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Bitcoin is a Ponzi

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Re: Bitcoin is a Ponzi

#51

Post by glenvdb »

A lot of the "Common Objections" relate to the REASONS people choose to own Bitcoin and how those cases make it a Ponzi.

There are many different reasons to own Bitcoin, however the author seems to only view it through the lens of someone living in a wealthy and developed country with financial stability.

The properties of it being difficult/impossible to confiscate and its privacy make it valuable in oppressive regimes. A refugee could store their wealth in Bitcoin, leave their country, settle somewhere else, and access their Bitcoin without the risk of it being confiscated during the journey, because they can simply memorise the seed phrase (24 words).

It's predictable issuance schedule also makes it valuable in countries suffering from high inflation or hyper-inflation.

This is a good article to rethink the use cases of Bitcoin: https://bitcoinmagazine.com/culture/check-your-financial-pri...

Alex Gladstein works for the Human Rights Foundation and does lots of good work in Bitcoin advocacy. His other articles are worth checking out.

And the data backs this up. Some of the biggest growth in Bitcoin users around the world have been in places around Africa and Vietnam who are subject to some of the situations mentioned above.

Do you think these people see Bitcoin as a "Ponzi"? Do you think they care if such a definition doesn't change the properties they find useful/valuable?

Re: Bitcoin is a Ponzi

#52

Post by sailingparrot »

dhsysusbsjsi wrote: post #9

I think this is simplistic. It’s viewing Bitcoin through a lens of a traditional Ponzi scheme assuming people that trade their fiat currency for Bitcoin are investing, with a view to one day take profits back into dollars. What if people are seeing discussion of minting a trillion dollar coin, trillions in QE, 25% of all dollars created in the last 12 months…and concluding that fiat currency is in an endgame and they…

> What if people are seeing [...]

What if my grandmother had wheels?

More seriously, how many people do you know are seeing what you are talking about?

Everyone I know that invested in crypto did so hoping to trade it back later on for more fiat than they paid. Sure, maybe it's a biased sample, but it's a sizeable sample and I do not know even a single person that traded their fiat for crypto definitly.

Re: Bitcoin is a Ponzi

#53

Post by ltbarcly3 »

Using this dumb definition of a ponzi scheme, every stock IPO that doesn't pay a dividend is a ponzi scheme. Bitcoin is valuable because people agree on using it as a form of money, and it is limited in supply. Nobody is making more bitcoins from nowhere to pay out existing bitcoin holders.

Idiotic definition of a ponzi scheme crafted intentionally to include bitcoin, fails to include bitcoin, but does cover many valid economic activities.

Re: Bitcoin is a Ponzi

#54

Post by ralston3 »

topspin wrote: post #15

Nope. No one is being deceived. A Ponzi scheme pretends to be based on legitimate equities and value and is therefore a fraud. Bitcoin makes no such claim.

This was my take as well. A key feature of a Ponzi scheme is the deception needed to pass the scheme off as “legitimate”

Re: Bitcoin is a Ponzi

#55

Post by bb88 »

tshaddox wrote: post #47
Osmose wrote: post #26

Earlier quoted context omitted.

If it's not about cashing out then why is the primary hype mechanism talking about the dollar-equivalent value of anything crypto related? Why does it matter if an NFT was sold for $300k worth of ether?

Presumably because people are currently most familiar with the price of everything else in dollars.

Dollars are accepted everywhere. BTC is not.

Edit: Not sure why the downvotes, but it's still true and still likely true for the forseeable future.

Re: Bitcoin is a Ponzi

#56

Post by Sargos »

blackoil wrote: post #19

I was just now seeing the first video of https://a16z.com/crypto-startup-school/ . Whole video is about how blockchain is awesome because Computer, Internet and Mobile were awesome. Followed by some answers about how we don't know of any use case right now. Is there any non currency use case of blockchain?

