Bitcoin Forum

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I would really like to get to the bottom of this question in an objective debate.

I have added a poll so that readers can express their subjective opinion without my censorship. The objective answer to this question is in the objective logic debated in this thread. Objectively the poll is a measurement of the level of delusion and mania, as to whether it agrees with the objective arguments made in the thread. Those who can't make objective arguments will vote only. This level of measured delusion and mania can serve as further evidence of the ponzi scheme, e.g. for the authorities.

Since this is a self-moderated thread, please review what I think it is the objective difference between objectivity and subjectivity (https://bitcointalk.org/index.php?topic=336350.msg3658759#msg3658759).

http://en.wikipedia.org/wiki/Ponzi_scheme


The only aspects of the above definition that could possibly be argued to not fit to Bitcoin are the words "fraudulent" and "operators". I will objectively argue that the early adopters are the "operators" and also that the operation is no less "fraudulent" than any other typical ponzi scheme.

The gains of earlier investors come from the investment of later investors, because the Bitcoin operation generates no cash flow nor profit for investors. There are threads devoted to charting and promoting the very high (12x per year?) exponential trendline price gains (https://bitcointalk.org/index.php?topic=322058.msg3627236#msg3627236) of Bitcoin. The perpetuation of high returns requires an ever-increasing flow of money from new investors to sustain the scheme.

http://www.coolpage.com/commentary/economic/shelby/bitcoin.jpg (https://bitcointalk.org/index.php?topic=322058.msg3627236#msg3627236)

The fraudulence arises from the realization that the large investors in Bitcoin can not deny the facts of this post. It is implausible they don't realize the true qualities of what they are promoting to later investors.

http://www.sec.gov/answers/ponzi.htm


If we equate "organizers" with "operators", the characteristics added by the SEC definition are "with little or no risk". I can cite numerous comments throughout the bitcointalk threads where owners of Bitcoin claim the infallibility of the Bitcoin model for growth.

Bitcoin is amalgamation of some characteristics of a pyramid aka multi-level marketing scheme and all characteristics of a ponzi scheme. Specifically the earlier owners of the Bitcoin, promote the low-risk or no-risk and high-gains benefits to later investors.

I don't objectively see how this can possibly be refuted. I am interested to see what others can say.

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I have presented some detailed logic (https://bitcointalk.org/index.php?topic=339876.msg3649398#msg3649398) for why for as long as Bitcoin is not widespread in the population, it can not function effectively as a currency. And the chicken-and-egg dilemma conclusion of that presented logic is that it will be ponzi scheme for as long as it is not a currency, and it will not be a currency for as long as it is a ponzi scheme.

We all love the concept of a decentralized currency and we all want it to succeed.

So what is the actual problem here?

If you work out the above linked logic in your mind, then objectively the problem is that in order for investors to exit without converting to fiat and thus driving the exchange price down in a stampede, the coin needs to be a widespread currency so that the investor can exit by investing the coin directly without ever converting it to a fiat.

See the problem is that when you invest in a company, that company needs to pay its costs in a currency and people in general can only use a currency that is accepted by all merchants. And I am not just talking about esoteric merchants applicable to our current demographics, but everything down to the fish vendor carrying a bucket outside my nipa hut in the mountain in this third world country where I reside. Okay maybe actually we would be fine if our coin was merely accepted by a significant minority or simple majority of developed country merchants, assuming most investors in bitcoin reside or invest only in developed markets.

The problem is that in order for merchants to accept bitcoin, there needs to be a demand from their customers. And thus we need our coin to be distributed to significant portion of the world's population.

But Bitcoin is highly concentrated among the wealthy investors, probably controlling 90+% of the coins (https://bitcointalk.org/index.php?topic=323988.msg3570144#msg3570144). Note when analyzing the linked data, please don't argue that offchain services storing everything in one coin distorts the data, because I see for example that localbitcoins provides a separate address for each user and some users have wallets with 100s or 1000s of addresses, so if anything the data is skewed towards making the concentration appear to be less worse than it is.


How can that concentration possibly be resolved. If the investors sell for fiat it plummets in price, and if they try to use it as a currency, they can't possibly get enough economy-of-scale to divest more than a sprinkling of coins, because Bitcoin is not a widespread currency. But it can't become a widespread currency until it is widely distribution. Again another catch-22 or chicken-and-egg dilemma.

The only way I see for a coin to solve this dilemma is to be widely distributed from mining. And Bitcoin can't do this, because it is dominated by ASICs (no one with a PC can mine effectively) and it stops asymptotically at 21M coins. In fact, half the coins were awarded in the first 4 years, and 75% in the first 8 years, and 87.5% in the first 12 years, and 93.75% in the first 16 years.

Let the discussion begin.

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Edit: Not limiting the supply of coins to 21M has no downsides and has other benefits too:

reserved

No, mania/bubble yes... Ponzi scheme not really...

Refute the definition of a Ponzi scheme objectively. Otherwise you have not presented an objective argument, just a subjective opinion.

If you want to be taken seriously, you must argue it as a lawyer would, focusing on the legal definition of it.

Because only the legal definition is going to save your arse when it comes to prosecution time.

Remember that every ponzi schemes impoverishes most of the investors and only a few escape. Thus either you lose everything, or if you are one of the unlucky few to cash out then you gain a very big legal culpability if this is a ponzi scheme.

Bitcoins can be compared to commodity, or any real word objects which have increased in value. It's openly and freely traded inside the technical limitations. No dividends are paid by any authority. All the profits come from appreciating perception of market value.

For it to be ponzi I would require there to central authority  or a system which clearly moves money from new investors to old investors. This is not the case.

You're basically just pointing at nature and saying everything is a ponzi scheme.

It's not guilty until proven innocent, if you're begging for rebuttal then at least argue why it's fraudulent beyond empty circular logic.

Logic fail.

It is not objectively correct to claim that everything in nature fits the definition of a ponzi scheme.

Ponzi scheme is a certain kind of fraud/scam... I limit the use of term for certain group of investment operations. Bitcoin just doesn't fall under these.

I'm not saying that early adopters don't have possibly unfair and unreasonable advantage in bitcoin. Which might be it's downfall...
Point is that everyone knows how much there is currency out there and can make judgements based on this knowledge.

As far as I can see, you did not refute the definition of a ponzi scheme.

There is no tangible commodity. It has no intrinsic value if it is not a currency. The only value it has is the value from later investors following earlier investors. Thus it fits the definition of a ponzi scheme.

The definition doesn't say the operators or organizers must be centralized.

The system clearly moves value from later investors to earlier investors.

Dividends are paid the miners. Mining is somewhat monopolized by large capital somewhat due to ASICs requirement and pools. But any way this point is irrelevant, as it is not required by the definition of a ponzi scheme. I quoted two definitions in the OP.

as listed on https://bitcointalk.org/index.php?topic=268955.0
Bitcoin 101 Blackboard - Why Bitcoin is Not a Ponzi Scheme - Debunking Bitcoin Myths
http://www.youtube.com/watch?v=7u4F8cpzqao&list=PLzctEq7iZD-7-DgJM604zsndMapn9ff6q&index=2

Is the stock market a ponzi scheme then?

And by that I don't mean the dividends paid by the companies. But the notion of ever increasing value based on possible future performance. Which is often much higher than the value of companies holdings...

"no intrinsic value if is not a currency"


The Department of Justice said Bitcoins can be “legal means of exchange” at a U.S. Senate committee hearing, boosting prospects for wider acceptance of the virtual currency.


Nov. 18 (Bloomberg) -- The Senate Committee on Homeland Security and Government Affairs meets on virutal currencies in Washington. U.S. Senator Tom Carper, a Democrat from Delaware, the Treasury Department's Jennifer Calvery, the Justice Department's Mythili Raman, and Bitcoin Foundation Inc.'s Patrick Murck comment. (Excerpts. Source: Bloomberg)
Enlarge image Bitcoins

“We all recognize that virtual currencies, in and of themselves, are not illegal,” Mythili Raman, acting assistant attorney general at the Justice Department’s criminal division, said at the hearing.


Seems the assistant attorney general believes it is a currency,  therefore can not be part a ponzi scheme by definition.

I can only process your posts so fast, this one takes more time because I have to watch a 23 minute long video and pause it to write down his points, because you did not.

Thanks for sharing that, because it helped me refine all the reasons why Bitcoin is undeniably a pyramid+ponzi scheme. Slam dunk!


Points made:

1. Bitcoin is not owned by anyone.
2. Not being advertised by an owner.
3. Panic crashes in price are bankruns because Bitcoin is a currency
4. Crashes are less likely to happen in future because liquidity will increase
5. Ponzi schemes require con men and secrets
6. Ponzi schemes require complete lack of transparency
7. Ponzi scheme is a zero-sum game with mostly losers
8. Those who cash-out often end up in jail
9. Direct investment not through a con man is not ponzi
10. The early investors are so excited they don't cash out soon
11. The early investors spread the word to later investors
12. Con man shows fake certificates (truth is secret) of account balances
13. Some bad news causes a stampede
14. Con man has run away with the money
15. Bitcoin is 100% transparent
16. Early adopters cashing out is not a zero-sum game, Satoshi selling would just cause temporary drop in price

If the man who produced that video owns Bitcoin then he is a con man as follows.

Follows are my rebuttals correspondingly numbered.

