Bitcoin Forum

Bitcoin now ends up to be a ponzi after all, No matter how thin scammers slice it

It's just a pyramid scheme of
Few of who sell first able to grab your money, Most of who sell late to be the last bag holders and lost everything

Pon·zi scheme
ˈpänzē ˌskēm/
noun
a form of fraud in which belief in the success of a nonexistent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors.


Bitcoin does not guarantee returns nor is there a "Bitcoin Enterprise" you are investing in. lol

Sorry your definition fit fails.  :D :D :D

So hundreds per coin is considered losing everything.  Hmmm....  Starting to slowly feel like bottom.

World Bank Report: Bitcoin is a 'Naturally Occurring' Ponzi
http://www.coindesk.com/world-bank-report-bitcoin-naturally-occurring-ponzi/

sorry your intention to scam more to buy failed

everything is becoming a ponzi...

Just because you linked an article doesn't mean the definition is used properly within said article.

Once again you fail:  ;D ;D ;D

LINK: http://www.investopedia.com/terms/p/ponzischeme.asp

"DEFINITION OF 'PONZI SCHEME'
A fraudulent investing scam promising high rates of return with little risk to investors. The Ponzi scheme generates returns for older investors by acquiring new investors. This scam actually yields the promised returns to earlier investors, as long as there are more new investors. These schemes usually collapse on themselves when the new investments stop.


INVESTOPEDIA EXPLAINS 'PONZI SCHEME'
The Ponzi scam is named after Charles Ponzi, a clerk in Boston who first orchestrated such a scheme in 1919.

A Ponzi scheme is similar to a pyramid scheme in that both are based on using new investors' funds to pay the earlier backers. One difference between the two schemes is that the Ponzi mastermind gathers all relevant funds from new investors and then distributes them. Pyramid schemes, on the other hand, allow each investor to directly benefit depending on how many new investors are recruited. In this case, the person on the top of the pyramid does not at any point have access to all the money in the system.

For both schemes, however, eventually there isn't enough money to go around and the schemes unravel."

You seem presumptuous to imply I am trying to scam anyone. I have a spotless record on this forum and online for over 3+ years.

Your account lol...is pretty new.  :P

Name:   sumzeroend
Posts:   2
Activity:   0
Position:   Newbie
Date Registered:   Today at 04:47:45 AM
Last Active:   Today at 05:06:30 AM

That pretty much describes most of the stock market IMO.   Are you saying the entire stock market is a Ponzi?

You noob clowns need some new material.

sumzeroend is a ponzi.

Wrong! equities can grow into their valuations but not an empty speculative asset like bitcoin

Oh rly?

Bitcoin price went from $0 to now $270.

Yup can't "grow" into its valuation.  ::)

Is it me or are all of the idiots who think they know what they are talking about online today?  :D :D :D

That's purely from speculation not fundamentals.  Shiller won the Nobel for his "irrational exuberance" theory.  Sorry but you are the idiot here

Fundamental: Person A buys 100,000 Bitcoin at pennies...

Then decides to spend said bitcoins with merchant B who sells goods.

Yeah pretty sure the "fundamentals" you speak of are there with Bitcoin.

You are just not wanting to see it or are too ignorant to see it.  ;D <---- Take your pick.

You're  embarrassing yourself. 

You probably don't know that Edward is guy who was screaming SELL when Bitcoin was 2$ in 2011 :)

Oh really? lol please show the holes in my argument.

You say bitcoin lacks fundamentals and is purely from speculation but I just gave you a simple example of where bitcoin is not purely speculation-used and has fundamental uses going on within the economy/network of bitcoin.

Please embarrass me away.   :D

Of course he doesn't his account was created today and can't seem to use the word ponzi in the proper context of its definition.

Edward is funny to listen to though. "We are going to $1".... ;D ;D ;D

The troll is high in this one.

The obvious is you don't know what fundamentals mean.  

