As an occasional bitcoin holder, I don't think it's a Ponzi scheme. Who's the Ponzi schemer? How come every time it collapses it comes back bigger in a year or two?
It's not a Ponzi scheme. It's a multi-level marketing or pyramid scheme. A percentage of every sale (transaction fees) of crypto goes to the other coin owners of the crypto. For every crypto coin it works slightly different.
For Bitcoin, the original design was that everybody could be a miner and (potentially) receive transaction fees. Now it's in the hands of a few with the computing power.
70% of Bitcoin holders bought in last year. A continuous stream of greater fools is necessary for its price to even remain at the current level
Also, every ponzi scheme gives amazing returns, before it inevitably collapses. For example Madoff was able to give decent returns to his investors for 17 years! 'Number go up' is not a refutation of a ponzi scheme.
Yeah but with a Madoff/Ponzi scheme the thing collapses, Madoff goes to jail, it ends. Bitcoin seems more like other assets that don't make things, stuff like fiat money, gold, fine art and so on.
> stuff like fiat money, gold, fine art and so on.
This comment is a great example of how little bitcoin enthusiasts tend to understand about investing. One of this things is very much not like the others.
"Fiat currency" is virtually never used as an investment asset. Even in the FOREX market you purchases pairs of currency rather than just a big pile of dollars. In your 401k when you want to go all "cash" you very often end up choosing investment vehicles that track cash.
The entire function of a currency is as a medium of exchange, it only has value in the process of exchanging. It makes no sense, at the individual investor level, to 'hold' dollars.
If you don't understand how a fiat currency differs from gold and fine art then you absolutely should not be "investing" in bitcoin.
> A continuous stream of greater fools is necessary for its price to even remain at the current level.
I think HN is going to need a good explanation for this. The value is intrinsic, and can go up without any activity happening... I think there are other fools scouring about here in the comments.
I think it comes back bigger each time because more people get involved. From a handful of tech geeks at the start to maybe 100m people this time around.