Despite receiving a warning from the Philippines Securities & Exchange Commission (PSEC), the crypto-enthusiasts are looking forward to the launching of an Ethereumpyramid scheme called “Forsage”. A heavily debated project called “Forsage” has been a cause of a great increase in the number of Ethereum deposits since its worldwide announcement in February this year. Although it is believed that the proposed project is vulnerable to high risk yet the project successfully allowed a considerable increase in the volume for the past many days. The project is a matrix cycler based program that is purported to allow its users to earn passive income by simply inviting more and more partners to sign up.
When someone visits the Foresage website he will be apprised that if he invests 0.05 ETH (i.e. US$ 18.34) and that if he is able to get more members to join the scheme then against each member he will be entitled to gain a certain percentage in the shape of compensation. The only condition precedent is that in order to complete the cycle, the investor will have to ensure that he brings 3 referrals. This means simply that the more the partners, the greater the rewards. However, the Philippines based proposed scheme is infamously considered as a Ponzi scheme which attracted in the issuance of a warning by the Philippines Securities & Exchange Commission (PSEC) because allegedly the scheme has not been registered with the SEC and that the permit/license has not been obtained to run the Foresage.
Reportedly SEC has also termed the scheme as “Ponzi”. The fear amongst the industry is that such schemes are nothing new but rather similar schemes are generally launched by many businesses, individuals, companies and organizations and are existing all over the world which offer rewards to their customers for bringing in more customers. Such schemes are most commonly known as “Referral System”. However, such schemes do not enjoy a good history. It has been seen that while the business of the company grows but only a handful of referrals were able to earn passive income which leads to an increase in the number of inactive participants in the business activities. Referrals are rather insisted upon to join against their will.