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Author Topic: The Multi-level Marketing scheme argument  (Read 5462 times)
Synaptic
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July 17, 2011, 07:10:34 AM
 #61

The easiest way to know right now that the current setup of Bitcoin is completely suspect is the fact that these kinds of questions even get brought up.  I mean, just try and imagine this office conversation:

Me: Hey guys, I think I've found a way to make our code a lot more efficient.

Office mate #1: Your changes smell like a Ponzi scheme to me.

Office mate #2: I don't know about that, but if you think about the details, it's just self-evident that it is not a multi-level marketing scheme.

A reasonable system would never have these kinds of questions brought up.

No, the reason the current setup is quantitatively corrupt is that many of the same criticisms of an MLM apply to what supposedly should become the perfect reserve currency for the entire World.

If in your clever little allegory "You" said, "Oh, and whoever starts writing code for this project first gets paid upwards of 1000% more per line than anyone who writes code afterward, but ONLY if you can convince more people to start writing code now, which shouldn't be too difficult since they might get paid upwards of 100% more per line than the next guy.  Oh, AND this program is set up to become the all knowing AI that solves a problem humanity has been having as long as history, you should really tell everyone about what a utopia it could be if we write it. It's the greatest thing since sliced bread!" then of course the picture becomes a bit clearer...
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TraderTimm
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July 17, 2011, 05:07:28 PM
 #62

I'm glad bitcoin is going through this now. I want it to be attacked from all sides, bashed by every resource, scrutinized and proclaimed a failure right out of the gate. If the underlying system can't survive this, then it wasn't meant to survive. Seeing how we haven't gone down to zero in relative valuation compared to < insert currency here >, and the participation in the network measured in TeraHashes per second hasn't declined in any significant way.

I'd say this bodes well for the future.

We've got until the end of August to disprove some of the more fantastic 'bubble' claims, then after that it is only a matter of time before other obstructions are surmounted and toppled.

Please, do your best to kill bitcoin - it only becomes stronger after every obstacle is defeated.

fortitudinem multis - catenum regit omnia
Synaptic
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July 17, 2011, 05:29:30 PM
 #63

I'm glad bitcoin is going through this now. I want it to be attacked from all sides, bashed by every resource, scrutinized and proclaimed a failure right out of the gate. If the underlying system can't survive this, then it wasn't meant to survive. Seeing how we haven't gone down to zero in relative valuation compared to < insert currency here >, and the participation in the network measured in TeraHashes per second hasn't declined in any significant way.

I'd say this bodes well for the future.

We've got until the end of August to disprove some of the more fantastic 'bubble' claims, then after that it is only a matter of time before other obstructions are surmounted and toppled.

Please, do your best to kill bitcoin - it only becomes stronger after every obstacle is defeated.


Amen. I'm no opponent towards a wholly Darwinist outcome.

Bitcoin will become all that it's meant to ever be. Nothing can stop that.

If it's meant to be a small community of disenfranchised fools who saw stars in puddle of shit, so be it.

If it's the world's next greatest financial instrument, so be it.
BTConomist
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July 17, 2011, 06:08:08 PM
 #64


When we talk about Bitcoin, we're talking about a digital commodity whose value depends (just as any other commodity) on supply and demand.

What makes an accounting ledger (read: bitcoin) a commodity?

Now, the bitcoin network as a whole has a market price, which will adjust based on the value and volume of things (e.g. fiat currencies, bananas, etc.) that are sold for bitcoins; but a unit of account itself (a.k.a. a bitcoin transaction) is just another credit/debit entry in that network. So, when you speculate on the value of BTC in terms of fiat currencies, you're trying to price the act of recording a transaction. Essentially, you're trying to figure out a wage that an accountant should be paid for tracking all bitcoin-denominated transactions.

But don't we already have accountants for the bitcoin network? And don't we pay them in bitcoin bounties and transaction fees?

Bitcoins are earned, not traded! If you plan on hoarding BTC, you're on my target list. (And yes, it is possible to swim in BTC.)

Don't give me that Bull... I'm one of those honey eating Bears that the bees hope to never meet again... Viva la BTC!!!
kloinko1n
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July 21, 2011, 03:45:33 PM
 #65

Please tell me the different % payouts I get from the different levels of referrals.  Thanks.

I dunno, depends on what you get from CampBX, apparently.


LOL!! Brillant!  Cheesy Cheesy Cheesy
Rassah
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July 21, 2011, 07:45:28 PM
 #66


When we talk about Bitcoin, we're talking about a digital commodity whose value depends (just as any other commodity) on supply and demand.

What makes an accounting ledger (read: bitcoin) a commodity?

