Willing ponzi schemes

Your tipical ponzi scheme consists of a clear number of stages:

• dangle a impossible promise/return in front of greedy people to make them ignore the risk (the ‘make money fast’ crowd)
• rely on the piramide effect to let your victems do the marketing for you, which creates a exponential number of new “customers”
• do a rugpull or go down with the ship, when the scheme is no longer viable

=== collecables === ` In history we have had a lot of collection crazes. People used to believe that the value of coin collections would go up forever. People collected baseball cards, and paid insane amounts of prices for rare cards. The issiueing of limited postal stamps used to be main income source of small nation states. In more recent times the collection of tous in chocolate easter eggs and beanie babies were a hupe that never seemed to end.

Those “investments” have now dropped heavyly in value. But new trades have sprung up into place.

=== meme-stocks ===

Consider first the case of the so called meme-stocks.

The case started humbly enough. Some small stocks were shorted by commericial short-sellers, while the real value was understated. Added that some of these stocks were sentimental, and that by buying them you could drive the short sellers into heavy losses, this was a big middle finger to nasty commercial vampires.

But a strange thing happened. People involved in this trade discovered that buying these stocks created a self-fulfilling provacy, which is that if people kept buying hse stocks, and if nobody sold them, the ‘paper value’ would only go up. This trade is of course not perfect, since the companies issueing the stock can always create more shares (gameshop, etc), but the case is clear for everybody to see.

Everybody can be a (paper) milionare as long as nobody sells. Of course the people who got in first get more, just like in a piramide scheme. The big thing is of course that everybody needs to be convinced NOT to EVER sell the stock. If nobody sells, then the stock can only go up. This behavior (holding) was strongly encouraged in the reddit groups that initiated the buying of the stocks in the first place.

Did(do) the people buying these stocks know this dynamic? Yes, almost everbody was in, which makes this a form of willing collective `pump-and-dump, except people are not dumping.

=== crypto coins ===

Is there a more extreme case of this dynamic? Yes. We can see it in the price and behavior of crypto-coins, like bitcoin.

It started small, with the tipical tech promise that a new kind of tech would disrupt the world of finance.

But the cases for bitcoin and other cryptocoins started drying up faster than new cases could be created. Bitcoin has long ago ceased to be the micropayment option, then it ceased to be a viable option for international banking, and even the idea that it could be a safe store of value has disapeared (its value drops when gold rises).

The most promising solution of bitcoin (money laudering) was undermined through the fact that the bitcoin ledger can be tracked beter then any cash transaction ever could, and the privacy coin (monero) is now going nowere.

In short: bitcoin is limited in the number of transactions, expensive to use, no good value for storage, and not even usable for laundary. It’s not even secure (see the use number of hacks). The usage of bitcoin is even defaluary, since the costs of rewarding bitcoin miners is devaluating the value of the coin. It even has a number of serieus security attacks suchs as the 51% attack. The only thing it has going for it, is that it was the first crypt-coin.

Is these any remaining bisseuness case for bitcoin left? Yes: HODL (hope that numbers go up, and convince others to hold as well)

stable coins buy bitcoin whales shake out highly leveraged traders speculation

Buy crypto, take loans against it, and use those to buy more crypto