Is cryptocurrency a financial pyramid

[Obari]

I came across a news on Quora and I went into a very deep reason on the reality  of life and judge from the article on the post, I couldn't agree less with the author/writer because at the long run, it seems money is just circulating and the moment  money seizes circulation, even the price of bitcoin  is affected, hence the price of bitcoin  would increase if demand increases and demand can only increase when there is more money to spend.

So I had to bring this to the forum to know if you guys also think, cryptocurrency is some ways a financial pyramid.
Let's discuss please

[1714860401]

1714860401

[Onset]

They likely didn’t get Bitcoin right.

Bitcoin doesn’t need increasingly more demand to get a larger price. Scarce supply plays a huge role in the middle of all this. Supply gets more scarce, miners keep mining, price needs an increase for mining to continue to be worth it. Will I continue to pay double or more for Bitcoin after next halving? Yes. Will others do the same? Yes! Because you get the idea that Bitcoin simply becomes harder and more costly to mine.

This pyramid scheme thing has been debated ever since Bitcoin exists. It’s good to have debates and opinions but it sucks that some people argue and debate with zero knowledge of the subject. You don’t need one more guy to invest in Bitcoin for price to increase. All you need is miners to stop accepting to sell freshly mined Bitcoin for a certain price and the already existing users of the Bitcoin network to agree to pay more since costs increased. This is obviously not the only factor of price changes but it plays a huge role many seem to forget about or pretend it doesn’t exist.

[Yatsan]

First of all, how do you define financial pyramid? 'coz it has various definition such as the context of fraudalent scheme and the other one is a strategy to efficiently make use of your money as you get older. Ofcourse the market price of Bitcoin will depend on the demand since there's nothing to regulate its value unlike other assets. Lower supply means higher demand but that depends if the asset would really be creating a demand to its consumers or users. Not all things which has low supply will automatically have a demand.

And if this is about investment pyramid, then Bitcoin would more likely fall to high risk speculative assets simply because of its high rate of market price volatility and its usage across majority of countries.

To make it simple, Bitcoin is simply a currency and an investment at one and that is because of its characteristics with regards to its changing market price.

[Dunamisx]

I came across a news on Quora and I went into a very deep reason on the reality  of life and judge from the article on the post, I couldn't agree less with the author/writer because at the long run, it seems money is just circulating and the moment  money seizes circulation, even the price of bitcoin  is affected

When there's an economic imbalance in fiat monetary system, bitcoin is not affected, else this current economy would have been the determinant for bitcoin sustainability, but things aren't the way you perceived it, bitcoin cannot be affected by economy inflation because it's own network entirely is different from the system running the fiat economy and monetary system, they are centralized economy depending on the outcome of each state or country to sustain the economy through their GDP and other economical parameters while bitcoin network is base on demand and supply only on the bitcoin ecosystem.

hence the price of bitcoin  would increase if demand increases and demand can only increase when there is more money to spend.

Since bitcoin is volatile, there might only be a coincidental experience that such occur at almost the same time but that doesn't judge if the economy is what determines the demand for bitcoin or not, bitcoin is already a volatile currency and its self sustainable through it demand and supply without replying on the fiat monetary policy.

[Despairo]

Since you're discuss about cryptocurrency aka shitcoins, then it's yes shitcoins is a financial pyramid because they offer unrealistic return if you able to invite people to invest in their project. Remember shitcoins is centralized, they can manipulate their supply and their price, it's not like Bitcoin which is decentralized. Bitcoin price is only depends on demand and supply, while shitcoins price is depends on demand and supply and manipulation.

[Beparanf]

They likely didn’t get Bitcoin right.

Bitcoin doesn’t need increasingly more demand to get a larger price. Scarce supply plays a huge role in the middle of all this. Supply gets more scarce, miners keep mining, price needs an increase for mining to continue to be worth it. Will I continue to pay double or more for Bitcoin after next halving? Yes. Will others do the same? Yes! Because you get the idea that Bitcoin simply becomes harder and more costly to mine.

Do you even know what you are saying. Demand is what makes the price grow because any token with great feature will not grow the price if there’s no real demand on it. On Bitcoin case, Bitcoin is the only real decentralized project that starts the use of Blockchain. This makes Bitcoin in demand to reach the current price. All your explanation about supply can be easily copied by fork coins or any shitcoins since supply can be customized by the creator. The demand can’t be controlled since it’s base on user’s perspective or speculation on the token.

