How crypto scams are structured
389 sats \ 2 comments \ @muteness11 5 Jul 2023 bitcoin
I wanna share a list for those who do NOT know how manipulation and ponzi like crypt schemes are developed ... educate yourself so you dont fall victim to any, below is copied and pasted from one of them!
There are tons of ways to launch a token, but I generally believe that most launches do not optimize for growth, and do not give enough optionality for dealing with different market conditions. I haven't really seen anyone do this, and I am curious what people think.
  1. projects needs to identify what KPIs it wants to maximize.
  2. tokens should be rewarded for those who stake and maximize the KPI
  3. there should be no max supply or pre-mine, for anyone.
  4. team should get a fixed % of the rewards that are maximizing #2
  5. DAO controls need to be able to adjust #2, change which KPIs are incentivized and by how much and the market conditions change.
  6. because of #4, team can sell equity to private investors. This aligns team and early backers with the long term grind, and usually results with reasonable structures with vesting, etc...
  7. Team reward of 30% is the upper bound of reasonable (apple tax level)
Everything is built to optimize #1. Because #2 is variable, there is basically no need to time the market or have a big launch out of the gate. Treat it as a/b testing. Find the right KPI and reward structure that generates the most value for the protocol. Start small, then accelerate it as you see the growth loop working.
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14 sats \ 1 reply \ @nullama 5 Jul 2023
The first question you need to ask yourself is:
"Why don't they use Bitcoin instead?"
The answer in most cases is simply because they want to print money from thin air and sell it to you for Bitcoin or fiat.
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0 sats \ 0 replies \ @kepford 5 Jul 2023
The most charitable view I can give crypto projects is that you are buying stock in the project/company/product. But when they pitch it as anything else in my view they are scamming.
Most people get mixed up and confused with crypto when they forget to ask why. Why do we need x. This goes for bitcoiners as well. Someday it won't matter but in this phase it does matter. If you don't get why bitcoin is needed you won't get it. It will be a get rich scheme to you.
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