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Bitcoin is a Ponzi

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441–450 of 684 posts

Re: Bitcoin is a Ponzi

#441

> Nevertheless, investing in gold at the current price seems unwise, since its price is many times its "natural" price as commodity and so it is more likely to go down than up. This is a misconception and a fundamental misunderstanding of gold's primary utility for thousands of years. While it is true that gold's price reflects a significant premium beyond the "natural" market price, this has been the case for millen…

Some people will never change their minds. They've made their choice and changing their mind would be more painful than not. Bitcoin could be the world reserve currency and the same people would still say it's a scam. Ultimately, who cares? The world is changing with or without them.

Probably true. On another note, I see Impervious.ai in your post history. I've never been able to wrap my head around what they're building. If you're willing, I'd love if you could point me to any good learning resources.

Re: Bitcoin is a Ponzi

#442
post #293

In a Ponzi scheme, a fraudulent perpetrator takes your money (and the money of many others), gives some of that to early dropouts but takes the rest for himself . Ponzi schemers profit from lying to you where your money goes. With a decentralized digital asset there is no sole person or company that profits from just lying to you about where your Dollar goes in exchange for digitals. Sure, miners and exchanges make p…

> With a decentralized digital asset there is no sole person or company that profits from just lying to you about where your Dollar goes in exchange for the digitals. Ponzi schemes don't have to run by single individuals, but perhaps by multi-person organizations like the mafia. The mob was the reason the RICO laws came to be. And undoubtedly, the mafia organizations would collaborate to break up their crime into reg…

That's interesting. Can mobs sue each other for anticompetitive practices?

Re: Bitcoin is a Ponzi

#443
post #384

Earlier quoted context omitted.

I’m sorry but what? Was this in the US? Because the intro was “oppressive regime,” and then you gave an example of an oppressive regime, and now I’m realizing you might very well be in the US. I’m just shocked; never considered this could happen. Was this related to your employer, and… Well, I should just ask rather than guess :) thank you for sharing, and I’m really sorry that happened. One of the best decisions I’v…

I’ve thought of doing this, but how would it work if you have a normal day job? Can you have your job pay you through the LLC?

That’s sadly the catch. I’m sorry — I completely forgot to mention that this works for me because I’m consulting, so businesses pay my LLC rather than me.

However, I will say that one business wanted to hire me full time, and I refused and asked for a higher consulting rate, which they agreed to. So it’s not impossible for your next job to end up similarly.

But then you don’t get benefits (my wife’s health insurance covers us both), sick days, and you probably have to log hours (to my surprise). So even if it’s more lucrative for me right now, there are definite reasons this path isn’t suitable for everyone.

Definitely consider it if you can swing it though. And also, you can simply invoice yourself for services rendered from your LLC, which effectively transfers money from your personal account to the LLC. I’ve had to do this to bootstrap funds into the account (since your balance starts with $0, which is useless).

The problem is tax. There are two issues. One is that an LLC is a pass-through entity. That means all profits are expected to pass through immediately to your personal account, or used immediately on business expenses. If you try to maintain a $20k balance for a year, for example, you’ll discover that this balance counts against your deductions for that tax year (effectively a negative $20k deduction). Or at least that’s my understanding so far.

Therefore, as with most things, you should ask an accountant for advice. But that’s an unsatisfying answer. My answer was going to be, therefore, you can create a C Corp instead of an LLC, and transfer some of your personal funds into that (by invoicing yourself).

The problem (argh, they never end) is that the income will be taxed for the Corp, and then taxed again when you pay from the Corp back to yourself. This is precisely the “double taxation” problem that LLCs were designed to solve!

The reason it still might make sense is because of all the incredible benefits of setting up your own company. For example, merely opening a Mercury account at all means you can redeem $5k of aws credits. $5k! I’ve done this! To my surprise, it happened!

And that’s just one of like 80 Mercury perks. There are so many, and it’s been so much fun window shopping through them all. It’s how I wound up using quickbooks for example.

Plus you’ll have an account that people can wire money to. Mercury has a nice little PDF with all your wire transfer details. It feels like driving a Tesla, whereas US Bank was like not having a car at all. (It was truly one of the worst business banking experiences imaginable. They even managed to lose an incoming $10k wire transfer. Nonsense like that simply doesn’t happen with Mercury.)

So there’s a brain dump of pretty much everything I’ve learned over two months of studying this. The takeaway is that if I had a day job, I would set up a C Corp and transfer a few grand to it by invoicing myself. (No, I wouldn’t use stripe atlas. That’s $500. You can do it yourself for $50, and it’s been surprisingly painless. Both Missouri filing and the IRS EIN were entirely online, so you don’t even have to mail anything.)

