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even the ECB disagrees in Bitcoin being a Ponzi by its definition.
A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing
investors from funds contributed by new investors. Ponzi scheme organizers often solicit new
investors by promising to invest funds in opportunities claimed to generate high returns with little
or no risk.In many Ponzischemes, the fraudstersfocus on attracting new money to make promised
payments to earlier-stage investors and to use for personal expenses, instead of engaging in any
legitimate investment activity.14
On the one hand, the Bitcoin scheme is a decentralised system where – at least in theory – there
is no central organiser that can undermine the system and disappear with its funds. Bitcoin users
buy and sell the currency among themselves without any kind of intermediation and therefore, it
seems that nobody benefits from the system, apart from those who benefit from the exchange rate
evolution (just as in any other currency trade) or those who are hard-working “miners” and are
therefore rewarded for their contribution to the security and confidence in the system as a whole.
Moreover, the scheme does not promise high returns to anybody. Although some Bitcoin users may
try to profit from exchange rate fluctuations, Bitcoins are not intended to be an investment vehicle,
just a medium of exchange. On the contrary, Gavin Andresen, Lead Developer of the Bitcoin
virtual currency project, does not hesitate to say that “Bitcoin is an experiment. Treat it like you
would treat a promising internet start-up company: maybe it will change the world, but realise that
investing your money or time in new ideas is always risky”.15 In addition, Bitcoin supporters claim
that it is an open-source system whose code is available to any interested party
i omitted the bogus counter-aruments investors from funds contributed by new investors. Ponzi scheme organizers often solicit new
investors by promising to invest funds in opportunities claimed to generate high returns with little
or no risk.In many Ponzischemes, the fraudstersfocus on attracting new money to make promised
payments to earlier-stage investors and to use for personal expenses, instead of engaging in any
legitimate investment activity.14
On the one hand, the Bitcoin scheme is a decentralised system where – at least in theory – there
is no central organiser that can undermine the system and disappear with its funds. Bitcoin users
buy and sell the currency among themselves without any kind of intermediation and therefore, it
seems that nobody benefits from the system, apart from those who benefit from the exchange rate
evolution (just as in any other currency trade) or those who are hard-working “miners” and are
therefore rewarded for their contribution to the security and confidence in the system as a whole.
Moreover, the scheme does not promise high returns to anybody. Although some Bitcoin users may
try to profit from exchange rate fluctuations, Bitcoins are not intended to be an investment vehicle,
just a medium of exchange. On the contrary, Gavin Andresen, Lead Developer of the Bitcoin
virtual currency project, does not hesitate to say that “Bitcoin is an experiment. Treat it like you
would treat a promising internet start-up company: maybe it will change the world, but realise that
investing your money or time in new ideas is always risky”.15 In addition, Bitcoin supporters claim
that it is an open-source system whose code is available to any interested party
