For anyone still unaware of exactly what I am talking about here, two of the biggest online payment processors currently prepared to allow HYIP related websites are PerfectMoney and EgoPay. Previously the single biggest processor was LibertyReserve until they were closed down by US financial authorities and their owners arrested by various police forces and extradited to the US. More than just HYIPs however, LR were elbow deep in all manner of illegal activities, either directly or by association, so it’s really no surprise that they would eventually come under investigation. But the knock-on effect of that was much closer scrutiny, or maybe the fear of much closer scrutiny, I really don’t know, in other payment processors. The biggest rival to LibertyReserve and probably the one that gained most business from their closure was PerfectMoney, however they were also the first ones to take action against ending up in the same courtroom as their former competitors. Within weeks of the LR seizure, PM made the announcement that all accounts belonging to US Citizens/Residents/US Companies were to be disabled. True to their word this rule was enforced starting on the 1st of July last year, less that six weeks after LR got into trouble.
Considering that PerfectMoney have some of the lowest fees in the market for online HYIP payment services this really did a lot to curtail the options for US based investors. The situation has now been compounded by EgoPay, for reasons best known to themselves, also deciding to shut down US based accounts. In less than three weeks, March 14 I believe, US based EgoPay account holders will no longer be able to receive any payments into their accounts. This is followed by a two week grace period during which you are allowed to withdraw any funds still held on account. After that, your account is to be permanently closed.
So why is this happening at all, and why is it happening now? Neither processor have been exactly forthcoming with explaining the reasons behind such radical measures, but let’s be honest here, you don’t need to be Einstein to figure this one out. The US market is enormous for payment processors like PM and EgoPay, and the amount of money it can potentially hold is probably enough to make most people’s eyes water. To voluntarily remove yourself from a market that big and surrender almost unlimited future earnings is not something most businesses would do lightly. In fact from an economic and business point of view it would be almost laughable for any other company to even contemplate such a thing. So why are payment processors any different? Clearly then they are very very afraid of the consequences of of continuing in this line of work and clearly have very good reason for believing with 100% certainty that unless they willingly and preemptively remove themselves from the US market then US law enforcement officers will do it for them. Tightening regulations, stricter enforcement of existing laws, and the fact that legislators are catching up with the technology that has always been so far ahead of them are all playing their part here. It’s not so much that what they’re doing was illegal, it’s that there wasn’t any law at all governing the online payments market. Law makers of an older generation don’t really understand the concept behind it, and so it flies under the radar until younger more tech savvy operators take the reigns. By which time of course technology has evolved another generation and the dance continues!
But one thing is always guaranteed – government and big business do not like anonymity. They prefer it if you can account for every dollar that passes in and out of your hands, and take a cut for themselves. You know, “wet their beaks” as the slightly smaller time gangsters than the tax inspectors might call it. And if you are handling US currency as most online HYIP transactions do, then the US authorities feel they should hear about it. Whether you agree or not is your own business, I really don’t care. But the online payment processors are concerned enough about the consequences of being accused of enabling US residents to earn US currency without being traced that they have decided it’s best to back off for the foreseeable future.
The precedent has already been set with LibertyReserve, so nobody involved in this business should be under any illusions that it can’t happen to them as well. And to be blunt I honestly can’t say I blame the owners of PM and EgoPay for doing what they did. I think I’d probably do the same, wouldn’t you? I mean giving up a highly lucrative market can’t be easy, but when the alternative is a very long stretch in prison then I’d do it in a heartbeat. Their respective businesses will continue, less profitable I guess, and probably fewer employees as well. But everyone with their liberty in tact to carry on enjoying the no doubt still lucrative living they can earn from serving the rest of the globe where government agencies take a less prying interest in what private individuals do to make a couple of extra dollars for themselves in order to feed and house their families.
All well and good but it does very little to help the actual situation now facing those US residents still looking to play the HYIP industry. LR are closed, PM have taken themselves out of the loop, EgoPay have enough reason to believe they had better withdraw from the US market, and STP have become far more discriminating about who they will allow use their services. Where does that leave you, the investor then? Like I already said, HYIP admins have no such misgivings about taking your money, you’re free as you always were to join whatever online HYI related projects you wish, it’s just that the channels which you can move money in and out of these programs are starting to get restrictive. So what are your alternatives? If the twenty something year history in which the internet has played a major role in business and money has taught us anything, it’s that there are ways and means of getting around almost anything. Just like when a river flowing towards the sea hits a mountain, it either goes through it or goes around it, but it will never be stopped by it.
The question then is how does one get around all of this? You see I can’t help but feel that a lot of the self imposed rules now enforced by PM and EgoPay are really just to pay lip service to the authorities, to do the absolute minimum required of them to make it simply awkward rather than totally impossible for US residents to continue using their services. In an entirely online business with no compulsory identification process, how are they really supposed to know what customers are in the US and which ones are living elsewhere? Sure, they monitor your IP address and once they see it’s American then you’re blocked, but almost anyone with the most basic and rudimentary internet skills can mask that very very easily. And if you do do that, I have to say I’d be absolutely amazed if either PM or EgoPay were to put any effort whatsoever into looking any closer.
