I don't see Ponzi at all.

Here's a question for you. What are the odds that Bitcoin after ten years will be "as successful" as Paypal was after its first ten years?

Say the odds are 10% that Bitcoin will have as many users after a decade as Paypal did. Pick any number that you want. I'll use 10% chance.

And say that each user holds on average, a small amount of money in Bitcoin - some amount that they can conduct business, but not so much that they would have fit if they lost it. I'll say $10 worth, on average. You use whatever number you want.

OK, Paypal had 150 Million users after its first decade, according to this NY Times article:

http://www.nytimes.com/2007/11/19/technology/19ecom.html (combined with the Wikipedia article that said that Paypal was founded in 1998, meaning nearly ten years old at the time of the NY Times article.)

If Bitcoin has 150 million users after a decade, and each user holding (on average) $10 worth of Bitcoin, and, in January 2019 (its tenth anniversary), there will be 17 Million Bitcoins (a known value), then how much will each one be worth? That's $1.5 Billion worth, divided by 17 Million. That's $88/bit coin. Simple math.

And if there's a 10% chance of that happening exactly, and a 90% chance of them being completely worthless, then today, each bitcoin is worth $8.80. Or even if the "midpoint" of the 10% probability is equal to Paypal's success, with some probability that it will do slightly better, and some equal probability that it will do slightly worse, but a 90% probability that all bitcoins will become worthless, then they are worth $8.80 today.

Now, as each day goes by, and the word spreads, the probability of such success may go up. And that means that the value will go up. If more people hear about bitcoins, then the likelihood of such success may jump to 20%. And then their value should double as well, jumping to 20% of the $88/Bitcoin. The value is proportional to the perceived likelihood of widespread use of Bitcoins. And when there were just a few Bitcoin owners with little press, the likelihood of success was small, so the value was small. With the recent press, the likelihood of success goes up, so naturally the value goes up. And if there's some government crack-down or some flaw in the system, then the likelihood of success will go down and therefore the value will likely go down.

Naturally, their value is what someone else will pay you for them. But as you can see in the above model, there's nothing to say that Bitcoins can't get to $88/coin by 2019.

I'm calling this the "JerFelix Bitcoin Valuation Model", in case you want to refer to it later. Learn it. There will be a test!