1. This is not a required in the definition of a ponzi scheme.
2. It is being promoted by the early adopters.

3. Bitcoin is not a currency because it is not accepted every where that currencies are. You don't say pesos are a currency in the USA. You convert to dollars because dollars are a currency, even though perhaps a few places in the USA might accept your pesos. Yet this is irrelevant, because panics have nothing to do with doubt about reserves in a bank's vault. Panics are because there is no intrinsic value and everyone is looking at everyone else to see who will be the first one to stampede. Subconsciously everyone knows the value is dependent on not many people selling and many more people buying, because if the momentum of the price gains slowdown, the reason to invest is gone. Some of the owners are misinformed and think there is way Bitcoin could become a currency, because they haven't though deeply about the concentration of the distribution of the coins as I documented in the OP. Thus the price doesn't drop to 0, because the uninformed owners believe in something that doesn't exist. But one day they will become wiser as they see that Bitcoin isn't close to being a currency even many years from now. This myopia is equivalent in effect to the secrets a con man hides from the investors.

4. As the price rises higher and higher the early adopters have more and more incentive to exit, because the larger their holdings become in fiat value, the more impossible it is for them to ever cash out. Also as I explained in #3, more and more of the investors will realize it is not becoming a currency, meaning inability to divest by investing the BTC directly in a business instead of converting to fiat. OTOH, more and more later investors will rush in, thus indeed liquidity could increase and it must else the price gains can't continue. But one day, there simply won't be enough later investors to come in, either because many have realized what the end game is, or because there aren't any more out there in the world with sufficient wealth to invest in it. In either case, then the price can't continue growing, so then the stampede must ensue. And then there will be no reason to buy low, because everyone was already in. And the masses will lose everything in this stampede to those few who cash out. And so who will buy it low? The few won't buy it low, because they know no one else can buy it, because they are all bankrupted. If Bitcoin will be owned by most investors in the world, then this will destroy the world. This is why ponzi schemes are so incredibly evil and dangerous. This is different from a stock, because a stock has intrinsic value to due earnings, profit, cash-on-hand, talent of management, talent of employees, contracts, etc..

5. It is apparent from #4 that all the destructive effects of a ponzi scheme doesn't require a centralized con man, neither do the definitions I quoted in the OP. And in effect the early adopters who are promoting this system are con men. The secrecy in Bitcoin is the myopia the gullible later investors have when they are told certain buzzwords, e.g. "decentralized", "anti-government", "better than gold because supply is limited 21M coins", etc.. These buzzwords along with the lack of aptitude among most people, cause their brains to feel good and they love the price gains, so they don't pay attention to the facts of this thread. The con man relies on the same gullibility when he gets the investors to believe certain buzzwords, e.g. "international postage stamps arbitrage" as Charles Ponzi did and the investors did not verify it is no different than spinning buzzwords at the Bitcoin investors and they don't verify the logic.

6. Transparency is not required, rather Ponzi schemes only require the investors are too lazy or gullible to check on whether there is an intrinsic value or not.

7. Bitcoin is zero-sum at the terminal velocity as explained in #4. It is important to understand that those who cash out take out more than they put in, due to the illusion of price gains. See #12 for why price gains are an illusion.

8. Indeed they do end up in jail. And Bitcoiners who cash out will also in my opinion end up in jail, because so many people will be wiped out by Bitcoin. Note this hinges on Bitcoin not becoming a currency which I explained why it can't in the OP and I reiterated in #3 why it is not a currency. But I am sure we will debate this more downthread.

9. Handing your money to an earlier adopter instead of handing to a centralized con man, does not change any of the dynamics of the ponzi outcome described in #4. I have refuted the secrecy and transparency points above. I will also address the fake accounting in #12.

10. Ditto in Bitcoin.

11. Ditto in Bitcoin.

12. Bitcoin exchanges lie about your balance. They seem to imply that you can sell for a certain price, but the float is only about 0.1% of the market cap, meaning only about 0.1% of the money in Bitcoin can get out any where near the current price. Slam dunk!

That proves this is not a currency and it is no where nearly similar to a bank account!

You can't argue that is okay for stocks so it should be okay for a currency, because as I explained in #4, stocks have an intrinsic value. Bitcoin has no intrinsic value because it is not a currency. Yet if it were a currency, then exchanges wouldn't lie about your account balance. It can't be both ways. If 90+% of Bitcoin wasn't concentrated in a few hands, then the exchange markets would have orders-of-magnitude higher float and liquidity, and thus it could be both a currency and an investment. I suggest a fix in the OP.

13. Ditto in Bitcoin.

14. As explained in #4, those who cash out run away with all the money. It is important to understand that those who cash out take out more than they put in, due to the illusion of price gains. See #12 for why price gains are an illusion.

15. I have explained above why it is not effectively 100% transparent. For example in #12, there is no way to know what your balance is. And in #5 how the psychology of later investors is manipulated causing the truth to be opaque to them. Also this point is irrelevant because in #6, I explained why transparency is not required for a ponzi scheme. The definitions of a ponzi scheme in the OP don't require transparency.

16. Refuted in #4.

I refuted the transparency point in my prior post. It is quite long but well worth the read I think.

The fraudulence is those who cash out are not myopic and are aware of the end game outcome, that is why they cash out and forsake more "astronomical gains", because they realize what the end game is.

See points #4 and #12 in my prior long post. You are comparing apples-to-oranges.

Gold and silver are a legal means of exchange, yet they are not currencies as evident by the fact that you pay capital gains in the USA and VAT in Europe. You better be paying your capital gains on Bitcoin spends in the USA and VAT in the UK.

You do not pay capital gains nor VAT any where in the world (on a gain in the value of the currency) when you spend the legal tender currency.

So they have not declared Bitcoin to be a currency. The "virtual currencies" is a euphemism for "we are trying to decide what the f$ck this is, but it seems like virtual and some of the users think it is a currency".

It would be better described as a Pyramid scheme, which is similar to but distinct from a Ponzi scheme.

The main distinction is that Pryamid schemes are normally decentralized or at least the 'center' is constantly in motion, were as as Ponzi scheme always has it's money flowing through one individual which is the linch-pin of the whole thing.  In a sense the rebuttal that BTC is not a Ponzi because it is decentralized it true, but this not mean it is not a scam, it's just a different kind of scam.  Believe it or not humans invented decentralization before Peer-2-Peer software and have used it for scams for a long long time, but naivete people always thinks that anything with the glow of Technology on it is new and revolutionary and none of the obvious lessons of history apply.

Most Pryamid schemes involve a recruitment quota for each new member both directly and indirectly as their recruits recruit more in an exponential growth.  Eventually people who reach the quota are automatically cashed out and the Pyramid they were in fissions as the 2nd Tier members become the next in line to be cashed out when their pyramids reach completion.  Another key distinction is that while a Ponzi scheme always involves the ringleader lieing about what they are doing, a Pyramid scheme often WILL disclose EXACTLY how it works to everyone involved, after all in a decentralized system everyone needs to know the 'DNA' of the scam to perpetuate it.  The problem is that  greed and a lack of 'categorical imperative' (aka failure to think about the systemic effects of everyone acting some way) in most people moral thinking allow them to blithe-fully engage in the Pyramid activity without actually believing it is fraudulent.  You would be appalled at the simplicity of some of the pyramids people will engage in, shit like "recruit 10 people each of which gives you $100 then they recruit 10 people each", literally it can be that simple on it's face.  So the overall attitude of 'it's not fraud because I understand it' that comes from BTC folks is very much like what we would expect in a Pryamid scheme.

BTC modifies the Pryamid scheme by allowing early adopters to never cash out, but instead keep watching their unrealized gains pile up as long as they can delay their gratification.  It even has a way to move up in a sense, if you buy more BTCs you can feel like one of thouse early adopters too.  The real key here is the mining model of exponential decay that guaranteed early adopters would always have the most coins and later adopters (mining or buying) would face a shortage.  The speculative bubbles have just been the icing on the whole thing, even without them the long term trend reflects the pyramid growth as more people are recruited and thouse already in ante up more money so as not to be 'left behind'.

Lastly this was all wrapped in an incredibly slick marketing package by Satoshi, the combination of cryptographic anonymity, libertarianism and gold-buggery was the perfect sell to a generation of disgruntled internet mouth breathers.  More then all the technical details the way it was sold as 'digital gold' was the most fraudulent part.  Satoshi even claimed the declining mining curve was 'like gold' which is a complete lie, annual gold production as been climbing for centuries not declining, so the choice of a decay curve is for one thing only to make a guaranteed profit for early adopters.

Do you even stock bro?

My trading account gives me a total balance of all the securities I hold using their current market value rather than an amount I could actually get for all of them. OMG YOU'RE RIGHT THEY MUST ALL BE PONZI SCHEMES!

I agreed in the OP:


I also concur with the other points you made and you stated them more eloquently or lucidly than I did.

One of the first flaws that stuck out to me like a sore thumb was Satoshi comparing Bitcoin's declining coin rewards to gold. I smelled immediately a scam. Good to see you saw that too.

I guess we are the only two guys who don't lack of 'categorical imperative' morals on the entire forum here?

That would be a very sad statement about humanity if that is the case. Should you and I join the Illuminati and be done with the cattle then? Or is there hope for us to save them from themselves?

As usual, you fail to read and comprehend the point made upthread.

#4 and #12 point out that stocks have intinsic value and Bitcoin doesn't if it is not a currency. Thus you can't compare this to stocks. Your bank account that holds your currency doesn't give you a market balance.

Really basic 101 things that were never explained in the Bitcoin wiki.

Really? I have a Canadian bank account which as it happens quotes me a balance in both Canadian and US dollars. What do you suppose the odds are that if I walk into my bank tomorrow morning and ask for all my cash in US dollars that I get the exact amount quoted tonight?  

Point 4 doesn't prove bitcoin has no intrinsic value, it assumes it.
Kinda like how point 12 "points out" that a market balance is clearly fraud.

Converting from one currency to another is not spending a currency. When you spend a currency, there is no exchange price. That is a key factor of why one currency always dominates an economy. Imagine if you were paid in dollars but had to purchase your food in Bitcoin. You would go crazy trying to plan your budget, due to exchange volatility.

