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People say they can't get their money out of Yotta Savings (YCombinator 2020)
- fortran77 2y agoAlso see: https://www.youtube.com/watch?v=bBUkajbg688 https://www.youtube.com/watch?v=bBUkajbg688 and look at all the recent Reddit threads on Yotta: https://old.reddit.com/r/yotta/ https://old.reddit.com/r/yotta/ Here's the YCombinator page for them: https://www.ycombinator.com/companies/yotta https://www.ycombinator.com/companies/yotta
- ec109685 2y agoFools who believe there is risk free 2x yields and their money are soon parted: “Users save money, get over 2x the national average in interest and weekly chances to win additional prizes up to $10 million through weekly random number drawings.” What a joke.
- ornornor 2y agoTheir website barely mentions they’re a bank, it says everywhere “ WIN MONEY!!!”… looks like one of these online casinos. And the About Us page is password protected.
- Sohcahtoa82 2y agoTo be fair, the national average interest rate is only ~0.46%, which is insanely low considering how many banks are now offering 4-5%. Offering 2x the national average is still low. The $10M random number drawings are definitely shady as hell, though.
- foxbeneficial 2y ago[flagged]
- popcalc 2y agoYou can also still buy tokens/yottacash... they'll take your money but there's no way to cash out. This is being caused by the Synapse/Evolve dispute
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- JumpCrisscross 2y agoYotta's middleman went bankrupt in early May [1]. They were apparently bad at keeping track of their money, with "tens of millions of dollars are unaccounted for," despite some "partners of its venture backers such as Andreessen Horowitz" having allegedly been "aware of such discrepancies" [2]. [1] https://www.cnbc.com/2024/06/01/synapse-bankruptcy-yotta-accounts-locked.html https://www.cnbc.com/2024/06/01/synapse-bankruptcy-yotta-acc... [2] https://www.theinformation.com/articles/inside-the-collapse-of-synapse-missing-funds-were-known-to-investors-banks-for-years?rc=gtdonx https://www.theinformation.com/articles/inside-the-collapse-...
- reducesuffering 2y agoMeanwhile Synapse founder CEO is spending time on twitter telling frustrated depositors: "I am sorry, I should not have called you an idiot. That wasn't nice. You are a moron." from the Greek island of Santorini. https://x.com/sankaet/status/1790563922732544367 https://x.com/sankaet/status/1790563922732544367
- JumpCrisscross 2y agoWow, "CEO Sankaet Pathak called into the bankruptcy hearing from Santorini island in Greece, and the general counsel Tracey Guerin was in Rome" [1]. Someone at the DoJ is going to make a career out of this guy. [1] https://prospect.org/justice/2024-05-24-judge-appoints-trustee-synapse-bankruptcy/ https://prospect.org/justice/2024-05-24-judge-appoints-trust...
- localfirst 2y agoWhenever I see this type of bravado I always assume they are putting on a brave face because things are far worse than they appear. It's the cavalier attitude towards taking other peoples money. Unbelievable.
- hooverd 2y agoOr stimulants. Adderall bravado is real and explains a lot.
- fnalelal 2y agoTL;DR looks like a crypto savings / gambling site (i.e. a scam, like crypto anything).
- rkeene2 2y agoFrom what I understand, it didn't look like that when most users signed up -- it looked like a gimmicky bank account with a savings account that a portion of the interest was invested in a lotto-style system, so you were earning slightly less interest plus some chance to win a large payout. This is a lot different than what they "pivoted" to after accepting user deposits.
- millzlane 2y agoGlad I took mine out a couple years ago and put it in a high interest savings account. Gamified savings and articles about it got me more interested in my personal finances. So for that I'm thankful.
- toomuchtodo 2y agoConsider a money market fund consisting of high quality government debt at your brokerage. You may be able to avoid state income tax on the income depending on your circumstances. https://www.bogleheads.org/forum/viewtopic.php?t=398408 https://www.bogleheads.org/forum/viewtopic.php?t=398408 https://www.bogleheads.org/forum/viewtopic.php?t=395586 https://www.bogleheads.org/forum/viewtopic.php?t=395586
- RcouF1uZ4gsC 2y agoApparently “Yotta” should be pronounced “Yo outta” as in “Yo outta savings”.
