European central bank researcher paper implies bitcoin is a ponzi scheme

[bbc.reporter]

It appears that if there really opens a real regulatory implication for bitcoin in Europe, I reckon the government will do their best on where they can attack something that might be threatening to them. They do this by imposing higher taxes.

I speculate that capital gains tax will be increased to discourage trading bitcoin.

In any case, according to Tuur Demeester this research paper is a declaration of war against bitcoin.



In a paper from European Central Bank (ECB) economists Ulrich Bindseil and Jürgen Schaaf, they argue that Bitcoin’s rise in value disproportionately benefits early adopters at the expense of latecomers and non-holders.

While this doesn’t necessarily reflect the official stance of the ECB, the paper has opened debate over potential regulatory implications.

The paper claims that, in a scenario where Bitcoin’s price continues to rise, “the existence of Bitcoin impoverishes both non-holders and latecomers” as early Bitcoin holders accumulate wealth without contributing to the productive economy.

It describes the situation as a “zero-sum game” where early adopters “increase their real wealth and consumption” at the expense of those who enter the market later or never at all.

Read in full https://www.dlnews.com/articles/regulation/european-central-bank-paper-declaration-war-bitcoin-tax-ban/

[OcTradism]

I speculate that capital gains tax will be increased to discourage trading bitcoin.

They will try to do similar things like Italy.
Italy to raise capital gain tax on crypto to 42% from current 26%.

The paper claims that, in a scenario where Bitcoin’s price continues to rise, “the existence of Bitcoin impoverishes both non-holders and latecomers” as early Bitcoin holders accumulate wealth without contributing to the productive economy.

If you invest in a successful one, a company with its stock or Bitcoin project with its native currency bitcoin BTC, it's always true that early investors will benefit most, if they can hold. They can not say this principle only works with Bitcoin market and early Bitcoin investors and holders.

They ignored another fact that if people get richer by Bitcoin investment, they will use money to purchase things, use many services and it's their ways to help economy. They use their own-made money, you can consider it as hard-earned money too, for right things to help many business and people by their spendings. It's better than governments and central banks that only print more money, increase national debts, and use money from citizens, tax payers very unprofessionally and kind of wasting valuable money and resources.
https://www.usdebtclock.org/world-debt-clock.html
https://worlddebtclocks.com/

It describes the situation as a “zero-sum game” where early adopters “increase their real wealth and consumption” at the expense of those who enter the market later or never at all.[/i]

They must admit that in any market, it's zero sum game, not only Bitcoin market. When they are brave enough to admit this fact, they will feel better with this Bitcoin market and no longer hate it.

[odolvlobo]

It describes the situation as a “zero-sum game” where early adopters “increase their real wealth and consumption” at the expense of those who enter the market later or never at all.[/i]

Rather than read an article about the paper, you can read the paper directly here: The distributional consequences of Bitcoin

TL;DR: FUD, FUD, FUD, ...

I feel that their claims about the lack of fairness are ridiculous. They claim that the redistribution of wealth due to bitcoin is not really a redistribution of wealth because it is not redistributed evenly to everyone. They claim that increased spending by Bitcoin investors will drive up prices for the rest. On its face, it's a dubious claim, but made worse by omitting the fact that it would also be true for every source of wealth.

My impression is that they are complaining that Bitcoin doesn't fit their communist ideals. They seem to believe that people should not be rewarded for their ingenuity, intelligence, and work.

It is ironic that they also say that Bitcoin has no economic value. Time will tell, but their criticisms are moot if that is true. If Bitcoin's economic value never develops, then any wealth created by Bitcoin will simply evaporate.

[icalical]

The "zero-sum game" argument totally neglects what happens to the greater economic impact of Bitcoin. Its decentralized nature offers new avenues for transferring value across borders without intermediaries, and for this reason alone, it has created new markets, jobs, and investment opportunities that add to the economy.