They likely didn’t get Bitcoin right.
This pyramid scheme thing has been debated ever since Bitcoin exists. It’s good to have debates and opinions but it sucks that some people argue and debate with zero knowledge of the subject. You don’t need one more guy to invest in Bitcoin for price to increase. All you need is miners to stop accepting to sell freshly mined Bitcoin for a certain price and the already existing users of the Bitcoin network to agree to pay more since costs increased. This is obviously not the only factor of price changes but it plays a huge role many seem to forget about or pretend it doesn’t exist.

It depends on the context of the pyramid. The OP financial pyramid is not the typical ponzi scheme that probably most of you assuming. It can be just a layer on money distribution on an asset. The attached link is not working which there’s no way to verify the real context for the word financial pyramid.

[rozak]

I came across a news on Quora and I went into a very deep reason on the reality  of life and judge from the article on the post, I couldn't agree less with the author/writer because at the long run, it seems money is just circulating and the moment  money seizes circulation, even the price of bitcoin  is affected, hence the price of bitcoin  would increase if demand increases and demand can only increase when there is more money to spend.

So I had to bring this to the forum to know if you guys also think, cryptocurrency is some ways a financial pyramid.
Let's discuss please

The price of Bitcoin increases due to market demand, and also it is affected due to limited supply. This will be different from the money circulating in society. they continued to be printed and increased in number.
somehow I can't open your link, so I don't know what financial pyramid you mean. or can be more specific to your subject. the mention of cryptocurrencies may be too broad. maybe Bitcoin will represent your view.

[Taskford]

Since you're discuss about cryptocurrency aka shitcoins, then it's yes shitcoins is a financial pyramid because they offer unrealistic return if you able to invite people to invest in their project. Remember shitcoins is centralized, they can manipulate their supply and their price, it's not like Bitcoin which is decentralized.

This happen on shitcoins since they offer a sort of percentage to people who can recruit more user to participate on their platforms. Also on airdrop since which is commonly use by some scammer since they want to distribute their tokens to gather supporter  that  can help them out spread the word about what project they created and help them to have positive discussion towards its community created. This is the main reason why to many people got scam on those scam projects since there are greedy people helping scammers to make their activities more easier.

[blockman]

I came across a news on Quora and I went into a very deep reason on the reality  of life and judge from the article on the post, I couldn't agree less with the author/writer because at the long run, it seems money is just circulating and the moment  money seizes circulation, even the price of bitcoin  is affected, hence the price of bitcoin  would increase if demand increases and demand can only increase when there is more money to spend.

So I had to bring this to the forum to know if you guys also think, cryptocurrency is some ways a financial pyramid.
Let's discuss please

The first guy that answered that Quora question said that it's like stocks and that's most likely easier to understand for those that doubt crypto. While those scam projects make the impression of this a pyramid or a scam. There are already negative thoughts about upon hearing the term pyramid and it's all about the scam. But it's not important at all, those projects that add no value to the market will always be exposed. But the good ones especially bitcoin will remain to be the most preferred crypto of all time. And it's the first one that has taken the negative thoughts and criticisms.

[stompix]

Bitcoin doesn’t need increasingly more demand to get a larger price. Scarce supply plays a huge role in the middle of all this. Supply gets more scarce, miners keep mining, price needs an increase for mining to continue to be worth it. Will I continue to pay double or more for Bitcoin after next halving? Yes. Will others do the same? Yes! Because you get the idea that Bitcoin simply becomes harder and more costly to mine.

You have just described the growing demand!
And no, as with any other thing out there, be it an asset, a commodity, a metal, oil, real estate, jpg monekys or bitcoin they all need more demand in order for the price to grow. How could the price even go up when there would be fewer people with less money buying than people selling?
No matter how great Bitcoin is it still needs to abide to the laws of economics.

So I had to bring this to the forum to know if you guys also think, cryptocurrency is some ways a financial pyramid.
Let's discuss please

You've been around this forum for almost a year and you seriously, seriously!!!! want to discuss this here?
Besides, just a quick search and I've found a ton of topics with the same thing, why not express your fears there?

How do I convince people that Bitcoin isn't a financial pyramid
Bitcoin Exceptionalism: Why Should this Pyramid-Ponzi Not end Like all Others??

[m2017]

I came across a news on Quora and I went into a very deep reason on the reality  of life and judge from the article on the post, I couldn't agree less with the author/writer because at the long run, it seems money is just circulating and the moment  money seizes circulation, even the price of bitcoin  is affected, hence the price of bitcoin  would increase if demand increases and demand can only increase when there is more money to spend.

