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Ignoring the opinionated part of the title for a moment: because there's money in it, pure and simple. That money comes from the buyers, in a kind of pseudo-Pon

Ignoring the opinionated part of the title for a moment: because there's money in it, pure and simple. That money comes from the buyers, in a kind of pseudo-Ponzi scheme, but it's still the basic motivator for getting involved in ETH.

jonmb 9y ago
That's what got me interested. The tech itself seems cool, but I bought in at $100 because I wanted to sell around $300, which is what I did. I wonder how many people who buy ETH are doing it because they believe in the future of the tech versus just gambling (which is basically what I did). All the hacks and scams involved have kept me away from keeping any money in it long-term.
wakkaflokka 9y ago
This is it. I took some disposable income and invested in ether during the initial EEA announcement. I know little of the fundamentals of ethereum. I bought in at $16, and it's now at $230. Talk about a ridiculous return. Pulled out my principle and some gains, and the rest is along for the roller coaster ride. I'll be the first to admit that I'm probably the type of investor whom people will point to as an example of an ethereum bubble (someone who knows little of the technicals behind ethereum, but is in it 'for a quick buck'). It truly scares me to hear about cases where somebody invests a large portion of their worth into something as volatile as crypto currency.
- MSM 9y ago
  >I'm probably the type of investor whom people will point to as an example of an ethereum bubble (someone who knows little of the technicals behind ethereum, but is in it 'for a quick buck'). I always see "traditional" investors point to this and say "How could you possibly invest money into something you don't fully understand?" I'm personally not invested in crypto at the moment but I can understand the draw- my response is this: When you look through your 401k, how many of those companies are even recognizable? If I were to ask extremely basic questions about any of their financials, could that person speak to them? The answer is almost unanimously "No", but it's completely accepted (beyond accepted really, it's pushed on you) to invest into companies that people don't fully understand, yet shamed if someone takes a gamble on crypto.
  - a_c_s 9y ago
    It would also be unwise to fill a 401k with a handful of stocks because a friend of a friend recommended them. That's why the general advice is for people to fill their 401k's with a few index funds (and chasing average market returns) rather than trying to get lucky by picking the next FB, AAPL or GOOG.
rb808 9y ago
Absolutely, I wish people would call it out as a Ponzi scheme more. A good example is if ETH or some other ccy takes off and BTC withers. What is a BTC worth? nothing. But people are buying it because it'll be worth more in the future. That is the definition of a bubble. Given that the original owners make the money from new entrants - that is the definition of a pyramid scheme.
- dallashoxton 9y ago
  >Given that the original owners make the money from new entrants - that is the definition of a pyramid scheme. By that criteria, any company that undergoes an IPO is also a pyramid scheme.
  - rb808 9y ago
    A company has real assets, and profits that can be distributed to owners. Crypto currencies have neither.
    - dallashoxton 9y ago
      Yes, but what defines a pyramid scheme is its unsustainability from a mathematical standpoint, not necessarily the fact that original owners and early adopters make money off of new investors. I think the latter property is present in almost all financial markets -- the "smart money" phenomenon. I agree that the entire cryptocurrency market is in a bit of a bubble, but to write it all off as a pyramid scheme seems a bit of stretch to me. edit: also, "pyramid scheme" to me is a very loaded term with a specific legal meaning to it as it applies to one single entity, i.e. the person or company operating at the "top" of the pyramid. There isn't really such an entity at the top of the entire cryptocurrency market, so I think it's much more apt to call it an asset or asset class bubble rather than toss around such contentious terms.
- Joeboy 9y ago
  I'm OK with pseudo-Ponzi scheme, but if you just call it a Ponzi scheme them people will assume you just haven't understood the tech. The tech is novel and interesting and even somewhat useful.

jonmb 9y ago

That's what got me interested. The tech itself seems cool, but I bought in at $100 because I wanted to sell around $300, which is what I did. I wonder how many people who buy ETH are doing it because they believe in the future of the tech versus just gambling (which is basically what I did). All the hacks and scams involved have kept me away from keeping any money in it long-term.

wakkaflokka 9y ago

This is it. I took some disposable income and invested in ether during the initial EEA announcement. I know little of the fundamentals of ethereum. I bought in at $16, and it's now at $230. Talk about a ridiculous return. Pulled out my principle and some gains, and the rest is along for the roller coaster ride. I'll be the first to admit that I'm probably the type of investor whom people will point to as an example of an ethereum bubble (someone who knows little of the technicals behind ethereum, but is in it 'for a quick buck'). It truly scares me to hear about cases where somebody invests a large portion of their worth into something as volatile as crypto currency.

MSM 9y ago
>I'm probably the type of investor whom people will point to as an example of an ethereum bubble (someone who knows little of the technicals behind ethereum, but is in it 'for a quick buck'). I always see "traditional" investors point to this and say "How could you possibly invest money into something you don't fully understand?" I'm personally not invested in crypto at the moment but I can understand the draw- my response is this: When you look through your 401k, how many of those companies are even recognizable? If I were to ask extremely basic questions about any of their financials, could that person speak to them? The answer is almost unanimously "No", but it's completely accepted (beyond accepted really, it's pushed on you) to invest into companies that people don't fully understand, yet shamed if someone takes a gamble on crypto.
- a_c_s 9y ago
  It would also be unwise to fill a 401k with a handful of stocks because a friend of a friend recommended them. That's why the general advice is for people to fill their 401k's with a few index funds (and chasing average market returns) rather than trying to get lucky by picking the next FB, AAPL or GOOG.

rb808 9y ago

Absolutely, I wish people would call it out as a Ponzi scheme more. A good example is if ETH or some other ccy takes off and BTC withers. What is a BTC worth? nothing. But people are buying it because it'll be worth more in the future. That is the definition of a bubble. Given that the original owners make the money from new entrants - that is the definition of a pyramid scheme.

dallashoxton 9y ago
>Given that the original owners make the money from new entrants - that is the definition of a pyramid scheme. By that criteria, any company that undergoes an IPO is also a pyramid scheme.
- rb808 9y ago
  A company has real assets, and profits that can be distributed to owners. Crypto currencies have neither.
  - dallashoxton 9y ago
    Yes, but what defines a pyramid scheme is its unsustainability from a mathematical standpoint, not necessarily the fact that original owners and early adopters make money off of new investors. I think the latter property is present in almost all financial markets -- the "smart money" phenomenon. I agree that the entire cryptocurrency market is in a bit of a bubble, but to write it all off as a pyramid scheme seems a bit of stretch to me. edit: also, "pyramid scheme" to me is a very loaded term with a specific legal meaning to it as it applies to one single entity, i.e. the person or company operating at the "top" of the pyramid. There isn't really such an entity at the top of the entire cryptocurrency market, so I think it's much more apt to call it an asset or asset class bubble rather than toss around such contentious terms.
Joeboy 9y ago
I'm OK with pseudo-Ponzi scheme, but if you just call it a Ponzi scheme them people will assume you just haven't understood the tech. The tech is novel and interesting and even somewhat useful.