The OP explained that you can't divest Bitcoin by spending it, not in large size at least. Thus your only option for spending it (in most cases) is to convert it to fiat.


Point #3 discusses why it is not a currency as well other posts in this thread.


I never wrote that market balance = fraud.


Of course stock markets provide market balances. But bank accounts do not, not when you are spending your money on goods and services. That is why comparing stocks to currencies is a strawman.

You can't at the same time argue that Bitcoin is a currency, then tell me I must convert it through a market balance to another currency before I can spend it (in most cases).

And this is why you can't withdraw your balance without losing some of its value, at least if your balance is larger than the current market float.

Unlike a bank account, I can withdraw my balance at full value without worrying about whether the spot-market balance reflects my true account value or not.

As point #12 explains, this is critical when defining a pyramid or ponzi scheme, because not knowing your account's true balance (you can't until you actually sell it on the market) means Bitcoin is not 100% transparent. It can't be 100% transparent.

@anonymint

thanks for your efforts with the list,
i'll read through when my brain's a bit fresher.
also i have to read through the killswitch thread.
very interesting...will post soon

Oh sorry AnonyMint, I skimmed your OP too lightly and missed that statement of yours.  Still I would argue that BTC is fully Pyramid in it's nature and not Ponzi.  Both Pyramids and Ponzi's are sustainable only by exponential growth, but in the key areas they differ (central vs decentralized), (one promoter, many promoters), (facts of investment hidden, facts disclosed truthful) each aspect of the Prymaid matches BTC perfectly while the Ponzi scheme dose not.

BTW I added an expansion of my 2nd Paragraph in my first post that deals with the information disclosure differences in Ponzi vs Pryamid situations.

I would best describe BTC a a pyramid scheme with tech-stock bubble overtones and ideological promotions, and I'd advise you to refine your critic of BTC in this manor because it will be more effective.  BTC defenders can and do point out several of these distinctions like lack of centralization which the average person dose associate with a Ponzi scheme.  Thus when you call BTC a Ponzi your argument will be easily undermined by this rebuttal, if you argue it is a pyramid the average person (once they know what a pyramid scheme is) will be far more likely to see the similarity and the standard BTC promoters well trained Ponzi rebuttal will fail.

Their is a good reason that FAQ for Bitcoin go out of their way to have "Is BTC a Ponzi scheme" and why every promoter has virtually memorized and can parrot a rebuttal to the Ponzi accusation, so they can essentially knock down a straw man and thus put the prospective adopter at ease because most people lack the sophistication to realize their are more types of scams then just Ponzis.  But they NEVER dare to breath the word Pryamid because their really is NO defense they can mount to that.

Also I'll give your poll a yes vote because I agree with your general opinion but I would have preferred 'some other kind o fraud' as an option.

You should tell my credit card issuers that. Whenever I use my Canadian credit cards to import goods or services from the US, some seemingly randomly marked up number of Canadian dollars ends up on my bill!

Your argument is a red-herring. Bitcoin can be a valuable internet currency without being anyone's primary currency.

Good advice.

You didn't answer whether we should give up join the Illuminati instead?  :-\

You very confident we can win against this mass mania?

Well frankly your fighting a Balrog here, but you might as well use a fork rather then a spoon.

I personally don't try to save the whole forum from itself, like the Catcher in the Rye I just look for thouse who want to be saved and try to invite them to Freicoin.

The float between all national currencies is sufficiently large that the exchange rate doesn't move 1200% per year and 20% in a day, as it does with Bitcoin. Usually a few % at most per day only. Thus your fiat account balance is still fairly accurate as converted to foreign fiat currencies.

I wrote upthread that if we could better distribute a coin and get a larger float then we could get closer to calling that coin a currency. This is impossible with Bitcoin because of the ASICs and the 21M limit.

There is no mechanism in Bitcoin that can lower the concentration of the coins (at least not significantly enough to matter). You expect to give yours away to help solve the problem? Selfishness and greed was the problem from the very moment Satoshi pitched the gold lie about the coin supply curve.

P.S. We don't do most of our commerce in foreign fiat currencies, and when we do decades from now, there will be a single currency for the world. That is the whole point of why we have to fight against a failed outcome. The elite have a plan and Bitcoin is part of it.

I think this is correct strategy. See from the poll that some percentage understand, and they are the ones we should save, because they will run the economy after all the rest destroy themselves.

We are doing our part here to explain it to those who want to be wise and join "us".*

Of course I am joking about joining the Illuminati, because that is enjoining failure too. We must provide a decentralized solution that works well for those who are worth saving.

*Note I am not currently involved with Freicoin in any way.


I edited the poll question to include "pyramid".

I added this to the OP.

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Edit: Not limiting the supply of coins to 21M has no downsides and has other benefits too:

Logic fail.

Although I wish that was true, I already pointed out that it can't be true until BTC is a currency, but there is no way for BTC to become a currency, because it can't be deconcentrated and dispersed.

I do appreciate the sentiments, and that is why I offered a solution that would meet your goals.

You are conflating your hate towards the system, with the fact that Bitcoin doesn't help you, because Satoshi designed it to fail. You've been hoodwinked but you are letting your hate of the system obscure your objectivity on the fact that Bitcoin was designed to suck all your system-haters into a scam that destroys you.

Very clever who ever dropped Bitcoin out of the sky.


I agree with most of that, but if you think China's elite are any better (they are different but not better) than Western elite, you have a painful lesson coming to you.

You need to also wakeup and stop being so gullible and naive.

You are only 1/8 awake. You haven't reached the level of awareness that Impaler and I have.

yes if you change a few words bitcoin matches a bit better the definition of a ponzi, that doesn't mean it is one.
Changing a few words for a fiat currency would make it match a ponzi definition too, do it with the Zimbabwe fiat!


Now  even with your little tricks one part of the sec definition remain ineffective with bitcoin



It is quite obvious that if you stop putting money in bitcoin the price of a bitcoin will simply have no sense anymore because nobody will want to buy. But also nobody will want to sell.
That doesn't mean that the bitcoin network would stop.

This has been proven true in the past, bitcoin already survive sevral big depression with less poeple on board willing to put less money for quite a long time. Bitcoin did survive to this when a ponzi would colapse.

Bitcoin might collapse, but it certainlly won't collapse only for the reason that poeple stop putting money in it.



Finally you make the assumption that bitcoin is a currency or that bitcoin must be a currency to succeed or that bitcoin holder "want it" to be only a currency and this is a false assumption until you proved it.

See the posts by Impaler. He lucidly explained Bitcoin matches better a Pyramid than Ponzi, which I had also included in the OP. Read again the title of the thread.


Absolutely not. Hyperinflation is nothing like the mechanism of a Ponzi scheme. That is very sloppy analysis to conflate those two very different mechanisms.

In hyperinflation, the central actor is increasing the supply forcing all the users of the currency to race faster to unload the depreciating currency.

In Ponzi (or Pyramid), the later investors are bringing in all the money to pay the gains of the early investors.

If you don't see that Cat is not Horse. Then I can't help you.


Nonsense. The 90+% concentration of coins in a few hands, tells you that people are not investing in Bitcoin to use it for spending. They are investing for gains. And if gains stop they will exit. Here I quote an investor (a "friend") who owns 10,000 Bitcoins:



That is precisely the reason it will collapse and not come back up again. But we are a long ways from that. Appears the elite and the media are pushing it. It will likely reach $trillions in market cap with all of the liberty lovers in it before it collapses in a ball of fire stampede to the exits.


I am sorry to hear you can't follow the logic on why it isn't a currency and why that means no one can exit.

Lets do a little simple math as follows.

Joe invests $100 to buy all the BTC from Satoshi on day 1, all of BTC is worth $100
Sally invests $1000 to buy 10% of BTC from Joe, all of BTC is worth $10,000

Joe wants to withdraw his $9000, but there is only $1100 invested in BTC.

You see if they can't spend it as BTC, then it is never worth the level of cash that was brought in.

You see most people can't do math in their head. They need to see it.

So now you see it.

It cant possibly be a ponzi scheme because it goes against the definition.  There is nobody in charge that is payign you extra money.  It is pure supply and demand.  It could bubble like the tulip bubble, but bitcoins are very convenient, so I doubt it.

Repeating:


It is not like a tulip bubble, because tulips have intrinsic value. I hear they are still very valuable today.

Why do I need to keep repeating that Bitcoin has no intrinsic value if it is not a currency.

And there is no way to deconcentrate it from the current 90+% of BTC is in a few hands. Thus it can't be a widely accepted currency, because it is not widely held and can't be widely held. By the time 1% of the global population has purchased, it will be priced on the order $30,000+ and then the other 99% won't be able to afford to get much BTC at all. You say that is okay, but it means you impoverish the rest of the world relative to early adopters so the velocity of money would collapse, because very rich people spend a much smaller % of their money than middle class people. The 99% will never go for that arrangement, they will stick with fiat and then the collapse of Bitcoin's bubble will ensue and the stampede to the exits with all trampled and value lost.

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the Worldwide Financial System as a whole is a Pyramid/Ponzi  !!!!!

a lil example on interrest rates

If Joseph in the year zero, had laid in  One cent  on the imaginary bank of Jerusalem, at five percent interest, after 15 years would be due to him two cents,
after 29 years, four, after 53 years  8 cents. One hundred years later, his descendants would then be able to withdraw € 1.11 and after 250 years,
there were already about a thousand euros ...

In 2000, out of the One cent would finally become  2 times 10 ^40  (2.000.000.000.000.000.000.000.000.000.000.000.000.000 euros).
Extrapolating this amount into gold, so Joseph's descendants would be entitled to 436 billion globes of pure gold! Corresponding large the debt would be to the other.

