Scamming people, running a pyramid or ponzi, selling shovels.
edit: I'm only semi-joking, the official Bitcoin forums quite literally has pyramid and ponzi and straight up fraud schemes that people happily sign up to and refer each other to. There is no attempt to hide them or look legitimate. You'll find ridiculous-to-outsiders threads asking "hey anyone know a good ponzi i can sign up for will use your referral"
The marketplace subforum is nearly totally populated with stolen/hacked accounts, subscriptions using fraudulent/stolen credit cards, it's pretty much a fraud forum.
How does a "straight up fraud scheme" work? Can I tell people on Bitcoin forums that I'm pretending to be a Nigerian prince and they'll give me money? If so, where can I find these forums?
You have your choice: there is a subforum specifically for "Gambling and all "investments" that are so risky they might as well be gambling (HYIPs, pyramid schemes, etc.)", or you can just buy hacked PayPal accounts and cards in the "Digital Goods" subforum.
There are communities which explicitly state their intentions.
A bit related - I've seen forums etc. where the community pumps stocks, crypto currencies, and what not.
Everyone knows what happening, and they're all in on it.
One typical way is that some "stock guru" is selling spots for private chats / rooms, where they'll regularly announce "signals" - i.e hyping up some penny stock. The group members will obviously start purchasing shares / pumping the stock, and exit as soon as outside buyers enter the cycle.
Sometimes they just flat-out announce public pumping schemes on forums / user groups.
> Everyone knows what happening, and they're all in on it.
The thing with Hertz' stock going crazy even though they declared bankruptcy was insane... people were buying the stock because they're betting there'll be another idiot wanting to buy the stocks off them for a higher price. Which is the entire principle of crypto, IMO.
There is no "official" Bitcoin forum, what a asinine thing to even say. The fact that you'd make up such a dumb thing is proof you have now idea what you are talking about. But hey, haters gonna hate I guess.
Since I can't edit this anymore, I'm going to clarify that I know there is no "official" forum, but I am referencing the largest one that used to be on the bitcoin.org domain, but is now bitcointalk.
- order book based exchanges like bitstamp, kraken, coinbase pro
- brokers like coinbase, there are loads of local brokers in various countries
- otc desks, for bigger transactions, wealthy and lazy clients, privacy oriented clients
- p2p exchanges like paxful, localbitcoins
- mining
- payment processing (bitpay, coinify)
- AML/KYC services like chainalysis, elliptic
- selling luxury/expensive stuff for btc for those who got rich too quickly
- lawyer, accounting, tax related services
- selling precious metals for crypto
- prostitutes (?)
- gambling
- privacy oriented services (vps, vpn, domains etc)
Grey area
- blackmail SEO services
- mixers
- purse.io style services
Illegal
- ponzi schemes
- ransomware
- online drug markets
- hacking, phishing, fraud markets
- scams
- hacked server credential markets (have heard about this, not sure though it exists)
I went on the BTC forums for the first time in years because of this thread; it used to be filled with wide-eyed people that wanted to change the world in a way before all the regulation hit, with at least somewhat interesting libertarian discussion.
The entire market subforum is illegal, except for one or two. It's gone to literal shit.
Hacked server credentials, "cheap server for mining!!" VMs purchased via stolen credit cards and resold for spam, attacks, and crypto mining until they get shut down for abuse or chargeback, hacked .edu emails, hacked MSDN credentials, cracked software for money (it's a 50% chance they're offering stolen-credit-card-acquired keys, and a 50% chance they'll just send you probably_trojan_crack_keygen.exe and tell you the software needs this patched to work and to not download it from the official source).
Plenty of abusive services on offer, like "we'll upgrade your dropbox to pro for life" where the instructions are to send them your email and password and they just add a stolen credit card to pay annually.
The usual shitty "buy likes and followers on social media" scammers where their own account has 9 obviously bot followers with half naked women profile images, and nothing else.
