Is a blockchain project a pyramid scheme?

(1) Is the blockchain a pyramid scheme?

Recently, a photo of a Chinese aunt posing at the blockchain conference became popular in the circle of friends, and netizens commented: aunts have been blocked by the blockchain Chain stare. Since the beginning of this year, some lawbreakers have carried out pyramid schemes under the banner of blockchain finance, which has become one of the latest variants of pyramid schemes. Recently, a blockchain pyramid scheme case was cracked in Xi’an.

Zhang Yangqiu said that virtual currency, as a new thing, is often used to engage in illegal and criminal activities. It is difficult for ordinary investors to see the law of operation behind the establishment of a pyramid selling network through the Internet to expand the scale of fundraising. She reminded that various virtual currency platforms generally promote technologies such as “blockchain” and “decentralization”, and some are named after international organizations and multinational financial groups, which are very confusing. Middle-aged and elderly friends must invest carefully. It’s best not to dabble in unfamiliar investing areas.

Source of content Xinhuanet

㈡ Is the blockchain a disguised pyramid scheme? Is the blockchain a scam?

Is the blockchain a disguised pyramid scheme? Not difficult to identify.
For the purpose of developing personnel, by calculating and paying remuneration to the developed personnel based on the number of directly or indirectly developed personnel or sales performance, or requiring the developed personnel to obtain membership qualifications on the condition of paying a certain fee Seeking illegal benefits, disrupting economic order, and affecting social stability are pyramid schemes.

㈢ What is blockchain? Is this a pyramid scheme?

All sales that claim to be blockchain are hype concepts, beware of scams.
It only represents my personal opinion, please don’t spray if you don’t like it, thank you.

㈣ Is blockchain a pyramid scheme in disguise?

Blockchain is a new technology and not a pyramid scheme in disguise. With any technology, it is just a fact of pyramid selling in the name of “blockchain”. The state has issued announcements many times to crack down on such pyramid selling. The following is Xinhuanet’s report on blockchain pyramid schemes:

Blockchain is not equal to virtual currency, and there are also security risks. Only by removing the flashiness can the blockchain return to its true application value.

The investment of 80,000 yuan will become 800,000 yuan after three months? Shenzhen police cracked a huge fund-raising fraud case. Under the guise of the blockchain concept and 10 times the income, thousands of investors were deeply involved, and the amount involved was as high as 307 million yuan. Under the “mysterious veil” of the blockchain, criminals have taken advantage of their crooked brains, and the blockchain has become a “signboard” for economic crimes such as fraud and pyramid schemes.

Why has the blockchain been repeatedly “used crookedly” by illegal acts such as pyramid schemes? In addition to “unknown”, what is the “function” of blockchain technology itself? Since the beginning of this year, with the strengthening of supervision, the cooling down of currency speculation has brought new opportunities for the development of blockchain. How is the implementation of blockchain commercial “applications”? “Lookout” Newsweek reporter recently conducted an investigation.

When the three-month “fund release period” promised by the trading platform expired and the staff began to “kick people” in the QQ group, Tang Haiyan, who lives in Bao’an District, Shenzhen, realized that she might have been deceived .

Previously, Tang Haiyan invested 80,000 yuan to buy a virtual currency called “Public Silver Coins” under the introduction of her classmates. “The other party said that this currency is the most advanced blockchain technology at present, with Tibetan tea as collateral, and also showed me the ‘technical white paper’. I don’t understand blockchain, so I didn’t read it carefully.”

Although I don’t know much about blockchain and virtual currency, the high investment income makes Tang Haiyan full of expectations. She told reporters that the company issuing the “Plain Silver Coin” will regularly split the virtual currency at a ratio of 1 to 10, which means that each split will increase the value of the “Plain Silver Coin” in the hands of investors by 10 times. . As long as it is split once, the 80,000 yuan she invests is equivalent to buying 800,000 yuan worth of “general silver coins”, and she can get huge profits by selling it on the trading platform.

According to the rules of the trading platform, the “Public Silver Coins” just purchased cannot be traded immediately, and must be frozen on the platform for three months before the “release period” can be ushered in. However, when three months passed, Tang Haiyan not only did not wait for the doubled assets, but the 80,000 yuan frozen on the platform could not be used for transactions.

