A Ponzi scheme is a fraud where someone takes money from customers promising some kind of return (typically they are guaranteed, or consistent. Which doesn't make sense) but uses money from the new investors to pay off the previous ones.
By now you should see the problem with that. It doesn't work, if everyone wants to take their money out there just isn't enough.
A pyramid scheme is… Think referral rewards: convince 2 friends to join and you get to keep some of the money they make, then they convince 2 friends, ect… Nobody is really selling anything, the only real way to generate any form of cash flow with that scheme is to get more people to join. Herbalife, for example, is a pyramid scheme. (Go ahead and sue me). Again this doesn't work, if you convince friends to convince 2 friends, we're 2 levels down and we have (2^0) + (2^1) + (2^2) that's a power series, it has exponential growth. The number of people needed so that x person make money is 2^(x + 1) - 1
8(10)^9 ≈ 2^33
Congratulations @zack960! You have completed the following achievement on the Hive blockchain and have been rewarded with new badge(s):
Your next target is to reach 1000 upvotes.
You can view your badges on your board and compare yourself to others in the Ranking
If you no longer want to receive notifications, reply to this comment with the word
STOPCheck out the last post from @hivebuzz:
Support the HiveBuzz project. Vote for our proposal!