Bitcoin Is The Total Opposite of a Ponzi Scheme — Here’s Why

“A Ponzi scheme is a fraudulent making an investment scam promising high rates of go back with little risk to investors. The Ponzi scheme generates returns for older investors by acquiring new buyers. that is just like a pyramid scheme in that both are based on the use of new buyers’ funds to pay the earlier backers. For both Ponzi schemes and pyramid schemes, in the end there isn’t sufficient money to go around, and the schemes get to the bottom of.” — Investopedia

apart from the use of the Tulip analogy, in case you need to allow the arena realize that you are completely ignorant approximately Bitcoin technology, announcing “Bitcoin is a ponzi!” is your first-rate guess. It indicates a essential lack of capacity to do fundamental studies into some thing you don’t understand, earlier than making any large assertions approximately it.

while you understand the generation at the back of Bitcoin and the reason it became invented, you may see that it is honestly the entire contrary of a Ponzi scheme.

allow’s destroy it down:

“A Ponzi scheme is a fraudulent making an investment scam promising high costs of return with little hazard to investors.”

when you have now not read the authentic concept paper of Satoshi Nakamoto posted in overdue 2008, you should. It’s 8 pages long, pretty technical, however isn't always too difficult to digest. You’ll word that in no way in that paper does it mention any form of go back on an “funding” in Bitcoin. It never even mentions a price for one Bitcoin. It absolutely nearly solved one of the oldest troubles in computer technological know-how, the byzantine popular’s problem, and consequently established its fee inside the technique. Bitcoin’s cost proposition turned into in no way earnings-driven, and preserving Bitcoins within the early years was seen as “just for geeks” or “magic net cash”, sarcasm blanketed.

genuinely not anything approximately Bitcoin is a mystery. it is one of the maximum open technologies inside the international. It’s open source, anybody can evaluation the code, everybody can make contributions to the code, everybody can run the software voluntarily and take part inside the network, and all and sundry can use the network without permission. The complete history of all Bitcoin transactions is seen to all of us in the global too.

It’s a total paradigm shift from any sort of economic machine in the records of mankind. It’s the entire contrary of a fraudulent making an investment scam, that's shrouded in indistinct promises of excessive returns with capital inflows and outflows which are kept in a secret ledger.

“The Ponzi scheme generates returns for older buyers by means of obtaining new traders. that is similar to a pyramid scheme in that both are based on using new buyers’ finances to pay the earlier backers.”