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Bitcoin is a Ponzi

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Re: Bitcoin is a Ponzi

#221

Post by nprz »

zacmps wrote: post #163
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.

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

Pseudonymous, censorship-resistent, permissionless, peer-to-peer. Many people in authoritarian or monetarily irresponsible countries use these features to protect, store, and transfer their wealth[0].

[0]https://www.theguardian.com/technology/2021/jul/31/out-of-co...

Re: Bitcoin is a Ponzi

#222

Post by zekrioca »

iplaman wrote: post #68

Bitcoin is now being considered as official currency in Brazil where the author is. It will be interesting to see how this develops https://timesofindia.indiatimes.com/business/cryptocurrency/...

I don’t think this will pass there.

Re: Bitcoin is a Ponzi

#223

Post by anonporridge »

Imnimo wrote: post #105
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 percentage of the current value of Bitcoin do you believe is driven by demand from people with that outlook?

Who cares? Whenever this bull run stalls and crashes, people who don't think this way will sell out thinking the party is over.

Meanwhile, the total number of people who view bitcoin as a permanent allocation in their asset portfolio will have increased drastically, and they'll keep on stacking sats.

Each boom bust cycle operates this way. A minority of new investors become true believers, and the rest of the chaff wash away in the crash.

Re: Bitcoin is a Ponzi

#224

Post by chasebank »

ChainOfFools wrote: post #170
lpa22 wrote: post #11

> They generally invest in gold as a hedge -- a "store of value" -- that they hope will retain its value in case other assets go sour. I strongly believe bitcoin will be the new gold one day, if it doesn't pan out as a currency. It sounds insane, but I actually believe the Winklevoss twins when they say Elon and SpaceX will be able to mine gold on asteroids within the next 20 years, which would crash the price of gol…

> Elon and SpaceX will be able to mine gold on asteroids within the next 20 years, which would crash the price of gold. what would be their incentive to do it, then?

Well, if the cost of mining is less than the value of the gold, I’d imagine there’s plenty of incentive.

Re: Bitcoin is a Ponzi

#225

Post by [deleted] »

qaq wrote: post #89
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…

Generally people participating in a Ponzi scheme do not view it as such. The tactics deployed by truly oppressive regimes make anything easy to confiscate including bitcoin.

[deleted]

Re: Bitcoin is a Ponzi

#226

Post by sb057 »

chowchowchow wrote: post #184
hanniabu wrote: post #154

Earlier quoted context omitted.

So no different than gold?

It’s clearly argued that since a majority of demand for gold is from non-investors it doesn’t fit the definition..

Roughly 50% of gold's demand comes from private investors and central banks, with another 40% of demand being driven by (para-investment) jewelry.

https://www.gold.org/goldhub/data/gold-supply-and-demand-sta...

Re: Bitcoin is a Ponzi

#227

Post by lalaland1125 »

glenvdb wrote: post #160
justapassenger wrote: post #129

Earlier quoted context omitted.

I find it very manipulative to use people suffering as an excuse to pump speculative assets. Sure, there’s very tiny amount of people who use Bitcoin as you described. But so there’re people who get benefits from smoking.

I find it very manipulative to offhandedly dismiss the utility it provides to people suffering under oppression or unstable financial systems and to compare that to smoking. As the article states, check your financial privilege. And "tiny amount of people"? What's "tiny" here? Hundreds, thousands, millions? Do you know how many people use Bitcoin in this way?

> Do you know how many people use Bitcoin in this way?

Do you?

Re: Bitcoin is a Ponzi

#228

Post by gretch »

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 hold cash because they can get things done on short notice. Like if a storm blows over your fence, you can write a check and have it replaced. If you held stocks, bonds, or real estate, you’d have to sell that asset and withdraw cash to get your fence back up which is pretty unacceptable.

I hold cash knowing full well that I’m bleeding due to inflation, but the versatility is well worth it. That’s pretty much everyone who is holding cash other than a small handful of forex traders speculating on USD vs euros or whatever

Re: Bitcoin is a Ponzi

#229

Post by [deleted] »

tw04 wrote: post #191
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…

[deleted]

Re: Bitcoin is a Ponzi

#230

Post by topspin »

baby wrote: post #136
topspin wrote: post #36

Earlier quoted context omitted.

The crucial difference that excludes Bitcoin (and any other such blockchain currency) is that a Ponzi scheme deceives investors by pretending it is profitable and the profits are derived from legitimate investments. Bitcoin et al. does not do this; there is no deception, no fraud and, therefore, no Ponzi.

Wait what? Are you saying you don’t get spammed by people who tell you it’s going to the moon?

That claim has been and is made about all manner of financial instruments and most of that isn't Ponzi either. To be a Ponzi scheme you need the fraud; "it's safe, legitimate, consistently profitable investment backed by high quality equities with little to no risk, and it's going to the moon!" That's a Ponzi Scheme. Bitcoin doesn't claim to be a low risk AAA investment vehicle.
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