4 ms·

What makes a Ponzi scheme, a scheme is; a guaranteed profit. Crypto profit is not guaranteed at any time, the criteria is not met thus is not a Ponzi scheme.

spaceisballer 5y ago
For people who minted the new crypto it is. They sell something worth nothing and can pump and dump.
- trixie_ 5y ago
  You missed the point where mining is not free.
dpark 5y ago
Madoff didn’t “guarantee” profit either but was still running a Ponzi scheme. I am not convinced that cryptocurrency qualifies as a Ponzi scheme (the real distinction is that the person at the top knows they’re selling a fraud) but it’s certainly driven by pure speculation.
rvz 5y ago
> at any time. It's really simple. Take for example, Bitcoin: When Bitcoin reaches its next all time high, literally everyone is in (unrealised) profit. However, to get that 'profit' they have to sell it; mostly starts with the few rich speculators at the top of the pyramid accumulating starting to sell and a new fool who buys in late. The next time Bitcoin crashes, the ones at the bottom who bought in late and hold it always lose. Therefore the criteria is met and it is a Ponzi scheme and that is what Bitcoin is really useful for.
- randomhodler84 5y ago
  Ya know, Amazon stock is the same. Is that a ponzi? Maybe it’s a super ponzi because unlike BTC, Amazon can keep issuing common stock, which pays no dividend. BTC is capped at 21M. Non-dividend stock is shuffling funny tokens between investors who hope it will be worth more in the future. So either lots of things are ponzis or maybe they are not ponzis at all, and the definition doesn’t work.
  - hypertele-Xii 5y ago
    The difference is, Amazon apparently performs useful work. Bitcoin is literally an energy-wasting contest.
    - randomhodler84 5y ago
      Consumerism at your fingertips, delivered; or a censorship resistant peer to peer monetary system. I know which does more work for me!

spaceisballer 5y ago

For people who minted the new crypto it is. They sell something worth nothing and can pump and dump.

trixie_ 5y ago
You missed the point where mining is not free.

dpark 5y ago

Madoff didn’t “guarantee” profit either but was still running a Ponzi scheme. I am not convinced that cryptocurrency qualifies as a Ponzi scheme (the real distinction is that the person at the top knows they’re selling a fraud) but it’s certainly driven by pure speculation.

rvz 5y ago

> at any time. It's really simple. Take for example, Bitcoin: When Bitcoin reaches its next all time high, literally everyone is in (unrealised) profit. However, to get that 'profit' they have to sell it; mostly starts with the few rich speculators at the top of the pyramid accumulating starting to sell and a new fool who buys in late. The next time Bitcoin crashes, the ones at the bottom who bought in late and hold it always lose. Therefore the criteria is met and it is a Ponzi scheme and that is what Bitcoin is really useful for.

randomhodler84 5y ago
Ya know, Amazon stock is the same. Is that a ponzi? Maybe it’s a super ponzi because unlike BTC, Amazon can keep issuing common stock, which pays no dividend. BTC is capped at 21M. Non-dividend stock is shuffling funny tokens between investors who hope it will be worth more in the future. So either lots of things are ponzis or maybe they are not ponzis at all, and the definition doesn’t work.
- hypertele-Xii 5y ago
  The difference is, Amazon apparently performs useful work. Bitcoin is literally an energy-wasting contest.
  - randomhodler84 5y ago
    Consumerism at your fingertips, delivered; or a censorship resistant peer to peer monetary system. I know which does more work for me!