“Other investors began to question the authenticity of this investment in the QQ group, and as a result, the company’s staff kicked out these investors one by one. I feel bad,” she said.

The fact also proved Tang Haiyan’s intuition. At the end of March 2018, the Shenzhen police detected a large fund-raising fraud case with a total of 307 million yuan in fraudulent funds. In this case, Shenzhen Puyin Blockchain Technology Co., Ltd.It is precisely in the “blockchain + Tibetan tea” model that the Group Co., Ltd. issues virtual currency to extract public deposits. Tang Haiyan is one of the thousands of victims.

Shenzhen police investigation found that the company claimed that investors could buy and sell “Public Silver Coins” on the virtual trading platform “” to earn the price difference

. In fact, the change in its buying and selling price is that the company used investors’ investment funds for behind-the-scenes operations, and once raised the price of “Public Silver Coins” from 0.5 yuan to 10 yuan, allowing investors to taste some sweetness. When a large number of investors entered the market, the company continuously cashed out by maliciously manipulating the price trend of “Public Silver Coin”, which eventually made the “Plain Silver Coin” in the hands of investors worthless.

Since 2018, fraud and pyramid schemes under the banner of blockchain have become a common “routine” in new criminal methods. In April 2018, Jinan police took down a pyramid selling gang under the guise of “Western Development”, “National Poverty Alleviation”, “Original Shares”, “Blockchain” and “E-commerce”, arrested more than ten main suspects, and frozen the cases involved. There were more than 100 accounts and more than 300 million yuan of funds involved in the case were seized.

Jinan police introduced that Huileyi e-commerce company designed fake virtual disks on the Internet on the grounds that the country is vigorously developing the big data industry, and released so-called “treasure coins” and “precious coins” and other virtual currencies.

They first presented a certain amount of virtual currency to newly joined MLM salesmen under the guise of gifting, each priced at tens of yuan, and then increased the value of the virtual currency all the way to more than 100 yuan or even several hundred yuan through artificial manipulation Yuan, attracting people who do not know the truth to join, and finally “cut leeks” through the cyclical fluctuations of the so-called “depreciation” of virtual currency, and it goes on and on, and finally achieves the purpose of seeking illegal benefits.

In Xi’an, the local police also successfully cracked a massive online pyramid scheme under the banner of blockchain. According to the police, the criminal suspect, Zheng Mou, organized 9 people, including Zhang Mou and Li Mou, who were the administrators of the network platform with high salary. Sell ​​virtual “Datang Coins” on the “Consumption Era” online platform and manipulate the appreciation rate;

At the same time, promotion conferences are held in many cities at home and abroad to attract members, and according to the development of members and offline conditions, set 28-level agency in charge, in just 18 days, the gang has developed a total of more than 13,000 registered members. At present, it has been found that the case involves 31 provinces, municipalities and autonomous regions across the country, and the funds involved are as high as 86 million yuan.

The “Tencent 2017 MLM Situational Awareness White Paper” released by the Tencent Security Joint Lab stated that recently, various types of overseas capital, virtual currency, ICO (the initial public offering of tokens for blockchain projects) Financing) projects emerge in an endless stream, which hides many risks such as illegal issuance, false projects, cross-border money laundering, fraud, pyramid schemes, etc., resulting in a large amount of funds flowing abroad. Once it crashes, runs away or loses contact, investors often have nowhere to complain and make losses difficult recover. Such as Baichuan Coin, Mark Coin, Beta Coin, Dark Coin, etc.

Reporters of “Lookout” News Weekly interviewed in Guangdong, Shandong, Shanghai and other places and learned that most people know that the concept of blockchain is very popular, but “what is unclear” is about the specific functions of the blockchain. There are different opinions: some people think that it is used for “investment and wealth management” and “trading currency”, while others think it is “a major invention of the same magnitude as the steam engine”, and some entrepreneurs are even more eager to seize this “once-in-a-lifetime opportunity to get rich”.

