These two new ‘parody’ apps—PoWH 3D and FOMO 3D—make a mockery of the crypto ecosystem by transparently letting early investors directly benefit from the funds of later investors. PoWH 3D, is a decentralized exchange, with its own unique ethereum-bonded token, and FOMO 3D is a gambling game designed to simulate “all the excitement of an ICO exit scam.”
By writing the rules into a mechanism of open source smart contracts, the new apps need no ploys to prey on the ever-present human tendency for greed. They have already garnered unprecedented appeal, blowing CryptoKitties off the blockchain with almost 4,300 ether ($2 million) of collective trading volume over the last 24 hours—a figure that puts them in competition with the most popular decentralized exchanges.
The four anonymous collaborators behind the project—“Team Just”—say that they have never met in real life. But despite having never heard each others voices, have managed to build a platform valued in the hundreds of millions. A boost in income for lead developer Mantso, who was reportedly subsisting on a diet of rice and cereal when the project began.
Powh3D—Proof of Weak Hands 3D
“TRUST US, WAY EASIER” – Proof of Weak Hands 3D
PowH 3D, a decentralized exchange, touts itself as a “blockchain managed smart contract economy in three dimensions.” This revolves around a bonded ethereum token (P3D), which rewards holders with dividends whenever anyone else invests. Every time someone transacts on the exchange, it levies a 10 percent fee, which is then distributed to everyone holding the token—creating an incentive to hold through volatility, and causing some to shout Ponzi.
Unlike a Ponzi, however, equal favour is given to new and old investors. When a token holder sells, the 10% fee is distributed equally, with no preference between old and new players. This unique taxation model makes the token incompatible with other exchanges. Critics suggest the game shares many qualities with Ponzi schemes, but its satirical website claims that equal inspiration is drawn from the world of cryptocurrency.
As a greater fool game, users are rewarded for drawing people in, and for sticking around over time. But these features are termed ‘mining’ and ‘staking’, in reference to the rewards received for supporting Proof-of-Work or Proof-of-Stake blockchains: “Yes, our staking and mining systems are comedic jabs at cryptocurrency as a whole, they’re also immensely more fun, and reward in (ETH) instead of something that ‘may’ have value later.”
Fomo3D—Fear of Missing Out 3D
The other branch of the ecosystem is Fomo3D—a gambling game with the self-professed purpose of making a mockery of ICOs. Promising players “all the fun of an exit scam”, the action resembles a lottery—with a twist. On entering the game, each participant buys a key, the cost of which is put in a pot to be won by a lucky participant when the round ends. But also, key holders benefit from a percentage of all new funds.
In this way, each key acts as both a lottery ticket, and a dividend. The model is advertised on the website as a “a psychological social experiment in greed”, and has attracted huge sums of money—the present pot totals 36 million dollars at the time of writing.
Little wonder therefore that the team are launching another version—“FOMO3D FAST”, which will compete with a gang of freshly spawned copycat schemes like Proof of Community, EthPhoenix, Grand Theft FOMO, Ratscam, Proof of Fair Launch, and more.
A fully transparent Ponzi scheme
As the popularity of these games has continued to push up the price of GAS for general transactions, they have attracted hostility from critics. But one commentator believes that because these games are implemented transparently as smart contracts, they cannot be so easily disguised, and the developers cannot so easily exit scam, making them superior to the alternative—underground ponzi schemes: