Pyramid Schemes in Crypto: Dodging Digital Deceptions

Pyramid Scheme is a fraud scheme with a top-down hierarchical structure.

What is a Pyramid Scheme?

A pyramid scheme, like a Ponzi scheme, is an “enrichment” scheme that benefits those at the very top of the organization.When using a financial pyramid scheme, it is not necessary to have a specific product to sell. For example, the scheme can target people who want to make money by inviting them to pay a fee to join the organization.

Those who join are promised money from those they recruit. The pyramid structure is such that those at the top get money and those at the bottom usually lose money. Pyramid schemes are some of the oldest fraudulent schemes, and yet, unfortunately, they have not lost their relevance due to their manipulative and predatory tactics.
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