Many industry insiders said that it is precisely because there are many misunderstandings in people’s understanding of the blockchain that criminals have opportunities to mislead investors in troubled waters.

First, blockchain is not equal to virtual currency. By the end of last year, the number of domestic ICO participants and the total number of transactions had doubled, a large number of digital currency exchanges fled overseas, and the proxy investment model involved more ordinary people in high-risk investments.

Many industry self-media, well-known celebrities have formed interest alliances with issuers, digital exchanges, etc., to endorse and create public opinion for the “Air Coin” project platform. In December last year, nine departments including the People’s Bank of China characterized ICOs as “suspected of illegal fundraising, financial fraud, pyramid schemes and other illegal and criminal activities”.

In the interview, many people told our reporter that the existence of tokens has built a set of rights and interests mechanism for the development of blockchain technology, and this mechanism is indispensable for stimulating the prosperity of blockchain applications. of. “The market practice in the past five years has proved that the application of blockchain without an equity mechanism is like a computer without Internet access and a market economy without currency. The application scenarios and development speed are greatly reduced,” said an investor in Shanghai. .

Actually, the token represented by Bitcoin is only one of the earliest products to verify the blockchain technology. chain development�Obvious negative effects.

Xiao Wei, chief engineer of the network blockchain, told this reporter that the myth of ICO’s rapid wealth shakes the research and development of blockchain technical talents, and the myth of coin speculation with hundreds of times returns is a test of the block chain. The patience of chain technology R&D talents. “Many of the ‘comrades’ in the circle who used to do blockchain technology research and development together have been transferred to issue coins, and now there are very few who can insist on technology research and development and application.”

Beijing Internet Finance Industry Xu Zewei, secretary of the party committee of the association, said that in the context of China’s ban on ICOs, many domestic start-ups that promote blockchain applications are “selling dog meat” and packaging originally worthless tokens through conceptual packaging to raise money. “ICO has polluted the good atmosphere of innovation and entrepreneurship and created a speculative product. Many young people are not thinking about starting a business, but are thinking about issuing coins, which makes everyone have the illusion of getting rich overnight.”

At present, more and more people in the industry are starting to think about whether the development of blockchain must rely on the issuance of tokens to achieve incentives. Guo Dagang, secretary-general of the Beijing Internet Finance Industry Association, told this reporter that the so-called incentive mechanism is only a theoretical basis for the project party to issue tokens for itself. Huo Xuewen, director of the Beijing Municipal Bureau of Financial Work, also believes that if the blockchain does not get rid of the dilemma of issuing coins, it will never find a legal mechanism for landing.

Second, the blockchain is not a panacea, and its security is at risk. The blockchain is generally considered to have three functions:

First, the data stored on the blockchain cannot be tampered with or forged, and the data has high credibility and credibility; second, The whole process of the transaction can be traced to the source, which can realize the accurate tracking of responsibility; third, the smart contract embedded in the blockchain can be automatically executed based on the contract, thereby improving work efficiency and reducing the risk of default. The industry generally believes that blockchain has broad application prospects in finance, logistics, trade and other fields.

In fact, the blockchain is not a panacea, and its functions also have many limitations. It is generally believed that according to the characteristics of its cryptography, in order to tamper or forge on the blockchain, it is theoretically necessary to control more than 51% of the nodes. When there are enough nodes in the blockchain, this trust creation mechanism with widespread participation by the public is difficult to tamper with.

However, in reality, digital currency exchanges are frequently attacked or even stolen. On June 20, 2018, the South Korean Bithumb exchange announced on its official website that the exchange was attacked by hackers, and 35 billion won, or about $32 million, of cryptocurrency was stolen.

Ji Xinhua, known as China’s first generation of “hackers”, said that the blockchain will continue to face attacks, and the process of uploading data to the chain is prone to information leakage. Some people in the industry are also worried that once the super computing power of quantum computing is realized, it will also have a direct impact on the blockchain.

Zhao Yao, a special researcher at the Institute of Finance, Chinese Academy of Social Sciences, told our reporter that the academic community had confirmed as early as 2013 that the blockchain is not perfect, and there are many “cheating” strategies. Attacks that control more than 51% of nodes do not exist only in theory, as long as there is enough economic incentive.