I think this is just misunderstanding.   You can say bitcoin is no good without it being a pyramid scheme.  I could buy a load of carrots and find it a bad transaction, either was a bumper harvest and others similarly were able to source enough carrots so we got too much supply or it could just the produce was bad.   Even if I was scammed by some front, still not a pyramid
  Theres no multiplication effect in bitcoin causing it to be a pyramid, the only similar thing might be the online hype effect where knowledge and acceptance of bitcoin was not linear but more exponential but the protocol itself is quite set and regular to stop over supply

Bitcoin fits into the definition of Shiller's "naturally occurring ponzi" which is a more or less a behavioral economics explanation of inflating asset bubbles

sumzeroend
Newbie
*


Activity: 2




registereed new acct. to tell us something thats been said 1000 times already?

Lol obviously you don't know what purely speculation means.

I've debunked your claim. Now all you have is to play the vague card of what "fundamentals" means in your view. I've given you a fundamental usage for Bitcoin to give it non speculative value. Of course you ignore it and don't address it.

Lol look who is embarrassing themself.

Umm, no.  All you described was a transaction.  If I bought a beanie baby for pennies and traded my neighbor for bike, therefore fundamentals.  That's your example?

I won't bother to explain to you cause you're too dumb.  Just google it on your own.  I'll give you a hint though.  Start by searching "future cash flow".  Then search "carry trade" if you wanna know how fundamental analysis can be used to trade currencies.

All commodities are speculative.  The price is derived purely from supply/ demand forces.  If you buy Bitcoin for pennies and sell it to a greater fool for $1000.  Congratulations,  you made a good spec trade.  No fundamentals involved

Hard to see when a bubble pops, but Bitcoin does have fundamentals. It offers a decentralized way of safely and anonymously transacting funds (virtual objects of value) from one party to another anywhere with an internet connection within approximately one hour without the need of middlemen, i.e banks or other institutions. All transfers are secured mathematically (cryptographically) by the largest and safest (decentralized) computer network in the world and are saved in a public ledger, which protects coins from being doublespent. It offers infrastructure to an entire new economic sector, and at the same time has the power to disrupt existing formerly and falsely trusted industries such as the banking sector, federal reserve banks, perhaps even irresponsible nation states - all formerly believed to be system-relevant.

No one forced the guy to deliver a pizza for 10000 Bitcoins back in the days. No one forced anyone greedy enough to buy Bitcoins at 1000 Dollars. Promises are sold everywhere on the streets, and it wasn't clear at all that Bitcoin's price would ever increase thousandfold from its initial price.

Now I'm too dumb?

No it seems you can't admit that your statement of Bitcoin's price increase being "purely speculation" is pure bullshit.

My simple example disproved your statement and gives non-speculative fundamentals that support bitcoin's value.

If you are going to insult my intelligence by playing the "look it up yourself" card you may as well just run away from the argument as I've addressed your claim in a straight forward manner debunking your bullshit claim.

If someone buys bitcoin and a merchant chooses to accept it for payment....it gives it value (a price...example $0 to $270)...the trade between bitcoin and goods is not speculative. It is a transaction.

Obviously your definition of speculation is pretty broad to encompass every day transactions. I suppose when I go to McDonalds to buy a cheeseburger that is speculation with my dollars eh?

lol please spare me the pompous arrogance

Thanks you said it much better than I.

+1

The guy who says I am too dumb thinks that there is NO fundamentals and only speculation in the bitcoin price increase from $0 to $270.

I call bullshit.  ::)

EVERY monetary asset is "a pyramid scheme".  If bitcoin has the pretention to be a monetary asset, it cannot be anything else but a pyramid scheme, of course.

Gold is a pyramid scheme.  Fiat is a pyramid scheme.  All means of payment are based upon a pyramid scheme.

Why ?

Because the incentive to "buy" the asset (bitcoin, dollars, gold) is purely and solely determined by the speculation that others will want to buy the asset from you later.  In this phrase, "to buy" comes down to "willing to give up value in order to obtain it".  That value can be labor (you are willing to work in order to obtain it), it can be giving up useful commodities (selling a house for bitcoin), it can be giving up other monetary assets (dollars for bitcoin).

