With the recent death of the bitconnect ponzi scheme I wanted to help you guys spot obvious schemes that will eventually run out with your money. This might seem stupid, but people are going to invest in them and lose their money so I figured I would make this a warning because already in the aftermath I already see people moving back to a few other lending schemes. The problem with ponzis is there is always someone on the inside who has more knowledge and access than you so your chances of getting your money out before they run is very small.
The new platform that I saw Trevon pushing was lendconnect, which is also a complete ponzi and will run off with your money eventually. How can I make such a claim? I can do the simple math that people either dont want to do or for some reason choose not to do. First of all there are tiers of investing so if you invest more you should be able to get your money out quicker, but im guessing that even if you put the max (50k) and can pull your money out in 60 days, you still wont ever get it.
Lets do the simple math to show you what I mean. Because 99% of the people using the site will compound their earnings, we will use the compound interest forumula. They are currently paying on average around 5% a day so if you put in just $1 how much money would you make in say a month? 2 months? A year?
These are the amounts you would have after
30 days: $4.32
90 days: $80.73
180 days: $6517
1 Year $54,211,841
2 Years: $2.9 quadrillion
3 Years: $159 sextillion
Obviously this could never actually be sustained. Doing the math usually tells you all you need to know.
They boast they are using the funds to make money on trading and are making 2-3 percent a day. This is complete bullshit. Any real trader knows that you cant push trades and you wont be profiting every day, if you could we would have many more traders with billions of dollars. The problem with this is despite what people tell you making that much a day compounded in trading is hard, very hard. The liquidity in the crypto market as a whole wouldnt even be able to hold a sell orders of such magnitudes and you would end up losing money.
The next thing you have to be aware of is multi level marketing tiers (pyramids) and getting money benefits for getting people into the system. Why do you think so many people push people to invest? They basically get the greater fool to hold the bags while they run off with the money. If you arent the creator of the project you probably arent the one getting away with the money. People need to stop gambling their money like this. They all want to belive they can be the one who gets out but they almost never are and even if they are, its at someone elses expense.
Overall I expect many of these ponzis to be popping up after the failure of bitconnect to try and capitalize on people who will make the same mistake twice. Dont be the person who falls for the same scam again and again. You worked too hard for your money and its too valuable to give to some scammers. Do your due diligence before entering a project and look out for the signs that its a scam.
-Calaber24p