Looking inside BitEnsure: Bitcoin savings account or Ponzi scheme?
Disclaimer: CoinDesk does not in any way endorse BitEnsure and is not qualified to offer financial advice. Any actions readers choose to take are at their own risk. Update August 16, 2013: BitEnsure has now announced that it is closing due to bad press. Its website now has the following message: "Unfortunately, due to the timing of launching Bitensure and current news events the reception to Bitensure has been overwhelmingly negative. We do not see the potential that once existed in the idea of a Bitcoin Savings Account at this time. We are discontinuing the site." BitEnsure also confirmed....
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There are several high profile criminal and civil cases involving Bitcoin in the United States. In some of these the prosecution is clearly applying law to Bitcoin transactions that might not apply. But in the case of Trenton Shavers and his Bitcoin Savings and Trust this turned out not to be the case, even though his attorneys tried to make it look like it. A US Federal Judge has ruled in case is SEC v. Shavers et al, U.S. District Court, Eastern District of Texas, No. 13-00416 that the Bitcoin Savings and Trust was indeed a criminal enterprise and Shavers was guilty of running a Ponzi....
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.....
This particular Ponzi Scheme in Vietnam will give Bitcoin a bad reputation in the country. Cryptocurrency is not regulated by the banks, and the local government is not too keen on Bitcoin either. Ever since the inception of Bitcoin, there have been individuals and companies trying to discredit cryptocurrency. Some of them even go as far as setting up deliberate Ponzi Schemes to defraud Bitcoin investors. Such a scheme seems to be on the brink of collapse in Vietnam. Hundreds of people have been burned by this pyramid scheme, which seemed to rely on an MLM structure. It is not the first....
One of the first named plaintiffs in a new lawsuit against JPMorgan Chase says he lost $650,000 — including retirement savings — to an alleged $328 million crypto Ponzi scheme the bank helped keep running. Related Reading: Iran Set To Deploy Mines, Oil Hits Highs — What It Means For Bitcoin Robby Alan Steele is […]
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....