4 ms·

Should say [2012] in title. This is an old paper that apparently predates the point in time when bitcoin started getting used for this kind of scheme. For examp

• gwern 12y ago
  I think the interest of this is pretty timeless - that such a bizarre gambling/investment subculture could exist at all... And the Pirateat40 example isn't really 'post-modern' but a more standard classical Ponzi where it poses as a possibly-real business: there was considerable doubt among quite a few people about Pirate possibly doing some sort of arbitrage on the relatively inefficient Bitcoin exchanges at the time, and it took the Ponzi growing substantially & Vandroiy making his famous bet against Pirate to make it clear to all and sundry that yes, it really was a Ponzi; after Vandroiy's bet, it might have been 'post-modern' but that period only took a few weeks (months?) and then it folded.
  • javert 12y ago
    I think it's pretty timeless too. But still, I imagine there was a huge shift in this area after bitcoin became more well-known, so the fact that the article comes before that point in time matters. And given bitcoin's reputation, I just assumed the article was about bitcoin from the title. (I say this as someone who is a big fan of bitcoin.) You are right about pirateat40. I was paying attention to it at the time. It was not at all certain that it was a ponzi scheme. However, let me make one comment for other people who may not be so familiar with it. It became completely obvious that it was probably a Ponzi scheme, early enough for people to take their money out of it who didn't want to just gamble. Of course, I admit, that's a subjective analysis.