DeFi (Beyond a currency, a whole trustless financial system where no one can cheat)

NFTs (Not just art but concert tickets like GET protocol, gaming like Axie Infinity, collectibles like Crypto Punks, etc)

DAOs (Internet scale corporations/governments)

Identity systems (ENS, BrightID, Proof of Humanity, etc which allow for supranational products that build on top of reputation and uniqueness. The Sign-In With Ethereum standard is bringing self-custody OAuth authentication to Web 2.0 applications)

Enterprise interoperability (Baseline)

There's a ton of stuff going on and it's almost impossible for any one person to keep up with everything. It's easy to write everything off as a scam but there's hundreds of thousands of really smart and high integrity developers working in this space and it's worth keeping an eye on.

Re: Bitcoin is a Ponzi

#57

Post by onlyrealcuzzo »

wyc wrote: post #44

"By that definition, stocks too are ponzis. No. Stocks have an external source of revenue, namely the profit that the company makes by selling its products and services to customers..." This is a very simplistic view of equities markets and does not explain penny stocks, meme stocks (GME/AMC), TSLA, and other things that seem to escape traditional fundamental analyses.

The vast majority of equities by value are not penny stocks or meme stocks.

Re: Bitcoin is a Ponzi

#58

Post by fighterpilot »

reducesuffering wrote: post #7
fighterpilot wrote: post #4

> gold > real estate > stocks Sure, these things aren't ponzis. What about art and stamp collecting, though? How are they not ponzis under this definition?

They have value as tax evasion schemes

And bitcoin has value to some people who wish to avoid local hyper-inflation or who wish to do transactions not allowed by financial institutions.

Re: Bitcoin is a Ponzi

#59

Post by LurkingPenguin »

dhsysusbsjsi wrote: post #9

I think this is simplistic. It’s viewing Bitcoin through a lens of a traditional Ponzi scheme assuming people that trade their fiat currency for Bitcoin are investing, with a view to one day take profits back into dollars. What if people are seeing discussion of minting a trillion dollar coin, trillions in QE, 25% of all dollars created in the last 12 months…and concluding that fiat currency is in an endgame and they…

> It’s viewing Bitcoin through a lens of a traditional Ponzi scheme...

And? Should we should look at it through a lens of a non-traditional Ponzi scheme? Ponzi 2.0 is better than Ponzi 1.0?

> What if people are seeing discussion of minting a trillion dollar coin, trillions in QE, 25% of all dollars created in the last 12 months…and concluding that fiat currency is in an endgame and they are permanently trading what fiat they have now for one of a finite number of digital assets that will ever be created.

If the Debt Bubble is nearing its end and fiat currency is in grave jeopardy, what is the mechanism by which the people holding these "digital assets" will save themselves from the economic hell that awaits the world?

Re: Bitcoin is a Ponzi

#60

Post by topspin »

Nursie wrote: post #41
topspin wrote: post #15

Nope. No one is being deceived. A Ponzi scheme pretends to be based on legitimate equities and value and is therefore a fraud. Bitcoin makes no such claim.

Not all of them, some are even advertised as Ponzi schemes.

Once the deception is dispelled it ceases to be a Ponzi scheme, the BS spewed by marketers not withstanding. Ponzi is fraud; deception is imperative. Everything is else Not Ponzi.

I'm no crypto currency fanboi, but I feel no need to commit the intellectual fraud of misapplying well understood concepts to denigrate it. Every couple of months, however, someone decides they can score some clicks by yelling 'Ponzi' and we get this headline again.

In addition to being tedious it's also dangerous. Blockchain and cryptocurrency is new phenomena and we don't yet know what value there is here. We can, however, confidently assume that if the false narrative that Bitcoin is a Ponzi Scheme is successfully applied The Great And The Good will suddenly discover the moral obligation to crush it out of existence and criminalize everyone involved.

That possibility worries me far more than whatever part of the status quo bitcoin might disrupt.

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