Zeng Guang, secretary general of Shenzhen Internet Finance Association, said that blockchain technology itself is not irreplaceable or subversive. “Some criminals exaggerate the role of the blockchain to show that the blockchain has huge investment value, which is worth the vigilance of the majority of investors.”

Thirdly, the popularity of the blockchain is not Not exactly true. The data shows that from the end of 2017 to the beginning of 2018, more than 300 self-media mainly focused on ICO projects appeared, which has become a noteworthy abnormal phenomenon.

“Most of these self-media have the financial support of the person in charge of the exchange and the investors of the currency circle, and the objective independence of their reports is difficult to guarantee. Most of them advocate ICO and currency speculation, and exaggerate the digital currency. Prospects have created the convenience of public opinion dissemination for the illegal fund-raising of problem projects.” Xu Zewei said that some blockchain self-media investors are themselves ICO project investors, and their profit model is to charge advertising fees and project promotion fees to become token issuance. Helpers of public opinion, and some media have developed into agency investment agencies, making profits from them.

(4) Is the blockchain project a pyramid scheme? Extended reading:

On August 24, 2018, the website of the China Banking and Insurance Regulatory Commission released A risk warning reminding the general public to prevent illegal fundraising in the name of “virtual currency” and “blockchain”.

The original text is as follows:

Risk warning on preventing illegal fundraising in the name of “virtual currency” and “blockchain”

China Banking and Insurance Regulatory Commission, Central Cyberspace Administration , the Ministry of Public Security, the People’s Bank of China, and the State Administration for Market Regulation:

Recently, some criminals under the banner of “financial innovation” and “blockchain” have issued so-called “virtual currency” and “virtual assets”. Digital assets” and other methods to absorb funds and infringe on the legitimate rights and interests of the public. Such activities are not real�Based on blockchain technology, the fact that the concept of blockchain is hyped up for illegal fund-raising, pyramid selling, and fraud has the following characteristics:

1. Networking and cross-border are obvious. Relying on the Internet and chatting tools to conduct transactions, and using online payment tools to receive and pay funds, the risks have a wide range and spread quickly. Some criminals set up websites by renting overseas servers, essentially carrying out activities for domestic residents, and remotely controlling the implementation of illegal activities.

Some individuals claim in the chat tool group that they have obtained investment quotas for high-quality overseas blockchain projects and can invest on their behalf, which is most likely a fraudulent activity. Most of the funds for these illegal activities flow abroad, and it is very difficult to monitor and track them.

Second, it is deceptive, tempting, and concealed. Use hot concepts to hype, fabricate a wide range of “Tall Dashang” theories, and some also use celebrity V “platforms” to promote, using airdrops of “candy” as a temptation, claiming that “the value of the currency only rises and does not fall”, “the investment cycle is short, High return, low risk”, which is highly delusional.

In practice, criminals illegally make huge profits by manipulating the so-called virtual currency price trend behind the scenes, setting profit and withdrawal thresholds and other means. In addition, some lawbreakers also issue tokens under fancy names such as ICO, IFO, and IEO, or conduct virtual currency speculation in the IMO way under the banner of the sharing economy, which is highly concealed and confusing.

Third, there are a variety of illegal risks. Through publicity, criminals use “static income” (to make profits from the appreciation of currency speculation) and “dynamic income” (to develop offline profits) as bait to attract the public to invest funds, and lure investors to develop personnel to join, and constantly expand the capital pool , with the characteristics of illegal fundraising, pyramid selling, fraud and other illegal activities.

This kind of activity uses “financial innovation” as a gimmick, and is essentially a Ponzi scheme of “borrowing the new to repay the old”, and it is difficult to maintain the operation of funds for a long time. The general public is requested to view the blockchain rationally, do not blindly believe in hype promises, establish a correct currency concept and investment philosophy, and effectively improve risk awareness; if you find clues about illegal and criminal activities, you can actively report them to the relevant departments.

(v) Is the blockchain a pyramid scheme?

