Ponzi Scheme Meets Smart Contracts With Ethereum Piggybank

Now that Ethereum is gaining a lot more attention as of late, new types of scam programs and services are starting to pop up.  Bitcoin and Litecoin have been going through this phase as well, as anything with a decent value will attract unwanted attention sooner or later. One of the most recent projects is called the Ethereum Piggybank, which will let users earn Ethereum forever. Not that anyone would believe such claims as investment games are not necessarily the most legitimate offerings in the world of digital currency these days.

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Ethereum Piggybank Quacks Like A Duck

Although the Ethereum Piggybank concept looks rather attractive on the service, there are some worrying aspects about this program.For example, there is no website associated with the project, as users will need to send funds to an address depicted by a QR code. However, the owner of this program has posted the address which can be tracked on either Etherchain or Ether.camp. Plus, the entire concept is open source, and anyone can verify the code of this smart contract.

Investor games all revolve around the same principle as your average pyramid scheme: the ones to get in early might see some return on investment, whereas the latter ones will have a hard time recruiting new members. For those members who are interested in joining this program, there is a 3% profit, which can be earned instantly and forever. Moreover, every 25th investor will earn 9% profit forever.

Additionally, there is a referral system put in place, which asks users to promote a pdf file. Needless to say, promoting random files on the internet is never a good idea, even though Ethereum Piggybank might be offering an entirely legitimate file. As more investors join the program after this file has been promoted, the profit earnings will keep going up. 500 Investors will earn users a 1500% profit, which can be quite appealing to some users.

There is nothing wrong with Ethereum Piggybank as long as new investors are referred to the platform. Once the stream of Ethereum dries up, so will user payouts. Even though this is all very transparent and funds are locked in a smart contract; these investor games are not the best use case of Ethereum smart contracts.

Source; Bitcointalk

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