I'm tired of the "Ponzi" meme
Hello readers; I'm @lemony-cricket and I was just waiting for everyone else to stop posting. I'm still here, and I will be until the witnesses turn out the lights; I promise.
Charles Ponzi, the original conman himself source. Public domain.
People really hate cryptocurrency.
Since the very early days of Bitcoin, there have been those who seek to destroy it or at least relish in its failure. There are a wide variety of reasons for this; some of them I can think of are:
- Envy. "I didn't get rich off this, so why should these people?"
- Schadenfreude. "These guys are losing so much money it's hilarious."
- Ethics. "Crypto is making millionaires out of the worst people in the world."
- Vindication. "I knew it was going to crash eventually. Was only a matter of time."
- Speculation. "I have an open short position; I hope Bitcoin crashes to zero."
- Environmentalism. "Bitcoin is a huge waste of natural resources."
- Conflict of interest. "Cryptocurrency threatens my business or other interests."
- Skepticism. "There is no value in Bitcoin. It is a ponzi scheme."
I am mildly sympathetic to some of these, particularly the environmental, conflict of interest, and ethical concerns. I don't mean to say that I hold these views myself; it's just that I believe they are valid points and, to some degree, I believe they deserve more credit than they are given by the community.
There are many valid arguments against cryptocurrency, but the "ponzi" bogeyman is an absolutely invalid one that keeps coming back. I'm going to focus on that one today.
Semantics aside, it just doesn't fit.
I could take the easy way out and cite the literal definition of a Ponzi scheme. As Wikipedia tells us:
A Ponzi scheme [...] is a form of fraud in which a purported businessman lures investors and pays profits to earlier investors using funds obtained from newer investors.
Very few cryptocurrencies fit this definition. There are exceptions, most notably Bitconnect and certain Ethereum smart contracts, but these could hardly be called currencies in the first place; they are centrally-issued and "token" fits better (though the lines are very easily blurred between the two).
But what people really mean when they say that cryptocurrency is a Ponzi scheme is that it has no intrinsic value; that it serves as a wealth redistribution mechanism which favours those who bought in at lower prices... oh, and we usually have to assume that that last part is a bad thing for the sake of this argument.
Consensus is valuable.
I feel that anyone who denies this is either ignorant, closed-minded, or being dishonest on purpose; for sake of one of the motives listed above, perhaps, or some other ulterior motive I didn't think to list. The reason I feel this way is simple: not valuable to you does not mean not valuable at all. Value is subjective... and there is a real value in consensus technology.
Regardless of whether Bitcoin rewards early adopters (it does), or whether this is justified (it is), the fact that all those miners are working to secure the network makes Bitcoin the most secure medium of consensus in history, and in exchange for this creation of value, the network pays the miners in newly minted coins. Even if the value of Bitcoin itself drops to zero, that innovation is not going away. Consensus technology has been let out of Pandora's box, and it will always have a place in the world at any price or level of legitimacy.
To those who stick to their "Ponzi" guns for the greater good: I understand that the societal impacts of cryptocurrency may be unfavourable in some ways. There can be no avoiding these issues. The ecological impact is probably non-negligible (though I have yet to read any credible study on Bitcoin's carbon footprint). There are a lot of people with questionable morals who are a lot richer now than perhaps they should be, and if Bitcoin continues to rise in value, they'll get even richer.
The existence and use of cryptocurrency definitely threatens certain aspects of our way of life, but I don't think that gives people licence to be dishonest. The fact is: you aren't going to miraculously save humanity from crypto by lying to people. Instead, we should focus on how we can use consensus technology to better the world... because it's not going away anytime soon. 🍋
Posted from my blog with SteemPress.
The more people don't like crypto the more sure I am that I made the best decision spending time learning about it!
I largely view the anti-crypto talking points as bullish indicators. So you're telling me this thing is horrible for the planet, helps horrible people do horrible things, and all we can do to try and stop it is convince investors everywhere to act in direct opposition to their own interests for the sake of the greater good?
Yeah, excuse me while I buy a shit ton of whatever you're whinging about. ^_^
Hey man I have no idea what you are talking about? I did not say anything about planet I think you are mistaken LOL!
I think there has been a misunderstanding. By "you're telling me" I meant a hypothetical other person, not you.
This post was addressing anti-Bitcoin arguments, and in my reply to you I was talking to them, not you. I am sorry I offended you. :(
Let me put it another way: when people act scared about what crypto is capable of, it makes me want to buy more. :)
Ok my bad I read it wrong. Thanks for clarifying!
"It's for nerds only."
"It's never going to happen."
"Isn't it what only criminals use?"
"It will crash to it's own impossibility."
"It will never catch the attention of the public."
"It will never be anything else than something to speculate."
"Isn't this what the authorities and the banks warned us all about?"
"It wont last!"
I've stopped speaking about this to anyone who I know because of the "I have no clue what this is, my main purpose is to oppose it and not listen anything about it" -attitude.
