Quote:
Originally Posted by housenuts
This is exactly how you defined ponzi in post #22.
As for gold's uses and it's scarcity, I would imagine the ratio of gold held in reserves and unused (speculative) to gold used for ornamentation (utility) than the ratio of bitcoin held by people (speculative) to bitcoin used by people (utility).
I'd like to see a stat on worldwide gold holdings.
I'm confused you think I defined ponzi scheme in post #22. If you mean this
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People buy part of a company because they think that company will be successful--->their investment goes up in value and they make money.
then I am really confused. This is the reason people invest in ANYTHING, including ponzi schemes. Does that make every investment a ponzi scheme? Lol?
The difference between companies listed on a stock index and bitcoin or other ponzis is that those companies most often produce things of real value and scarcity, and they have to go through a vigorous process of being listed, so as to PREVENT ponzi schemes being listed on the markets. Do some still get through? Absolutely. But most don't.
Bitcoin has the scarcity thing down I suppose, with its maximal production limit but it doesn't have the value. It doesn't DO anything well except, as I have admitted, remit across borders quickly and easily, and of course act as an excellent way of buying illegal things pseudonymously.
However, the reason it is valued so high is because people believe it will be widely used as a better currency at some point in the future than what we have now, and there is absolutely no evidence that it has, or ever will be. It is
pure speculation. I don't know how long it will take for the majority of investors to see this; it could be 20 years and it could be 6 months, but it will happen. The most important point about bitcoin though, is that historically it has not been used as a currency. The vast majority of people invest in it because they believe one day it will be widely used as one. Ironically, the higher the price is, the less it will be used as a currency and the lower the price the more people will disinvest in it. This reason alone makes it doomed to failure, unless it finds some other widespread use to maintain its valuation.
Last edited by DoOrDoNot; 06-23-2017 at 05:12 PM.