Curious what intrisic value these tulips had/have???

I saw a post on it yesterday but I can't find it now. It was saying they collapsed from the peak bubble price to equivalent of $1200 in today's money if I am not mistaken.

Interest does indeed concentrate wealth to the lenders.

And debt is eventually unpayable if total debt grows faster than productivity.

And debt can be expanded faster than the supply of base money would allow by employing fractional reserves of any base money, whether it be fiat, gold, or Bitcoin. For example, I've heard that Ripple is fractional reserves of Bitcoin.

So having a pyramid ponzi scheme in the base money doesn't help! It makes it worse.

We need the decentralization, but we also need to deconcentrate the distribution of the coin.

We need to do that with capitalism and not socialism, i.e. not just giving away coins for nothing. Impaler might disagree with me on this point.

I explained how in the OP.

this might Help

http://www.youtube.com/watch?v=s0K65v_V8Sg

Okay done. Whew need a cold shower! So freicoin's demurrage is the "hamster tax".

Now I remember that demurrage is not socialist, because no one gets the tax, it is sent to ether. It is taking away a little bit of coin from everyone who doesn't spend the money regularly. The point is to keep the velocity high, and it penalizes savers and rewards the spenders. And not spending from debt, so don't conflate this with Walmartization and overconsumption.

Whereas I proposed continuing the coin rewards and making proof-of-work only work on CPUs.

Actually both concepts could be combined.

They both help deconcentrate distribution in different ways. Demurrage by pushing the coin to move, which means more people being paid in the coin, and my idea means more people can download the miner and generate coins on their PC.

Actually appears my idea is more important initially, because we can't spend the coin if there aren't many merchants and thus we need to widely distribute the coin as first.

Btw, I recently wrote that I expect we need both fiat and decentralized coin. I will find my post and quote it back here.

Edit: can't find that post. My reason is that we can't always be anonymous and a decentralized coin will never survive if it isn't anonymous, because the government is going to destroy it by attacking the people using it if they can identify them. There will be two parallel economies, the anonymous one and the fiat one that you pay taxes on.

Since the motivation behind Bitcoin is not fraudulent, it fails to meet the definition of a Ponzi scheme.  You may have grave doubts about the wisdom of investment in Bitcoin.  You may regard the anti-state idealism of its early adopters as unwise.  But you can never call it a fraud so its not a Ponzi scheme.

That isn't logical.

It is like saying since the motivation (idealism) is to reach the top of Mt. Everest, that you can necessarily do it barefoot. Bitcoin is like barefoot, it doesn't get you to your ideals.

Come on guys. Use your noggin.


It has nothing to do with the investment. It has to do with destroying our only chance to defeat the NWO.

The Bitcoin pyramid+ponzi is going to hand everything to the elite (government) on a silver platter.


That doesn't make any sense. I want to have a decentralized coin that will accomplish the idealism. Bitcoin is a Trojan horse designed to fool you into thinking it will, but in reality it is designed to destroy all of you and your idealism.

Read the entire thread and learn.


I proved it is fraud. Read the thread.

Its clear that you believe in the NWO nonsense.  I don't.  To me, Bitcoin is an interesting social experiment.  I mined a couple of thousand in 2011 just to see what could be done.  I got the cost back with a tax write off so its been lucrative as well as being interesting.  The whole idea that there is a shadowy group that already controls the world economy and politics decided to overturn the existing economic order with Bitcoin is just laughable.

That is not an argument against whether Bitcoin is a ponzi or pyramid. You are going off-topic (although I'm guilty of mentioning).

Pyramid schemes are interesting social experiments? Would you like to tell that to the judge when asks why you were promoting a pyramid scheme here?

I see you got coin rewards from mining in 2011 when it was CPU-only (i.e. not required to buy extra hardware), so you don't care that others can not do the same now because mining is now ASIC-only.

You got yours, so screw the rest of the world. You haven't addressed the point that Bitcoin is not a currency, because the coins can't be reasonably distributed throughout the population. Thus it can't have an intrinsic value, and thus it is a pyramid scheme with apparently you as one of the early adopters who is profited on it and promoting it.

Nothing wrong with profit and promotion, if not a pyramid scheme. Can you refute the logic presented?

I am now deleting new posts which repeatedly ignore Impaler's posts and the thread subject, which clearly state Bitcoin is a pyramid or ponzi.

If you only argue it is not a ponzi, you are repeating what has already been debated several times in the thread already.

Your challenge is to argue how it is not a pyramid scheme.

We don't need more "me too" noise posts. We need solid objective debate that hasn't been already covered upthread.

Your aggressivity does n t help any debate and makes you look like a overconfident-i m right kind of fools....
Now when i send 10 000€ to a foreign contry and pay 600euro charges with fiat, and almost 0 with bitcoin some wealth is saved along the way that justify a valuation for the all system?
When i save my monney into a currency that is inflated to hell only to serve the ambitions of a few politician/bankster wishes i feel quite bad.
When i save it to a neutral network like bitcoin i feel much better and richer, the sadness saved along the way justify some valuation.

What you describe with your joe exemple is the how arbitrary a market valuation is but i still fail to understand how this is different to fiat valuation or stock valuation...
But maybe my king fail to understand it too.

Quote me being aggressive? I think I am just refuting and agreeing depending where I see the facts to be. That is called debate.


Agreed that is nice, but transaction fees won't necessarily stay low (https://bitcointalk.org/index.php?topic=340686.0) in Bitcoin. Undoubtedly they must increase as coin rewards diminish, and if coin rewards did not diminish and Bitcoin was CPU-only, then the pyramid problem would be solved and transaction fees would remain low forever.

So why not fix it? Why are you defending an inferior coin design?

And this is rarely used feature (as a portion of Bitcoin's market cap) is not a reasonable justification for running a pyramid scheme that will destroy most of the investors.


Me too! Damn it!


You won't feel richer when the pyramid scheme collapses and you lose all your value.


What about the future sadness you are going to feel when the pyramid scheme collapses and your only chance to main a solution was wasted on the wrong coin design?


Because stocks have an intrinsic value. See point #4 in my post on page 1.

Bitcoin has no intrinsic value. Yeah maybe those occasional transfers are nice, but they are not something you do every day. Every day you are still using that dirty, nasty fiat. And Bitcoin can do nothing to change that. And Bitcoin will waste the chance to change that. And instead make all us of bankrupt in a pyramid collapse of epic proportions exceeding the Tulip Mania.


I hope I can convince you to change your vote and support a better coin design. And help us save the world and improve the world.

Pyramid schemes are indeed illegal when they promote something with no intrinsic value. Do you want me to cite convictions for you?

The difference is (and this is the 10th time I've repeated this!) is that Bitcoin has no significant intrinsic value if is not a currency.

Those other tangible assets you mentioned do have an intrinsic value.


Agreed that is neat. And I want to keep that. But we could improve the coin design so that it actually becomes a real currency and not just niche.

Why not do that?


An altcoin could do that. Bitcoin can't, it has no intrinsic value for the reasons I have detailed in the OP and in my numerous posts in the thread.

That is not what I mean by an altcoin. Litecoin does nothing to fix the currency distribution problem, because it is not CPU-only (being dominated by GPUs) and coin rewards diminish and transactions fees will rise. All the same stupid design decisions that are in Bitcoin.

We would need an altcoin specifically designed to be better.


It would need to be better, and also probably extraordinary.

But we refuted that networking effects nonsense already in the The Problem with Altcoins (https://bitcointalk.org/index.php?topic=279650.msg3495695#msg3495695) thread.

What network effects? Bitcoin ain't a currency. And given a liquid exchange, the altcoin can do everything Bitcoin can do, even seamlessly with a single click for FX and spend in one step.


Bitcoin community will never agree to perpetual coin rewards that never diminish.

Sorry Bitcoin can't be fixed.


Bitcoin developers refuse to change the coin supply curve and make transaction fees low forever.

And the ASICs existing miners will never let Bitcoin be changed to CPU-only. Impossible to fix that in Bitcoin. Too late.

They will not listen.

Sorry.

Ponzi is locked in by the developers who control Bitcoin.

Also the community doesn't understand this. And so the community doesn't know to rally for this change.

Much easier to just make an altcoin.

Those who mine and buy that altcoin will become incredibly rich when the BTC runs to the altcoin as it becomes clear that the altcoin is becoming a currency faster.

I wrote Pyramid, not Ponzi since Impaler corrected me upthread.

You agreed it is a pyramid didn't you?


Changing your vote would be motivational to the people who are developing that altcoin.

Is Bitcoin a pyramid or not objectively?

Okay my mistake. I get lazy to type "Pyramid+Ponzi" because of the Pyr is slower for me to type.


Actually I wrote in the OP it is amalgamation of Pyramid+Ponzi. It has the decentralized participants of the pyramid and the later investors providing all the gains for earlier investors of the ponzi, with no income and no intrinsic value.

Pyramid schemes usually don't sell the stock of the pyramid, but I think some do. So that is why it is a ponzi-pyramid.


I see it can never scale as a currency, thus it has no value to you once the gains stop. Thus you and everyone else will exit and the value will go to near 0. Because only a very small fraction of the market cap is using it for spending.

This can't change, because Bitcoin isn't designed to distribute out to the masses to get them involved in spending it.


And also for a zillion other things that masses use currency for, because once you put in their hands, you've created a market for the merchants to sell to.

Bitcoin can never do this, see the distribution concentration table in the OP. Then note that all mining is ASICs only. And coin rewards are diminishing. Which means you can't get coins out to the masses in exchange for securing the network.

And the double-whammy is this means transactions fees will rise, thus killing off the few uses as currency.

Thus NO INTRINSIC VALUE WHATSOEVER going forward.


No we can do much better.

Why are you so defeatist?