I bought the dropbox thing years ago... they just added lots of fake referrals which increased the available storage. I also bought fake followers and what not.
I was young and stupid, wouldnt do it again. But obviously there is demand for that stuff, what can you do.
Oh no, it's not the add 2GB with ref thing, it's "get pro plan with lifetime warranty". Apparently everything everybody sells comes with "warranty". Probably explains why there's pages of people complaining about things like this: https://i.imgur.com/FOzDIjD.png
I just found it funny that a "genuine 100% real followers" shop can't even get followers for themselves.
One way that I made money was lending cryptocurrency through DeFi platforms.
Basically:
- Buy DAI (which is ~1DAI to 1USD) through any platform (e.g.Coinbase)
- Transfer to your local wallet (e.g. Metamask).
- Then lend it on one of these exchanges [0].
One exchange that's not on the list https://app.fulcrum.trade/lend has a higher interest rate (probably because they're trying to get users as they were hacked earlier this year).
Last 2 months I held DAI in Fulcrum and I made about 2.5% on my money.
Also holding ETH for the last 6 months, which has paid off by sheer luck.
Just look at the comments and realize you will not find that kind of advice here. It's like asking Microsoft in the last century how to make money with free software.
Look at what you already know and see how these skills are needed. If not sufficient, learn compatible skills to expand your skillset in a way to serve the market needs.
Defi is where the effort is. If you are a developer, knowing how to build then deploy smart contract on ETH is the 101.
Illicit tactics aside which other comments seem to cover, for HN'ers, I suspect there's a very real opportunity to make money by providing security auditing services to crypto startups and projects.
- Flash-loan strategies (this verges on illicit, ymmv)
- Build a fund. If you have a wealthy network that's not techy, there's probably interest.
- Crypto-art (NFTs etc, budding community)
- Mining. This is profitable if you have access to free/cheap power
- Build technology that actually leverages blockchain -- streaming micropayment-based business models, truth estimation via prediction markets, distributed computing (Filecoin/RNDR/Codius/GNT), idea X where crowdsourcing is key to success. I agree that most of this stuff can be built with a centralized model, but that doesn't mean there isn't money to be made going the crypto route. In some cases the crypto aspect might be the interesting thing that builds your top of funnel and makes users actually use it. After all, real crypto enthusiasts are wanting for valid use cases.
It's certainly fascinating... ETH enables a collateral-less loan, which is wild, and something I'd point towards for skeptics who "haven't seen one use case crypto/blockchain enables that couldn't be done with a client-server model".
The reason I say it verges on illicit, is that the most profitable flash-loan trades I've read about usually depend on some form of market manipulation and special knowledge about price oracles. They're not illicit in their own right, and can be a great tool for arbitrageurs I imagine.
I still don't get it. Can you point me to some actual examples?
Do you mean people are front running contract using data provided by oracles? I would not see that as illegal, just as removing friction coming from oracles that have too much latency.
I don't know that it's outright illegal. But manipulating the price of a token for your own gain, at someone else's expense, is illicit imo.
If I know how an oracle calculates a price for a pair, I can probably alter the oracle's value for it (with a lot of volume from your flash loan), without affecting other exchanges value for it. This lets you create arb opportunities for yourself: https://www.trustnodes.com/2020/02/15/hacker-makes-360000-et...
Get an interesting idea funded by someone who's chasing fads, then convert the funding to developer salaries while building something technically interesting even if practically useless.
I few years back I made an ETH collectibles game, like Crypto Kitties, but simpler. It was just to learn how eth/solidity worked, but to my surprise people actually started buying and selling the items. It made me around $20k in a few weeks (took a small % of transactions). Eventually, I realized it was basically just a bunch of crypto wales playing hot potato and at times using bots to bid things up. No one really thought these items would have any long term value. Not much different than most alt coins I guess. It died out on its own and I was happy do be done with it since running an online casino wasn't what I wanted to do with my life.