- localfirst 2y agoand of course Graham Stephen was promoting the hell out of Yotta. This is like what, the 3rd time he's embroiled in something like this? It's going to take a very long time for Yotta users to recover their funds methinks hopefully they still have some sense and return the funds
- Havoc 2y agoIf you cut corners on the service you have more money to “growth hack”. Entire VC model is broken
- MrFoof 2y agoIt appears that today Coffeezilla has put his first investigative video out on it: https://www.youtube.com/watch?v=bBUkajbg688 https://www.youtube.com/watch?v=bBUkajbg688
- blibble 2y agowith real premium bonds you are lending your money to the government treasury, which is as close to zero risk as you can get meanwhile yotta is some shitty VC funded startup operated and invested in by people who think following regulations is something only other people need worry about (and then they go crying for a government bailout when their bank collapses because they have no understanding of concentration risk)
- nytesky 2y agoMaybe I am misreading it, but their site seems to imply the program banks will provide FDIC insurance: https://help.withyotta.com/en/articles/4494665-is-my-money-fdic-insured https://help.withyotta.com/en/articles/4494665-is-my-money-f... Which then directs you to contact ANOTHER COMPANY to confirm… that your money at Yotta is held by a 3rd party bank in an FDIC insured account. Honestly I feel like they are referring to FDIC in bad faith with this weird non answer scavenger hunt. Is the core problem that Yotta expected synapse to distribute funds to program banks, and now Synapse and the banks books don’t agree? So even if you checked with Synapse, would they have directed you to the bank with your money for confirmation— or is it all commingled funds anyways?
- rkeene2 2y agoI run a kind of similar service to Yotta (though we haven't launched to consumers yet, and don't have the gimmick of investing some portion of your interest into a lotto-style system). Coffeezilla (linked in another comment) did a good job explaining it. Yotta isn't a bank and doesn't hold user funds -- those funds are at a bank (almost definitely, unless they're breaking the law which I have no reason to suspect), and the bank pays FDIC insurance on each of them. This means the funds are safe against a variety of threats, but not all. Being at a bank is also not the same thing as being available (though banks do have availability reporting and capability requirements). From what I recall Yotta contracts with Synapse for integrating into a bank, and the issue is between Synapse and the bank they work with. Depending on who maintains the authoritative copy of the ledger (the bank or Synapse), the bank may only know the total amount in all combined user accounts and periodically audits of individual accounts -- so they could have ended up in a situation where $X in the bank for Y users, but the total on the Synapse's ledger for that same set of Y users exceeds $X, something which is never supposed to happen unless you're a (highly regulated) bank. If that happened there would probably need to be a much more detailed and time consuming audit of every transaction to determine the "real" balance of each account, and figure out why it doesn't match the total the bank has. Depending on how Synapse implemented their ledger (and this is continuing to assume they are the system of record), that may involve restoring backs and trying to piece together everything from data that was not necessarily intended for this purpose. Because, in this scenario, the bank doesn't know who owns which dollars it has in Synapse's account it can't give those dollars back to their depositors. If worse comes to worse, the bank will sort it out by asking depositors for proof of deposits and then try to correlate those to Synapse's best guess at data that matches total deposits. If Synapse did something with user funds (not the data on their ledger, the actual dollars) other than what the user directed, then there could be big trouble for them and I'm not sure if the FDIC coverage helps there, or if it will be a civil process to try to make everyone whole, or something else entirely. Based purely on the reporting I've overheard and no direct insight (or even researching it beyond the reddit post and this thread), that's my best guess as to what is happening.
- vetclmark 2y agoFrom https://www.ycombinator.com/companies/yotta https://www.ycombinator.com/companies/yotta > SAVE MONEY AND WIN PRIZES UP TO $10M THROUGH WEEKLY NUMBER DRAWS. > Users save money, get over 2x the national average in interest and weekly chances to win additional prizes up to $10 million through weekly random number drawings. These are the kinds of companies YC invests in. Then the moderators here at HN go around telling users that they should apply to YC. As if an investment from YC is something to be proud of.
- zdandoh 2y agoWhy is this a bad thing? The psychological draw of gambling is very strong. Independent of execution, it seems like this product harnesses that aspect of human psychology to get people interested in saving money. Governments have utilized this same model effectively to entice citizens to save and invest: https://en.m.wikipedia.org/wiki/Premium_Bond https://en.m.wikipedia.org/wiki/Premium_Bond
- immibis 2y agoYC investors, like all other investors, are only interested in making money. You don't make money by paying people twice as much interest as everyone else. Something is fishy.
- HWR_14 2y agoNot all investors are only interested in making money. That's why so many investment vehicles take into account ESG scores. Or why people refuse to invest in cigarette companies.
- ains 2y agoFor what it's worth the claim is "2x the national average in interest", the national average in interest is incredibly low as many people have their money in checking/savings accounts at large banks with near 0% interest rates. It's very possible to give people twice the national average and still make money on the spread between that and the ~5.5% short term treasury yield. Marcus by Goldman Sachs claims their rate is "8x the national average" at 4.40% and I'm sure they're making money just fine too.
- michael_vo 2y agoHow does this happen? Isn't there a board for these companies where they are advised not to pivot to gambling?
- jellicle 2y agoThe old business model of being able to withdraw funds has been disrupted.
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