@RealJamesWoods 1/ Some argue Bitcoin’s distribution is analogous to a Ponzi scheme, but it’s nothing like one. The definition of a Ponzi Scheme: “a fraudulent investing scam promising high rates of return with little risk to investors.
@RealJamesWoods 2/ The Ponzi scheme generates returns for older investors by acquiring new investors.” It isn’t one for the following reasons:
@RealJamesWoods 3/ Returns The Bitcoin whitepaper never mentions an investment or promising high returns. In a Ponzi scheme, the value for early investors rely solely on new entrants coming in with fresh capital, and their earnings/dividends come directly from this capital.
@RealJamesWoods 4/ With Bitcoin, the opposite is true. Most early Bitcoiners lost or sold their Bitcoin. Bitcoiners are human, they make human mistakes and have human needs (buying a house).
@RealJamesWoods 5/ “Bitcoins have no dividend or potential future dividend, therefore not like a stock. More like a collectible or commodity.” — Satoshi Nakamoto
@RealJamesWoods 6/ Usage The market’s determination of what one Bitcoin is worth has nothing to do with greater fools getting in the system, but an after effect of its true value proposition, one that it already had even when it was worth nothing.
@RealJamesWoods 7/ Transparency Absolutely nothing about Bitcoin is a secret. It’s open source, anyone can review the code, anyone can contribute to the code, anyone can run the software voluntarily and participate in the network, and anyone can use the network without permission.
@RealJamesWoods 8/ The entire history of all Bitcoin transactions is visible to anyone in the world too. It’s the total opposite of a fraudulent investing scam, which is shrouded in vague promises of high returns with capital inflows and outflows that are kept in a secret ledger
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