Smartphones were for nerds once too. I remember.
I even remember when listening to music on the Internet was something only criminals did. Now, it's an international industry making millions and millions of dollars.
"But those are entirely different things! I know because I know, I don't need to read more about it or listen to experts."
In my country this reasons you stated are some of the reasons why people do not invest in crypto. Most people see it as a scam and that's just sad. Before joining steemit, I knew of bitcoin and that was all. I didn't even know of etherum or that there are more cryptocurrencies out there. I didn't even know of crypto exchanges and so on.
It is education on cryptocurrency and the blockchain technology that would make the difference in the long run. People need to really know what cryptocurrency means so they can understand what they stand to loose watching from the sidelines.
This is true. Most people don't have the technical understanding necessary to "get" crypto. Even many of the current believers in blockchain technology don't actually understand how or why it works, especially on Steem where things are made a bit more "user-friendly." I think that it will take a generation or two before it's cemented into the collective intellect.
Children learn to sign their name in school, but they don't learn about digital signatures. They learn to protect their identity but they don't learn about private keys. They learn to write cheques but will probably never actually write one. It takes time for educational systems to evolve, but I do believe that one day not so far away, basic cryptography and cryptocurrency topics will be taught in schools.
Fiat uses plenty of power on it's own. All the ATM's and banks. Much of our money is actually just numbers in a bank and it's been that way for a while. Fiat needs banks and ATM's and card machines everywhere. What does crypto need? A wallet and some computers to verify the transactions. Those computers can be placed anywhere, including next to power plants and in ice caves.
As for the ponzi aspect...there are a lot of things that have similarity to ponzis, in that the new money pays the old. Affiliate programs sprang to mind. Of course, some are more ponzi than others. With affiliate programs, the older members invite newer members, giving a percentage of what they spend to those that invited them. Technically there are a limit to the number of members that you can invite. Eventually, you'll run out of people. Of course, that rarely happens. Nothing gets 100% adoption. In reality, you can invite people, some of which won't even try to bring in others, make plenty of money, and they'll use whatever the service is and likely be happy with it.
There are also stocks. The new money raises the price and eventually, the old money sells their stocks, earning a ton for being one of the first.
You seem insistent that the early adopters deserve this reward. In some cases they do. The early miners certainly deserved what they got, because they allowed Bitcoin to become what it is today. Of course, Steem proves that just because you were here early and have gotten a lot of SP doesn't necessarily mean that you deserve to be in a position of high SP. The reward for early adoption is often greater than it necessarily should be, but it rewards people for being there when others weren't.
Whatever the case, crypto does serve a purpose. You ever tried using Paypal? They charge you a substantial fee, don't care about your privacy, have shitty customer service, and occasionally seize people's money with little or no evidence.
Yeah. If wealth redistribution to early investors makes something a Ponzi, virtually every public company is a Ponzi.
Well, being one of them I suppose I am biased. But you're an early adopter too... :)
I don't really like getting into these subjective concepts of "deserve" and what is "fair." The fact is, if you were in the right place at the right time with Bitcoin, it wasn't enough. You had to also take a fair amount of personal financial and other risks. The legality of such things was not clear at the time, and back then the ratio of illegal activity was much higher (BTC would not be where it is today without the Silk Road giving it value as a means of exchange). It was always possible for early adopters to be prosecuted... and people have been prosecuted for selling bitcoins without a money services licence.
Thanks! I received some alpaca socks, two large pizzas, a few hundred dollars
' worth of crack cocaine, and an eternity of retrospective dread. Your support is encouraging. ^_^Some of them are...because they don't actually have any value and have just been growing in value because hey, they've been existing and getting people to buy shit for a while now. Then one day they just tank and you realize that they weren't worth anything. But some other ones are actually worth something. But you can't know if the value of a stock doesn't necessarily show if something is just a worthless product that's appreciating in value just based on lies.
I think crypto does offer an option to have custom coins that can replace stocks with something more unique. You can create debt instruments with them or an alternative to stock that has an actual value in addition to what the crazies on some floor somewhere say something's worth.
Stocks and other things these days aren't literally ponzis...but sometimes I kinda feel like they aren't quite as far off from them as we'd like to think.
Tell me about it. I was paying attention the whole time. I wanted to buy Bitcoin...but unfortunately, I listened to the idiots with FUD saying that it was too risky. There were some that got prosecuted, the the risk to reward was probably a lot better than many of us feared. If only I had decided "WTH, I''m gonna buy some Bitcoin! The first time I heard about it." Of course, I also was wanting to do crypto forex trading back a number of years ago and now that's exactly what I'm doing!
I couldn't agree more, good catch Lemon!
lol
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@lemony-cricket, I'm interested in the same topic as you, let's spin it together. I signed on to you, I hope you'll sign up for me. Always glad to meet new people!
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STOPYes, I think that's well and Crypto Sure enough to increase may be