You are not a programmer (?) so you don't realize what we can do.

So what back twitter? If everybody wants to sell their tweeter stock, what would be the value of a tweeter stock?
Tweeter as more debt than asset then would the value be 0 as your exemple sugest? Clearly not. A tweeter bond would have NO value as if nobody sells, nobody buys!
Would tweeter stop to be if nobody was
Willing to buy a tweeter bond? No idea, maybe

I wrote on page 1:



Investors see value in their existing software. That have a huge codebase already.

Their huge userbase which can be marketed to, because Twitter is not decentralized. You can't market to Bitcoin users from the public ledger.

Etc..

No way for Bitcoin to generate an income. It must be a currency, else it has no intrinsic value.

So then why do you assume we can't program a better coin design?

You know that software is highly unlimited.  The creative mind is the only limit.


Okay good you found a niche use of Bitcoin. But that is not helping make Bitcoin a currency for the masses who need a currency to buy food, to pay bills, etc.. every day stuff.


No we don't agree. 99% of the market cap of Bitcoin is for investment gains and not for spending.

Thus there is only 1% intrinsic value as a currency (or something roughly in that range, maybe only 0.01%).


It will prevent the future price from collapsing to a low intrinsic value which in Bitcoin is 1% or 0.01% of its current value.

By distributing the coin to the masses for mining, to drive merchants to accept it for everything.

And it will do one more thing which helps you.

Bitcoin is sending the coin rewards for mining to 0 over time. Thus transaction fees must rise a lot to compensate for the loss of coin rewards. Thus in the future, you may not be able to cost effectively use Bitcoin for transactions, because the fees will be so high.

I propose to keep the coin rewards (but not too high) forever and don't allow ASICs to mine only PCs (personal computers), so that we distribute the coin to the masses who already have a PC. And so the merchants will become so numerous.

And so we replace the dollar. And we make a beautiful world.

Actually I think more of parallel economy to the dollar, not replace it, but replace much of it. Much more of it than Bitcoin can.

Then we agree to disagree if you think investor invest in tweeter for any other reason than increasing or protecting their wealth.

You assume that Bitcoins are actually/ will be mined to be spent.

One would argue by recent hoarding by Chinese, Bitcoins will end up more like a digital gold, a wealth hoarder, a finite supply yet ability to transact at low cost, so with built in benefits.

Gold has no intrinsic value either per se, it is not valued by how much electricity it conducts, however for something to have intrinsic value, it needs to carry moral value first, imo.

You could argue the mere fact the bitcoin has no interference from the Government (at this stage) that it morally has substance, therefore it does have intrinsic value to the current holder/hoarder.

 

 

 

I didn't disagree with that.

I said the value can't go to 0, because there is a significant intrinsic value backing it up.

If the estimates of its intrinsic value are too high, then the investors are wrong.

The Bitcoin investors are egregiously overestimating the intrinsic value of Bitcoin. The currency use is a very tiny fraction of the market cap, and can't increase as fast as the market cap is increasing.

Whereas Twitter has billion users I think, and can send display advertising to all of them to generate revenue. That is a significant intrinsic  value, despite being in debt to develop that.

I can actually prove they will be spent if they were mined with CPU-only instead.

1. Masses will download and mine even when the coins returned are worth much less than the electricity consumed. Because it will be too small to notice on their electric bill.

2. Thus professional miners will be gone.

3. Masses spend because they don't have much. Even if they save it for a while, eventually the value is large enough they spend it. Middle class spend a much higher % of their income on personal needs than rich businessmen investors do.


Indeed that is the problem with Bitcoin. You are making my point for me.


Everything tangible has some intrinsic value. Gold has properties that are extremely unique and can't be replicated out of thin air.

Altcoins can be created every day, and if one is better than Bitcoin, it will expand Bitcoin's effective supply of coins. THis hasn't happened yet, but it will soon. Mark my word.


Fuzzy perceptions are made to be disappointed.

Government is only going to allow Bitcoin if they can control it. And they can control it. I have even explained how they can take it over using Amazon (https://bitcointalk.org/index.php?topic=336350.0).

And they can take it over because they can control every person who buys and sells it via AML and KYC and taxation.

And other ways...

Pipe dreams are made to be broken.

There are solutions to those issues, but Bitcoin does not and will not have the solutions.

I have to agree, that bitcoin has dynamics which resemble a pyramid scheme. But that would change, as soon as you are able to pay all your bills and taxes with bitcoin and earn them directly without the need to convert to fiat somewhere along the transaction chain.

For this there needs to be mainstream adoption, so IMO the only possibility for BTC to survive as currency is that all participants follow the mentality "One for all, all for one".

Honestly, I would like to believe it, if there wasn't so much greed in human nature....

Distributing the mining coin rewards to millions of people who download it with one-click will do that.

And the investors can buy from them. So no problem the greed will help then.

Bitcoin is the inverse (converse)!

The investors mine the coins, then the masses are expected to buy them. brain dead design for a coin.

Why is the only point anonymous?

The point is to not use fiat which gives control to the cartels who capture our governments.

Also anonymity is nice just because you don't want Obamacare computer telling you that you bought too many pizzas this week and need to eat cucumbers for the rest of the month. Did you see Obamacare is forcing men to have Maternity care insurance?  :o

We need to break the back of the socialism before it drags us down into the gutter of waste and failure.


And if you don't get widespread use as currency, then government can pigeon-hole you. Because the masses won't care if the government fucks your currency which they don't use any way.


No either the security will decrease so it can be 51% attacked easily or the transaction fees will be going very high such as 50% (especially if happens when coin rewards have diminished).

You didn't realize that your future depends on Bitcoin not declining in price!

So now you see the currency is lost when the price crashes! NO INTRINSIC VALUE.


I just refuted that with a slamdunk. ;)

Now you are thinking "Oh shit, Anonymint is correct".  ;D

I am going to eat. Be back in an 1.5 hours.

Looking at your posts and the others in this topic. You could say its a new scheme that uses many characteristics of the others.

You can't see the writing-on-the-wall? Focus your crystal ball on this and estimate the future...

http://www.bloomberg.com/news/2013-11-20/bitcoin-is-still-doomed.html

I think we can see what kind of future Hawker wants for us.

He wants a limited hangout for drugs and illegal sales of MMO into China.

He doesn't want the rest of the world to benefit from this innovation.

Very selfish man who got 1000s of coins from CPU mining of Bitcoin before GPUs and ASICs took over. Then he doesn't want us to make an altcoin that can offer that permanently to all people of the world via download.

These are the type of people who want to ruin the world with their greed.

Now we see how one early adopter thinks. Very disappointing.

We must stop them by outcompeting with them. Leave them with their silly Bitcoin and let them wallow in it, or they can come join us once they realize they were rendered irrelevant.

Technology and open source is not a monopoly. It is not a limited hangout.

Fruits to the one who brings it to the masses.

I know this because I did it (Coolpage.com 1 million users in 2 years when internet was 10x smaller), the author of Firefox did it, etc..

Bitcoin is completly transparent which no Ponzi Schema can be. Ponzi Schemes require a lack of transperency!

Been refuted already upthread. And you did not address the fact that Bitcoin is a pyramid-ponzi.

I will delete any more posts which have not quoted and replied to existing refutation upthread, if they are repeating some point that has already been discussed.

You must read the entire thread before posting.

Copy of what I am sending to Hawker in PM.

You think the government is going to let your limited hangout (drugs) coin not pay taxes?

The real plan was laid out by Larry Summers, Paul Krugman, Bernanke, and the ECB this week:

http://armstrongeconomics.com/2013/11/17/negative-interest-rates-eliminating-cash-the-summers-solution/
http://armstrongeconomics.com/2013/11/21/negative-interest-rates-coming-soon-to-a-bank-near-you/
http://armstrongeconomics.com/2013/11/20/the-bitcoin-hearing/
http://armstrongeconomics.com/2013/11/19/congressional-hearings-on-bitcoin/
http://armstrongeconomics.com/2013/11/21/will-electronic-money-be-deflationary/

Read it and weep.

Impaler I realized this is not the same as demurrage, because they will nationalize the bank accounts and retirement plans, so you won't be able to put the "savings" into motion.  This is all on official government documents such as the new bail-in regulations. No conspiracy nut stuff, it is all ready to put into action in next year or two.

Was this to me? I'm not sure what any of that has to do with my post.

No I was debating with Hawker in PM and posting some of my findings here to the public thread. I appreciated your post Btw.

Oh, my bad. Just wanted to make sure.

Well, i am really glad they arent listening to you. CPU only? Eh?
Right, and the next botnet steals all coins via a 51% attack. The presence of ASICs has pretty much thwarted the potential threat presented by a malicous botnet.

Now the pools and a few big players can take over. Btw a 51% attack can't steal coins. You are not qualified to speak, because you don't even know Bitcoin 101.

The botnets won't work with CPU-only mining because it uses all the main memory and user will realize his computer is captured. Very dangeous for the botnets to run it.  They loose their bots.

Also why would I care if botnets mine, as it adds security. It is only a problem if one botnet can get 51% which won't be possible if million people download your client.

Take your ASIC investment and insert where the sun don't shine.

When I say "masses" I mean masses of people like me. You see from the poll in my thread there are 13% who think like me.

13% of 7 billion = 910 million

No I don't agree that ponzi requires a central con man. I think the definition only says that later investors fund earlier and no intrinsic value.


No it can't. I refuted that in spades:

https://bitcointalk.org/index.php?topic=340686.msg3663722#new


Much worse than that. Nearly all will lose everything. And they will lose their freedom too. Mark my word.


All the people saying Bitcoin is a good investment are a fraud.

When everyone is destroyed, then they will all agree it is a fraud and start pointing fingers.

