4 ms·

I find it rather annoying how the word "ponzi" is being redefined to just mean "shady business". Tether is definitely shady af, but I don't understand the obse

• robbiep 5y ago
  Well the thesis per the article is that unless more cash keeps piling into tether in order to handle withdrawals then tether could collapse, which is pretty much the practical definition of a ponzi - don’t be the last one without a chair when the music stops
  • tofukid 5y ago
    A Ponzi scheme is an investment fund whereby older investors are paid returns from newer investor principle. Tether does not promise any returns. It’s not an investment. It’s a stable coin. It’s traded near $1 to 1 tether. Most traders don’t redeem tethers. They sell them on an exchange when they need to go back to dollars.
    • robbiep 5y ago
      I’m not saying it is or it isn’t. The thesis of the article is that it is, and the reasoning they provide is consistent with the definition of a ponzi scheme. So it’s consistent and your reasoning is no better than theirs until we have more evidence (ie it fails or it becomes the cornerstone of a long lived vibrant ecosystem)
• bhouston 5y ago
  Bitcoin is a ponzi in the classic sense though. There is no underlying value and the price only goes up if more people buy in. A lot of people see the parallels: https://www.cnbc.com/2021/04/23/bitcoin-a-gimmick-and-resembles-a-ponzi-scheme-black-swan-author-.html https://www.cnbc.com/2021/04/23/bitcoin-a-gimmick-and-resemb...
  • ourcat 5y ago
    More people -> Higher Market Cap. -> ??? -> Profit.
  • gruez 5y ago
    "Gold is a ponzi scheme in the classic sense though. There is no underlying value[1] and the price only goes up if more people buy in." [1] it's literally a shiny yellow rock. You can argue that there's some intrinsic value for use in jewelry or electronics, but given the demand breakdown (https://www.statista.com/statistics/299609/gold-demand-by-industry-sector-share/ https://www.statista.com/statistics/299609/gold-demand-by-in...) and the current price, anyone buying right now is going to experience massive losses should a collapse happen
    • kryogen1c 5y ago
      except gold has been valuable for thousands of years and retains value without electricity and internet, none of which are true for BTC.
      • gruez 5y ago
        In other words, gold is a more proven/resilient ponzi scheme
        • RivieraKid 5y ago
          Gold has plenty of use besides speculation - jewelry, decoration, electronics, healthcare.
          • gruez 5y ago
            Covered in the GP comment. >[1] it's literally a shiny yellow rock. You can argue that there's some intrinsic value for use in jewelry or electronics, but given the demand breakdown (https://www.statista.com/statistics/299609/gold-demand-by-in https://www.statista.com/statistics/299609/gold-demand-by-in...) and the current price, anyone buying right now is going to experience massive losses should a collapse happen