Posts

WHAT IS A SCAM?

avatar of @nonsowrites
25
@nonsowrites
·
0 views
·
2 min read

The Special Fraud Unit of Nigeria recently arraigned Mr. Dominic Joshua Ngene, the founder of Brisk Capital LImited for stealing over 2 Billion Naira from Investors. Brisk Capital Investment promised investors a whooping 60 percent return on investment.

The news of his arrest made rounds across different media outlets with many critics questioning investors' indiscretion in investing in such a scheme. 60 percent ROI seems quite unreasonable for the average person, but is it really?

The last time I checked cubdefi was offering a 1070% APY in one of their farm pools. So I understand why many would be reluctant to invest. It doesn’t seem feasible in the long run, but I do understand these figures change over time and rightly so.

Being in the crypto sphere for quite some time now I have become quite accustomed to these insane returns. This doesn’t mean I am gullible and invest in anything that offers the highest returns but I do so with an open mind.

IS IT A SCAM BECAUSE YOU LOST?

I think this is an important question we need to ask ourselves when it comes to investing. I believe thinking in terms of only profit is a very biased way of looking at investing. In my opinion, whatever has the likelihood of turning out profitable also stands the chance of being unprofitable

LOSSES ARE ALSO PART OF THE BARGAIN.

For example, you work 40 hours a week for a month for a said amount of fiat. By the end of the month, the value of the fiat drops by 10 percent. Do you consider that whole exchange as a fraudulent one? In this scenario, are you getting the value of the time investment in fiat? The answer is no. However, these sorts of losses aren’t tangible and are easily disregarded.

We’ve seen cases of economies suffering hyperinflation and people losing all the value they’ve stored. Do we consider those governments as fraudulent? Why not? They’ve failed on their promise to protect the value of their currency, making the vast majority suffer.

A scam in its very nature is a dishonest scheme where the facts are hidden by one part. This doesn’t apply to a scheme that is open-ended where information is available to all. In such scenarios, losses are possible and should not be neglected.

TRUST IS AN IMPORTANT ELEMENT IN INVESTMENT.

To invest in anything, you need to trust either the idea or the person involved. It is a huge human flaw but I would rather not have it any other way.

“A world where we cannot be conned is a world where we don’t trust.”

-Ricky Jay

In summary, we should not be quick to label an investment a scam because we lost. The motive behind any investment is important, and though it is hard to discern, it helps differentiate a scam from an investment that went wrong.