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Crypto... just one big Ponzi scheme?


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#1 Rogerdodger

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Posted 28 April 2022 - 10:39 PM

Is Crypto just one big Ponzi scheme?

 

“You start with a company that builds a box,” founder of FTX said in the latest episode of Bloomberg’s Odd Lots podcast, and “maybe for now actually ignore what it does or pretend it does literally nothing … pour another $300 million in the box and you get a psych and then it goes to infinity … then everyone makes money.”

 

This week we witnessed the latest — and perhaps more striking — sign that crypto might not be the future of finance. On Tuesday, Sam Bankman-Fried, founder of FTX, a huge crypto exchange, opened a can of worms by describing “yield farming” — crypto’s makeshift alternative to traditional bank lending — as a Ponzi scheme.

 

All multi-level marketing cheerleaders emphasize the dreams, hopes, emotions and wishes, but not the product... in my view.

Amway, Mary Kay, Avon, Mona-Vi, Shackle, phone cards, time-shares, Doge Coins, and TV healers... if you only have faith ...

Just my lifetime of observation...

But that's all I have to offer, my opinion based on a lifetime of observation.

 

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Edited by Rogerdodger, 28 April 2022 - 10:47 PM.


#2 SteveB

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Posted 28 April 2022 - 11:04 PM

Agree with your lifetime observation. Thanks for sharing! I thought I was the only one who thought this. Buy tulip bulbs instead. They are real and make the world pretty!

#3 MikeyG

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Posted 29 April 2022 - 02:33 AM

I rode Crypto from 12-15k to 50k while most scoffed at it. Now its been dead money for over a year. I have no interest in getting back in as I have no idea its valuation, it was a pure technical play.

#4 pdx5

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Posted 29 April 2022 - 05:13 PM

Crypto is just speculation.
Coinbase wallet has all signs of Ponzi scheme.
They give you "passive" interest which simply means it is on paper, not cash.
You can cash out which means the new entrants will finance the cash.
"Money cannot consistently be made trading every day or every week during the year." ~ Jesse Livermore Trading Rule

#5 MDurkin

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Posted 29 April 2022 - 07:10 PM

If Bitcoin last at the bottom of this recession, I will buy some, maybe 5 percent of portfolio. If it disappears I would not be surprised at all.


Edited by MDurkin, 29 April 2022 - 07:11 PM.


#6 Iblayz

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Posted 30 April 2022 - 08:50 PM

Not addressing the Crypto idea at all, but I am addressing the ponzi/multi-level marketing comparison. People ALWAYS confuse the two. And when someone wants to bash multi-level marketing they nearly always call it a ponzi scheme. Not really a fan of multi-level marketing but, they do have products and services involved. Bill Ackman tried to bash Herbalife as a Ponzi scheme and look what that got him. A big fat loss. In a ponzi, initial investors are paid from the funds garnered from later investors and for a while the thing looks like the greatest thing since sliced bread. But there are no products or services and soon they are unable to take in enough new money to pay off those who want to cash out (or want the "returns" on their money) and the thing crashes. Multi-level marketing is NOT a ponzi scheme. The laddering of commissions may make it look that way, but there are still products and services beneath the surface. Sometimes those products or services are pretty good, but the way they get to the consumer is less than ideal.


Edited by Iblayz, 30 April 2022 - 08:52 PM.


#7 Rogerdodger

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Posted 01 May 2022 - 01:10 PM

Warren Buffett gives his most expansive explanation for why he doesn’t believe in bitcoin

 

“If you said… for a 1% interest in all the farmland in the United States, pay our group $25 billion, I’ll write you a check this afternoon,” Buffett said. ”[For] $25 billion I now own 1% of the farmland. [If] you offer me 1% of all the apartment houses in the country and you want another $25 billion, I’ll write you a check, it’s very simple. Now if you told me you own all of the bitcoin in the world and you offered it to me for $25 I wouldn’t take it because what would I do with it? I’d have to sell it back to you one way or another. It isn’t going to do anything. The apartments are going to produce rent and the farms are going to produce food.”