Are 10% daily HYIPs dead?

The latest wave of 10% daily HYIPs appeared earlier this year with the launch of 10Bit on April 28th, and in a relatively short period of time they have become very popular. But, how long will they last? I’m sure the so-called experts on forums and paid monitors (who don’t invest by-the-way) can give you many answers, but as investors, let’s take a look and try and understand the phenomenon that is the 10% HYIP.

The Basics

I get a lot of questions about how long HYIPs will run, and yes, with some experience you can sometimes be very accurate when basing it on the reputation of a particular admin and past performance; but, the one thing you can’t predict is how much investment inflow the HYIP will get or how regular it will be. Ultimately, it is this inflow of funds that determines the running time of the HYIP.

For a 10% daily HYIP, obviously the admin must pay out 10% of the total invested or risk being labelled a scam and then investment will drop dramatically – and we all know what happens then – if you are unsure, you should probably read my HYIP basics page. All HYIPs are a bit of balancing act in any format, but it is particularly true for the high paying ones.

The workings of a 10% HYIP

As a quick example and to keep it simple, say a HYIP gets 100 BTC of new investment every day. On the first day it must pay 10 BTC, on the second day it has 200 BTC and is paying out 20 BTC. On the third day it has 300 BTC and is paying out 30 BTC. You get the picture – so, by day 10 the HYIP is paying out the same as what’s coming in (100 BTC). The admin is still ahead at this stage due to paying less in previous days, but on the next day it needs to pay out more than it gets in. You can probably guess what happens next!

If you guessed that the admin will cover the costs, then you are terribly wrong. If you guessed that the HYIP shuts down payments – then you are right. This is normally when the unsuspecting investors get in as they see that the HYIP has been paying for a number of days. DO NOT be one of these investors.

Obviously, these numbers will vary, but it’s a pretty easy concept to understand, and I hope that you can see that you need to get in early, or not at all for these HYIPs. I should point out that an experienced admin can keep the HYIP running during this period to try and catch the big fish.

Recent 10%’ers

Since 10Bit, there has been a resurgence in 10% HYIPs, many which appear to be from the same admin namely 10Bit, 15Bit, BitcoDaily, and Bitstorm, which have all performed strongly. Then there have been the moderate performers managing to just make ROI (Nano-Bit, Crypto-Trade, and Cryptonium). Lastly, there have also been some which have performed somewhat less spectacularly including GoodlyBit, Coiner Ltd, and the most recent one, SolidBit which returned only 20%.

Looking at the returns over time, there is a definite downward trend from the early 10Bit return of 280% to the woeful Solidbit return of 20%. Digging deeper, you can see that even though the latest from the 10Bit admin, Bitstorm, was a good performer, it only returned 150%. You simply can’t ignore the trend of lower returns each time.

Where to from here

I feel the demise of 10% HYIPs will be partly due to the inherent short-term nature of this type of HYIP as alluded to above, but also to the fact that investors learn quickly to adapt to them. When comparing 10Bit and 15Bit to Bitco and BitStorm, it is already evident that investors are getting in early and only investing once. The later two had massive levels of early investment comparably. This does provide a huge level of investment to the HYIPs in the early stages, but as new investments start to dry up, payments get shut-down much earlier than usual. This tends to off scare even the most serious risk-taking investors.

So, ultimately, 10% HYIPs are limited to short bursts, and it would appear that we are almost at the end of this trend. Whether I am right or not, as investors we need to be aware of how quickly the HYIP industry can change and adjust accordingly. You can be sure that the admin of these HYIPs are going to adapt quickly to how investors act.

In any case, I for one will still be investing; however, I will certainly be limiting my investment for this style of HYIP. I will also be looking for new trends in the industry, and of course, letting you guys know as soon as I can of developments. Happy HYIPing.