Ponzi Scheme
By Cryptomcmillan1 | Updated on May 24, 2020
A Ponzi scheme is also referred to as pyramid scheme, and typically takes the form of an investment scheme which pays existing investors with funds collected from new investors. Ponzi schemes usually come with the promise of high returns and little risk, while requiring members to actively recruit more members to join the scheme. Once recruitment stops the schemes usually go bust as they run out of funds to pay existing members.
Related Terms
Cold Storage
Offline storage of cryptocurrencies which is arguably safer as they also require physical access (eg. hardware wallet, paper wallets)
Zero-Knowledge Succinct Non-Interactive Argument of Knowledge (Zk-Snarks)
An acronym for Zero-Knowledge Succinct Non-Interactive Argument of Knowledge, zk-SNARKs refers to a protocol where one can prove posession of a given piece of information (eg a string or hash) without revealing that information and also without any interaction between both the prover & verifier.
Proof of Stake (PoS)
A consensus algorthm that assigns block validation queue based on the coins/token locked in by the validator.
Liquid Proof of Stake (LPoS)
A proof of stake consensus mechanism by Tezos that slightly differs from Delegated Proof of Stake.
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