Three-Ponzi Theory Overview

+----------------------------------------------------------+
|   THREE-PONZI THEORY                                     |
|                                                          |
|   [Dividend] -----> [Mutual Aid] -----> [Split]          |
|       |                 |                  |             |
|       v                 v                  v             |
|   Low Risk          Mid Risk          High Risk          |
|   Creditor          Lender            Equity             |
+----------------------------------------------------------+

1/ What is Three-Ponzi Theory

Ponzi schemes may seem bewildering, but fundamentally there are only three models: Dividend, Mutual-Aid, and Split. All Ponzi schemes are combinations of these three models.

The analytical method based on this logic is called the “Three-Ponzi Model.” The three types can appear independently or in combination, each with its own pros and cons, corresponding to specific launch, operation, and collapse logic.

The Three-Ponzi Model is also the primary methodology for evaluating investment targets.

2/ Three Basic Types

Traditional Definitions:

Type	Definition	Revenue Source
Dividend	One-time lump sum investment, linear dividends over time	Later deposits distributed to earlier investors
Mutual-Aid	A pays B, B pays C, C pays A forming mismatched cash flows, per-transaction settlement	Interest spread from fund maturity mismatch
Split	Continuously splitting one asset into new assets, attracting new capital through lower-priced new assets	Market cap realization after asset appreciation

3/ Launch Logic (Design Characteristics)

Does it form a capital pool? Allow free entry/exit? Promise fixed returns?

Dividend: YES; NO; NO
Mutual-Aid: NO; Mostly NO; YES
Split: YES; YES; NO

The essence of any Ponzi is achieving low-cost capital aggregation and creating mismatch. Profits depend on how much capital and how long you can distribute.

Therefore the main vulnerabilities are in three stages:

Stage	Meaning	Key Question
Entry	Capital Pool	Does entering require locking liquidity or upfront payment
Exit	Free Entry/Exit	Can principal freely enter and exit
Bubble	Returns/Payout Ratio	Are fixed returns promised

4/ Collapse Logic

Type	Collapse Condition	Result
Dividend	New deposits < Fixed return interest	Stop pool withdrawals, close shop (profit from remaining principal)
Mutual-Aid	Mutual-aid funds < Fixed return interest	Stop mutual-aid circulation, insider accounts exit
Split	No new liquidity to take over new split assets	Project team realizes market cap profits

5/ Operator Profit Formula

profit(Dividend) = Total deposits - Total fixed dividends
profit(Mutual-Aid) = Total funds in mutual-aid state × % insider account ratio
profit(Split) = Project team's total selling profits

⚠️ Always remember the project team is here to make money. When calculating Profit, take the maximum value, not zero

6/ Three Operating Elements

From the operator’s perspective, operational considerations are:

Reserves — Deposits used for paying withdrawals and interest
Payout Ratio — Too low nobody plays, too high easy collapse
Market Costs — Expenses to drive deposits

The operator’s task is to balance these three points and maximize profit

7/ User Demand Evolution

As the sophistication of Ponzi participants increases, traditional schemes no longer satisfy people’s growing Ponzi demands:

❌ Dislike entry fees, front-loaded interest cuts, and long lockups
❌ Demand free capital movement to prevent rugs
✅ High returns

This completely contradicts operator interests and operational needs, but competition is fierce. Operators must trade off among the three. The goal isn’t following demand, but making the market accept it.

8/ Audience and Risk Preference

From the audience perspective, from Dividend to Mutual-Aid to Split represents continuously increasing risk preference:

Type	Risk Preference	Traditional Finance Analogy
Dividend	Low	Creditor
Mutual-Aid	Medium	Loan Shark
Split	High	Equity Investor

Core Terminology Quick Reference

Term	Definition
Fund Mismatch	Temporal/amount inequality between deposits and withdrawals, fundamental source of Ponzi profits
Payout Ratio	Proportion of returns distributed to users from total deposits
Reserves	Funds used for paying user withdrawals and interest
Insider Accounts	Hidden accounts controlled by operators for early positioning and profits
Beta	Average return/gain rate of the overall market or similar projects
Chip Structure	Distribution of tokens/assets among different holders

Next: Dividend Ponzi Explained