[popol12]

This. Plus, if you deposit Eth on Aave, it's not for the 1% returns but because it then allows you to borrow other coins which you can use somewhere else in DeFi, where it can bring you much higher returns (convex/curve for instance). I'm amazed that this guy wrote such a big article on a topic he obviously doesn't fully understand.

[roywiggins]

The problem is that every Ponzi insists that their critics just don't understand their special sauce that generates their phony returns.

[max48]

The problem is also that people are using the word "ponzi" to describe every investment they think is bad and/or don't understand. offering high rates doesn't automatically means it's a ponzi. With the definition that some of you are using here, literally every single bank, currency, edge fund and all publicly traded companies would be a ponzi.

[kangnkodos]

I think it's a good rule of thumb to assume that anyone who guarantees returns greater than the historical return of the S&P 500 is a ponzi scheme.

I don't know of a single reputable bank, hedge fund or publicly traded company that does that.

A huge number of places do have high returns from time to time. But any reputable firm points out that past returns do not guarantee future results. No reputable firm guarantees returns that high in the future.

The key is the guarantee.

Anyone who GUARANTEES returns that high in the future is suspect, and therefore must be more transparent than usual in order to clear the bar. The article indicates that Celsius was less transparent than usual in describing exactly how they made their high returns.

[roywiggins]

Celsius does say "While Celsius strives to maintain stable reward rates over time, any change in circumstances may bring about changes to such rates, and in some events the rates may drop to 0%" deep in their Risk Disclosure.

https://celsius.network/static/risk-disclosure.pdf

Which is a bit odd- there's no chance you might lose money? How are they making money without risking that the return might drop below 0?