Bitcoin is a Ponzi • Hacker News Board

Re: Bitcoin is a Ponzi

#191

Post by tw04 » Thu, Oct 07, 2021, 4:44 AM UTC

jliptzin wrote: post #147

Bitcoin is a lot of different things to a lot of different people. The fact that it satisfies a certain set of conditions of a Ponzi scheme does not invalidate the myriad current and future applications of crypto. The social security administration could also be considered a Ponzi scheme, but it still provides tremendous value to a lot of people.

>The social security administration could also be considered a Ponzi scheme, but it still provides tremendous value to a lot of people.

The Social Security Administration is entirely solvent by itself. The only "ponzi scheme" comes from congress using it like a piggy bank. And despite all that, SSA is backed by the US government. Bitcoin is backed by... nothing. So it's basically the equivalent of the zimbabwe dollar, not SSA.

Re: Bitcoin is a Ponzi

#192

Post by rabuse » Thu, Oct 07, 2021, 4:44 AM UTC

cemerick wrote: post #176

glenvdb wrote: post #51

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 regi…

"Bitcoin privacy" is a contradiction in terms, as has been repeatedly proven. You set up a scene of a refugee "storing their wealth in Bitcoin", but it begs the question: where are these refugees with substantial wealth they are looking to exfiltrate? Typical refugees are emigrating from locales where they were earning dollars per day. The use case of shielding hoarded wealth during a journey to a freer locale is a b…

Venezuela

Re: Bitcoin is a Ponzi

#193

Post by jtbayly » Thu, Oct 07, 2021, 4:44 AM UTC

Zamicol wrote: post #140

dvt wrote: post #61

People use BTC/ETH/etc. in exchange for goods . I mean, I'm not a fan of cryptocurrency, but calling it a Ponzi scheme is just wrong. There are plenty of shitcoins out there that are purely pump and dumps, but it seems like BTC is here to stay.

This year Ethereum has so far settled over $6 trillion in value on chain. And the system has revenues. Ethereum did around $35 million daily in fees this last week. Uniswap did around $3 million. https://cryptofees.info/ No doubt there's something to it.

That’s like saying that because people are actually selling shovels and pickaxes there is something to the gold rush.

Re: Bitcoin is a Ponzi

#194

Post by minitoar » Thu, Oct 07, 2021, 4:44 AM UTC

Kranar wrote: post #119

onlyrealcuzzo wrote: post #57

Earlier quoted context omitted.

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

The average P/E ratio of U.S. stocks is 38, meaning if the value of a stock really is primarily based on its ability to produce an external source of revenue, it would take 38 years for an investor to recoup the cost of a share of a company. When you adjust for 2% inflation, it would take 117 years for someone to recoup the cost. Since that exceeds the lifespan of well over 99% of the population, it must follow that…

You don’t need to completely repay the principal to benefit from that cash flow.

Re: Bitcoin is a Ponzi

#195

Post by shaklee3 » Thu, Oct 07, 2021, 4:44 AM UTC

dosenbrot wrote: post #122

sailingparrot wrote: post #52

Earlier quoted context omitted.

> 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.

How about the stock market? Everyone I know that invested in stocks did so hoping to trade it back later on for more fiat than they paid.

This is addressed in the article. As is gold, but it doesn't seem like people read it.

Re: Bitcoin is a Ponzi

#196

Post by BrianHenryIE » Thu, Oct 07, 2021, 4:45 AM UTC

BrianHenryIE wrote: post #173

zacmps wrote: post #163

Earlier quoted context omitted.

I'm sorry, what applications? Besides accelerating global warming there doesn't seem to be anything it's good at.

Commerce.

To be entirely clear, a company I work with accepts Bitcoin, then ships physical products.

Re: Bitcoin is a Ponzi

#197

Post by oingodoingo » Thu, Oct 07, 2021, 4:45 AM UTC

hanniabu wrote: post #154

muglug wrote: post #94

Earlier quoted context omitted.

A very very minute percentage of bitcoin is used in transactions. The vast bulk of it is seen by its users as an investment. And historically there have been Ponzi schemes that allowed people to cash out before the scheme fell apart — but it was always a small minority cashing out.

So no different than gold?

yeah but i’m not going to create a new element on the period table

Re: Bitcoin is a Ponzi

#198

Post by newacct583 » Thu, Oct 07, 2021, 4:45 AM UTC

rufus_foreman wrote: post #182

>> People invest into it because they expect good profits OK yeah that's called an investment. Most people don't invest in stuff they think will be unprofitable. Maybe you're different? >> that expectation is sustained by such profits being paid to those who choose to cash out Profits aren't paid out from Bitcoin. There are no profits being paid out. That's sort of the key difference. Bitcoin doesn't send you a check…

> Profits aren't paid out from Bitcoin. There are no profits being paid out. That's sort of the key difference. Bitcoin doesn't send you a check if you own it.

That's a pedantic evasion. You're conflating profit ("making net money") with dividends or other rent mechanisms. Selling an investment is colloquially "profit taking" too. And you can only sell, on balance, to those entering the bitcoin system.

Re: Bitcoin is a Ponzi

#199

Post by monocasa » Thu, Oct 07, 2021, 4:45 AM UTC

nightski wrote: post #183

People do not invest in USD because they expect a gain? Anyone holding cash is doing exactly this. Because the only rational reason to hold USD instead of spending it or converting it to some other asset/investment is because you think it's value is going to either hold or grow more than other options. If people expected no gain in USD (or inflation) then they would not hold USD and instead choose assets or other inv…

No, people expect inflation of USD, devaluing held dollars.

Re: Bitcoin is a Ponzi

#200

Post by rufus_foreman » Thu, Oct 07, 2021, 4:46 AM UTC

newacct583 wrote: post #198

rufus_foreman wrote: post #182

>> People invest into it because they expect good profits OK yeah that's called an investment. Most people don't invest in stuff they think will be unprofitable. Maybe you're different? >> that expectation is sustained by such profits being paid to those who choose to cash out Profits aren't paid out from Bitcoin. There are no profits being paid out. That's sort of the key difference. Bitcoin doesn't send you a check…

> Profits aren't paid out from Bitcoin. There are no profits being paid out. That's sort of the key difference. Bitcoin doesn't send you a check if you own it. That's a pedantic evasion. You're conflating profit ("making net money") with dividends or other rent mechanisms. Selling an investment is colloquially "profit taking" too. And you can only sell, on balance, to those entering the bitcoin system.

No it is not a pedantic evasion, with a Ponzi scheme, you get sent money. On a regular legally defined basis. That money has to come from somewhere.

Bitcoin doesn't have to send you a check every month or it collapses.