You're moving the goal posts. It's fine to be against cryptocurrencies, but I think it damages your credibility when you claim bitcoin is a ponzi scheme. Since it shows a lack of understanding of what a ponzi scheme actually is. By you I don't mean you in particular, I mean it in a more general sense.
We can argue about what constitutes a proper Ponzi scheme, but the idea that the promotion of crypto thus far has existed to allow early adopters to cash out at the apparent expense of later adopters, while bringing essentially no other utility to any of its backers or the public at large, is pretty obvious.
That’s just semantics at this point. I would encourage you to address the statement being made and ignore the technical definition of the phrase. To restate without the offending phrase:
[T]he idea that the promotion of crypto thus far has existed to allow early adopters to cash out at the apparent expense of later adopters, while bringing essentially no other utility to any of its backers or the public at large, is pretty obvious.
And the semantics matter. When we are using words that mean specific things. Other wise why even care what words we use? Just throw something and expect everyone automatically understand.
I wasn't trying to debate the merits of crypto. I'm pointing out that the parent has a clear misunderstanding of what a ponzi scheme is. The semantics is the whole point. He's using the word incorrectly.
By your definition, every successful stock on the planet is a ponzi scheme
I double checked and no one in our comment chain has said anything about legality at all, or even implied same, so you pointing that out as the defining distinction is not really relevant, don't you think? Besides, pump and dump schemes of securities are illegal, though notably most crypto is in the grey area because the SEC doesn’t classify it as a security.
It's a bit of a shortcut. It implies that cryptocurrencies like bitcoin and ethereum don't fulfill the necessary criteria to be deemed a ponzi scheme. If we look at all the red flags mentioned in the wikipedia article.... I shortened some criteria, for a more detailed explanation of each criterium I suggest you check the Wikipedia article.
High investment returns with little or no risk. --- Not true.
Overly consistent returns --- Not true.
Unregistered investments --- True in some cases, not true in others.
Unlicensed sellers --- same as above.
Secretive or complex strategies --- Not true.
Issues with paperwork --- Not true
Difficulty receiving payments --- Not true. Actually irrelevant.
The sales personnel or adviser are overly pushy or aggressive. --- Not true. Actually irrelevant. Not bitcoin or ethereum sales personnel or advisers exist.
The initial contact took place by a cold call or through a social network, a language-based radio or a religious radio advertisement. --- This one is a tough one since there are definitely devotees that likely were vital in the initial spread. In most cases people probably came into contact with crypto through the mainstream media though.
The client cannot determine the actual trades or investments that have been carried out. --- Not true
The clients are asked to write checks with a different name than the name of the corporation (such as an individual) or to send checks to a different address than the corporate address. --- Not true. Actually irrelevant.
Once the maturity date of their investment arrives, clients are pressured to roll over the principal and the profits. --- Not true. Also irrelevant.
A Ponzi scheme (/ˈpɒnzi/, Italian: [ˈpontsi]) is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors.[1] The scheme leads victims to believe that profits are coming from legitimate business activity (e.g., product sales or successful investments), and they remain unaware that other investors are the source of funds. A Ponzi scheme can maintain the illusion of a sustainable business as long as new investors contribute new funds, and as long as most of the investors do not demand full repayment and still believe in the non-existent assets they are purported to own.
> The scheme leads victims to believe that profits are coming from legitimate business activity (e.g., product sales or successful investments), and they remain unaware that other investors are the source of funds.
I think that's the key part that contradicts Bitcoin. Nobody believes that Bitcoin is a business that generates profits, and everyone is aware that when they cash out, other investors are the source of funds.
There's no illusion of a business, and no assets that are promised to exist but don't.
Do you need to crack it if the government can be a majority hashrate of the miner pool? One need not crack it to control it. You'd be able to double spend, mine empty blocks, orphan blocks from other miners, etc. Just need to get to and sustain 51% of the hash pool, which sounds trivial considering nation state compute resources.
I see no scamming in say Link (bringing offchain data on-chain for other projects to use) or SNX (on-chain synthetic assets). There's a ton of examples of projects that have nothing to do with scams and are more akin to normal companies providing blockchain-related services.
That may be true, but I was looking for positive outcomes from the industry as a whole. Of course there are companies like metamask as well that just provide services within the crypto industry.
Alchemix, Axie Infinity, Balancer, Aave, Pool Together, DyDx, Sorare.
Hundreds more too, I list them in most of these threads and yet every time, same question. The amount of people who confidently proclaim crypto does nothing useful without actually looking into the cool things that are happening is getting old.