Blockchain is a computer technology, which itself does not have the nature of pyramid schemes.

Blockchain is a new application mode of computer technology such as distributed data storage, point-to-point transmission, consensus mechanism, and encryption algorithm.

In a narrow sense, blockchain is a chain data structure that combines data blocks in a sequential manner according to time sequence, and is cryptographically guaranteed to be non-tamperable and non-volatile. Fake distributed ledger.

In a broad sense, blockchain technology is the use of block chain data structures to verify and store data, the use of distributed node consensus algorithms to generate and update data, and the use of cryptography to ensure data transmission and access. A new distributed infrastructure and computing method that uses smart contracts composed of automated script code to program and manipulate data.

To identify MLM, you need to look at three characteristics:

1. Entry fee

Whether it is necessary to subscribe for goods or pay fees to obtain the qualification to join or develop the qualifications of others to join , to seek illegal benefits;

2. Pulling people’s heads

Whether it is necessary to develop others to become their downlines, and to develop personnel based on the number of direct or indirect rolling development personnel Pay remuneration and seek illegal benefits;

3. Remuneration method

Whether the remuneration is calculated based on the sales performance of direct or indirect development personnel to seek illegal benefits.

If you meet the above characteristics, you may be suspected of pyramid schemes.

(5) Is the blockchain project a pyramid scheme? Extended reading:

Article 7 of the “Prohibition of Pyramid Selling Regulations” stipulates that the following acts are pyramid schemes :

1. The organizer or operator requires the development personnel to develop other personnel to join the development personnel through the development personnel, and the development personnel shall be calculated and paid based on the number of direct or indirect rolling development personnel (including Material rewards and other economic interests, the same below), seeking illegal interests;

2. The organizer or operator, through the development personnel, requires the development personnel to pay fees or pay fees in a disguised form by subscribing for commodities, etc. Obtain the qualification to join or develop other personnel to join, and seek illegal benefits;

3. The organizer or operator, through the development personnel, requires the development personnel to develop other personnel to join, forming an online and offline relationship, and offline Calculating and paying online remuneration based on sales performance, seeking illegal benefits.

㈥ Is the FBC blockchain a pyramid scheme?

For this kind of fast chain project that is not well understood, it is best not to touch it! ! !
Here shares a “hidden rule” Digital currency in many parts of China is playing with the concept, in the name of blockchain, it is actually useless, first of all�� is to tell you about a project of “District Express Chain+”, and then tell many people that the market has great prospects, and then issue tokens to make money, and the dealers will have a community to buy a large amount of one they issued Digital currency, then the price of this digital currency will naturally rise. When they think it is okay to rise, they will sell a lot, and retail investors will naturally suffer. There is also a term in the industry called “pending order”
The most comprehensive management office It’s best not to touch this stuff, especially if you’re not sure.

㈦ Is the Spaceman blockchain a pyramid scheme?

Whether it is a pyramid scheme, it will be determined according to the operation mode.
Multi-level marketing means that the organizer or operator develops personnel, calculates and pays remuneration to the developed personnel based on the number of personnel or sales performance directly or indirectly developed, or requires the developed personnel to pay a certain fee as the basis. Acts of seeking illegal benefits, disrupting economic order, and affecting social stability by means of obtaining membership qualifications.
Anyone with the following behaviors is a pyramid scheme:
1. An entry fee needs to be paid.
Second, the need to develop offline. It is necessary to constantly find collaborators, and induce others in the model of multiplying income under the guise of forming a team.
Third, according to the number of people below and the business performance of these people to determine how much return you have.

㈧ How to identify blockchain pyramid schemes

Pay more attention to information websites in the blockchain industry, such as Jinniu Finance, Golden Finance, Babbitt, etc., generally the blockchain projects reported above It will not be a pyramid scheme, hope to adopt!

㈨ Is Youdun Blockchain a pyramid scheme?

Abstract Youdun Blockchain Co., Ltd. is another limited liability company registered in Baoding City, Hebei Province on 2018-11-23. The registered address is located at No. 365, Jiangtai Road, Xiongzhou Town, Xiong County, Baoding City, Hebei Province.


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