While I can't speak for those running a full-on sales-and-services business, simple HODL speculation has worked out well for me. I aim to trade rarely and discuss trading even less, so I have simply picked out new issues that have a remotely credible whitepaper, placed a bet, and waited. The ones that pan out become the seed for the next round a few years later. My biggest worry is simply in losing the wallets or fatfingering a trade.
The industry as a whole doesn't have to be showing profits or cashflow so long as capital keeps coming in -- and it does, because it's sufficiently disruptive to finance that everyone looks for an angle, and because it's very easy to create new tokens, the money is being made, in some sense, simply by putting out the hat and asking: "is this idea good?"
I make trades based on analyzing data that historically has not been available in financial markets.
I designed custom compression algorithms to manage the huge amount of data.
I came up with a new charting technique for the data that I have yet to see elsewhere.
Then I apply some "technical analysis" principles that traders use to analyze price data, but I add a few ideas of my own devising to make the analysis appropriate for the kind of data I'm using. Edwards and Magee are a huge influence on my work.
I'm working on algorithms now to automate the analysis.
39 comments
[ 3.0 ms ] story [ 101 ms ] threadedit: I'm only semi-joking, the official Bitcoin forums quite literally has pyramid and ponzi and straight up fraud schemes that people happily sign up to and refer each other to. There is no attempt to hide them or look legitimate. You'll find ridiculous-to-outsiders threads asking "hey anyone know a good ponzi i can sign up for will use your referral"
The marketplace subforum is nearly totally populated with stolen/hacked accounts, subscriptions using fraudulent/stolen credit cards, it's pretty much a fraud forum.
It’s nice that all the original stuff is still there instead of buried on Twitter or Reddit.
I think this is where the hate comes from, you guys simply can't grasp that no one is in charge.
A bit related - I've seen forums etc. where the community pumps stocks, crypto currencies, and what not.
Everyone knows what happening, and they're all in on it.
One typical way is that some "stock guru" is selling spots for private chats / rooms, where they'll regularly announce "signals" - i.e hyping up some penny stock. The group members will obviously start purchasing shares / pumping the stock, and exit as soon as outside buyers enter the cycle.
Sometimes they just flat-out announce public pumping schemes on forums / user groups.
The thing with Hertz' stock going crazy even though they declared bankruptcy was insane... people were buying the stock because they're betting there'll be another idiot wanting to buy the stocks off them for a higher price. Which is the entire principle of crypto, IMO.
Grey area - blackmail SEO services - mixers - purse.io style services
Illegal - ponzi schemes - ransomware - online drug markets - hacking, phishing, fraud markets - scams - hacked server credential markets (have heard about this, not sure though it exists)
The entire market subforum is illegal, except for one or two. It's gone to literal shit.
Hacked server credentials, "cheap server for mining!!" VMs purchased via stolen credit cards and resold for spam, attacks, and crypto mining until they get shut down for abuse or chargeback, hacked .edu emails, hacked MSDN credentials, cracked software for money (it's a 50% chance they're offering stolen-credit-card-acquired keys, and a 50% chance they'll just send you probably_trojan_crack_keygen.exe and tell you the software needs this patched to work and to not download it from the official source).
Plenty of abusive services on offer, like "we'll upgrade your dropbox to pro for life" where the instructions are to send them your email and password and they just add a stolen credit card to pay annually.
The usual shitty "buy likes and followers on social media" scammers where their own account has 9 obviously bot followers with half naked women profile images, and nothing else.
Random half page selection: https://i.imgur.com/LiG25q8.png
I was young and stupid, wouldnt do it again. But obviously there is demand for that stuff, what can you do.
I just found it funny that a "genuine 100% real followers" shop can't even get followers for themselves.
Plenty of financial crap: https://i.imgur.com/C5VZoAs.png
Basically:
- Buy DAI (which is ~1DAI to 1USD) through any platform (e.g.Coinbase)
- Transfer to your local wallet (e.g. Metamask).
