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Important note: bitcoin is a ponzi [1] and not digital gold. Learn how the investment fraud works. [1] https://github.com/openblockchains/bitcoin-ponzi https:/

Important note: bitcoin is a ponzi [1] and not digital gold. Learn how the investment fraud works. [1] https://github.com/openblockchains/bitcoin-ponzi https://github.com/openblockchains/bitcoin-ponzi

gillesjacobs 6y ago
No Bitcoin is not a Ponzi. A Ponzi scheme has a very particular set of characteristics. Bitcoin is not even a pyramid scheme. It does not require new buyers for its value to increase. It currently is highly speculative and manic market, possibly a bubble. The quality of your link speaks for itself, it reads like schizoid scribbles.
- thendrill 6y ago
  Uhh.. Where do you think this number that you call "value" comes from? It comes from the crypto exchanges. The value. Is the latest settled sale. So when someone sets a sell price and someone buys at that btc, is when the value is set. So yeh. You absolutely need new buyers for its value to increase.
  - gillesjacobs 6y ago
    Needing new buyers for price to increase is not the definition of a Ponzi scheme. Because that is true for any speculative asset due to the price setting mechanism. Your argument entails that the price of Bitcoin is highly inflated over its fundamental value, i.e. that it is a speculative bubble. Speculative bubbles are very different from Ponzi schemes. A Ponzi scheme has the following definition according to the SEC: >“A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors. Ponzi scheme organizers often promise to invest your money and generate high returns with little or no risk. But in many Ponzi schemes, the fraudsters do not invest the money. Instead, they use it to pay those who invested earlier and may keep some for themselves." Ponzi schemes require a central fraudster to pass on money directly from old to new investors with the underlying asset obfuscatedly held on promise by the fraudster. With cryptocurrency the buyer has control of the commodity, you actually have control of the crypto, there is no promise of a consistent return with little risk, there is no central entity defrauding targets with promises that hold the asset in reserve passing on money directly from new to old investors. What we do have is a speculative bubble which will no doubt be devastating for new investors when it collapses. But the definition of a Ponzi scheme is not met.
    - thendrill 6y ago
      What about the bit coin whales? The btc-e money the Mt gox coins. Satoshish original coins and all the gpu miners pre 2012? There are plenty of people walking around with btc wallets with hundreds to thousands of coins that are basically funny money to them. For every btc price cycle there is more usd and less coins in circulation. Selling off 10 btc at the moment on any exchange would tank the price with about 10k usd....
      - gillesjacobs 6y ago
        > Selling off 10 btc at the moment on any exchange would tank the price with about 10k usd.... That's just not true and I don't even see any reason how it could be. I am looking at the Binance BTC order book and depth chart and 24 BTC sell orders at 56500 just went through. Price is not crashing. Mining and whale centralisation are huge problems and downside in crypto depending on how prevalent it is. I am not saying that Bitcoin is not a dangerous investment, that there it is not a speculative bubble. I am just saying that it does not meet the definition of a Ponzi scheme. There is indeed a lot to critique about the current crypto market but at least make sure the arguments are founded on facts.
        jcpham2 6y ago
        Coinbase moved 400+ BTC in 15 minutes this morning at 7 am ish central time. I know because I had to move my sell orders higher. Y’all are crazy. This is not accurate.
anticristi 6y ago
I thought the real value of Bitcoin is hiding shady deals: drugs, money laundering, etc. Needless to say, there is plenty of that to drive Bitcoin value up.
- hnick 6y ago
  That's a large part of my view on it. Even if no one "believes" in it, and the value essentially freefalls, BTC or something like it is still useful as a short term settlement device in lieu of taking suitcases of cash over a border or similar. You buy the token, send it to someone, they cash it out. People on each side (maybe the same person!) take a cut.
- lrem 6y ago
  Hiding by making a permanent and public record of every shady deal? ;)
- imtringued 6y ago
  You are looking for Monero.
GoblinSlayer 6y ago
>Robert Shiller
mujina93 6y ago
Thank you for the link. The document could benefit from being a bit more polished and have less exclamations, but it contains some useful links and references at the end, such as this interview here, which I found it reflects what the bubble of cryptocurrencies is about: https://amycastor.com/2021/02/11/nouriel-roubini-tether-is-a-criminal-enterprise-sec-should-probe-elon-musks-bitcoin-tweets/ https://amycastor.com/2021/02/11/nouriel-roubini-tether-is-a...
charcircuit 6y ago
By that definition literally all investments are ponzis. You buy something hoping that someone else will be willing to buy it from you at a higher price. Oops the cryptocurrency bubble popped. Oops the company went bankrupt and your stocks are worthless. Oops a natural disaster happened and the house and land lose a lot of value. Oops pokemon is no longer popular and all the TCG cards you have become worthless. Oops the government is no more and your treasury bonds are worthless. Realize that there is always a bubble and take advantage of the bubble while it lasts.
- atleta 6y ago
  Not really. Company stocks indeed do have an intrinsic value: companies pay dividends. Now they can go bankrupt, sure, but that's an independent issue. Indeed the very fact that they can go bankrupt (in which case your stock will probably be worth 0) shows that they have an intrinsic value. So, as opposed to BTC, you don't have to buy it in order to sell it to someone else at a higher price. You can hold it and still make a real profit. (As opposed to the price increase, which you'll only realize if/when you do sell.) And since this is the case, it will mostly anchor the price in the long term to the profit (dividend) making capabilities of the stock. So no, it's not always a bubble. You could argue that 'fiat' money is a ponzi/bubble but that also has intrinsic value (as the issuing central bank/government will stand up for it, e.g. force every merchant to accept it, you can pay taxes in it, etc.). But if you say that gold is a similar ponzi/bubble, then your probably right. While gold also does have intrinsic value (for its usage as a base material e.g. in electronics), its price is, as far as I can understand a lot higher than what that use would guarantee. (We use relatively little compared to how much we keep in safes.)
  - charcircuit 6y ago
    >companies pay dividend Not all companies do that though. $GOOG has no voting rights nor dividends yet is worth more than $2100. It does literally nothing as far as I can tell, making it useless compared to even something like bitcoin. Despite this, you could have made a lot of money by just buying the stock years ago and selling it now. >You can hold it and still make a real profit That would take 33 years to happen with the stock that currently has the highest yield assuming that yield is constant over those 33 years which is probably a bad assumption. Who wants to get a profit 33 years in the future? If I could not resell it, it would be worthless to me. With cryptocurrency you can also yield farm to make some money while you are just holding by essentially loaning them and having interest paid to you.
imtringued 6y ago
Yes, Bitcoin is a ponzi scheme that collapsed 4 times. The problem is that people will bet that there will be more ponzi schemes to come in the future.