Enjoy your freedom in the meantime and prepare for a long time behind bars soon.

People change when they go from feeling good, rich to feeling angry, poor.

None of you have a gf or wife? You don't see how irrational women can be? Men are like that when they get fucked over with money.

Yeah, but transfer bitcoins and revoke transactions. Doesnt change the point.

And the biggest botnets had 10M+ bots connected. Considering the amount of people mining that can easily be topped by a botnet.

50+% attack can transfer Bitcoins and it can't really revoke older transactions. Definitely not before last checkpoint and someone always has a copy of the older history.

50+% it is a big problem and we don't want it to happen.


Botnets are entirely not a problem, if the coin only allows pools. ;)

Bitcoin supply is limited, the amount set is known from source code.

If for ponzi scheme, then the flow will be very oddly than bitcoin as a typical ponzi scheme obscures more information  than bitcoin, also there is only one node for the game. Bitcoin is, just like DSP, so if more people join, then the system will be better as the system will replace majority of transaction systems very soon as all people can monitor the flow.

You haven't thought this out grasshopper.

That doesn't make any sense. Read the thread.

The transparency point was refuted on page 1.

The "majority of transactions" has been refuted in the recent page.

You would need to refute those prior refutations. I almost deleted your post because it violates the warning I put saying you must read the thread. But I decided to give this warning one last time.

Bitcoins are just worth whatever people are willing to pay for them - the market cap is irrelevant.

If Satoshi suddenly sells 1 million BTC then there will be massive slippage and the price will tank - but there's no con or scheme - everyone knows this.

We all know of the big stashes of bitcoins and what would happen if they were sold all at once (initially anyway)
We all know all the facts and we choose to buy/sell based on this reality.

Where's the con? How have we been tricked?

Anonymint, I do enjoy your posts, and you do present interesting arguments, However I must ask as to your end-game?.
Is it purely educational
Is it a righteous ego trip where you get to flex your intellectual prowess… are you just looking for "i told you so"  moments??
Are you try to save ourselves from wasting time/effort/money?
Your agenda is quite telling, but your motives are not…. please explain.

The con is you got several facts wrong.

When the number of new investors can't increase fast enough, it collapses. We don't need Satoshi to sell, that was a strawman invented to make it sound less likely.

Even only tiny stashes sell it will collapse at that point.

This is the nature of pyramid-ponzi schemes.

I explained that in great detail upthread. Once you bankrupt the later investors on that end-game collapse, you don't have any more investors to do it again.

This is assuming Bitcoin makes it to ponzi saturation point. It might be stopped before that by government action or an altcoin.

I am preparing those who want something better to understand why it would be better, then hoping those who can develop it will see the opportunity.

In short, trying to fix the problem I see.

Yep I know all this - Bitcoin could collapse. It could fail (like MySpace) - but that's my problem. I can sell or buy freely knowing this. Everyone already knows this.

When these coins are dumped, won't the new owners just continue the same game?
Aren't these the new investors? - all these people with cheaper coins? A new mass of people willing to hold or sell or start buying more?

I appreciate that, but your clearly not stupid.
Everyone on this forum is here because a vested interest in BTC.
"no one wants to be told there child is ugly"  and in a similar vein, no one here will agree with your every word…. because it goes against the reason that they frequent this forum in the first place… It's like going on a Ford forum and telling everyone that Honda is better….no one will listen regardless of if you are right.

Even if you provide a valid argument, no one is going to become enlightened as they have blickered vision.


I personally have a reasonable position in BTC… enough to make me what to fight it's corner, champion it's cause and hope it achieves half of what the optimists promise.
I am a realist, as most people are… many people post their desires here (even if they won't reach fruition) but continuing to try to push your point is a fool's errand and you will get no-where.

As much as I agree with much of what you say, the dreamer in me wants this to go to the moon, and no amount of analysis or speculation will change other peoples view… you will achieve nothing except frustrating yourself.

Surely your time may be better spent on another alt-coin forum so you can tell everyone how naive we are??
This way you will acheive praise, recognition and support…. rather than resistance.

You apparently missed the post upthread about this. I will repeat the logic in case it got buried.

Assuming Bitcoin makes it to saturation, meaning everyone that will buy has bought, then it collapses because price can't move up, thus investors want to exit to go get gains else where.

Then only a few investors can cash out. The vast majority will be stuck with the crashed value. This is math at the top of the OP.

So then you've ended up with a very few who cashed out with huge gains (probably the early adopters who were selling all the way up slowly), and everyone else bankrupt.

So who buys your coin now? No one left to buy it.

End of story. End of world (if Bitcoin makes it to $trillions market cap).

Well maybe it's best if you don't buy any bitcoins then - you've done your risk assessment and I've done mine.

I am not.

I will buy the right altcoin if it comes. I will sit on the ask always in the early days and weeks, if it has the correct design.

Thank you. So you must also not be.


12% say they don't.


Agreed.

So they won't be early adopters. They will miss the gains from 0.0001 to $1 or $10. But still they won't buy, because their pride as they will remember me telling them here that they would be forced to buy.

So the goal is to make sure they won't buy until it is $100 or $1000. So they don't run the new economy. Because I think they are the socialists and not the wise ones that we need running the new economy.

You might wise up at around $1, because you are apparently not stupid.


My advice to you is don't be greedy. Sell early, maybe at sometime next year or 2015. Take your triple or 10X gains and run like hell from Bitcoin and hold your nose that you are losing more gains.

You will be very grateful you did that.

Maybe let a small portion ride, just for the thrill and just for a what if experiment.


This is a time where men will be separated from boys and (most) women.

I need a few good men.

Well boys you've pushed it down to 11%,

11% of 7 billion = 770 million people.

That is still about 750 million more than I need. So just keep voting on the socialist choice. It thrills me to no end.

Dodgers there was one more motivation. I wanted to see if I could learn anything or be rebuked. I did learn several new things in this thread.

Probably also subconsciously to demonstrate I am the alpha/sigma-male here amongst mostly betas, and I suspect Impaler is a sigma.  :-[

Yeah then i guess you over estimate the revenue you can get from advertising. I personnally think tweeter fits very well all your definition as the advertising stuff really look far over estimated to me. Now both tweeter stock and bitcoin have this speculative value in it. It s all about what it may do in the futur not what it does right now and this is very hard to estimate. May be that bitcoin will be used for some very surprising things later on...
So if one day investor realise that ads will never pay back tweeter will be in the position you think bitcoin will be when nobody will want to protect there monney/speculate/make cheap transaction anymore. To me one will happen and to you looks like it ll be the other one. Maybe none will and every body ll be happy.

You may be correct. Many dot.com stocks were clearly ponzi-pyramid schemes as there was nothing there (no intrinsic value) at all and they went poof and they collapsed and died forever. It was all smoke and mirrors. Ditto many junior mining companies. Perhaps ditto most PinkShits stocks (pink sheets, hehe).

You need to provide an argument, otherwise this is just a temper tantrum.

Bitcoin is a technology. It is a blockchain-based transaction ledger. There is a limited number of claims to this ledger. These are called satoshis, or bitcoins (10^8 satoshi). We are here to deduce if Bitcoin is a Ponzi scheme, a Pyramid scheme, a Greater-Fool's-game or just a freely-traded something, subject to markets' whims, resulting in booms, busts, bubbles and crashes.


A) I start with assuming that "Ponzi scheme" option is already refuted beyond doubt.


B) As for "Pyramid scheme", after much deliberation I fail to see the logic, how Bitcoin would qualify. I wonder if we even read the same definitions for a Pyramid scheme:
- Wikipedia (http://en.wikipedia.org/wiki/Pyramid_scheme)
- Investopedia (http://www.investopedia.com/articles/04/042104.asp).

The essential qualifications for a pyramid are not met.


C) What has been discussed upthread under the name Pyramid scheme, should more precisely be called Greater-Fool's-game (http://en.wikipedia.org/wiki/Greater_fool_theory). The essence in this would be that people buy in anticipation of a price rise, without regard of the intrinsic value. If the price is indeed rising, this may suck quite many people in, resulting in a spectacular collapse if the intrinsic value fails to meet the expectations.

It does not matter whether we are talking about Internet stocks with currently negative earnings, tulip bulbs, shares of the Blockchain pie, or something "completely useless" such as modern art. The fact is that people are (in most jurisdictions) free to invent, produce and sell things for whatever price they can gouge in a voluntary market. Also buying at inflated prices is not criminalized.

At most, Bitcoin could be classified in this category.

It has to be noted that this kind of speculative bubbles are almost completely harmless. If the product does not have intrinsic value, its production does not burden the real economy. Every time someone buys the bag at a higher price, another one receives the money. The only way to become bankrupt is to take excessive risk or leverage, which are always very stupid actions and people prone to them cannot be helped unless all banks and casinos are closed.

Unlike Ponzis and Pyramid schemes, which revert to zero when unfolding, speculative bubbles revert to their intrinsic value. There are many Internet stocks that are doing good in Nasdaq, tulip bulbs have a certain price, bitcoins will always have a price and art has its valuation. The real economy lives on quite unaffected of the speculative valuation.


D) It seems that the crux of the matter is, whether Bitcoin/bitcoins have intrinsic value as a currency/money or not. If not, it has been a recurring fad over several years and numerous bubbles, which have repeatedly risen higher and higher. In fact, the numbers we are seeing in the exchanges testify that every day until this week has been a bear trap.

It is hardly possible that Bitcoin would have survived the 2011 bubble if there was not a promise of significant utility. The word promise is important, because money is a high network-effect thing. If I have all the money in the world, it is most likely worth less than half of it. Money tends to be worth the most when it is distributed in a Pareto way (http://en.wikipedia.org/wiki/Pareto_principle).

