The rise of bitcoin Ponzi Schemes

During the last year or so there seems to have been a rise in bitcoin Ponzi schemes. A Ponzi scheme occurs when returns to investors are paid using money from new investors rather than profit from business activities. Ponzi schemes hook new investors through offering abnormally high returns. I want to share an experience, so hopefully others don’t make the same mistake I did. I lost a tiny amount of my bitcoins in in two Ponzi schemes. I thought these organisations were high risk high reward, however the fact is putting bitcoins into them is straight up gambling as there is no telling how long they will last.

The first is Gladiacoin which claims it will double your bitcoins in 90 days. At the time I deposited, people were posting videos on youtube of the daily returns they were receiving. Once you put a deposit into Gladiacoin, you have to wait 45 days for return of initial investment. The problem is there is a big chance the scheme won’t even last for 45 days without some sort of issue, which was what happened in my case. In addition, organisations like these take advantage of people’s greedy nature. People will likely reinvest their earnings and not take them out.

The second is Bitgrow, which claims it is a U.K. based company. This company claims to pay investors 7% daily. These returns are even higher than Gladiacoin which is 2.222% daily. The problem is that the con artists have done a good job at making it look legitimate. However with simple calculations one could see how it is not sustainable for very long.

In conclusion people on youtube need to stop encouraging others to join these Ponzi schemes. It makes me sick to my stomach losing just a small amount of my bitcoins. I can’t believe how unethical some people are. If it sounds too good to be true it probably is. There is no easy way to make money.