collapse of the bitcoin pyramid

collapse of the bitcoin pyramid

From William M. Robinson

I'm raising money for a cause I care about, but I need your help to reach my goal! Please become a supporter to follow my progress and share with your friends.

Support this campaign

Subscribe to follow campaign updates!

More Info

How to avoid falling victim to the collapse of the Bitcoin pyramid?

Having exhausted all the possibilities for the influx of new customers, the financial resources of this structure begin to gradually deplete and are no longer able to provide high payments to all their depositors. As a result, there is a significant mismatch between the constantly growing financial liabilities and the steadily decreasing monetary base. It often happens that after half a year, the organizers are unable to make the promised payments and clients lose their investments.

Meanwhile, financial liabilities are growing rapidly, while there is practically no inflow of funds. In these conditions, depositors are beginning to feel anxiety about the safety of their funds. In their midst, various negative rumors, frightening forecasts and panic appear. Most investors begin to get rid of their securities, which leads to a sharp drop in their market value and almost complete depreciation. As a result of the inability to maintain the level of liquidity and market value of "securities", the Bitcoin HYIP collapses. In order not to be left without money, you need to feel the moment and pick up your own a little earlier.

The main types of financial pyramids

Multilevel pyramids - the main mechanism for the construction and functioning of this structure is as follows: each newly arrived participant makes the first contribution, which is distributed among the members of the pyramid higher in the hierarchy. In turn, a beginner, in order to earn money, must invite several people, whose contributions will also be distributed in the same way. And so it continues until the influx of new members dries up. Such a scheme can bring profitability up to 500% to those who are at the upper levels of the structure, which greatly exceeds the possibilities of bank deposits. Those investors who cannot attract new investors to the community lose their funds, and the number of people suffering serious losses averages 80-90%.

Ponzi-type pyramids - these structures got their name from Charles Ponzi, who was the author and organizer of such a pyramid at the beginning of the 20th century. Unlike a multi-tier scheme, in this case, attracting new members is not required, but only an initial contribution, as a rule, for a serious amount. All participants are guaranteed a high income after a certain period of time. The first clients receive high profits from the organizer's personal funds, and then the principle of mutual information is triggered, and new investors appear, inspired by their example. Newly received funds go to payments to old depositors. 

This cycle continues for some time, until the organizer suddenly disappears with all his clients' money in an unknown direction. 

Campaign Wall

Join the Conversation

Sign in with your Facebook account or