Greetings to all readers of this great platform, especially to those who are part of the great community of #ProjectHOPE, in the present opportunity I want to talk a little about what are considered as pyramid projects, which are currently being seen a lot within the crypto world, and many of them represent a great economic risks, that the people who invite you to be part of the project do not warn you of the danger to your resources.
The image used is from Public Domain, Author: PixaBay
Currently it is very common to hear people talk about a project where you invest $100 and a few days later you have a large amount of money, and most projects have the same feature, because you make the investment, you make compound interest, which is to add the interest generated by your investment to the initial capital invested, and thus you manage to increase your capital and triple your profits in a few days.
These projects are characterized by not having a liquidity pool, since their liquidity works as follows, while some people are investing in the project, others are withdrawing their profits, which end up being the investment of the person who entered, at the time that people stop investing continuously or the interest generated is greater than the income the project tends to end.
Many people enter these projects for their rapid capitalization without understanding the risks that this generates, and have a system known as referral system, which seeks that people who are on the platform, seek new investors and receive an economic bonus for doing this, being the way that people continue to enter and thus have more chance of leaving other investors.
The risks generated by this type of project are increasingly higher, because most of these projects are active today and tomorrow you do not know, they can close in a matter of minutes if one of the big investors take their profits, all the people who made small investments are trapped and without liquidity to withdraw, you have to be clear about the risk that your resources run in these projects.