Now, the bitcoin network as a whole has a market price, which will adjust based on the value and volume of things (e.g. fiat currencies, bananas, etc.) that are sold for bitcoins; but a unit of account itself (a.k.a. a bitcoin transaction) is just another credit/debit entry in that network. So, when you speculate on the value of BTC in terms of fiat currencies, you're trying to price the act of recording a transaction. Essentially, you're trying to figure out a wage that an accountant should be paid for tracking all bitcoin-denominated transactions.

But don't we already have accountants for the bitcoin network? And don't we pay them in bitcoin bounties and transaction fees?

USD/money is a commodity, and something like 95% of it exists in digital form, as just records in an accounting ledger. So...

BTConomist
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July 21, 2011, 08:13:16 PM
 #67


When we talk about Bitcoin, we're talking about a digital commodity whose value depends (just as any other commodity) on supply and demand.

What makes an accounting ledger (read: bitcoin) a commodity?

Now, the bitcoin network as a whole has a market price, which will adjust based on the value and volume of things (e.g. fiat currencies, bananas, etc.) that are sold for bitcoins; but a unit of account itself (a.k.a. a bitcoin transaction) is just another credit/debit entry in that network. So, when you speculate on the value of BTC in terms of fiat currencies, you're trying to price the act of recording a transaction. Essentially, you're trying to figure out a wage that an accountant should be paid for tracking all bitcoin-denominated transactions.

But don't we already have accountants for the bitcoin network? And don't we pay them in bitcoin bounties and transaction fees?

USD/money is a commodity, and something like 95% of it exists in digital form, as just records in an accounting ledger. So...

Thanks for bringing that up!
I was trying to draw the following distinction:

Ledger > Bitcoin, Dollar (Fiat money)... http://en.wikipedia.org/wiki/Money

Commodity > Gold Coins... http://en.wikipedia.org/wiki/Commodity_money

As you can see, since bitcoin is a general (accounting) ledger, there's no reason to treat it as a commodity?

Bitcoins are earned, not traded! If you plan on hoarding BTC, you're on my target list. (And yes, it is possible to swim in BTC.)

Don't give me that Bull... I'm one of those honey eating Bears that the bees hope to never meet again... Viva la BTC!!!
LeonGeeste
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July 21, 2011, 08:33:40 PM
 #68

Synaptic's claims are outright ridiculous, and I assumed he was trolling.  But it also seems like no one has given a thorough reply to his specific (moonbat) criticisms, so, at risk of feeding a troll, I will do it.

"Criticism has focused on their similarity to illegal pyramid schemes, price-fixing of products (BITCOIN BOTS, "EARLY ADOPTERS," EXCHANGE OPERATORS MANIPULATING MARKET PRICE),

You misunderstand what is meant by price-fixing of products in the context of MLM -- that criticism refers to how they keep the products' prices fixed regardless of the economics, through a contract between all of the distributors and the company.  There is no such price fixing in Bitcoin in that sense -- it's too decentralized for anyone to conspire to fix the price of anything in bitcoins.  Also, bots aren't an official part of the system.

As for the early adopter thing, we've been over that here a thousand times: this is no different from buying shares at an IPO that turns out to become hugely profitable.  If it turns out that your investing in the IPO enables significant productivity gains, you make a lot of money.  Likewise if you "invested" early on to get Bitcoin off the ground and make it a respectable currency, you could make a big profit if it gets to that stage.

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high initial start-up costs,

No, the software is free, it costs virtually nothing to start trading stuff for bitcoins.

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emphasis on recruitment of lower-tiered salespeople over actual sales (RAMPANT SPECULATION VS. REAL ECONOMY),

Who's doing the emphasizing?  The project leads sure as hell don't, and you don't have to deal with any kind of indoctrination from that kind of person in order to use bitcoins.

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encouraging if not requiring salespeople to purchase and use the company's products (BITCOIN "ECONOMY"),

No one's required, and they're only "encouraged" to use those vendors because, um, those are where you can spend your bitcoins.  It would be different if people were pressured to make non-Bitcoin purchases from vendors that accept Bitcoin, but that's not happening, and if it were, it's not because of the "owners" of the non-existent "Bitcoin company".

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potential exploitation of personal relationships which are used as new sales and recruiting targets (DITTO),

WTF?  Most people heard about this online, not through some "personal relationship", and unlike MLM, you're not required to go through an "upline" or licensed agent or whatever to get involved.

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complex and sometimes exaggerated compensation schemes (DITTO),

What's the "Bitcoin compensation scheme"?  Are you talking about the transparent miner policies?

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and cult-like techniques which some groups use to enhance their members' enthusiasm and devotion (NEED I SAY MORE)."

Alright, where are these cult-like Bitcoin activities?  Where's the Bitcoin worship meeting?  Where's the pledging fealty to a leader, etc?