Before I get to the alternatives to EgoPay and PerfectMoney then, let’s see what your options are if those are the processors you would rather continue with. Accounts are free, very easy to open, and anonymous. I mean you can tell them your name and address if you really want to I suppose, but personally I wouldn’t. There are a number of ways you can access your new accounts from the US while masking your American IP address then, though be careful because some carry a higher risk of discovery than others.
Online proxy servers for example. For anyone who doesn’t know what this means, in simple terms the proxy is a website you visit first and then type in the address of the site you are actually looking for. The proxy then opens the new website for you but at all times keeping you within the parameters of the proxy’s own website. The payment processor then logs the visit from the proxy IP address while yours remains hidden. The problem there however is that the proxy IP address can be fairly random. It will change almost every time you use the service, and can make you appear in literally any country. This includes the US, so of course it’s only a matter of time before you start showing up there simply by coincidence.
Another example might be to use a new internet browser that specializes in anonymity. Most of you will I imagine be familiar with Mozilla, Internet Explorer, Safari, and the likes seen as most likely you’ve got one of them open on your computer right now if you are reading this. Less well known, and I admit it’s only something I’ve started using myself only recently, are the likes of The TOR https://www.torproject.org (an acronym for The Onion Router) web browser that protects your identity online and allows you to surf anonymously. Handy for more than just HYIPs by the way, if you’re as sick as I am of all the spying and the flood of advertising we are bombarded with online from companies like Google then it’s well worth your while downloading TOR https://www.torproject.org/download/download-easy.html.en as an alternative browser. The fact that almost every PC and laptop comes with a built in browser from the manufacturer tends to make most people a bit lazy in this respect, but if you spend a lot of time working and earning online it’s worth the couple of minutes it takes to download. The TOR bowrser https://www.torproject.org looks quite similar to Mozilla Firefox by the way, so there’s no real effort needed to get accustomed to using it for most of you.
Perhaps the most effective way might be the use of a VPN, which stands for a Virtual Private Network. This isn’t generally a free service but shop around and you’ll soon see there’s no need to spend more than about $5 a month at most for many providers. Then rather than the random IP’s assigned to you by the free proxy servers, you have access to your very own secure private network and can often choose the country you wish to appear online in. OK, it might sound a bit shady at first, but in actual fact there are lots of people around the world using such services for all sorts of reasons. Many national television stations broadcast online for example, but only to IP addresses from their own country. If you happen to be a US citizen working overseas and want to watch HBO online for example, you can buy (well, rent) a VPN that convinces the station you are viewing from the US. Likewise if you are genuinely in the US but would prefer that PerfectMoney would see you online in let’s say Australia, a VPN is a cheap and effective way of doing that.
On the other hand if you prefer not to use the cloak-and-dagger tactics and simply abandon your PerfectMoney and EgoPay accounts, what are your other options? They are after all not the only online payment processors working with the HYIP industry. Trouble is they are definitely the two most widely accepted right now, even if you don’t necessarily agree that they are the best. SolidTrustPay for example has for reasons best known to themselves drastically scaled down the extent of their HYIP related activities in recent months, and since the new year in particular. So while STP don’t at the moment place any restrictions on US residents operating an account, the uses an average HYIP investor might have for such an account have become limited recently. Which is a shame really because I myself always rated them quite highly, and with their excellent new debit cards working so well the options for moving money in and out of STP quickly and hassle free have never been better. Why exactly they are clamping down on HYIP admins so much now when opportunities for them to increase their share of the lucrative US audience are almost limitless, it being a billion dollar market they could practically claim for themselves if they wanted, is something I can’t explain. But that’s the way it goes so until they reassess their policies get over it and move on.
Likewise with PexPay. They’ve had a reasonably good list of funding and withdrawal options for American residents for sometime now, though the practical value of owning an account is doubtful given that there’s almost nothing you can use it for at the moment. I mean I have no idea what if any non-HYIP related businesses accept them, but in this industry admins have been slow to warm to them to say the very least. Still, it costs nothing just to open an account and leave it dormant until you find something you can use it for. Some users may not like the fact that verification of your identity is required for moving large amounts of money, though you can try it out with smaller figures easily enough without this requirement. While PexPay don’t currently offer members debit cards such as STP and EgoPay do, there are online exchangers such as xchanger (interviewed here) that will move your PexPay funds to those processors for you. Otherwise you can use bank wires, ACH, or get paid by check mailed to your home address to get paid if you wish.
It all looks good on the surface I must say, but ultimately it’s extremely disappointing that the PexPay administration seem to be almost entirely bereft of ideas when it comes to promoting their business. With PerfectMoney having withdrawn from the US market, EgoPay barely a month away from doing so, SolidTrustPay expressing no interest in expanding their position, one would think the potential here was obvious. Existing HYIP admins and investors alike are going to have to come up with some alternative and fast because programs will no longer be allowed to pay their US members via EgoPay from the middle of March. It’s almost like standing in an abandoned car park, there’s a bundle of money on the ground with no one around for miles, and yet no effort is being made to pick it up. PexPay are we are told operating within both US borders and US law, are especially aimed at US customers (though everyone else is welcome too, naturally), but it would seem the people living there don’t want to hear about it. The management of PexPay was interviewed on MNO last October (read it here), just as the industry was getting over the worst of the fallout from the LibertyReserve closure, but so far the expansion promised by the admin hasn’t really come to fruition. However if they are not capable of stepping up their promotional work at this of all times in the industry’s history then honestly I’d be left with very little confidence in their abilities to run a payment processor at all.
