Why is cryptocurrency a Ponzi? As noted, there are a fixed amount of coins. [There is not a fixed amount for all cryptocurrency. There is a fixed amount for Bitcoin in particular, and some others, but it is not true as a general statement that there is a fixed amount of cryptocurrency.]
In and of themselves they produce no income, have no intrinsic value and you can't hold it in your hand so to speak. [Again, not true. If I cash out today, I am $504.93 richer today than the day I first jumped in 3 weeks ago - even after the slight downturn I previously mentioned this morning. I invested $1,000.00, and my cash out would give me $1,504.93. But I am not going to do that to satisfy your need for proof. I’m going to leave it in, and grow it some more.]
They are not a commodity which actually has backing although who wants a ton of pork bellies in their garage? [Yes, they ARE a commodity, exactly like $$ are a commodity on fiat currency exchanges.]
The only way they grow in value is if there is a buyer willing to buy in. [Not so. They bring their own intrinsic value because of the technology they represent, even before they go on sale. Stock in Apple Computers had value before the first share sold, because Jobs and Wozniak had a great idea that had value. The market will determine how that value will go up or down, but you have to understand that you’re not just engaging in just a “coin”, you’re engaged in trading on the value of whatever technology the coin brings to the market.]
Without new buyers coming in the whole thing collapses. Let's say your coin is valued at $12,000 right now and you decide to sell it. What happens if there are no buyers? What is your coin worth? Nothing. [It doesn’t work that way. If I hold stock in Microsoft, and I want to sell it, I don’t have to step up to the plate and wait for a buyer.....I just sell it, and it goes back into the pool of shares available for purchase. Same with crypto. If I want to sell it, I don’t have to wait for someone to make an offer on it. I just sell it. Period.]
As with Ponzi, it depends on new people coming in with the glint of riches and easy money in their eye and willing to put their money in. No new buyers and you have nothing. All of the early investors do well as long as they get out before the bubble bursts and the late investors get hosed. This is just a variation of a Ponzi. It requires the blood of new investors to make the profit for the older investors who hopefully for them get out before it collapses. So, once the feeding frenzy is over and there are no new investors (suckers as Ponzi and Madoff would call them) the bubble will burst. Ponzi schemes can go on for years so longevity means nothing. The requirement is new people willing to buy. The incentive is greed as there is no physical "commodity" that one gets. You are not putting a Colt Python in the gun safe waiting for it to increase in value. [My friend, you are about as far from understanding what is happening in the crypto market as one can be. I won’t waste any more of your time trying to put it into words that make sense to you, except to say this: EVERY objection you’ve raised can be said about ANY kind of investment there is, inside or outside of the cryptocurrency world.]
1911 Raptor wrote: OldCannon wrote:
rotor wrote:It's only a profit when you sell. The question is.......... when do you sell? Still a Ponzi.
Please refute the following then, take your time, I can wait:
- There is no central benefactor, thus there is no "pyramid" structure. It is, in fact, the opposite. No single person or entity can simply run away with the money.
- There is no promise of riches associated with investment. It is an investment risk just like any other currency investment, with the insurance that the originating country not propping up the currency with "quantitative easing" (a fancy word for "printing money backed by nothing")
- The value of the item is independent of "continuous aggregative investor" scenarios. A collapse in people buying/trading the currency does not result in a subsequent collapse of the value of the existing currency.
- Bitcoin (or other digital currencies) have a functional limit on quantity. Unlike national currencies.
- Ponzi scheme products cannot function as currency in any way, shape, or form
- There is technically no "bubble" upon which everything collapses. The quantity of bitcoin/litecoin/ethereum always exists in unhackable digital ledgers. The only fluctuation is based on the perceived value of the per unit item. It is, quite literally, impossible to destroy the existing currency without destroying the internet, and that's an entirely different problem.
Since there is no physical product involved what will you have when it bursts? Spot gold right now is $1316. Not $2000. But at least you can convert the gold into a ring or necklace for your significant other if it collapses. What happens to cryptocurrency if nobody wants to buy what you want to sell (or cash in)?
There is not a fixed amount for many of the coins, but it is true for Bitcoin. You’ve made a blanket statement that isn’t true, there.
Now, that doesn't mean I don't buy lottery tickets sometimes but I know I am not going to win but $5 so what, right?
Good luck my friends. Really I hope you all make a ton of money and only strangers we don't know get stuck.
OldCannon is absolutely right. It IS unhackable. What CAN be hacked is an individual’s account on an exchange, but the only thing the hackers can do is drain that user’s account.......JUST LIKE CAN HAPPEN TO YOUR BANK OF AMERICA OR [INSERT NAME OF BANK] ACCOUNT!!! Hackers may steal your funds out of your checking account, but they can’t drain Bank of America. The security of the blockchain is that is is a distributed ledger, hosted on hundreds of thousands of computers all over the world. If the ledger on ONE of those computers does not match the ledgers on all the others, it is sequestered until the data can be corrected. In order to hack the blockchain, you would have to hack into ALL of the hundreds of thousands of computers hosting the ledger, at EXACTLY the same second in time, in EXACTLY the same way, and hack the ledger in EXACTLY the same place; and it would have to happen SO fast that none of the already existing self-checking mechanisms would pick up on it. As OldCannon said, you would have to kill the entire internet to do it. It is even beyond the ability of large powerful nation states with sophisticated IT people to pull it off. That is just ONE reason why national governments are leery of crypto trading..... it is far beyond their ability to hack or control it, and they lack the means of using it as a cyber weapon against other nation states.
1911 Raptor wrote:Sounds like those in are trying to sell others to join. All we are are roses but nothing about the thorns. People say bitcoins are finite but what prevents more but coins from being created? Because someone said they wouldn’t?
Friend, I don’t care if you join or not. I think the whole purpose of this thread was to bring an opportunity to people’s attention. If they dont’ want in, it’s no skin off my nose. It literally does not affect my success (or failure) one way or the other. More Bitcoins cannot be created because it is technologically impossible to do. The number of coins was hard-coded into the Bitcoin code from day one, and that number is stored in the UNHACKABLE blockchain, so it couldn’t be changed even if they wanted to. What HAS happened is that other coins have sprouted up that use Bitcoin’s technology as the foundation for their own, but they each have their own blockchain, which is a fork off of the original Bitcoin blockchain. Similar things have happened with Etherium, where there exist other coins, with their own blockchains, but that are based on the original Etherium code.
What I would advise you to do is to actually STUDY what the blockchain is, and how it works. You can’t possibly understand what you’re criticizing if you don’t fully understand the power of a blockchain.
But at this point, I’m done. You can lead a horse to water, but you can’t make him drink it.