Topic: Anyone know a trustworth and stable HYIP investement site? - page 5. (Read 5206 times)

Here's how a HYIP works:

A thief convinces some people to let him hold their money for a short while.  We'll call them group A.

The thief then convinces other people to let him hold their money for a while. We'll call them group B.

The thief keeps some of the money from group B, and gives some of the money from group B to group A.

Group A now has their own money back and some of the money that was stolen from group B.

Group A is happy and advertises the scam for the thief.

The thief uses this positive news from Group A to convince more people to let him hold their money for a while.  We'll call them group C.

The thief keeps some of the money from group C. Then, to keep group B from getting angry and spreading bad information about the scam, the thief gives whatever is left of group B's money back to them, and then gives enough of group C's money to group B to keep them happy.

Now group A and group B are both telling people about how great the scam is.

The thief uses this additional positive news from groups A and B to convince more people to let him hold their money for a while.  We'll call them group D.

The thief keeps some of the money from group D.  Then to keep group C from getting angry and spreading bad information about the scam, the thief gives whatever is left of group C's money back to them, and then gives enough of group D's money to group C to keep them happy.

You might notice that each time the thief pays himself.  You also might notice that each group so far is getting more money than they put in.  The only way this can work is if each new group puts in more total money than the previous group.  Otherwise there isn't enough money to pay the promised profits to the earlier groups.

Eventually the thief runs out of people willing to participate in his scam.  At this point, he is no longer able to pay back any of the groups that have recently given him money.  He disappears, keeping all the money that he stole from all the groups that let him hold their money.

The earlier participants are essentially paid accomplices.  The thief pays them (with other people's money) to help him find more people to steal from and to convince people that he is not a scam.

Not all HYIPs are Ponzis but all Ponzis are HYIPs.

Any logical explanation of how a system can survive by paying investors with its own investor's money ? The return liability will only increase with time leading to a collapse.

Not necessarily, some are just incredibly risky.

Just read the article it explains it fine.


What this means is that the scheme is offering no services or products of value in return for the investment, for example in a legitimate stock if you purchase a company you will benefit from them doing well either through a rise in the stock price or through dividend payments, so even if you only had one investor in a company that investor would still be able to profit, in a ponzi scheme if there is only one investor the whole time the scheme collapses because there isn't money from other investors coming in.

what is the scam inside? will they not pay ?

HYIPs are always scam. Ponzi is a strict No-No. Try MLM programs with stable business model, e.g. Amoy, TupperWare etc. There may be some like these in Bitcoin too... but watch out their business model first.

They all are.

http://en.wikipedia.org/wiki/High-yield_investment_program

There is no such thing as a HYIP that isn't a scam.

I looked at many sites,but dont know wich are scams