What is Loom?
Loom is a ponzi scheme that doubles as a pyramid scheme which involves the recruitment of people to pay some amount of money in a group with the aim of getting 800% ROI (Return on Investment) on their contribution. Loom got into the social media trends just few weeks ago and it tends to be the new craze among the youth.
Loom as its simply called is also popular as Blessing Loom, Loom Money, Loom Circle or Fractal Mandala across the globe.
Loom is believed to have emerged from UK and it trend to Australia and with its viral endorsement and critics of the public it has become a trend in most countries such as Ghana, Nigeria and Togo just to mention a few.
How Loom Works.
Loom does not have a website where transactions are managed, everything is done in a whatsapp group.
After being convinced by someone that you will get a promising 80 Cedis by paying 10 Cedis to join a group, you will be required to prospect to other people be it your friends or family to join this group with the same idea.
How fast you earn your promised amount depends on how quick every member in the group can add others.
There are four levels or stages in Loom, Gift Receiver(Blue), 2 Leaders (Pink), 4 Coaches(Green) and 8 Gift Givers(Blue).
These sum of 15 people make one complete circle, In this scenario, the gift receiver pays nothing to be in the group, all he does is to come up with the plan. The gift giver each pay 10 Cedis to the receiver and then he moves out of the circle or the group in general. At this point he can choose not to reinvest and that means he has nothing to loose.
When the receiver leaves, the leaders now split into two groups, one leaves to set his own group ad and the other is promoted into the circle then they prospect to other to pay another amount. This process goes on and on.
Lets Apply Some Basic Maths here:
In order for you to make money as promised, every first payment attract 8 people.
For those 8 people to be paid the group needs 8×8 member thus 64 new members.
For 64 to be paid, the group needs 64×8 people thus 512 members.
And the maths keeps on multiplying and this is where the scam sets in, sooner than expected the group will run out of new recruits or there may be issues of brouhaha since not everyone will understand the process. This is where new recruits may end up loosing hard earned cash.
Loom is a ponzi scheme, we wouldn’t term it as scam because participants know of the business idea before joining but here lies the case they run out of recruits and that’s how ponzi and pyramid schemes work.
Just a word of thought, so for those of you who join loom to be gift givers, don’t you feel like being used by those in the middle?
And for those who got scammed in Loom why do you feel heartless and choose to prospect to people to also loose their money?
We will be generous to advice you to stay away from Loom since it can rip you off your hard earned cash.
We believe this review saved you from this scam. Let us know your thoughts in the comment session below.