So I had to bring this to the forum to know if you guys also think, cryptocurrency is some ways a financial pyramid.
Let's discuss please

In the highlighted sentence, instead of the word Bitcoin, put the words Shares, Securities, and so on, and then you will see that little will change (actually, nothing will change). The same principles work in the traditional stock market, but for some reason no one shouts that this is a pyramid scheme, right.

And if you take the banking sector. Any bank. Investors together bring money to a bank, for example, silicon valley bank (all coincidences are random). At one point, panic begins and investors begin to take their money back. As a result, there will not be enough money for everyone, but only for those who first thought to take the money. The last investors are left with nothing. Isn't that like a pyramid?

What am I talking about? And besides, structurally, the work of bitcoin is almost no different from traditional financial instruments, and therefore, it is ridiculous for me to hear such accusations against bitcoin that it is a pyramid scheme. If their are have the courage to call bitcoin a pyramid, then let them call the entire stock market a pyramid too.

[kryptqnick]

Let's start with what a financial pyramid is, and here I'm relying on my understanding plus Investopedia. A financial pyramid is a centralized project where those closer to the top can benefit by taking the money of those below them. It relies on promising unrealistic returns, and people who fall for it become the victims. It eventually collapses when no new victims (or not enough new victims) are found.
Bitcoin is decentralized, not a company, not recruiting anyone. When the price goes up, all investors benefit equally (if it's a 10% rise, it's a 10% rise for everyone). I don't think that new investors are necessary for the price to go up, even though it generally helps. More demand can be generated within a given number of users, and an increase of users doesn't directly lead to an increased price.
'Cryptocurrency' is a very general term, too broad. Some crypto projects may be scams, perhaps even built as financial pyramids. But it doesn't make the whole market or a concept of cryptocurrency a pyramid in any way.

[BitDane]

I came across a news on Quora and I went into a very deep reason on the reality  of life and judge from the article on the post, I couldn't agree less with the author/writer because at the long run, it seems money is just circulating and the moment  money seizes circulation, even the price of bitcoin  is affected, hence the price of bitcoin  would increase if demand increases and demand can only increase when there is more money to spend.

To be precise the increase of money does not necessary means there is an increase in bitcoin adoption.  There should be a meeting factor in order to say that there is a bitcoin adoption.  Although money is needed to invest in bitcoin market, it is necessary to have interest and acceptance.  So Bitcoin adoption will happen if people accept Bitcoin and put money on it.  In short to have more money to be injected on Bitcoin market, we need to attract more people to participate in Bitcoin economy.

So I had to bring this to the forum to know if you guys also think, cryptocurrency is some ways a financial pyramid.
Let's discuss please

Cryptocurrency is an open market, so there is no company that dictates the prices, the market moves according to the adoption so if we consider cryptocurrency being a financial pyramid then the whole markets can be consider as financial pyramid too.

[Mr. Magkaisa]

I came across a news on Quora and I went into a very deep reason on the reality  of life and judge from the article on the post, I couldn't agree less with the author/writer because at the long run, it seems money is just circulating and the moment  money seizes circulation, even the price of bitcoin  is affected, hence the price of bitcoin  would increase if demand increases and demand can only increase when there is more money to spend.

So I had to bring this to the forum to know if you guys also think, cryptocurrency is some ways a financial pyramid.
Let's discuss please

     -   What do you understand by financial pyramid mate? As far as I know, crypto mostly uses decentralized control unlike centralized banking systems. Apart from this it is a digital currency that also uses cryptography for security.

It is also difficult to counterfeit because of its security feature. Now in the financial pyramid it is a deceptive investment that is often used by exploitative people in their strategy who make promises of high returns, while cryptocurrency is not inherently fraudulent.

[Gallar]

I came across a news on Quora and I went into a very deep reason on the reality  of life and judge from the article on the post, I couldn't agree less with the author/writer because at the long run, it seems money is just circulating and the moment  money seizes circulation, even the price of bitcoin  is affected, hence the price of bitcoin  would increase if demand increases and demand can only increase when there is more money to spend.

So I had to bring this to the forum to know if you guys also think, cryptocurrency is some ways a financial pyramid.
Let's discuss please

You are right, that bitcoin will definitely increase in price, when there are many requests from people who will invest. But that doesn't mean that the amount of money in circulation will make bitcoin prices rise.

Indeed, this will certainly affect the price of bitcoin, but it will not have too much of an effect. Because it doesn't mean that a lot of money will have a big effect on the price of bitcoin. Even though a lot of money has been circulated around the world, in every country, it doesn't mean that people who have money will directly buy bitcoins. Because everyone must have what is called the necessities of life, so surely people will prioritize their needs first. Even bitcoin investors, I think, will definitely prioritize their needs first. Moreover, people who don't know bitcoin, are definitely most likely not to buy bitcoin.

