)
Thank you for sharing this warning brother @adly.jailani . I have a question though, what's your methodology in analyzing ICOs so that you can detect such ponzi schemes before they are widely launched and people get tricked into them? I understand that the information you graciously shared with us about those three coins was gathered from the public opinion and feedback from the experts, but it was after those coins were released and invested in. I would like to develop some kind of detection methodology that would spot such scams before they get big. I appreciate any feedback from you on this. Thanks.
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Good job!! Valuable insights here. Thank you
You're welcome @trumanity. Trying to do my best always:)
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Keep up the good work bro.. Thanks for sharing this.. It helped a lot.. Keep up the good work.
Sure @michaelcabiles. I always try to write a valuable post. Thanks for ur advice :)
Yeah Bitconnect is trash and I feel sorry for the big promoters that scammed everyone out of their money and now they will be facing many class action law suits in the future. May God help them. And changing ETH to OCC? Just like Bitconnect refunding everyone in bitconnect coins instead of bitcoins :P Amazing post!
Yeah. That's right @denoxblogger. They (Octoin.com) did it...:)
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