4 ms·

Ponzi's themselves are not illegal, but a descriptive term. I think what makes a ponzi scheme illegal is the existence of fraud, or lying about where the return

Ponzi's themselves are not illegal, but a descriptive term. I think what makes a ponzi scheme illegal is the existence of fraud, or lying about where the returns come from, not necessarily where the returns come from.

detaro 5y ago
A descriptive term for a type of fraud.
- runbathtime 5y ago
  Where are the returns coming from? Is it a productive activity? Or are you making returns from others coming in and buying at a higher price? This can describe people pushing stocks not because the business is profitable, but because they say the price will go up. What makes this illegal? I think it comes down to lying or fraud, which is already illegal. What makes crypto interesting is there isn't one person to point to, but everyone out there promoting it is like running their own ponzi because they only profit by convincing someone to buy in a higher price than them. Also in crypto, you can say bitcoin is going to 1 million and it is taken seriously so how do you this a lie? Also, it might get there in the future. It has to be about why the crypto is going up and that is tricky. Can you lie by omission, because in a ponzi if you don't say how the returns come, is that still a ponzi? If you just say, this is going to the moon, and people believe you, is that a ponzi? Ultimately, all legitimate returns (investing) come from productive activity. Gambling comes from ponzi like dynamics. Gambling that the stock goes higher, trading, etc. This is all about returns from other people, not from productive activity of the underlying. I think this ponzi is not illegal as long as there is no lying about where returns come from. Perhaps these activities shouldn't be allowed to use the word investment. Because it is so hard to think about, I don't think it makes since to call them a ponzi. I think it makes since to explain to people you are gambling, not investing, and it will eventually not be sustainable, but crash back to fair value, which most of crypto's case is slightly above zero. I think with crypto there is a lot of misdirection, fraud, lying, but it is very difficult to prove. The SEC can't even figure out what a security is.... Because crypto has no intrinsic value, predicting crazy prices are ridiculous. It is all based on speculation. Most people know there isn't a company behind it making profits and they know that some people got lucky and bought in way lower than them. This is known. What may not be known is basic financial literacy and people who know better that do not tell the truth because they can make more money confusing and pumping crypto to the moon. Most people who know it has ponzi dynamics do not care, most people like ponzis, know the risks, and still want to play. Crypto makes ponzi games more fair.

detaro 5y ago

A descriptive term for a type of fraud.

runbathtime 5y ago
Where are the returns coming from? Is it a productive activity? Or are you making returns from others coming in and buying at a higher price? This can describe people pushing stocks not because the business is profitable, but because they say the price will go up. What makes this illegal? I think it comes down to lying or fraud, which is already illegal. What makes crypto interesting is there isn't one person to point to, but everyone out there promoting it is like running their own ponzi because they only profit by convincing someone to buy in a higher price than them. Also in crypto, you can say bitcoin is going to 1 million and it is taken seriously so how do you this a lie? Also, it might get there in the future. It has to be about why the crypto is going up and that is tricky. Can you lie by omission, because in a ponzi if you don't say how the returns come, is that still a ponzi? If you just say, this is going to the moon, and people believe you, is that a ponzi? Ultimately, all legitimate returns (investing) come from productive activity. Gambling comes from ponzi like dynamics. Gambling that the stock goes higher, trading, etc. This is all about returns from other people, not from productive activity of the underlying. I think this ponzi is not illegal as long as there is no lying about where returns come from. Perhaps these activities shouldn't be allowed to use the word investment. Because it is so hard to think about, I don't think it makes since to call them a ponzi. I think it makes since to explain to people you are gambling, not investing, and it will eventually not be sustainable, but crash back to fair value, which most of crypto's case is slightly above zero. I think with crypto there is a lot of misdirection, fraud, lying, but it is very difficult to prove. The SEC can't even figure out what a security is.... Because crypto has no intrinsic value, predicting crazy prices are ridiculous. It is all based on speculation. Most people know there isn't a company behind it making profits and they know that some people got lucky and bought in way lower than them. This is known. What may not be known is basic financial literacy and people who know better that do not tell the truth because they can make more money confusing and pumping crypto to the moon. Most people who know it has ponzi dynamics do not care, most people like ponzis, know the risks, and still want to play. Crypto makes ponzi games more fair.