What are Ponzi and Pyramid schemes?
As interest in cryptocurrencies is on the rise, thanks to an increase in adoption worldwide, there has also been a rise in crypto-related scams, unfortunately.
This is why it is essential always to know what legit cryptocurrency opportunities look like so you can avoid scams designed to look like the real thing.
Some of the popular schemes making rounds as real crypto opportunities are Ponzi and Pyramid schemes.
What are the Ponzi and Pyramid schemes?
Pyramid and Ponzi schemes are Multi-Level Marketing schemes that promise huge returns on your investments. They rely on existing investors signing up new ones, which is their only source of revenue.
Like all Ponzi schemes, early investors get paid with the money from later investors. Eventually, when new investors stop signing up and depositing, the scheme collapses since no more funds can be paid out.
Note: While Yellow Card does encourage you to get your friends and family to join through our Referral Program, this is NOT an investment scheme, and we do not promise investment returns.
Yellow Card is a way for individuals to turn their money into cryptocurrencies. We are not an investment vehicle, nor do we offer investment advice. Beware of schemes and businesses that promise investment advice through Yellow Card - these are not authorized partners and do not offer their services through us.
How to spot a Ponzi and Pyramid scheme
Here are some of the warning signs that you might be dealing with an illegal scheme:
- Promises of very high returns/interest
- Guarantees that you "can't lose money."
- Little verifiable information on the company and owners
- Difficulties in withdrawing your funds
- Social signup links with high bonuses
- A sense of urgency to "invest now."
What should I do if I suspect a scam?
If anyone reaches out to you through any channel other than our official live chat or email address and asks for your account details, ignore such messages and report them as spam, then share your experience with our team.
Thank you for choosing Yellow Card.