If all money belongs to a few and others are uniformly poor, the rich cannot employ their money to buy goods and services because the poor are not capitalized to produce them. Similarly the poor cannot buy from the rich because they don't have the money. The (hypothetical and unachievable) situation that everyone has the same amount of money, quickly leads to Pareto distribution (or "worse" top-heaviness (http://en.wikipedia.org/wiki/Russian_oligarchs), unless the rule of law is present).

Let's think the valuation of Facebook from the user perspective. When Facebook had one user, it was worthless. I would say the value per user grew rather quickly when the earliest users came. Just out of my hat, let's say they valued it at $100 on average. As new users were added, the value for them was initially just above zero (the threshold of joining in is to receive positive value), but the old users' value was increased due to network effects. The more Facebook grew, the more value for everyone. From systems perspective, it should have been obvious that the supermajority of the target segment globally would become users.

The valuation of Facebook in the stock market is $112 billion, which is $95 per monthly active user. If the ownership of the system were possible for everyone in every stage of the adoption process, we would have an ownership distribution curve similar to Bitcoin's. (Now there is some 29-year old geek that owns 24% of all, talk about inequality  >:( ) In both cases, the value is roughly proportional to the number of users, but the issuance is fixed.

Facebook would not have become so valuable if it had not become widespread. Then the investors would have lost their stake. If Bitcoin fails, investors lose likewise. If someone sees the failure before the others and sells out, good for him. It is not a reason to be jailed. This is the basic free stock market operation, nothing new to see there.


Bitcoin is currently distributed in an even theoretically near-optimal scale-invariant Pareto way. Bitcoins can be easily traded in many parts of the world. The free market ensures that they are most optimally distributed, because if someone finds himself with too many bitcoins, he can sell. The one lacking can buy. The distribution of bitcoins is way more efficient and widespread than Facebook stock, and will soon become possible for practically everyone on the planet, which is unprecedented for any investment vehicle or even currency!

We share the vision that the inordinate gains in price drive adoption quicker than the general understanding of Bitcoin spreads. This will lead to a bubble of extraordinary valuation. But that will pop even quicker than it formed and no value will have been lost. The recent examples to be carefully analyzed are the Nasdaq bubble of 1999-2000 and the PM in 1980. Bubbles act as boosters to the underlying. Nasdaq bubble fueled the all-pervasiveness of Internet in the 2000s by providing ample VC money to everyone interested. PM bubble encouraged mining, resulting in tumbling PM prices when the mines started operations a decade later.

The bubble happens when the 2nd % wants to buy. Then it crashes and the 98% can slowly start buying. My father still owns Internet stocks, he only bought them long after the bubble ;) Life and markets go on and do not magically stop at the bubble top. Bitcoin exchange rate will not go to zero, it will go down and provide a spectacular buying opportunity in the wake of mass adoption that will drive the price to its realistic long term value (if there is one).


Gold is also not used as a currency. Gold is the most salable (http://www.professorfekete.com/articles%5CAEFMonEcon102Lecture3.pdf) commodity, meaning that it is the easiest to part with in large quantities. This has been called Money in the past.

As bitcoin grows bigger, it may surpass gold in this regard, or may have already done so. Thought experiment is that a person finds himself in a random place with $1 million worth of gold or bitcoins. How long time and how many % loss he must spend to make the transactions necessary to convert the value to what he needs.

Silver used to be the most hoardable (http://www.professorfekete.com/articles%5CAEFMonEcon102Lecture3.pdf) commodity, meaning that it is easiest to accumulate in small increments. Bitcoin has already become the most hoardable thing, proven by tipboxes etc. In long-range applications bitcoins are easier to accumulate than even cash!

There is a reason why the word 'silver' and 'money' are the same in 49 languages.


The Russians tried to privatize the communist state wealth directly to the people. The result was 50 million people who owned their share of huge enterprises for a few minutes, until somebody bought it from them at a price of a small bottle of vodka, or a cup of coffee. The companies ended back in oligarch control. It is not optimal, workable or possible for everybody to own a little. It invariably ends in somebody owning it all, and the masses do not get much of a benefit for selling their share. As much as we both would like it, faucets don't work.

In a more theoretical vein, if we assume that the altcoin system is worth $1,000 per user, and the users generate the value for themselves by CPU mining, and the inflation rate mimics gold's 2% APR, then the mining reward is $20 per user per year, and it is indeed a perfect analogy to exchange your monthly reward for a cup of coffee. Hardly a recipe for a stealth mass-adoption.

So my little economic knowledge makes me think you confuse an over over valuation ( bubble ) with pyramid scheme one is a scam from the beggining ( operators according to sec ) the other is a bunch of fool fooling themself and other but at least didn t start as a scam.
Is bitcoin in the later stage? That may be hard to tell ofc ...

I'm not sure you quite understand investments. There is not $1100 invested in BTC in this scenario, there is only BTC invested in BTC. As soon as Joe pays Satoshi $100 for some BTC all that happens is Satoshi has $100. That money no longer has anything to do with bitcoin. And neither does Sally's.

If I'm trying to raise capital and issue new shares which can be bought directly from me to be used for whatever purpose I'm raising capital from, then and only then can you really say the amount paid is "invested in" something.

Yes. Yes.

By "us", I mean avoiding a world like 1984 which will come very rapidly now.

As you can see, most westerners are now socialists. We don't have many John Wayne's any more. I want to save the few we have and promote them to the top to run the world in freedom. The socialists don't comprehend where they are going.

I am extremely sleepy.

I will obliterate this nonsense from my "friend" Risto.


Ditto YACoin.



Constructing a strawman is a disingenuous form of non-argumentation. It basically means you gave up before you started.

Must I quote from you the discussions in thread where we decided it has an amalgamation of ponzi and pyramid qualities. Surely you understand it is Marxism to require me to do your reading for you.


Not. Because you continue to (https://bitcointalk.org/index.php?topic=323988.msg3660710#msg3660710) blithe-fully ignore systemic effects.

No where do I see any dot.com stock professing valuations based on all 7 billion people one day buying in because it is a currency.

Currency is a very powerful implied con. It implies power far beyond any stock exchange, much less individual stock.


And none of those do we claim the economy-of-scale of the whole globe in one investment.

I strongly suggest you read Nicolas Taleb's new bestseller Antifragility.

The strongest characteristic of a ponzi scheme is the massive destruction it causes because the players don't see the systemic risk of pooling themselves. They are blinded to it by a mania.

And that is exactly what we have here today with Bitcoin.


Ha! You ignore systemic risk like any good collectivist does.


Bring all the world's money into one investment, then tell me how can the world function when that investment is not a currency.


You don't seem to understand that if you tie 7 billion people's shoelaces together they now walk as one.

Penny or nanopenny makes no difference. What matters is the relative potential energy outside the single TITANIC THING.


How you relate speculation to transaction volume by value is beyond me.  ::)


You apparently don't know that the Power-law (Pareto is special case) distribution of wealth only applies at the top 3%:

"Exponential and power-law probability distributions of wealth and income in the United Kingdom and the United States" by A. A. Dragulescu and V. M. Yakovenko


In fact the 97% own very little morsels which is mostly always moving as spending and wages in virtuous cycle.

And we don't give it away, the must mine it which means put up resources and effort to get it.


Where I live that is 1-2 weeks salary and a months supply of rice. I realize you live socialist Europe, where everything costs 3X what it should do to unions and 2X Lafer rate taxes.

The more salient point is you can expose many more people to this neat technology and then they will think of ways to make money with it and become merchants, etc.

The networking effects are unfathomable.

You are a clueless technological neophyte because you've never shipped a download software to 1 million people. I have. I know there are a zillion unforseen interactions and spin-offs.

All your arguments, AnonyMint, seem to be based on your own assumption, that "Bitcoin can not be a currency".

I want you to to back this up with some evidence.

If it quacks, smells, and tastes like a systemic catastrophe mania, then it probably is.

Do we need to invent new names for fraudulent pump & dumpers who egg us into systemic catastrophe?

All posts that are not on topic and of high quality debate will be deleted. This is a self-moderated thread.

I also deleted numerous of my posts that were tangential to the objective debate.

Thanks for agreeing with me. That is precisely my point too.

The spot price deludes him into thinking his stash is worth more than it is. Thus this is not 100% transparent. Can't be.

Yup. Thanks for agreeing with me.


Yup. Thanks for agreeing with me.


No you can not buy ALL goods with them, only a very few niche things.

Surely you see now why you did not understand.

Correct Satoshi has the $100 and Joe has the $1000. The early adopters have walked away with the cash just as in a Ponzi scheme.

And that has caused the spot price to be $1000 / 10% of BTC. So Joe values his remaining stash at $9000 and Sally hers at $1000. But neither of them can get the $10,000 until a greater fool later investor comes in to buy from them.

The key here is that there is no intrinsic value as a currency even though Bitcoin is pitched as being one.

Joe can't go spend his $9000 to invest in the NYSE. He has to convert to fiat first and he can't if a later greater fool doesn't come give it to him.

This is so elemental and obviously a scam.

This has been explained ad nausea. Read the thread! Don't expect me to write it again. Go read mofo.

Back up to 13%. Looks like we ended on a positive trajectory.

There are no new arguments, just people wanting to spam the thread.

The End.

Your penis has an intrinsic value, i.e. it can generate offspring.

Tangible things always have some intrinsic value, even if just as landfill.

Intangible things only have intrinsic value if the shared idea is factually true (e.g. whether Bitcoin is a currency (https://bitcointalk.org/index.php?topic=341594.msg3666870#msg3666870)) or if (e.g. religion) the shared idea can never be falsified.

