Re:Texas man charged with running $60M Bitcoin Ponzi scheme
by mmanfrin on Wednesday July 24, 2013 @01:41AM
(#6094678)
I remember when egold was a big thing, and every other site called itself a 'HYIP', high yield investment program -- they were all ponzi schemes, but the popularity of the larger ones spawned an entire ecosystem of these sites that were propelled only on the naive fantasies of those buying in to them. People truly believed that these programs worked.
[ Parent
| on HN ]
Re:Texas man charged with running $60M Bitcoin Ponzi scheme
by brazzy on Wednesday July 24, 2013 @03:23AM
(#6094887)
I recently heard about HYIP for the first time and did some reading - the amount of self-deception I saw was breathtaking. There were even sites that rated HYIPs by their "investment" structure and current payout status. People knew it was a Ponzi scheme and still believed that they could profit.
Truly, money eats brains.
Re:Texas man charged with running $60M Bitcoin Ponzi scheme
by ROFISH on Wednesday July 24, 2013 @03:44AM
(#6094951)
Those HYIP forums felt, to me at least, like it was Ponzi meta-investing. Many of the HYIPs paid out for a little while to encourage more 'investments'. So the part of the game was to get into early ones, but then get your money out before it closed.
Re:Texas man charged with running $60M Bitcoin Ponzi scheme
by brazzy on Wednesday July 24, 2013 @04:06AM
(#6094997)
So there were absolutely no differences to "normal" Ponzi schemes, except the participants went into into fully knowing what it was, but believing they knew how to beat the odds.
Re:Texas man charged with running $60M Bitcoin Ponzi scheme
by DanBC on Wednesday July 24, 2013 @04:40AM
(#6095066)
Maybe those were fake profiles generating confidence among potential 'investors' / marks?
Re:Texas man charged with running $60M Bitcoin Ponzi scheme
by Luc on Wednesday July 24, 2013 @06:42AM
(#6095362)
I uh... think I may have supplied one of those operators with software to automate payments. It was all rather arms-length and I didn't enquire, but it involved paying out interest to hundreds of e-gold accounts. And I got paid well.
Re:Texas man charged with running $60M Bitcoin Ponzi scheme
by morsch on Wednesday July 24, 2013 @05:51AM
(#6095238)
BTCST also spawned a huge ecosystem of "pirate pass through" operators -- the operator of BTCST went by the nickname PirateAt40 -- who gathered small deposits, offering small time "investors" the opportunity to piss away their BTC.