Moreover, while we are quick to focus on the gains made by the early adopters, it's equally impossible to overlook that the adoption of new technology often starts with those early risk-takers. Similar to the internet or smartphones, early players put their investments at risk with no guarantee of success. Add to that, Bitcoin's technological aspect-blockchain, for one-continues to drive development in everything from finance to supply chains.

It is understandable to be afraid of aggressive regulation such as the tax hikes instituted in Italy. However, regulation can balance innovation and consumer protection to create a healthier environment for growth, rather than stifling it entirely. Bitcoin is not all speculation. it is financial inclusion, mainly among people in regions that have limited access to banking facilities.

[MeGold666]

European Central Bank:

• Overstepping its mandate with bond-buying programs (PSPP, OMT).
• Lack of transparency and accountability in decision-making and supervision.
• Politically motivated actions during crises (e.g., Greece, Cyprus).
• Negative impact of monetary policies like negative interest rates.

If this was a small private company it would be already in court facing many years of prison love.

[Lucius]

Why a new topic when we already have a discussion here?

https://bitcointalk.org/index.php?topic=5513723.0

[BlackHatCoiner]

Rather than read an article about the paper, you can read the paper directly here: The distributional consequences of Bitcoin

After reading the paper, I just want to buy more Bitcoin. Dear God, I don't want to know what decisions these socialist propagandists take for me, and how their decisions influence my life.

Where do I begin? That Bitcoin is not promising higher returns? That the wealth of the early adopters does not come at the expense of the rest of society (LOL)? That Bitcoin rising in value does not impoverish anyone? That there's a tangible utility beyond speculation? That there is no such a thing as a "fair value", and everything is subjectively valuated?

But how would they know... Keynesian parrots...

[mindrust]

Tuur is a bit late. The war has started long time ago. Maybe he only noticed it now. Bitcoin is something the govs will never fully embrace. If they can control it through the centralized exchanges they won’t say much against it but the moment they realize that bitcoin can’t be controlled completely, then they will be getting weapons ready to fight us. It probably won’t happen suddenly, but that day will eventually come. Them enforcing KYC on everybody is speeding up the process.

[Wind_FURY]

LAUGHABLE "paper". Are those "economists" actually saying that if you buy low/the DIP and be early in your investment, then you are exploiting those people who buy high and late? What a "revolutionary" discovery from those European "economists"!

OK, now study Gold.

¯\_(ツ)_/¯

If they don't want Bitcoin to surge, they should probably stop printing money.

[bitmover]

It appears that if there really opens a real regulatory implication for bitcoin in Europe, I reckon the government will do their best on where they can attack something that might be threatening to them. They do this by imposing higher taxes.

I speculate that capital gains tax will be increased to discourage trading bitcoin.

In any case, according to Tuur Demeester this research paper is a declaration of war against bitcoin.



In a paper from European Central Bank (ECB) economists Ulrich Bindseil and Jürgen Schaaf, they argue that Bitcoin’s rise in value disproportionately benefits early adopters at the expense of latecomers and non-holders.

While this doesn’t necessarily reflect the official stance of the ECB, the paper has opened debate over potential regulatory implications.

The paper claims that, in a scenario where Bitcoin’s price continues to rise, “the existence of Bitcoin impoverishes both non-holders and latecomers” as early Bitcoin holders accumulate wealth without contributing to the productive economy.

It describes the situation as a “zero-sum game” where early adopters “increase their real wealth and consumption” at the expense of those who enter the market later or never at all.

Read in full https://www.dlnews.com/articles/regulation/european-central-bank-paper-declaration-war-bitcoin-tax-ban/

I read this news and I also took a look in the paper itself.

It is not enterily against bitcoin.  It points our some pros of it (like trustless), while also implies that it is a ponzi.

It states also that late comers will make money , as it's values tends to go up

You can read it full here
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4985877

[Wind_FURY]

I read this news and I also took a look in the paper itself.

It is not enterily against bitcoin.  It points our some pros of it (like trustless), while also implies that it is a ponzi.