gillesjacobs 6y ago

No Bitcoin is not a Ponzi. A Ponzi scheme has a very particular set of characteristics. Bitcoin is not even a pyramid scheme. It does not require new buyers for its value to increase. It currently is highly speculative and manic market, possibly a bubble. The quality of your link speaks for itself, it reads like schizoid scribbles.

thendrill 6y ago
Uhh.. Where do you think this number that you call "value" comes from? It comes from the crypto exchanges. The value. Is the latest settled sale. So when someone sets a sell price and someone buys at that btc, is when the value is set. So yeh. You absolutely need new buyers for its value to increase.
- gillesjacobs 6y ago
  Needing new buyers for price to increase is not the definition of a Ponzi scheme. Because that is true for any speculative asset due to the price setting mechanism. Your argument entails that the price of Bitcoin is highly inflated over its fundamental value, i.e. that it is a speculative bubble. Speculative bubbles are very different from Ponzi schemes. A Ponzi scheme has the following definition according to the SEC: >“A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors. Ponzi scheme organizers often promise to invest your money and generate high returns with little or no risk. But in many Ponzi schemes, the fraudsters do not invest the money. Instead, they use it to pay those who invested earlier and may keep some for themselves." Ponzi schemes require a central fraudster to pass on money directly from old to new investors with the underlying asset obfuscatedly held on promise by the fraudster. With cryptocurrency the buyer has control of the commodity, you actually have control of the crypto, there is no promise of a consistent return with little risk, there is no central entity defrauding targets with promises that hold the asset in reserve passing on money directly from new to old investors. What we do have is a speculative bubble which will no doubt be devastating for new investors when it collapses. But the definition of a Ponzi scheme is not met.
  - thendrill 6y ago
    What about the bit coin whales? The btc-e money the Mt gox coins. Satoshish original coins and all the gpu miners pre 2012? There are plenty of people walking around with btc wallets with hundreds to thousands of coins that are basically funny money to them. For every btc price cycle there is more usd and less coins in circulation. Selling off 10 btc at the moment on any exchange would tank the price with about 10k usd....
    - gillesjacobs 6y ago
      > Selling off 10 btc at the moment on any exchange would tank the price with about 10k usd.... That's just not true and I don't even see any reason how it could be. I am looking at the Binance BTC order book and depth chart and 24 BTC sell orders at 56500 just went through. Price is not crashing. Mining and whale centralisation are huge problems and downside in crypto depending on how prevalent it is. I am not saying that Bitcoin is not a dangerous investment, that there it is not a speculative bubble. I am just saying that it does not meet the definition of a Ponzi scheme. There is indeed a lot to critique about the current crypto market but at least make sure the arguments are founded on facts.
      - jcpham2 6y ago
        Coinbase moved 400+ BTC in 15 minutes this morning at 7 am ish central time. I know because I had to move my sell orders higher. Y’all are crazy. This is not accurate.

