An exit scam is a confidence trick where an established (usually illegal) business, e.g. a seller of drugs, stops shipping orders while continuing to receive payment for new orders. If the entity had a good reputation, then it can take some time before it is widely recognized that orders are not shipping, and the entity can then make off with the money paid for unshipped orders.
Exit scams can be a tempting alternative to a non-fraudulent shutdown for illegal operations, if the operation was going to shut down anyway for other reasons. If an illegal entity lives by e.g. selling drugs, it is not usually an option for the cheated buyers to call the police. The examples mentioned in news articles are online sellers, where the buyer does not know the identity or physical location of the scammer, and therefore have little recourse.
The online black market Evolution is cited as the biggest exit scam yet as of 2016. Here the administrators apparently made off with $12 million in bitcoin, which was held in escrow on the marketplace.
Individual vendors often reach a point of reputation maturity whereby they have sold sufficient product to have accumulated both significant reputation and escrowed funds, that many may choose to exit with those funds rather than compete at the higher-volume higher-priced matured product level.
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