It states also that late comers will make money , as it's values tends to go up

You can read it full here
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4985877

OK, they're not actually wrong to write that it's "ponzi-like", because it's like Gold - a naturally-occurring Ponzi. BUT there are other people who like calling Bitcoin as an actual "Ponzi" like it was a "scheme" to exploit plebs like us? It would be laughable to say that Satoshi invented Bitcoin to be an actual Ponzi Scheme. I'm very confident that those people that do believe that "Bitcoin = Ponzi Scheme" have not done actual research on Bitcoin. They merely read some articles and they don't have some understanding on how the network works.

[Sanitough]

Their judgment is based on their own system, trying to fit Bitcoin into it without understanding what decentralization really is. Central banks, by their name, are centralized, while Bitcoin is the opposite - decentralized.

They call it a Ponzi scheme because they think someone’s at the top controlling it. Sure, Satoshi created Bitcoin and owns a big stash, but he doesn’t control the system since it’s open source. Right now, Bitcoin is already regulated, and honestly, the bigger threat here might be the government. They could create regulations that put Bitcoin at a disadvantage, which could cause panic and lead to a sudden drop in value overnight. But even if that happens, it would only be temporary. It’s nothing like a Ponzi scheme, because when a Ponzi collapses, the people controlling it run away and leave it to crumble. You just can't do that with the Bitcoin network.

[Ale88]

In a paper from European Central Bank (ECB) economists Ulrich Bindseil and Jürgen Schaaf, they argue that Bitcoin’s rise in value disproportionately benefits early adopters at the expense of latecomers and non-holders.

Actual economists who work for the European Central Bank wrote something this stupid? I mean, I know these people are not the sharpest tool in the shed but writing something like that is beyond my comprehension. It's been like that since... Always? Who bought Amazon or Google shares years and years ago don't have an advantage? What about those who bought gold 30 years ago? Or maybe 50? Why do they talk like we live in some communist country and everybody must be the same? Those who invested in bitcoin at the beginning took a huge risk, they were visionaries, why should someone who buys today (maybe using an ETF) making the same profit as someone who bought 12 years ago?

[Wind_FURY]

Their judgment is based on their own system, trying to fit Bitcoin into it without understanding what decentralization really is. Central banks, by their name, are centralized, while Bitcoin is the opposite - decentralized.

They call it a Ponzi scheme because they think someone’s at the top controlling it. Sure, Satoshi created Bitcoin and owns a big stash, but he doesn’t control the system since it’s open source. Right now, Bitcoin is already regulated, and honestly, the bigger threat here might be the government. They could create regulations that put Bitcoin at a disadvantage, which could cause panic and lead to a sudden drop in value overnight. But even if that happens, it would only be temporary. It’s nothing like a Ponzi scheme, because when a Ponzi collapses, the people controlling it run away and leave it to crumble. You just can't do that with the Bitcoin network.

No, they're calling it a Ponzi Scheme because for someone to make money from it, another someone should decide to put more money in the system for the original someone to sell for profit. New money must enter the system for the old money to exit at a higher price-point.

They are right to the fact that Bitcoin is a "Ponzi", BUT a naturally-occurring Ponzi like Gold. The same as my post before, if they want to stop the "Ponzi", then they should stop the money-printing.

[hd49728]

No, they're calling it a Ponzi Scheme because for someone to make money from it, another someone should decide to put more money in the system for the original someone to sell for profit. New money must enter the system for the old money to exit at a higher price-point.

They are right to the fact that Bitcoin is a "Ponzi", BUT a naturally-occurring Ponzi like Gold. The same as my post before, if they want to stop the "Ponzi", then they should stop the money-printing.

Not only Bitcoin, not only gold, but also everything that has its value rises with time is part of a Ponzi. Because it comes from supply and demand and flow of money as capital in and out. Price only can rise and maintain its higher price with time if capital in is bigger than capital out and demand is higher than supply. It can come from many factors like population increase, demand increase, money supply increase, inflation issue, and many things, not only because of Ponzi intrinsic issue.

Governments and central banks are core parts of Ponzi by money printing and massive QEs.

