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Cryptocurrency as the next significant stage for computing technology, not just an investment


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7 minutes ago, zkom said:

The original quote was talking about literal cash money: "Yes, it’s a Ponzi scheme. But who cares? So are the dollars in your pocket." Dollars in anyone's pocket aren't a Ponzi scheme.

i would assume they meant “the dollars” to be representative of fiat currencies/markets built around money trading/etc. in general.

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8 hours ago, usagi said:

converting to another crypto coin or even buying something directly with crypto is not cashing out. and I think it's a stretch to say that the average person will have no trouble selling off their holdings whenever they feel like it without exchange problems, hacking, fraud, or some other form of irretrievable loss. or the currency wildly devaluing suddenly as zkom mentions which makes the whole endeavour pointless anyway. but let's say that it's all moving in a stabler direction where those specific issues will cease to be. what about the other parts of the problem? what about the antics in the current state of the crypto markets that lead people to point at this thing and say "I don't trust it"? do you think crypto is immune from the same basic greed that leads to top-heavy wealth concentration in normal markets? nb. you can't use the "well that's people, not the technology" argument to answer this when you posit the technology will magically solve everything including the people part of the problem.

converting to another cryptocurrency -is- cashing out of the one you sold and purchasing the one you bought.  it's not a stretch.  hacking, fraud, irretrievable loss?  yes these exist.  in all areas of life.  crypto is much larger now, coinbase isn't going to mtgox any time soon.  sudden wild devaluation?  I get your spin but it's a bit of a stretch.  everyone knows it's a volatile asset.  so you've reframed the idea of your original post I replied to as "there are various issues" but still not justified the original claim:

>there are people piling into this thing and boasting of making high value trades without actually being able to cash any of it out into anything used in the real world

not true at all

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1 hour ago, auxien said:

i would assume they meant “the dollars” to be representative of fiat currencies/markets built around money trading/etc. in general.

That doesn't make much sense to me. Just because you can get investments with dollars that might or might not be a Ponzi scheme doesn't make the dollar a Ponzi scheme. And the economy in general is not a Ponzi scheme either.

In a Ponzi scheme :

1) There is nothing inherently valuable in the thing that you invest in.

2) High returns are expected because there will always fresh investors that are willing to pay more.

A fiat currency is not a Ponzi scheme because number 2 fails. Nobody expects getting returns on just owning money. And the savings account interest rates are laughably low, around 0.5% per year. Even then you would argue that you are investing in the bank so the bank lends your money.

Stock market is not a Ponzi scheme because number 1 fails. You actually own shares in a company and you can take part in how the company is run and can get dividends.

Real estate market is not a Ponzi scheme because number 1 fails. You own physical property. Same with the rest of the investment options on anything physical like precious metals, art, natural resources, goods, etc.

Derivative financial contracts, like futures and options then get a bit murky. But I'd say they still hold some inherent value but it's just removed from the original expected value. They definitely are speculative for the most part though.

So I don't really know how fiat currencies or markets built around them are Ponzi schemes in general.

The cryptocurrencies check both boxes pretty well. The fact that it's not a centralized scam ran by a few people "in the know" and the fact that most of the investors know that there is inherently nothing valuable in the coins is what makes me doubt a bit that if it actually classifies as a Ponzi scheme. Usually in the Ponzi scheme the scammers are the only ones who actually know that all the money is coming from new investors and the investors think that they are paying for something real. Cryptos are more like a speculative bubble maybe?

 

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5 hours ago, ilqx hermolia xpli said:

converting to another cryptocurrency -is- cashing out of the one you sold and purchasing the one you bought.  it's not a stretch.  hacking, fraud, irretrievable loss?  yes these exist.  in all areas of life.  crypto is much larger now, coinbase isn't going to mtgox any time soon.  sudden wild devaluation?  I get your spin but it's a bit of a stretch.  everyone knows it's a volatile asset.  so you've reframed the idea of your original post I replied to as "there are various issues" but still not justified the original claim:

>there are people piling into this thing and boasting of making high value trades without actually being able to cash any of it out into anything used in the real world

not true at all

I like that you cherrypicked one part of my post as my entire original claim and stuck with that to try and unravel the whole argument. this is my claim:

> crytpo gay

for many reasons, only one of which you have half-addressed. and the human part of which you consistently ignore because you don't know how to address it. how do you feel about the CCP cracking down on it btw?

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4 hours ago, zkom said:

That doesn't make much sense to me. Just because you can get investments with dollars that might or might not be a Ponzi scheme doesn't make the dollar a Ponzi scheme. And the economy in general is not a Ponzi scheme either.

In a Ponzi scheme :

1) There is nothing inherently valuable in the thing that you invest in.

2) High returns are expected because there will always fresh investors that are willing to pay more.

A fiat currency is not a Ponzi scheme because number 2 fails. Nobody expects getting returns on just owning money. And the savings account interest rates are laughably low, around 0.5% per year. Even then you would argue that you are investing in the bank so the bank lends your money.

Stock market is not a Ponzi scheme because number 1 fails. You actually own shares in a company and you can take part in how the company is run and can get dividends.

Real estate market is not a Ponzi scheme because number 1 fails. You own physical property. Same with the rest of the investment options on anything physical like precious metals, art, natural resources, goods, etc.

Derivative financial contracts, like futures and options then get a bit murky. But I'd say they still hold some inherent value but it's just removed from the original expected value. They definitely are speculative for the most part though.

So I don't really know how fiat currencies or markets built around them are Ponzi schemes in general.