One alternative to the more established names that US users may have been too hasty in dismissing is Payeer. I don’t know why, but perhaps some of you think that for some strange reason being a Russian company you are somehow disbarred from using their services. Nothing could be further from the truth. They’re an online business, and as such are international in nature regardless of what country their offices are physically located in. The Payeer website is also fully available in English. Regular HYIP players will have noticed Payeer popping up almost everywhere recently, with most of the new programs including them as an option and older programs eventually adding them as well. The reason behind this sudden surge in popularity is open to debate, but my own guess is that prior to being an online payment processor they were already an e-currency exchange service provider with a decent reputation. As such they enter the market with a lot of very strong features already in place, particularly with regards to funding and withdrawal options which will suit US members. You can exchange to other e-currencies directly from your Payeer account which is quite useful, and also withdraw either to your bank account or directly onto bank issued Visa and MasterCards. Other than the withdrawal options and the growing number of HYIPs now accepting Payeer, other advantages include total anonymity with no verification needed, a very simple sign-up process, irreversible payments, and crucially low transaction fees.
I am aware that some readers have their misgivings about some aspects of Payeer. Operating from an unknown jurisdiction for example, possibly even a close connection with the HYIP industry. I myself however can’t really see how any of these things have ever saved you money in any other online payment processor, the real risk being with the activities you are using the account for rather than the medium through which you are simply moving the money from A to B.
Lastly then we have BitCoin. I don’t really have much to say about them for the moment for one simple reason – the point of this article is to help US readers of MNO with the current situation here and now. I genuinely believe that crypto currencies in general, and BitCoin in particular, will form the long term future of the online HYIP industry, but I’m talking about the next few years here. With almost no other legitimate businesses using the traditional HYIP payment processors and law enforcement agencies investigating them (or at least their activities) very closely, I think their days in the HYIP industry are numbered. They can either drop the HYIPs completely and go the way of PayPal, or else close down. But there’s no long term future for them in the HYIP industry that I can see. Circumstances have changed. If they can’t or won’t give investors what they want then investors won’t just walk away and forget about it. They will simply look elsewhere for service providers that will cater to their demands, and crypto currencies is where they will find it.
I really can’t say when the likes of BitCoin will eventually eclipse the likes of PerfectMoney in the HYIP industry, it may well be years, but I have no doubt that it’s coming. To put yourself in a stronger position to continue profiting from HYIPs then now is the time to get used to that idea and start studying how they work. Some of the many advantages to BitCoin include total anonymity, no centralized control for transactions whatsoever, low fees, and the ability to fund your account via different methods and exchangers. On the other hand it is highly volatile, with exchange rates likely to fall without much notice as well as rise. Indeed some might say it’s vastly overpriced as it is and can only come crashing down in value at some point. Personally I would think that as services like BitCoin are here to stay the worst thing that can happen in terms of exchange rates is that it eventually stabilizes to a realistic value. As for the legal status, well, maybe BitCoin can’t be regulated but there are infinite restrictions that governments can place on the companies publicly accepting it. Legitimate companies that is, something I tend to doubt need ever trouble HYIP admins!
To conclude then, whether you agree or not with what I have written above there are I think certain points on which we can all universally acknowledge. One is that it’s getting seemingly harder for Americans to participate in the HYIP industry. Another is that there are many ways to circumvent this. The most important thing is however that HYIP admins will collectively need to wake up to the potential that US customers bring to the industry, and do it fast. The US market has been always the very core of the HYIP industry, if not always in the number of individual people involved then definitely in terms of the money being spent. Without them it’s unthinkable that the industry will return to its former glory in the near future. So it’s in everyone’s interests that programs always always always go that extra mile and seek out more ways to make themselves as friendly as possible to American users.
I was tempted to say something like “we’re coming into interesting times for the HYIP industry now”, but you know come to think of it “interesting times” have never really been that far away in this business! Certainly things are changing though, which again is something never far away. But we’ll see how the industry develops during the rest of 2014, and fingers crossed it will ultimately prove as adaptable and resilient as it’s always been.
I just want to close the matter now by encouraging you to share your own thoughts on this. Obviously if you are American and directly affected by what’s going on now your comments are most welcome, however I think everyone should feel free to contribute no matter where you are from. You can write to me directly, but you’re also free to leave a comment after this article or on my shoutbox and tell us whether you agree, disagree and why you think so. I look forward to as many different angles to this as there are readers!
DAILY NEWS FROM THE HYIP INDUSTRY http://money-news-online.com/blog/2014/02/24/24022014-hyip-e-currency-solutions-us-investors-daily-news-hyip-industry/