Hello everybody. Welcome to the first episode of pointless endeavours. Today pointless endeavour, finding out if Bitcoin is just one giant pyramid scheme. The arguments for it, the arguments against it, and my own opinions on this somewhat controversial subject.
First off let’s all get on the same page. According to the finest Webster’s English dictionary, not really I just did a google search. A pyramid scheme is a form of investment in which each paying participant recruits further investors, with returns being given to early participants using money contributed by later ones. Sound familiar? It’s not a ponzi because using that model new investors are paid a percentage of funds accumulated, while this model is far more similar to a pyramid model.
Right off the bat we can rule it out as not a traditional pyramid scheme, it’s not a requirement of each participant who enters to recruit others, it’s actually more similar to purchasing an unbacked stock or shares in a company that doesn’t exist in this regard, but there are similarities.
So, let’s begin with arguments why it is a pyramid scheme. When Bitcoin first burst onto the scene, it was worth pennies. Drops pennies, I’m going to pick up them up after this Not only that, you could mine it on your laptop and have hundreds if not thousands of Bitcoins within a few days. So those who were there in the beginning are not on the same footing as someone who got in this year. Some would describe this as unfair as you are very much at the bottom of this pyramid.
Another argument for it goes like this. Ever said something positive about Bitcoin to someone? Ever made a post on a forum that was pro-crypto? Ever made a YouTube video talking positively about it, while you held some? Then you are a shameless shill.
Interestingly with the marketcap of Bitcoin in particular so high most of us talking positively about it don’t see it as shilling. It’s been estimated to take up to $100 million dollars to raise Bitcoin just 5%. So, you’re not really going to make much of a difference telling your mates, not in isolation anyway. At one point in time though it must have. Its market cap was $10k once, $100k, $1 million, and it spread by means of promotion. Just like a pyramid scheme. Illuminati music Case closed? Let’s look at the arguments against it..
While there is a lot to cover for the arguments against this, for brevitys sake I will attempt to get at the heart of the arguement. Here goes.. Investment into cryptocurrency idealistically is not for more fiat eventually, but a vote against the current system. A middle finger to the bankers who are “too big to fail”. A collective push to put the power of transacting away from centralized institutions with corrupt policies and national borders, and put it in our own hands. Bitcoin could be the new global reserve, and you could be doing all your shopping in Bitcoin, rather than with the money you’ve made from Bitcoin. The increasing buying power over time for those who got in early was simply a symptom of increasing popularity and not the ultimate goal.
And there you have it. Did I miss anything? Let me know. I’m pretty sure that while there is a lot more I could have said, I’ve got to the heart of the argument in both cases.
Now for my own opinions. The bankers got relatively no more than a slap on the wrist for their abuse of power that led to the great recession in the late 2000s and early 2010s. This negatively affected almost everyone in the world. Yet no one went to jail. What more can it take for people to care?
With this very much in mind I don’t think there could have been any other way to motivate people to care about a financial freedom movement that cryptocurrency has the potential to be, other than by its potential to financially reward them.
Sure some people are going to see the value of it and believe in it even if there was no chance of them getting more money out of it than they put in. Hell some would believe in it so much they’re willing to lose money to use it. For sure I can understand that. But to capture the time and attention of people en masse? They need to be incentivized in the first.
So finally to wrap up my own thoughts on this question. If Bitcoin is simply only a store of value that you sell for more than you put in and that’s the end of it, if it’s not transacted with and no one uses it for what it was created for, then it shares so many similarities with a pyramid scheme it might as well be labelled as one. The largest we’ve ever seen or potentially will ever see. Congratulations to all those who got in early enough, smart move – but what a wasted opportunity.
But if Bitcoin or cryptocurrency in general does what many believe it can do, including myself. When it has a market cap so large that it doesn’t fluctuate in price so much, when you can transact with it quickly and easily, and it is genuinely a viable alternative to using a bank for many things, then I think we can all see the early days of such wild price fluctuation and huge rewards to early adopters as merely the necessary evolution of modern finance.
Will it entirely replace fiat? No I don’t think so. I can’t imagine a world without it. Fiat is still useful for many things. cue fiat daily, replacing fiat?? Hhahahahaha
But in an ideal world cryptocurrency will have enough influence to reign in the corrupt practices performed by central banks.
But what do you think. Do you agree with me? Let me know your thoughts. The final answer is going to be subjective, but hopefully you found this video interesting. Leave a Like if you enjoyed and subscribe for similar honest cryptocurrency videos.
Peace.
Looking at the whole world, it looks like the future of BTC and crypto currency is very good.
But the Indian bank system and the negative news coming from time to time have caused significant losses to BTC and crypto currency and the youth have suffered a lot.
No more a pyramid scheme than the banks, when did the banks ever do you a favour?? oh 1% interest rates on your cash but charge you 4-7% for a mortgage over 25 years. Marketing is great, plant that seed nobody will every realise were con artists. HIDE the con (never get caught PPI) make it hard to get a loan. that's covered by Wonga 500% upwards. people are trapped crypto is the way out for many. keep it up CD
It would be great to have a collection of stories from people all around the world and what Bitcoin means to them. Something to shift the focus from the marketcap to (as an example) supporting financial freedom. The price speculation will almost certainly continue to take centre stage. But more than ever we need to push past this fixation so that those not yet aware of the true potential of this technology have greater opportunity for exposure... However, a true sentiment shift analogous to the push for environmental conservation will likely require another financial Armageddon :/.