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posted by mrpg on Tuesday July 17 2018, @12:00AM   Printer-friendly
from the krazy-kodak-kashminer dept.

From the BBC:

The company behind a Kodak-branded crypto-currency mining scheme has confirmed the plan has collapsed.

In January, a Bitcoin mining computer labelled Kodak KashMiner was on display on Kodak's official stand at the CES technology show in Las Vegas.

But critics labelled it a "scam" and said the advertised profits were unachievable and misleading.

Now the company behind the scheme says it will not go ahead. Kodak told the BBC it was never officially licensed.

An up-front investment of $3,400 to rent a box that will generate $375 a month in bitcoin? I hear the word "ponzi" on the breeze...


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  • (Score: 4, Interesting) by kazzie on Tuesday July 17 2018, @06:19AM (3 children)

    by kazzie (5309) Subscriber Badge on Tuesday July 17 2018, @06:19AM (#708230)

    Granted, this scheme was a profit-sharing scheme, where you give the Kodak licensee $3,400 rent and half of whatever profits you make. As such, it doesn't actually depend on using new investors' money to pay you back.

    I do, however, stand by my original statement: that if their estimate of $375 profit a month on a $3,400 investment was accurate, I'd be wondering "is this a Ponzi scheme?"

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  • (Score: 5, Informative) by kazzie on Tuesday July 17 2018, @06:26AM (2 children)

    by kazzie (5309) Subscriber Badge on Tuesday July 17 2018, @06:26AM (#708232)

    To pick some quotations from the article you linked:

    "Typically, Ponzi schemes require an initial investment and promise well-above-average returns."

    "It is common for the operator to take advantage of a lack of investor knowledge or competence, or sometimes claim to use a proprietary, secret investment strategy in order to avoid giving information about the scheme."

    "According to the United States Securities and Exchange Commission (SEC) ... the warnings signs include:[11]
    High investment returns with little or no risk"

    One these counts, the KashMiner quacks a bit like a Ponzi scheme.

    • (Score: 1) by Per Bothner on Tuesday July 17 2018, @09:05PM (1 child)

      by Per Bothner (7043) on Tuesday July 17 2018, @09:05PM (#708523)
      Those are properties of Ponzi schemes, but they are not the definition of Ponzi scheme, which (according to WikiPedia) "pays profits to earlier investors using funds obtained from newer investors".

      In other words, this is not a Ponzi scheme. They are many kinds of scams and frauds that are not Ponzi schemes.

      • (Score: 2) by kazzie on Wednesday July 18 2018, @08:05AM

        by kazzie (5309) Subscriber Badge on Wednesday July 18 2018, @08:05AM (#708704)

        Agreed. This is not a Ponzi scheme.

        But it sounds similar enough to make me worry about the wisdom of the scheme.