Digital currency's investment is a bit like a Ponzi scheme. Its basic routine is that the so-called "trading market" in digital currency is basically controlled by a specific institution. In the early days, in order to attract investors to invest, the price of coins was speculated very high. Once the time is ripe, they will concentrate on selling, and the price denominated in digital currency will plummet, leaving investors with nothing to lose.
20 17 Jiangsu internet finance association issued the guide to the identification of internet MLM, naming 26 kinds of so-called digital currency, such as precious metal coins and baichuan coins, as illegal pyramid schemes, all of which are or are suspected to be wearing the coat of digital currency.
Second, digital currency MLM generally has three characteristics.
1, there is a real product-digital currency, and the packaging is very advanced.
2. Participants can get a first prize, and the prize is digital currency himself.
With the increase of the number of people involved in the fraud, digital currency will appreciate. During the appreciation cycle of digital currency, the number of digital currency available to participants will also increase, and participants including the lowest level will also benefit. However, when entering the depreciation cycle, the bottom participants often lose a lot.
Third, identify pyramid schemes in digital currency.
1. allocation method
Virtual currency is not issued by a specific monetary institution, but is generated by a large number of calculations according to a specific algorithm, which is a decentralized distribution method. Each different terminal node is responsible for maintaining the same account book, and this maintenance process is mainly to package and encrypt the transaction information through algorithms, while MLM coins are mainly issued by an institution to make profits by pulling people's heads.
2. Trading method
Virtual currency is a sporadic transaction spontaneously formed by the market. After the scale is formed, the third party gradually establishes an exchange to complete the transaction. MLM coins are issued by institutions themselves and traded by self-built platforms.
3. Implementation mode
Virtual currency itself is an open source program, which is maintained in Github community. See the open source code for the parameters and methods of total amount limit. However, the open source of MLM coins completely copied other people's open source codes, and did not use open source codes to build programs, so its essence, like Q coins, can be controlled by websites.
4. Is the source code link given?
Generally, decentralized digital currency will give a link to the source code in a prominent position in official website to openly and transparently show the operation mechanism of the monetary system. MLM coins focus on the recharge transaction process, but do not mention its operation mechanism. Even the website doesn't have the link address of the source code.
5. Is official website the beginning of https?
Generally, the addresses of decentralized digital currency official website and trading websites all start with https, in order to protect users' data from illegal theft. However, related websites such as official website, trading websites, etc. If you sell money through pyramid schemes, don't start with https.