Ponzi Schemes how to spot them and how to find them!

As most of you probably know, after the last few months there has been quite a focus on Ponzi Schemes in the crypto space. Ponzi Schemes are relatively easy to spot if you look at the specific indicators. However, there are multiple ways a Ponzi scheme can be executed and some of them are hard to spot. I have listed the most common signs of a shady company or project here.

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  This is the biggest indicator for me, when I investigate a project or a coin. if by holding or investing an amount into the project and they promise a return of X% within X months then it is more then likely a scam. Nothing I guaranteed when we are talking investing.

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  As mentioned above nothing is guaranteed when investing anything can happen. That means if any project or company advertises their platform as ‘risk-free’ when money is involved that is an indicator that not everything is quite right.

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  It’s not uncommon for a company to have a referral program, it’s a way to gain traffic and attention from people. However, when there are multiple stages of referral to promote an aggressive campaign that is not a healthy marketing strategy and for a lot of people including me that's a red flag.

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  Always ask yourself this question before investing in anything in general but especially if it seems ‘too good to be true’. If the site or coin does not have any proof that they are earning money from something (most cloud mining Ponzi) you should always assume the only kind of income they have is from their investors. So, what happens when the new investors can’t fuel the payout to the old ones? The exit happens.

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  Bitconnect, BitconnectX, bitcoinascension and Davor. Just to name a few, there is a huge list on Reddit which you can find here.

Quick word.

If money is involved you should always do your own research, a lot of times if you have gotten caught by a Ponzi or Pyramid Scheme basic research into the company would have alerted you. If there are pictures on their site with staff members make sure to reverse google search them as 9/10 times the pictures are stolen from Google. When people talk about coins they have invested in and hype it up on Reddit Steemit or Youtube you should NEVER blindly trust their word. when you are spending your own money you know best.