As Bitcoin Bubble Loses Air, Frauds and Flaws Rise to Surface
Hackers draining funds from online exchanges. Ponzi schemes. Government regulators unable to keep up with the rise of so-called cryptocurrencies. Signs of trouble have appeared at nearly every level of the industry, from the biggest exchanges to the news sites and chat rooms where the investment frenzy has been discussed.
... “Cryptocurrencies are almost a perfect vehicle for scams,” said Kevin Werbach, a professor at University of Pennsylvania’s Wharton School. “The combination of credulous buyers and low barriers for scammers were bound to lead to a high level of fraud, if and when the money involved got large. The fact that the money got huge almost overnight, before there were good regulatory or even self-regulatory models in place, made the problem acute.”
1 comment:
Some people make fortunes off Ponzi schemes-- most lose their shirts. The famous example of a product bubble was Holland and the tulips in the 17th century. It's what I have felt investing in bitcoins will end up being for most. I believe in investing and we do-- but in solid things and accepting what goes up can go down (and the faster it goes up, the farther down it can end up). To me investing is about helping growth for others and ourselves but not a get rich quick scheme. No doubt though some do get rich off the other way of seeing it-- they do it though off others losing everything.
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