"Pirateat40" Makes Off $5.6M USD in BitCoins From Pyramid Scheme
This comes from the desk of "I told you so"! I am often reminded that Pyramid Schemes are all around us and are often called may things to disguise what they actually are. When I was first introduced to BitCoins I will admit I was curious because of how the money was generated but quickly lost interest after finding out that the money really has no backing aside from modern monetarily standards.
For instance think about this "What would happen if EVERYONE sold their BitCoins?" Well the people who sold first would get real money and as more people sold off their stockpiles the price would drop to the point where the coins would be worth nothing. Bottom line, early adopters win, (sound familar?)
Some duped investors have taken to trying to hunt down the pesky pirateat40. There are rumors that he is based in Texas. But short of extracting some good old fashioned (and wholly illegal) vigilante justice, it's unclear what the scammed can do. Bitcoin Ponzi schemes are growing more frequent -- one lawsuit in California [Scribd] has already taken up the issue. But it remains to be seen how seriously the courts will take the cyber-currency, given that it's founded on a rather anti-nation premise.
And of course, the onus for these losses largely rests on those who sent someone named "pirateat40" actual money, and failing to recognize the classic signs of a Ponzi scheme -- inflated interest rates, shadowy management, and unrealistic promises.
While BitCoin money has value because people don't cash in vigilante justice still will land you in jail where BitCoins are not honored nor will get you any special treatment. #Food4Thought
Related Web URL: http://www.dailytech.com/Pirateat40+Makes+Off+56M+...
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