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I do not think it would be difficult for someone to setup a website and scam newbies into buying 'bitcoin', handing over credit card info and taking wire transfers. Perhaps even act legit to start and then segue into only processing part of transactions as real. Quite a ponzi. I don't think is a stretch either. There isn't anything comparable that people would give you money for and the key really is the overwhelming interest and publicity combined with people who have no clue what they are buying. As long as (as with any ponzi) people don't withdraw more than they actually have this could go on for quite some time. Madoff had it much much harder.



You can't easily pull a scam like that using credit cards. Wire transfers could be potentially easier as we know the union transfers are hard to revert (but there's work being done there as well).

Essentially, if you interact with banks and have too many chargebacks or complaints, you'll be dropped. Or your fees will get massive. And that's if you find a payment processor who's happy with you taking money for cryptocurrencies in the first place.


True but if you are running a ponzi and you have enough money coming in then you can handle redemptions if you need to.


It's not about refunding the customers though. It's the payment gateway that will drop your as a customer. Neither them nor Visa/MasterCard want anyone running scams via them.


If I were running a scam, I'm pretty sure at the moment I would have a positive cash flow: a lot of people are transferring their USD/EUR into my bank account because they want to get on the Bitcoin train. If a few people are cashing out, I'm pretty sure I would be able to manage to give them their payouts. Exchanges also have a withdrawal limit of a few K's per day, in my ponzi scheme if someone wanted to withdraw 100K it would take maybe 10 days, and one hopes there are enough new suckers that each day I'm able to pay out, out of my official bank account, my slush fund. The rest of the money can be transferred out where no one can touch them...

And when the whole thing blows up, I disappear. My payment gateway will drop me, but what do I care?




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