PonziCoin Early Exit Suspected

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PonziCoin

PonziCoin was a very early service where users would send bitcoin and recieve more back (or lose their funds if they were too late). One day, the anonymous individual running it stopped paying out and disappeared. It doesn't appear that anyone got their funds back, though only a small amount was lost.

The country for this case study is not yet known.

About PonziCoin

"Allow me to introduce PonziCoin. Having grown increasingly tired of waiting around for owners of other Ponzi games to manually process payments, or worse, run away with the coins, and being a bit of a "techie", I challenged myself to build a more sophisticated script, which not only automates every payment, but uses the entirety of the wallet balance in every payment round meaning at the end of the game, there will only be a few satoshi's left (at best) e.g. nothing I could run away with!"

"The only Ponzi with an escrow reserve!" "Deposit between 0.01 and 0.1 for your chance to receive a 120% return!" "Rounds will automatically restart, with plenty of notice, when deposits begin to slow down." "The last deposit of each round is always guarenteed their 120% payout!"

"PonziCoin is a gambling game based on a Ponzi-type model. Before depositing, users should understand and accept the risks associated with this model. Payments will, and can only be made, once new deposits have been made. Should the system reach a confirmed deposit which is older than 12 hours, the game automatically resets." "PonziCoin charges a 5% fee. This helps cover the running costs of the site and provides the additional coins needed to repay the last deposit in every round. Due to this, the on-site balance will be slightly less than that shown on sites such as BlockChain.info."

"If they had sticked to their own rules and payed out the earliest n players winnings until the Jackpot is empty then it would have been perfectly ok, what has happened here is after a few successful rounds of the game they suddenly just took the jackpot and ran with it."

"I'm contacting privacyguardian.org (the registrar he used). They have a special form for reporting abuse. Will see how that goes."

"I feel so stu.Pid, i deposited 0.8 that was all i have. [I] lost 1btc to s.cams nd ponzis nd now probably 0..7 more, i am really done with it! i still have some hope that it is just a technical pb."

"It sucks to lose a bet, but I don't see how anyone here was "scammed." This was a well-advertised Ponzi scheme that paid out more than it took in, until it collapsed. Hopefully it was at least educational."

"We are chocked not bc the ponzi stopped from lack of investors, it is the 7th round... But bc the owner ran away with the money without paying anyone. From the outside we may look like freaks but please understand that he built trust very efficiently. I have still hope of getting back my money, i evaluate the probability at 7%"

"This is darwinism in its purest form. You are willingly participating in a ponzi scam, which make you a bunch of scammers as you want to profit from earlier investors money, and thus you deserve to be scammed and lose everything."

"At least Maddoff wasn't a random nick on the internet connecting through Tor and registering its website through a proxy. You really need to explore a new level of retardness to "invest" in this stuff."

"In the interest of full disclosure, I lost .3btc to this guy, I made the decision to deposit based off having done it twice before without incident and because the developer wasn't hard to get a hold of and was in fact answering my PM's quite timely re-assuring me this is an isolated incident, referencing the times things went down without a skitch. I'm prepared to charge it to the crypto-game, because I know I always should be if I'm willing to partake in something I ultimately have no control over after those funds leave mine."

"With their stupidity and greed ponzi participants are just giving an incentive to scammers to keep scamming, and thus I strongly believe that no pity and no mercy is deserved to those who lose money to these type of blatantly obvious scams."

The country for this case study is not yet known.

The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.

Include:

• Known history of when and how the service was started.
• What problems does the company or service claim to solve?
• What marketing materials were used by the firm or business?
• Audits performed, and excerpts that may have been included.
• Business registration documents shown (fake or legitimate).
• How were people recruited to participate?
• Public warnings and announcements prior to the event.

Don't Include:

• Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
• Anything that wasn't reasonably knowable at the time of the event.

There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.

The Reality

This sections is included if a case involved deception or information that was unknown at the time. Examples include:

• When the service was actually started (if different than the "official story").
• Who actually ran a service and their own personal history.
• How the service was structured behind the scenes. (For example, there was no "trading bot".)
• Details of what audits reported and how vulnerabilities were missed during auditing.

What Happened

The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.

Key Event Timeline - PonziCoin Exits Early

Date	Event	Description
March 9th, 2014 10:45:29 PM MDT	Main Event	Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.

Total Amount Lost

The total amount lost has been estimated at $7,000 USD.

How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

Immediate Reactions

How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?

Ultimate Outcome

What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

Total Amount Recovered

There do not appear to have been any funds recovered in this case.

What funds were recovered? What funds were reimbursed for those affected users?

Ongoing Developments

What parts of this case are still remaining to be concluded?

General Prevention Policies

PonziCoin was a literal and honest smart contract ponzi scheme. The rules were straightforward and users came in droves to play. As far as we can tell, no criminal action was taken and users generally appear to have accepted their losses.

Individual Prevention Policies

No specific policies for individual prevention have yet been identified in this case.

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

Policies for platforms to take to prevent this situation have not yet been selected in this case.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

No specific regulatory policies have yet been identified in this case.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.