Online HYIPs rarely provide their investors with information about what is being done with their money. This makes it easy for scam programs to succeed. Dishonest organizers can set up a website to look like other HYIPs available on the net, wait for investors to put their money in their hands, and then stop the activity and walk away with the cash.
Ponzi is a fraudulent method that works like a pyramid. In such schemes, profit is not made by successful economic investment, but by attracting new investors and using their investment money to pay existing members. This is all very well as long as the system has a constant stream of new members investing in it, but once a slow period is reached, the investments will stop coming in and the whole system will crash. Sometimes the system organizers don’t wait until this happens and just stop what they were doing and keep the money they had invested. Investors often don’t realize this until they stop receiving promised interest payments.
There are several ways to spot a Ponzi scheme from a genuine HYIP opportunity. First, beware of schemes that offer a high daily return percentage. If a site offers you 40% daily of your investment, you have to ask yourself where the funds will come from to make that level of payment. Second, although HYIPs often pay you for referring others to their schemes, these payouts are often low. If they offer you 10% per referral, it’s worth considering because referrals are the only way to keep the system going. Finally, take a close look at the site and its design and functionality. If you spot a lot of content that appears to have been simply copied from another website, or if the layout and design is particularly amateurish, the organizers may know that it won’t be needed as long as the system works. just a short term thing to make them money.
There are people who knowingly invest in Ponzis. This is because if you are lucky enough to invest and withdraw from the schemes before they collapse or stop working, you can make higher profits than through genuine HYIPs. However, you should keep in mind how easy it is to lose everything you invested with these systems. You may think you know when to quit these programs, but in reality, it is almost always luck rather than skill that provides investors with a profit from these schemes. Often, the organizers of these schemes invite their friends to participate so that when they receive the profits, only the people they select to share them with benefit.
You may decide to take a risk and try to play the pyramid scheme for your own benefit. However, it is worth remembering that if you do this, even if you make a profit, it will be at the expense of others. In addition to this, these systems are illegal and their organizers face severe legal sanctions if they are caught operating them.