Unrelated, I am curious if anyone knows if anyone is doing or has done a paper on Bitcoin and explored the idea on how it is or isn't similar to a Ponzi scheme?
In a ponzi scheme there isn't even a thing, commodity or otherwise, being invested in really. You never own anything except the promise of return. Your money is going nowhere but to the last batch of people to buy in via the person you bought it from, and then when Mr. Ponzi decides its time, into his own pockets as he runs away as fast as he can.
It's entirely possible to consider bitcoin a scam, or a bubble, but it really has no similarity to a ponzi scheme. It's a commodity asset that may have no long term value that's been over-zealously sold.
[Added Note: It'd possibly be accurate to describe what Mt.Gox specifically was/became as a ponzi scheme]
Right there.
I think the technology is great, but it has been speculated into the stratosphere.
Nobody is promising Bitcoin investors a profit because nobody (officially) speaks for Bitcoin to begin with. Anyone investing into BTC and subsequently losing or gaining money is doing it of their own will, not because they were scammed into it.
A ponzi scheme is a very particular kind of scam.
If I started an altcoin (like bitcoin) and promised people it would increase in value, it still wouldn't be a ponzi scheme because that is not how a ponzi scheme works.
It would be a different kind of scheme that I don't think has a name. edit: Well, some people would call it a pump-and-dump, so maybe that.
Bitcoin proponents have a lot in common with pyramid scheme pushers. 'It is a completely new kind of system', 'the powers-that-be are scared of this new technology because this will destroy their old system', 'this will change the world', 'you are just mad that you didn't get in on the ground floor. but don't worry you can still be involved as this will only to go up', 'the price is undervalued right now but once it starts going up there will be no stopping it', 'this isn't a pyramid scheme or a Ponzi scheme or a pump-and-dump, this is legal and everyone hating is a shill for the other side!'. I'm paraphrasing a bit but you get the idea.
You should look up some videos of people supporting known pyramid schemes like Vemma and see the similarities between what they say and Bitcoin enthusiasts.
Everything you describe happens in the equity market as well. It's simple speculation, not a Ponzi or Pyramid Scheme.
Also I'm not going to go into the details of each, but: Ponzi Scheme != Pyramid Scheme != Speculation
Then it isn't a Ponzi scheme, period. A Ponzi is a scam where you're lied to about a fake investment that doesn't exist and promised a return in a certain amount of time, your money is then paid to past investors as their return. Bad investments aren't Ponzi's just because people lose money.
All that shit you're talking about is called speculation. Just because idiots sound alike doesn't make the thing they're talking about the same. Pyramid schemes and Ponzi schemes are very particular things: fake investments where no commodity or good exists, money machines that fail because people are lied to and tricked and don't have the sense to understand exponential growth. If you aren't tricked into it, it isn't a Ponzi scheme, if there's a real underlying commodity like Bitcoin, it isn't a Ponzi or Pyramid scheme.
Stop using words you don't understand.
Whether some people who invested in bitcoin advocate for it, share similarities with other people who invested in other things and advocate for those other things, including pyramid schemes, is completely unrelated.
People saying bitcoin is a ponzi scheme is simply ignorance on the topic. That's not a cuss word by the way, just literal ignorance, the lack of knowledge. And hearing from them is like hearing from someone who thought dinosaurs and humans walked the earth simultaneously at one point, just completely wrong and with no basis in evidence. But easy to throw around as a truth in some communities that care not to explore the topic properly and thoroughly.
You'll also not find any government or bank reports on bitcoin being a ponzi scheme. And most modern governments have put a task force on it, most regulatory bodies like say the SEC, and most central banks like say the Bank of England. Bitcoin being a ponzi scheme hasn't come up. For example the World Bank released a report last year saying it wasn't a ponzi scheme.
Thing is, bitcoin has at various times in its life been a speculative bubble. Just like stock of Internet companies, housing etc. That bubble can pop (it did in 2014, from $1200 or so down to below $200), and it can continue trading at a more sensible price (about $250 today). It's inherent to bitcoin because it had to start at 0 value, publicly, from day 1, when it had 0 owners and 0 users and 0 investors. And that eventually grew to millions of owners, users, investors, meaning that it grew by a few million x in the past 6 years. That drove up the price. And if you see a price momentum, there will always be times that people buy because they predict the price going up, which reinforces the momentum through speculation to beyond its supposed value. That's when you get a bubble, and then the bubble pops. And 1-2 years later it starts all over again. Over time, as bitcoin becomes more used, its growth rate slows down, and these insane bubbles happen less and with less magnitude.
So if you want to write a paper on how bitcoin has had several speculative bubbles, it's probably true. Just look at the past few years. But a ponzi? It's simply not, it's a ridiculous claim.