Bitcoin is the new gold. The price of one Bitcoin has reached
over US$1,000, and with prices skyrocketing in this virtual
currency, there are now many online 'exchanges' and
'banks' set up to store Bitcoins for users.
However, fraudsters may be using some of these
'exchanges' as a front. In July 2013 the SEC charged
Trendon Shavers, from Texas, USA, with operating a Bitcoin Ponzi
scheme, and then in October 2013, another Hong Kong-based Bitcoin
Exchange collapsed amid allegations this was also a Ponzi
scheme.
The SEC says that new and emerging technology is often used as a
lure for setting up a Ponzi scheme, and it appears Bitcoin is a
prime candidate for this. So we thought it would be interesting to
compare the original Ponzi scheme to its modern-day internet
equivalent, nearly 100 years on:
