Examining Bitcoin for Ponzi Scheme Signs

Examining Bitcoin for Ponzi Scheme Signs

People who don’t fully understand what crypto-currencies are and see them more as some form of “imaginary money” are inclined to make unflattering comparisons between Bitcoin and ponzi schemes. Many countries and central banks have issued warnings on the crypto-currency and attacked it using this allegation with little substantiation. A few simple tests and closer examination will reveal whether there is any truth in such accusations. The interest towards Bitcoin became immense during the past year. As it is decentralized, promotes libertarian ideas and aims to help people, the virtual....


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World Bank: Bitcoin Is Not A "Ponzi Scheme"

Ponzi scheme: A fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned by the operator. Many of the under-informed, the under-educated, and the under-control masses have lobbed this parting shot at Bitcoin over the years. People tend to fear things that they don't understand, and will hide behind that fear with blind attacks that sound right, but are just as ignorant, if not more so. Bitcoin clearly does not fall into the definition of a "Ponzi....

"Pirate@40" Arrested for Bitcoin Ponzi Scam

Charles Ponzi. Trendon Shavers, aka "Pirate@40," was arrested this morning on securities fraud and wire fraud charges stemming from his involvement in a Bitcoin-related Ponzi scheme. A Ponzi scheme is a fraudulent investment operation where the operator pays returns to its investors from new capital paid by new investors, rather than from profit earned. The scheme is named after Charles Ponzi, who became notorious for using the technique in 1920. Shavers was the founder and operator of Bitcoin Savings and Trust (BCS&T), which offered and sold Bitcoin-based investments through the Internet.....

SEC Files Charges Against Digital Currency Ponzi Scheme Company

The US Securities and Exchange Commission (SEC) filed fraud charges against the operator of an alleged digital currency Ponzi scheme. The US regulator also froze the assets of individuals connected with this purported scam. According to the SEC press release, California resident Steve Chen and 13 California-based entities, including the US Fine Investment Arts, Inc (USFIA), are at the center of the alleged scheme. The complaint filed in the federal court in Los Angeles indicated that USFIA and Chen's other entities have raised more than $32 million from investors in and outside the U. S.....

All Things Alt: Ponzi Schemes, Blackcoin USBs and a Time Warp Attack

With another week gone by, let's shine the spotlight on recent developments and interesting finds in the world of alternative digital currencies. Shibes scheme in new online game. The popular meme-based digital currency dogecoin has been credited by some as providing a friendly introduction to digital currencies. However, now it is being leveraged to welcome people into a not-so-friendly corner of finance: the ponzi scheme. PonziDoge is billed as a "virtual experiment game" designed to educate people about the nature of ponzi schemes, a form of financial fraud that involves collecting....

Exclusive: Possible $500,000 Bitcoin Cloud Mining Ponzi Scheme Uncovered

Roughly nine months ago, Bitcoin Foundation Chief Scientist Gavin Andresen made a rather interesting comment on Reddit in which he claimed, "I suspect many [cloud mining companies] will turn out to be Ponzi schemes."There have been a few cloud mining scams uncovered over the past year or two, and it appears that another one could unravel in the near future. An anonymous source has provided information to Bitcoin Magazine regarding the possibility of a Bitcoin cloud mining ponzi scheme involving Bitcoin Cloud Services (BCS), which is currently one of the largest cloud-mining providers on....

Quotes

Bitcoin will do to banks what email did to the postal industry.

Rick Falkvinge, IT Enterpreneur, Politician. Founder of the Swedish pirate party