From email someone wrote to me:

> > A few hours ago I made the comment that BitCoin = Amway for delusional
> > Libertarian wannabes.  I couldn't help myself.  ;) Yesterday I said
> > something about the fiat pope (Bernanke) giving BitCoin his blessings -
> > the global mafia often reminds me of The Godfather.
> > Today a video began circulating of an interview with Max Keiser who
> > apparently said BitCoin is beautiful!  The mania is almost on par with the
> > religious fervor of a Pentecostal.  Will Keiser go into a trance next time
> > and speak in tongues?  lol

On the utility of "transparency" bullshit and TBTF systemic risk Armageddon it creates:

This thread has been published as an article at The Atlantic mainstream media publication.

http://www.theatlantic.com/business/archive/2013/11/bitcoin-is-the-segway-of-currency/281625/

Bitcoin Is the Segway of Currency

Silicon Valley thinks it's the future, but Bitcoin is more ridiculous than motorized scooters for adults.

MATTHEW O'BRIENNOV 21 2013, 1:02 PM ET

Can we get these half off if we pay with bitcoins? (Reuters)
We were promised jetpacks. We got Segways instead.

Well, we didn't get Segways. Nobody did. At least nobody other than mall cops, tour groups, and techies. Okay, and ironic polo players. But in any case, it's fair to say that Segway hasn't exactly been "to the car what the car was to the horse and buggy," like its founder Dean Kamen said it would (http://content.time.com/time/business/article/0,8599,186660,00.html). It hasn't even been to the moped what the moped was to the horse and buggy. Or what the bicycle was. It's just been a (sometimes morbid (http://www.nytimes.com/2010/09/28/technology/28segway.html?_r=0)) punchline. And one that's almost too impossible to believe. Did you know that Kamen thought he'd need an around-the-clock (http://www.wired.com/wired/archive/11.03/segway.html) factory churning out 10,000 Segways a week to meet initial demand? It's true. It's also true that he only needed to make 10 a week to do so.

This wasn't just self-delusion. It was mass delusion. Back in 2001, Steve Jobs thought Segway could be as big as personal computers. The venture capitalist behind Amazon thought it could be bigger than the internet. The entire internet. The only reasonable explanation for all this hype was that neither of them had actually seen someone ride a Segway. Because, as Y Combinator's Paul Graham puts it, you can't ride a Segway without looking like a "smug dork." And people generally try to avoid looking like that. They won't use something so inherently ridiculous, no matter how technically impressive it might be.

Like Bitcoin.

Now, for those of you who aren't techno-libertarians, Bitcoin is supposed to be a virtual currency you can use to buy things online. Except it's not really a currency, and you can't really buy that much with it. It's more like a dotcom stock (http://www.theatlantic.com/business/archive/2013/04/bitcoin-is-no-longer-a-currency/274859/)—circa 1999. See, in just the last month, one bitcoin has gone from closing at a then-record $192 to reaching $788 on Monday. It then opened at $502 on Tuesday, before briefly rocketing up to $900, and ultimately falling to $646. Just your average 80 percent price swing. That's totally normal for currencies ... if you multiply their biggest swings by 80.

You can kind of see these absurd price moves in the chart below. But only kind of, because the vertical up-and-downs have come so fast that they've blurred into each other. It's almost as if Bitcoin doesn't have a single price at any one time, but rather a range of possible prices that depend on the observer. (Note: the red dots show each day's closing price, and the black lines show each day's high and low).

We can see this a little better if we zoom in on just the last two months. Bitcoin prices were pretty flat from the end of September through early October, but then (relatively at least) doubled slowly. Then they doubled quickly. And then even quicker—before falling fast. Not exactly a stable store of value.

http://cdn.theatlantic.com/newsroom/img/posts/Bitcoin5.png

So why has Bitcoin gone parabolic? And what does this have to do with Segway? Well, the short answer is we don't know why the virtual currency has exploded. Part of it might be demand from China (which you can see in this realtime chart of who's buying Bitcoins). Part of it might be the reduced supply after the FBI shut down and seized the drug website Silk Road's substantial Bitcoin holdings. And part of it might be pure mania. But all of these are just another way of saying that Bitcoin's design makes it prone to these boom-bust cycles.

Segway certainly knows something about design problems. Though in its case, its product worked fine, if zipping around on a glorified scooter was your kind of thing. The problem was you couldn't use the product without looking insufferably pretentious. Bitcoin, though, has deeper problems. Its product doesn't work, and its early adopters are still incredibly self-satisfied—because it's making them rich. But the product really doesn't work.

See, the idea behind Bitcoin is to create a decentralized currency that central banks can't inflate and governments can't tax. Basically, digital gold. And like actual gold, the only way to get new bitcoins is to "mine" for them. That involves running a computationally-taxing program on your computer that mostly generates gibberish, but maybe, just maybe, some bitcoins too. The key, though, is that mining for more of the virtual currency doesn't create more of it. That's because there's a predetermined number of bitcoins. Specifically, there are around 12 million today, and there will be 21 million in 2040—and no more after that. Of course, this limited supply means Bitcoin should tend to increase in value against the dollar. But only tend to. See, its deflationary bias means Bitcoin prices will go up and down quite violently. Think about it this way. The supply of bitcoins can't increase much to meet increased demand, so increased demand will make prices soar. And soaring prices will make early adopters try to cash out their winnings—which will send prices crashing back down.

In other words, Bitcoin is a Ponzi scheme libertarians use to make money off each other—because gold wasn't enough of one for them.

Bigger Than PCs and the Internet Combined?

But techies say so what. That this misses the point. That what's revolutionary about Bitcoin isn't that it's a currency with no state-backing. What's revolutionary is that it's a payments system with no third-party, like a credit card company, standing in between buyers and sellers. See, any time you buy something, it's a minor leap of faith. You choose to believe that the seller will deliver as promised—and if they don't, you want your money back. That's where financial intermediaries like credit card companies and Paypal come in. They make sure buyers and sellers are both trustworthy, and handle any disputes.

Now, it's nice to be able to get your money back if things go wrong, but that's not free. The middlemen take their cut. Bitcoin, though, has no middlemen. It's just a decentralized peer-to-peer system. So you can't get your bitcoins back if things go wrong, but there won't be any transaction fees. The question is whether non-enthusiasts will think this trade-off is worth it.

Actually, the question is whether anyone will actually use bitcoins to buy things at all. It's not clear why they would when its value can go from $500 to $900 in a matter of hours. Nor when so many people treat it as an inflation hedge. They think of Bitcoin more as an investment than as money. Indeed, researchers from the University of California-San Diego and George Mason University found that 64 percent of all bitcoins are being hoarded in accounts that have never been spent. And of the bitcoins that are being spent, a full 60 percent are on the gambling site Satoshi Dice.

There are companies trying to expand Bitcoin beyond its core constituencies of libertarians, gamblers, and people buying drugs. The startup Bitpay, for one, lets merchants immediately convert any bitcoin payments into dollars. The idea is it can charge lower fees without making companies take on the risk that Bitcoin's value falls. It's a clever idea that should make merchants more willing to accept bitcoins ... but won't make people more willing to use them. The people who have bitcoins still have no reason to spend them, and the people who don't still have no reason to get them. They don't want a currency whose value you can't predict from one hour to the next. They don't want to buy things anonymously. And they don't want transactions to be irreversible (and certainly wouldn't want that if they got hacked (http://www.businessinsider.com/the-history-of-bitcoin-theft-2013-11)).

Every big idea starts out sounding crazy. But not every crazy-sounding idea ends up being big. History is littered with Segways. But for all its majestic dweebiness, at least the Segway was kind of useful. You really could zoom across sidewalks without anything resembling effort. I don't know why you'd want to, but you could. But what can you do with Bitcoin? Well, it's good for real and fake gambling. Since it doesn't have any actual fundamentals, it can be worth anything: Bitcoin 36,000 and 36 are about equally plausible. That's good for making money at the expense of people who get in the game later, but little else.

So the biggest difference between Segway and Bitcoin might be that even mall cops won't use Bitcoin.

Actually you and I entirely agree. Very astute. I was actually pitching that outcome but it may be difficult to discern among the constant defense of the prior points. I stated two possible outcomes.

1. Bitcoin goes to $trillions market cap and we have systemic default problem on our hands.

2. Altcoins or other factor halts the ascent before that happens.

However, #2 forks into basically two possibilities and one of them is very scary IMO:

2a. Altcoin(s) and decentralized competition.

2b. Government supply electronic fiat currency.

I've known for a long-time what the government's strategy was, and now they are starting to reveal it:


They can accomplish it with the market failure of Bitcoin.

They have two main vectors of takeover:

1. Regulate the people and business who use Bitcoin, since it is not anonymous.

2. Technical takeover employing Amazon (https://bitcointalk.org/index.php?topic=336350.0) et al.

Link to the other parallel thread:

https://bitcointalk.org/index.php?topic=342007.msg3682757#msg3682757

Henry Blodget weighs on the bubble.

http://finance.yahoo.com/blogs/daily-ticker/bitcoin-heading-toward-high-could-1-million-175818638.html

Peter Schiff conveys many of the same points:

Gary North who is allied with Ron Paul, Lew Rockwell, the Mises Institute, and Austrian economics, says Bitcoins: The Second Biggest Ponzi Scheme in History (http://www.garynorth.com/public/11828.cfm).

Add Alex Jones to the growing lists of prominent Libertarians that say Bitcoin is a ponzi-bubble.

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Gonzalo Lira (http://www.blacklistednews.com/Guest_Post_-_Bitcoin%3A_Get_Out_While_The_Getting%27s_Good_/30803/0/0/0/Y/M.html) explains why anonymity is so important but Bitcoin doesn't have it.

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Ron Paul says he was misquoted in the past on Bitcoin and he downplays the hype around Bitcoin:

http://video.foxbusiness.com/v/2916084919001?cmpid=cmty_twitter_fb