So it's best not to make a benchmark, that with lots of money circulating in the world, it will make bitcoin prices rise, things like that won't be guaranteed.

[Agbe]

This what I see from the link you provided 👇

But by the way, if money seized to flow, every other things be a business, currency and others will be greatly affected. Because at that time the demand of bitcoin will be very slow. So the supply will be be slow as well. Then inflation be low in some areas and high in the other areas. Why inflation will be low because the turn out to buy commodities will be less so the demand will low and the supply will be high. And why other places will be high is the sense that those who has the limited funds in their possession will use it to buy things with and high price.  Bitcoin the s not yet a pyramid.

[Onset]

You have just described the growing demand!
And no, as with any other thing out there, be it an asset, a commodity, a metal, oil, real estate, jpg monekys or bitcoin they all need more demand in order for the price to grow. How could the price even go up when there would be fewer people with less money buying than people selling?
No matter how great Bitcoin is it still needs to abide to the laws of economics.

What I meant to say is Bitcoin doesn’t need a new person to enter the system for it to be sustained. It does need demand continuously to exist and survive, but it doesn’t require a continuous loop of more investment today than yesterday to exist. Most “Bitcoin is a pyramid” theories come from the presumption that without a new investor tomorrow, Bitcoin dies. It doesn’t. It can live without new “victims”.

When I said others would continue buying too I was talking about others who already are Bitcoin investors. I meant to say there’ll be demand even if the price doubles because we all get it, the supply is just getting scarcer. Remember I said BTC doesn’t need increasingly higher demand to exist. Because typically, pyramid schemes need more money today than yesterday, more investors today than yesterday etc until they finally can’t do it anymore. To me BTC is just in no way close to the definition of a pyramid..

[stompix]

~

What I meant to say is Bitcoin doesn’t need a new person to enter the system for it to be sustained.
~
Remember I said BTC doesn’t need increasingly higher demand to exist.

No you didn't, you said it clearly in the first line:

Bitcoin doesn’t need increasingly more demand to get a larger price.

You mentioned investing and rising in price 7 times but not once you said anything about existing!

I meant to say there’ll be demand even if the price doubles because we all get it, the supply is just getting scarcer.

Again wrong, the supply is not getting scarcer, the supply grows, today we have 900 freshly minted coins that are added to the circulating supply, what you tried to say is the rate at which the supply is growing is going down.
For the supply to get scarcer you would need to destroy each day more coins than are getting minted.

[serjent05]

I meant to say there’ll be demand even if the price doubles because we all get it, the supply is just getting scarcer.

Again wrong, the supply is not getting scarcer, the supply grows, today we have 900 freshly minted coins that are added to the circulating supply, what you tried to say is the rate at which the supply is growing is going down.
For the supply to get scarcer you would need to destroy each day more coins than are getting minted.

It is either way I think Bitcoin is not getting or getting more scarce is dependent on the available supply to meet the demand.  Even with fewer Bitcoin in circulation if there is no demand for it, it won't be called scarce. 

We can compare an example of Bitcoin being 100% mined and lots of wallets with funds lost but it is fully available in the market and is selling at a stable price, this scenario does not show Bitcoin scarcity.  While in a scenario where Bitcoin is not yet fully mined and there is a supply of coins every 10 minutes but the demand outweighs the supply creating a shortage of Bitcoin that makes the price surge, then we can say that there is scarcity in that scenario due to shortage and more demand.

So shortage is the determining factor of scarcity. Demands outweigh the supply.

[_BlackStar]

I came across a news on Quora and I went into a very deep reason on the reality  of life and judge from the article on the post,

I didn't find the news, but maybe - in some cases justifiable especially about some altcoin projects. Of course I would never agree with them when they say bitcoin is a pyramid scheme even though I admit that early investors have made huge returns.

Please read this and I have made assumptions about it in the past: https://bitcointalk.org/index.php?topic=5382044.0#post_Bitcoinisapyramid

Bitcoin doesn't need this way to get a lot of users. Each user can get their own profit according to the amount of investment they want to make. You may be recruited by people who have business interests in the name of bitcoin like many investment platforms today where you become a referral member of people who take advantage of your member status. Bitcoin doesn't require this as you are free to make any purchases based on your current financial capabilities, P2P or centralized exchanges are a great place for you to buy and invest in bitcoin.