The cryptocurrencies check both boxes pretty well. The fact that it's not a centralized scam ran by a few people "in the know" and the fact that most of the investors know that there is inherently nothing valuable in the coins is what makes me doubt a bit that if it actually classifies as a Ponzi scheme. Usually in the Ponzi scheme the scammers are the only ones who actually know that all the money is coming from new investors and the investors think that they are paying for something real. Cryptos are more like a speculative bubble maybe?

 

the exact definition of "stealing from some investors to pay other investors" for a ponzi scheme is not what is being asserted by most people who call crypto a ponzi. as I understand it. rather it's around the same end result of skewed wealth concentration based on a small number of people in control defrauding or exploiting a mass of people. crypto isn't centralised by nature but that doesn't mean it can't be controlled and that market sentiment around it can't be influenced by a few people "in the know" for their gain, which is what happens all the time with pump and dumps.

maybe people shouldn't call things ponzi schemes loosely unless they meet those exact criteria, that's a fair argument.

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45 minutes ago, usagi said:

I like that you cherrypicked one part of my post as my entire original claim and stuck with that to try and unravel the whole argument. this is my claim:

> crytpo gay

for many reasons, only one of which you have half-addressed. and the human part of which you consistently ignore because you don't know how to address it. how do you feel about the CCP cracking down on it btw?

this homophobia isn't needed.  and I support the CCP cracking down on it to prevent capitalist within the CCP from stealing wealth and smuggling it out of the country.  the CCP's crackdown proves the power of crypto

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5 hours ago, zkom said:

That doesn't make much sense to me. Just because you can get investments with dollars that might or might not be a Ponzi scheme doesn't make the dollar a Ponzi scheme. And the economy in general is not a Ponzi scheme either.

In a Ponzi scheme :

1) There is nothing inherently valuable in the thing that you invest in.

2) High returns are expected because there will always fresh investors that are willing to pay more.

A fiat currency is not a Ponzi scheme because number 2 fails. Nobody expects getting returns on just owning money. And the savings account interest rates are laughably low, around 0.5% per year. Even then you would argue that you are investing in the bank so the bank lends your money.

Stock market is not a Ponzi scheme because number 1 fails. You actually own shares in a company and you can take part in how the company is run and can get dividends.

Real estate market is not a Ponzi scheme because number 1 fails. You own physical property. Same with the rest of the investment options on anything physical like precious metals, art, natural resources, goods, etc.

Derivative financial contracts, like futures and options then get a bit murky. But I'd say they still hold some inherent value but it's just removed from the original expected value. They definitely are speculative for the most part though.

So I don't really know how fiat currencies or markets built around them are Ponzi schemes in general.

i think i was conflating Ponzi scheme with pyramid scheme when being akin to the dollar/any currency not tied down very strictly. (i think i've made that mistake before here at some point, but that's my mistake.) apologies on getting that wrong and you wasting some words on me man, sincerely. but i do think there's something a bit like a pyramid scheme to the untying of any currency from physical reality. (i am obviously not a financial expert so yknow feel free to ignore anything i say)

...the entire idea of a currency (any that i can think of/certainly any fiat currency) is to get a large group all operating with and accepting it, which isn't itself bad at all of course (we do live in a society). but untying that currency from real world constraints and treating it like a malleable tool allows it to be manipulated in ways that to me look similar to a pyramid scheme: those who are there first/have the most can bring others in (be it outside countries/etc. or simply by increasing the population of working poor) with the intent of increasing their own wealth. that's the American version of capitalism we've seen since the early 1900s. it's not a strict pyramid scheme obviously, and there's perhaps some reversal of aspects of it along with the governmental/power/laws that have been manipulated in kind, but that's what i was thinking of when making the comment that they weren't exactly wrong.

to be fair, interest rates have been traditionally higher at times, but the big banks in America shut that shit down ~20 years ago.

41 minutes ago, usagi said:

maybe people shouldn't call things ponzi schemes loosely unless they meet those exact criteria, that's a fair argument.

agreed. of course the thing is that the crypto bros who tweeted that out were doing so for clicks/attention/etc and having a little 'wait, that's not right' is high tier trolling on their part. they don't have to be 100% correct, they just have to be right enough to seem like they're smart to the young idiot bros while also getting attention from more legitimate places who have to explain why they're wrong. the entirety of the crypto scam world is built on that shit.

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1 hour ago, ilqx hermolia xpli said:

this homophobia isn't needed.  and I support the CCP cracking down on it to prevent capitalist within the CCP from stealing wealth and smuggling it out of the country.  the CCP's crackdown proves the power of crypto

lol k

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14 hours ago, usagi said:
16 hours ago, ilqx hermolia xpli said:

this homophobia isn't needed.  and I support the CCP cracking down on it to prevent capitalist within the CCP from stealing wealth and smuggling it out of the country.  the CCP's crackdown proves the power of crypto

lol k

chengo approves.

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40 minutes ago, ignatius said:

why twatter no embed anymore???

 

wtf is going on with melonya's face here? looks like agent smith is trying to morph into her or somethin

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Quote

So why this hype?  Because the cryptocurrency space, at heart, is simply a giant ponzi scheme where the only way early participants make money is if there are further suckers entering the space.  The only “utility” for a cryptocurrency (outside criminal transactions and financial frauds) is what someone else will pay for it and anything to pretend a possible real-word utility exists to help find new suckers.

After all, a programmer doing the most basic test of a web3 prototype is going to need to get the cryptocurrency, spend the cryptocurrency, and any application will require all users to get the cryptocurrency as well.  If this gets abandoned quickly due to the inevitable technical failure “web3” still accomplished its goal of getting more suckers in and extracting their money.

So in the end web3 is a con job, a technological edifice that is beyond useless as anyone who attempts to deploy a real application will quickly discover.  It is, however, an amazingly effective form of Nerd Sniping.

The Web3 Fraud (Usenix)

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