anticristi 6y ago

I thought the real value of Bitcoin is hiding shady deals: drugs, money laundering, etc. Needless to say, there is plenty of that to drive Bitcoin value up.

hnick 6y ago
That's a large part of my view on it. Even if no one "believes" in it, and the value essentially freefalls, BTC or something like it is still useful as a short term settlement device in lieu of taking suitcases of cash over a border or similar. You buy the token, send it to someone, they cash it out. People on each side (maybe the same person!) take a cut.
lrem 6y ago
Hiding by making a permanent and public record of every shady deal? ;)
imtringued 6y ago
You are looking for Monero.

GoblinSlayer 6y ago

>Robert Shiller

mujina93 6y ago

Thank you for the link. The document could benefit from being a bit more polished and have less exclamations, but it contains some useful links and references at the end, such as this interview here, which I found it reflects what the bubble of cryptocurrencies is about: https://amycastor.com/2021/02/11/nouriel-roubini-tether-is-a-criminal-enterprise-sec-should-probe-elon-musks-bitcoin-tweets/ https://amycastor.com/2021/02/11/nouriel-roubini-tether-is-a...

charcircuit 6y ago

By that definition literally all investments are ponzis. You buy something hoping that someone else will be willing to buy it from you at a higher price. Oops the cryptocurrency bubble popped. Oops the company went bankrupt and your stocks are worthless. Oops a natural disaster happened and the house and land lose a lot of value. Oops pokemon is no longer popular and all the TCG cards you have become worthless. Oops the government is no more and your treasury bonds are worthless. Realize that there is always a bubble and take advantage of the bubble while it lasts.

atleta 6y ago
Not really. Company stocks indeed do have an intrinsic value: companies pay dividends. Now they can go bankrupt, sure, but that's an independent issue. Indeed the very fact that they can go bankrupt (in which case your stock will probably be worth 0) shows that they have an intrinsic value. So, as opposed to BTC, you don't have to buy it in order to sell it to someone else at a higher price. You can hold it and still make a real profit. (As opposed to the price increase, which you'll only realize if/when you do sell.) And since this is the case, it will mostly anchor the price in the long term to the profit (dividend) making capabilities of the stock. So no, it's not always a bubble. You could argue that 'fiat' money is a ponzi/bubble but that also has intrinsic value (as the issuing central bank/government will stand up for it, e.g. force every merchant to accept it, you can pay taxes in it, etc.). But if you say that gold is a similar ponzi/bubble, then your probably right. While gold also does have intrinsic value (for its usage as a base material e.g. in electronics), its price is, as far as I can understand a lot higher than what that use would guarantee. (We use relatively little compared to how much we keep in safes.)
- charcircuit 6y ago
  >companies pay dividend Not all companies do that though. $GOOG has no voting rights nor dividends yet is worth more than $2100. It does literally nothing as far as I can tell, making it useless compared to even something like bitcoin. Despite this, you could have made a lot of money by just buying the stock years ago and selling it now. >You can hold it and still make a real profit That would take 33 years to happen with the stock that currently has the highest yield assuming that yield is constant over those 33 years which is probably a bad assumption. Who wants to get a profit 33 years in the future? If I could not resell it, it would be worthless to me. With cryptocurrency you can also yield farm to make some money while you are just holding by essentially loaning them and having interest paid to you.

imtringued 6y ago

Yes, Bitcoin is a ponzi scheme that collapsed 4 times. The problem is that people will bet that there will be more ponzi schemes to come in the future.