[NotATether]

Yeah, what else is new?

There will always be bitcoin haters trying to claim that Bitcoin will make you poorer, even though all it's ever done is gone up up up over the last 10 years. And it is my belief that they also hate crypto in general.

It is surprising that many people have actually fallen for this false narrative around Bitcoin, and have thus missed out on early gains (which this paper attempts to victimize them for).

[Wind_FURY]

No, they're calling it a Ponzi Scheme because for someone to make money from it, another someone should decide to put more money in the system for the original someone to sell for profit. New money must enter the system for the old money to exit at a higher price-point.

They are right to the fact that Bitcoin is a "Ponzi", BUT a naturally-occurring Ponzi like Gold. The same as my post before, if they want to stop the "Ponzi", then they should stop the money-printing.

Not only Bitcoin, not only gold, but also everything that has its value rises with time is part of a Ponzi. Because it comes from supply and demand and flow of money as capital in and out. Price only can rise and maintain its higher price with time if capital in is bigger than capital out and demand is higher than supply. It can come from many factors like population increase, demand increase, money supply increase, inflation issue, and many things, not only because of Ponzi intrinsic issue.

Governments and central banks are core parts of Ponzi by money printing and massive QEs.

Plus my point is, what's the ground-breaking "discovery" of that "paper"? Because there was actually NOTHING "ground-breaking" about it, and those "economists" probably wrote it as a suggestive form of FUD.

 ¯\_(ツ)_/¯

Those economist should actually research what was in Satoshi's mind when he invented Bitcoin, and why he chose four year halving cycles as part of its inflation schedule. It probably wasn't a decision made simply "because", no? There was a good reason behind it, https://en.macromicro.me/spotlights/173/bitcoin-vs-major-central-banks-m2-supply

[franky1]

these so called "economists" dont know what they are talking about..

they cant even separate "value" talk from "price speculation" talk. thus they are not really good economists by not knowing the difference

the underlying value is based on the economic lowest cost on the planet anyone is willing to sell for, which is based on mining cost.. the value is kinda invisible to the markets and only seen when the market "tests bottom" periodically and it shows the resistance to sell and the support line of buyers

the PRICE is a separate number which wiggles around above value and its the PRICE that speculates visibly in the markets in a more playful way based on people paying more than value

as for being a ponzi. the bitcoin network is not based on a 'mr ponzi' owning all funds and only letting a small amount slip out from new buyers funding old sellers.. there is no 'mr ponzi' holding the big reserve of fiat, bitcoin is not backed by any reserve of fiat and no there is no way a 'mr ponzi' can just disappear with the big reserve leaving everyone else with dead indebted loss, however...
.. each centralised exchange can be treated as mini separate mr ponzi's.. so watch out for centralised exchanges and their business practices about how openly they allows withdrawals and sells

[Davidvictorson]

Anything to bring bitcoin down despite the plethora of growing positive benefits and evidence.

These people could have literally looked at countries, using El Salvador as a case study, they could have looked at organizations using Microstrategy as evidence, they could have looked at individuals using Andreas Antonopoulos and many others as case study yet they didn't do it.

Well I am not surprised bitcoin has been labeled so many bad names in the past and indirectly calling it a ponzi scheme isn't going to make any difference. In the future they may even label it a pyramid scheme and I will not be surprised.

[Frankolala]

So whose fault is it, the early adopters or the late adopters. It is true that the early adopters are the ones currently benefitting hugely from bitcoin, because they took the risk in the early days to buy bitcoin when other have the opportunity to do the same but they didn't. I could remember that in those early days most government were calling bitcoin scam and that it will not survive. They went as far as creating FUD through social media, why is Europe jealous now, because people took the risk to invest their hard earned money on bitcoin in those early days and now watch their bitcoin investment grow in value. Assuming, bitcoin didn't survive will government say all these. Making wealth is taking advantage of the opportunity when it comes at the right time. Why didn't these so called Economist see that bitcoin price will increase rapidly overtime and advice the government to buy bitcoin then.