Comment by vintermann

It's true that there are people who pay a premium for thinking they got one up on you, and will waste $1000 of effort to get $100.

But it wouldn't actually work well. It doesn't even need physical invites, keeping track of the invite graph is a great way to kick scammers out. It works. It's been demonstrated to work well since at least 2004.

The reason social media sites don't do it is not that it doesn't work - it's that growth trumps those concerns. Making onboarding as easy as possible is more important than keeping scammers out.