Ponzi

A Ponzi scheme pays ‘returns’ to earlier investors out of later investors’ deposits; there is no underlying income-producing asset, so it must keep recruiting or collapse. The signature: returns that are high AND guaranteed AND smooth, pressure to reinvest rather than withdraw, and rewards for bringing in others. Real high returns are visibly volatile — that’s the risk–return tradeoff — so smooth guaranteed 30% is not an opportunity, it’s a countdown.

First used in: 0.4 · Scam armor & how this course works