Just, uh… perhaps consider it a side hobby. This kind of nerdiness is uniquely fun to me. I imagine that it’s incredibly un-fun for most people. Treating it as a hobby helps overcome that pain, and the risk turns out to be minimal. I was surprised by that.

Re: Bitcoin is a Ponzi

#444

Lol at most of HN thinking Bitcoin is a ponzi and the fractionally reserved US dollar monetary&banking system is not. It's been over a decade guys, try opening your eyes and your minds or you're going to go down with the ship.

The difference is USD is backed by the U.S. government. Bitcoin is backed by nothing.

Bitcoin is backed by nothing but math.

Re: Bitcoin is a Ponzi

#445

Earlier quoted context omitted.

I got involved in bitcoin after being blackballed from the (US) financial world while for 2-3 months while I was "investigated" in the most dystopianly opaque way possible. One day I lost the ability to transact. A few months later I got it back. Had it not been for good friends who could cover my expenses, I could have easily ended up homeless. And the most shocking part of it all, was that I was merely collateral d…

That sounds absolutely terrible. Were you ever able to take legal recourse?

How would a liar be able to take legal recourse for something that didn't happen?

Re: Bitcoin is a Ponzi

#446

Earlier quoted context omitted.

I got involved in bitcoin after being blackballed from the (US) financial world while for 2-3 months while I was "investigated" in the most dystopianly opaque way possible. One day I lost the ability to transact. A few months later I got it back. Had it not been for good friends who could cover my expenses, I could have easily ended up homeless. And the most shocking part of it all, was that I was merely collateral d…

To begin with, let me say I'm very sorry this happened to you, and I think it sounds like an example of a really broken system. This should never happen to someone randomly, and I think you should have been compensated a lot for the troubles and stress it must have caused you. However, I think we should be careful with drawing the conclusion that technology for circumventing our institutions' ability to regulate alto…

Nope, we don’t want central democratic control over who can transact. We want no control.

Re: Bitcoin is a Ponzi

#447

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…

Nope, people do not hold USD because they expect a gain. They are willing to pay the inflation penalty because holding the dollars in question provides them something. Generally that means either a sense of security or liquidity on short notice. Holding dollars is paying a fee for liquidity.

[deleted]

Re: Bitcoin is a Ponzi

#448

Earlier quoted context omitted.

I got involved in bitcoin after being blackballed from the (US) financial world while for 2-3 months while I was "investigated" in the most dystopianly opaque way possible. One day I lost the ability to transact. A few months later I got it back. Had it not been for good friends who could cover my expenses, I could have easily ended up homeless. And the most shocking part of it all, was that I was merely collateral d…

To begin with, let me say I'm very sorry this happened to you, and I think it sounds like an example of a really broken system. This should never happen to someone randomly, and I think you should have been compensated a lot for the troubles and stress it must have caused you. However, I think we should be careful with drawing the conclusion that technology for circumventing our institutions' ability to regulate alto…

Calling that control “democratic” is a bit of a stretch.

Plus, anonymous physical cash transactions have been the status quo forever

Re: Bitcoin is a Ponzi

#449

In a Ponzi scheme, a fraudulent perpetrator takes your money (and the money of many others), gives some of that to early dropouts but takes the rest for himself . Ponzi schemers profit from lying to you where your money goes. With a decentralized digital asset there is no sole person or company that profits from just lying to you about where your Dollar goes in exchange for digitals. Sure, miners and exchanges make p…

Rarely is it one person doing all the lying in a Ponzi scheme. Commonly they're labeled as multi level marketing, which then encourages more people to lie.

And I disagree that bitcoin proponents doesn't claim they make your money with for you: there's a lot of talk about the "deflationary nature" of bitcoin, aka the "magical scheme". Miners haven't burned all the money invested in bitcoin, but I'll admit this particular scheme has an unusually high cost of business, for a Ponzi scheme.

Most victims of a Ponzi scheme believe they're investing in something that will earn them money in the long run, otherwise they wouldn't have fallen for it.

Bitcoins long-term value is clear by examining it's usefulness: it's a tulip, at best.

I'll also freely admit that bitcoin is by far the most cleverly disguised Ponzi scheme yet, it's nature will probably only be obvious after the inevitable collapse.

Re: Bitcoin is a Ponzi

#450
post #74

Earlier quoted context omitted.

> Blame financial news media, things like Fortune magazine's list of new crypto billionaires. The crypto financial news community was writing about this long before Fortune picked it up.

financial news media is a superset of the crypto financial news media; my statement remains true

Okay, so what you're saying is that the crypto community is what pushed crypto in that direction.
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