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How to earn with HYIP

Updated on July 24, 2012
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Disclaimer: Read Before you Proceed

While HYIP are legal in lots of countries, they are illegal on lots of others - like the U.S.

The HYIP have no product, and so, the FTC consider them illegal. If you are an U.S. citizen, you should read this article to understand how HYIP function only - that was the intent of the article anyway - what I mean is, don't even think about joining on of these. It is illegal!

I was inspired to create this article after seeing so many people intrigued by the functioning of these programs and wondering how it even pays to do such schemes. I wanted to get people to be aware of the problem, because it is one of the main problems in the internet nowadays - these scams grow and grow!

I'll explain how do these scams generate money, but I do not approve them nor promote them!


How do HYIP work?

HYIP = High Yield Investment Programs

The first thing you have to understand about HYIP is how they work - this is the part that makes them illegal.

An HYIP promises the most interesting rates on your investment like 1% or 2% daily up to 100% and 200%. That is crazy I know, but they fuel themselves on the laziness, greed and ingenuity of people - and believe me many fall for these scams.

Now, seeing this offer lets suppose 10 people join, investing 100$. The owner has now 1000$.

The "investment" starts to mature. While it matures the program gets more views and eventually 20 more people join. The owner now has 3000$. The first 10 people reach their payday and from those 3000$ the owner takes 2000$ paying the 100% interest to the 10 first.

The 10 first invested 100$ and got 200$, now they think they have hit the pot of gold! They recommend and post payment proofs and go on spreading the good news. They even reinvest in the hopes of compounding. Now the owner gets lots and lots of new inscriptions and pays the other 20 members with a little part of it. They get thrilled and advertise even more!

By the point the owner gets the ammount he wanted, he is fed up with this gymnastic or feeling no new members will arrive in quantity and he closes the program, taking all that money!

While 10% of people came out with a profit.... 90% were scammed big time.

This is how they work and why so many people make HYIP.

I hope I've discouraged you by now!

But that's not all!: They even make money selling your sign up data


Are HYIP legal in your country?

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How do you earn from HYIP

Well, as I stated, there are always those 10% who come out with a profit and I've heard of people in countries where it is legal that make a living out of it. But how do they do it? How can they win against the system?

Truth is.... they can't!

Here is how they try to be in the 10%:

- They refer new members: These programs want new members bad, they pay for them, and its easy to understand why since you now understand these programs right?

- They use HYIP monitors: There are sites that list paying and non paying HYIP. Don't forget most of them are corrupt and the HYIP may be paying these monitors to say they are legit

- They get in early and know when to come out: They risk-manage a lot and are calculating an escape plan even before they invest

An additional detail - even the pros get scammed a lot!

So, I hope I've shed a light on how these scams work, and how some people come out winning...

However, they are rare and I heavily discourage everyone - don't even think about this.

What do you know of HYIP

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    • profile image

      tomhardy 3 years ago

      Thanks for posting wonderful article. I am familiar with hyip program. Now, I have licensed hyip site with terrific HYIP Manager Software.

    • Rui Carreira profile image

      Rui Carreira 5 years ago from Torres Novas

      Yup, the scam is a form of the Ponzi scheme...

    • Rui Carreira profile image

      Rui Carreira 5 years ago from Torres Novas

      High Yield Investment Program, Randy... good point... I might clarify that!

    • Trinity M profile image

      Trinity M 5 years ago

      This sounds like a pyramid scheme and you are quite right, they are illegal in most countries and for good reason, people end up getting hurt. Thanks for shedding light on these scamsters.

    • Randy M. profile image

      Randy McLaughlin 5 years ago from Liberia, Costa Rica

      So, what does the acronym HYIP mean?