@staceyboyle
Ponzi risks arise if returns depend primarily on new participants rather than sustainable revenue or utility. Warning signs include promises of guaranteed high yields, reliance on continuous token issuance, or lack of real product adoption. Analyze whether rewards are funded from genuine fees, services, or ecosystem demand. Projects without clear value creation or with unsustainable token inflation may collapse once new user inflows decline. Reviewing financial reports, on-chain revenue, and ecosystem activity helps identify red flags. Healthy projects generate value from services or products, not merely from attracting new investors to sustain payouts.
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