In a Ponzi-like pyramid scheme, you expect a *greater* fool.  You expect others to give up much more to get it later, than you were willing to give up to get it now.  With a monetary asset, you expect an *equal* fool: you expect others later to give up about the same than you were giving up now to obtain it.  This is what allows a monetary asset to "store value" in time.
During the phase in which a non-monetary asset becomes a monetary asset, its value rises (from zero, or from its pure usage value, to its monetary value), and we are in the "greater fool" phase.  After that comes a stabilisation and an "equal fool" scheme (in which case the asset DID become a monetary asset), or comes a decline back to zero or its pure usage value (in which case the asset didn't succeed in becoming a monetary asset, and we had indeed a Ponzi-like scheme, with crash).

So saying that bitcoin is a pyramid scheme is an evidence.  If it weren't, it couldn't become a monetary asset in the first place.

Monetary assets can last a long time, but if we assume that all monetary assets stop one day being a monetary asset (maybe even gold), then ALL monetary assets will crash back to zero one day.  The only thing that distinguishes them is the time span over which they did keep up.  Gold has a record for about 5000 years.  Dollars have been crashing down since 1914 with a factor of 23, but are still a monetary asset.  Bitcoin, who knows.

The price increases by way of speculation.  

You  two clearly don't know what fundamentals mean.  And surely you wouldn't  even believe me if I explained to you so it's better you find out in your own.  

If you think think there is a fundamental value then you can tell me what it is from a DCF analysis.  Good luck with that since speculative assets have no cash flow.  Finance 101

Bitcoin having the (only) pretention of being a monetary asset, its fundamental is given by the monetary formula: P x Q = M x V.

But better: B = 1/P (the value of a bitcoin), and T = 1/V (the harmonic average of holding times).

M is the amount of bitcoins existing (ultimately 20 million).

If Q value of goods is traded against bitcoin, and if the average holding time between acquiring bitcoin and spending it for goods Q, is T, then the fundamental value of a bitcoin is given by:

B = Q x T / M

You can also say that the fundamental market cap of bitcoin is Q x T.

This is a fundamental, because as long as people want to buy value Q with it, and hold on average the coins during a time T, then the value of the market cap CANNOT be lower than Q x T.

Imagine that people are buying for the equivalent of $ 100 billion on the (black ?) market per year, and they are holding the coins for about 14 days (1/25 of a year, say), then the market cap of bitcoin must be about $4 billion.  Simply because this is the value the coins need to have to be immobilized during 14 days, and being able to buy $100 billion worth.

This is why the fundamental of bitcoin is merchant (and customer) adoption.


But of course, the current market value of bitcoin will include the speculative part of the FUTURE fundamental.  Currently, I don't think that bitcoin has as a monetary fundamental (as defined above) its current price.  I would even think it to be in the double digit range rather.   The current price reflects the speculation on a future higher fundamental of course.  I think the current decline is simply due to people finally realizing that that future higher fundamental, if ever, is not for the next few years.

The high end of the future fundamental would be if bitcoin replaced all of fiat in the world, and would be used in a similar way as fiat now (that is, similar holding times).  In that ultimate case, a coin would go for about $ 3 millon (value today).

If you expect that to happen 150 years from now, you can apply your discounted cash flow technique.  I don't know how much you'll find for the price right now.

If you expect bitcoin to be limited to a market of a few hundred billion dollars in the next decades, then everything depends on the holding times.  Those could be really short if people just use them as a transaction between fiat holdings, which would put the holding times to a few hours only.  In that case, you could expect the market cap to be divided by about 100. and end up in the few tens of millions up to a few hundred millions, which would bring us indeed back to a coin price in the double digits.

I never heard of a ponzi that collapsed multiple times.

Because one could not exist by definition. But try telling this to idiots who heard of bitcoin in 2014 and don't know what log charts are; to them, there was only one runup and one deflation, so they hurry to share their dumb revelation with us.

They could read this:
http://bitcoinobituaries.com/