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"Independent, unsalaried salespeople of multi-level marketing, referred to as distributors (or associates, independent business owners, dealers, franchise owners, sales consultants, consultants, independent agents, BITCOIN MINERS, BITCOIN EVANGELISTS, etc.),

Er, the existence of independent distributors, and commission-based salespeople isn't what MLM is criticized for -- that exists everywhere.  You're just misreading the article now.

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represent the company (BITCOIN P2P NETWORK) that produces the products or provides the services they sell (ONLINE TRANSACTION PROCESSING, COMMODITY SPECULATION).

Biggest phail.  There is no "bitcoin company", and the p2p network is not at all like one.  The transaction processing fees and block rewards exist simply because enough people follow a protocol (which they do to ensure their transactions are not rejected), not because of some corporate compensation scheme.

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They are awarded a commission based upon the volume of product sold through their own sales efforts as well as that of their downline organization (USD ENTERING THE MARKETS).

Complete non-sequitur.  You've given no explanation for how Bitcoin has a "downline"-based compensation scheme or organization.

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Independent distributors develop their organizations by either building an active customer base (BITCOIN EVANGELIZING),

That's not "building a customer base" in the sense of MLM, which would involve a group of people you have exclusive sales rights to -- which can't even happen with the way Bitcoin works.

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who buy direct from the company (BITCOIN EXCHANGE OPERATORS),

There is no "the" company, certainly not one that sells at some "wholesale price".  There are, rather, numerous buyers and sellers (you don't have to go through an exchange!) that compete, yielding a market-driven price.

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or by recruiting a downline of independent distributors who also build a customer base (BITCOIN MINERS, BITCOIN MERCHANTS)

Another complete non-sequitur.  How are these miners and merchants anything like the "downline distributors" of MLM?

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thereby expanding the overall organization. Additionally, distributors can also earn a profit by retailing products they purchased from the company at wholesale price (EARLY ADOPTERS, BITCOIN MINERS)."

Unless the non-fixed price happens to fall or something.

Seriously, I have no idea what you're on about.  Maybe too many bitcoiners are fanatical, but beyond that, I don't see how you are justifying anything more than a superficial resemblance between Bitcoin and MLM (and in a way that would indict the stock/bond market, IPOs, etc as well).  And I just wasted, well, too much time responding to a non-argument.

If you want to be taken seriously -- and I do want to know any negative aspects of bitcoin -- please describe, specifically what the negative aspects of Bitcoin are and how they resemble MLM.  Don't just quote a criticism of MLM, mention a kind of Bitcoin user, and expect me to see the connection.

If I don't get a serious reply to this, you're going on "ignore".
LeonGeeste
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July 22, 2011, 02:09:02 AM
 #69

I just got trolled, didn't I?  Roll Eyes
BitterTea
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July 22, 2011, 02:30:56 AM
 #70

Bitcoin is fundamentally flawed and it seems to me that someone so fucking clever should have come up with a way to base the block difficulty on some standard of economic activity and not the absolutely retarded metric of how many people are chomping at the bit for their own blocks.

Hahaha.

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some standard of economic activity

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absolutely retarded metric of how many people are chomping at the bit for their own blocks

Whoosh. That's the sound of you missing the point.
Tasty Champa
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July 22, 2011, 03:03:03 AM
 #71

why you guys carry on troll thread?

guy admitted his trollinz numerous times.
quite a mean little fellow too, having seen him around multiple times just being mean to people by his own ommision for no reason other than his enjoyment.
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July 22, 2011, 04:20:58 AM
 #72

MLM is one of the most effective ways to sell something, and it is all around us.

The nightclub that gives you a free limo if you bring 10 friends is using a MLM scheme.
Your house is marketed and sold under MLM.
The millions of retail jobs in North America pay commission to the seller, the store that owned the merchandise, and the distributor that sent it to them.  MLM

MLMs were looped in with "pyramid schemes for some reason, and that gave them a bad name.  The biggest difference in a true pyramid scheme is that you can never make more money than a person above you.  People on the bottom of the pyramid schemes make the least money.   All Pyramids are MLM.  Not all MLM's are pyramids.

Bitcoin is neither a MLM or it's subset Pyramid Scheme.  It has the same value to the buyer and seller regardless of how each was introduced.


I'm into creating universes, smiting people, writing holy books and listening to prayers.
If you want your prayers answered, you must donate to 1CDyx8AUTiYXS1ThcBU3vy4SJWQq6pdFMH
whenhowwho
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July 22, 2011, 01:04:12 PM
 #73

Hey Synaptic is famous!    http://www.youtube.com/watch?v=p_M-lildu8w

1HUy7T9SyNLTJCVX3p8KzftApYdWgcsRqD
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