They all sound the same to me!
In: Other
The two are similar, but different.
A ponzi scheme generally has one person or group at the top who is getting all the income from the new subscribers and then sending some portion to the early investors to make the system look like a winner. There’s really no motivation on the part of the investors to “sell” the product downstream, but they might do so for any number of reasons, including “look how smart I am, I invested in…”
A pyramid scheme puts that load on the people who are signing up, thereby spreading both the workload and money around the system as a whole. In this case, the “investors” have a very strong motivation to try to keep the system going because it’s the income from the people below you going directly into your pocket.
So ultimately, in a pyramid everyone knows its a scam, while in a ponzi that is not necessarily obvious.
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