- Then lend it on one of these exchanges [0].
One exchange that's not on the list https://app.fulcrum.trade/lend has a higher interest rate (probably because they're trying to get users as they were hacked earlier this year).
Last 2 months I held DAI in Fulcrum and I made about 2.5% on my money. Also holding ETH for the last 6 months, which has paid off by sheer luck.
[0] https://defipulse.com/income
2.5% in 2 mos is 15.97% annualized. Very respectable return. Can you keep that up for a year?
If so, you should repackage it and turn it into a ponzi. /s
Look at what you already know and see how these skills are needed. If not sufficient, learn compatible skills to expand your skillset in a way to serve the market needs.
Defi is where the effort is. If you are a developer, knowing how to build then deploy smart contract on ETH is the 101.
Other ideas:
- Crypto lending/staking (risky)
- Build blockchain based games (e.g. https://roobet.com/)
- HODL (seriously, a lot of the money made is from buying and waiting)
- Community-building (YT Channel, newsletter, blog, meetups, etc.)
- Arbitrage (success stories are not googleable)
- Flash-loan strategies (this verges on illicit, ymmv)
- Build a fund. If you have a wealthy network that's not techy, there's probably interest.
- Crypto-art (NFTs etc, budding community)
- Mining. This is profitable if you have access to free/cheap power
- Build technology that actually leverages blockchain -- streaming micropayment-based business models, truth estimation via prediction markets, distributed computing (Filecoin/RNDR/Codius/GNT), idea X where crowdsourcing is key to success. I agree that most of this stuff can be built with a centralized model, but that doesn't mean there isn't money to be made going the crypto route. In some cases the crypto aspect might be the interesting thing that builds your top of funnel and makes users actually use it. After all, real crypto enthusiasts are wanting for valid use cases.
Why illicit?
Tell me more about flash lending, I've seen interesting things being done with uniswap and I find defi fascinating!!
The reason I say it verges on illicit, is that the most profitable flash-loan trades I've read about usually depend on some form of market manipulation and special knowledge about price oracles. They're not illicit in their own right, and can be a great tool for arbitrageurs I imagine.
https://www.coindesk.com/defi-exploits-flash-loans-industry-...
I still don't get it. Can you point me to some actual examples?
Do you mean people are front running contract using data provided by oracles? I would not see that as illegal, just as removing friction coming from oracles that have too much latency.
If I know how an oracle calculates a price for a pair, I can probably alter the oracle's value for it (with a lot of volume from your flash loan), without affecting other exchanges value for it. This lets you create arb opportunities for yourself: https://www.trustnodes.com/2020/02/15/hacker-makes-360000-et...
Here's an explanation I just googled for that includes oracle manipulation: https://hackingdistributed.com/2020/03/11/flash-loans/
Again, there are certainly legit applications of flash loans, the market is still learning. This looks like a legit triangle arb: https://medium.com/@kentmakishima/the-43k-defi-magic-trick-f...
I think these exploiters giving some of the money back to their victims testifies to the shadiness of their tactics: https://www.longhash.com/en/news/3407/Why-Do-DeFi's-%22Flash...
Front running is a whole other beast :)
The industry as a whole doesn't have to be showing profits or cashflow so long as capital keeps coming in -- and it does, because it's sufficiently disruptive to finance that everyone looks for an angle, and because it's very easy to create new tokens, the money is being made, in some sense, simply by putting out the hat and asking: "is this idea good?"
I designed custom compression algorithms to manage the huge amount of data.
I came up with a new charting technique for the data that I have yet to see elsewhere.
Then I apply some "technical analysis" principles that traders use to analyze price data, but I add a few ideas of my own devising to make the analysis appropriate for the kind of data I'm using. Edwards and Magee are a huge influence on my work.
I'm working on algorithms now to automate the analysis.
It does not necessarily means any fraud but almost always means NOT being engaged into pure price movement speculations.
https://news.ycombinator.com/item?id=25345719