Two Ethereum ponzi games have raised over $46 million - and they're still growing | finder.com

Two Ethereum ponzi games have raised over $46 million – and they’re still growing

Peter Terlato 24 July 2018 NEWS

FOMO3D and PoWH3D are blatant ponzi games that are sitting at the top of the DApps charts.

Two decentralized apps (DApps), the biggest on the Ethereum blockchain, have amassed $46.6 million worth of ether by tempting players to join an intentional exit scam, designed as a jab at the cryptocurrency ICO space.

The DApps, FOMO3D and PoWH3D, were created by Team JUST and often devour a significant proportion of the Ethereum network’s daily trading traffic. For example, on Friday last week, FOMO3D and the contracts connected to it consumed roughly 40% of ETH network traffic at one point during the day. At the time, the game’s trading volume exceeded 31,000 ether. PoWH3D has broken blockchain records and continues to grow.

The two DApps currently retain a combined balance of $46.6 million in ether, according to DappClap’s statistics.

FOMO3D

In this game, players purchase keys and choose strategy-based teams, hoping to be the last person to buy in before a looming countdown timer expires and the accumulated prize pool is distributed among participants.

The ponzi-style game is designed to mimic the beginnings of an initial coin offering (ICO) and then play out like an incidental exit scam. There are also passive user referral benefits and random ether air drops.

PoWH3D

This DApp is a cryptocurrency exchange which allows participants to trade ether for P3D tokens. These tokens reward holders by paying out ether, directly, whenever anyone else buys, sells or transfers P3D digital coins.

Rewards are generated via a 10% flat transaction fee applied to all trades.

“Many holders often report earnings between 0.05%-2% of their holdings on a daily basis, though this fluctuates heavily based on transaction volume,” according to the Beginner’s Guide to POWH3D.

In a recent financial blog post, JP Konig noted that the games provide an “admirable amount of transparency”.

“They aren’t ‘schemes’ as I earlier defined them. They are ponzi games,” Konig said. “Because they are implemented transparently as smart contracts, they can’t be disguised as an investment. Nor can the administrator perform an exit scam. So these are safe, perhaps even innovative, zero-sum games for gamblers to participate in. They’re certainly superior to the alternative: scummy underground ponzi schemes.”

A new cryptocurrency research report has revealed that the overwhelming majority of initial coin offerings (ICOs) last year were determined to be scams, while only a small fraction successfully traded on an exchange.

The Commodity Futures Trading Commission (CFTC) has released a warning to potential buyers and traders of “utility coins” or “consumption coins” and tokens, cautioning against rushed decisions and a lack of research.

A recent mid-year research report has revealed that there has been significantly more malicious cryptomining, commonly referred to as “cryptojacking”, than ransomware attacks during the first half of the year.

You can learn all about different exchanges, understand exactly how to buy and sell cryptocurrencies, calculate your taxes, discover digital wallets to hold assets and explore a list of all the alternative coins on the market.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

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