Why Exactly is Bitcoin Not A Ponzi Scheme? - CryptoVantage

Why Bitcoin is not a Ponzi Scheme - rebuttal to the Washington Post

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Why Bitcoin Is NOT a Ponzi Scheme

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Why Bitcoin Is NOT a Ponzi Scheme

Why Bitcoin Is NOT a Ponzi Scheme submitted by AliBongo88 to Bitcoin [link] [comments]

Why Bitcoin is not a ponzi scheme

Why Bitcoin is not a ponzi scheme submitted by bc2014 to Bitcoin [link] [comments]

Here's why Bitcoin is NOT a ponzi scheme

Here's why Bitcoin is NOT a ponzi scheme submitted by apc01 to Bitcoin [link] [comments]

Why Bitcoin Is NOT a Ponzi Scheme

Why Bitcoin Is NOT a Ponzi Scheme submitted by AliBongo88 to btc [link] [comments]

Why Bitcoin Is NOT a Ponzi Scheme

Why Bitcoin Is NOT a Ponzi Scheme submitted by BitcoinAllBot to BitcoinAll [link] [comments]

Explain why Bitcoin is not a Ponzi scheme Like I am Bernie Madoff and you are Ron Paul

Alternatively; Explain why Bitcoin IS a Ponzi Scheme Like I am Ron Paul and you are Bernie Madoff
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The only reason why guys like Portnoy view Bitcoin as a ponzi is because he only understands it as a way to get more USD. Portnoy has to acknowledge why other people value and appreciate Bitcoin. It's not just a "get rich quick scheme". It's a "change the rules of the game scheme".

Bitcoin is a market mechanism to find equilibrium between supply and demand, store value, and allow humans to coordinate and collaborate in new and peaceful ways.
Problem is that the IRS stifles Bitcoin's use as a medium of exchange because of the tax laws.
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Doing some research. Why is bitcoin not a ponzi scheme?

I'm learning about it and coming across some banks that are saying it..I'm wondering why.
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Why you can’t cash out pt 3: Bitcoin is not a Ponzi scheme! It just works like one [by me]

Why you can’t cash out pt 3: Bitcoin is not a Ponzi scheme! It just works like one [by me] submitted by dgerard to Buttcoin [link] [comments]

Doing some research. Why is bitcoin not a ponzi scheme? /r/Bitcoin

Doing some research. Why is bitcoin not a ponzi scheme? /Bitcoin submitted by BitcoinAllBot to BitcoinAll [link] [comments]

Economist Explains Why Why Bitcoin Is NOT a bubble or a Ponzi Scheme...

Economist Explains Why Why Bitcoin Is NOT a bubble or a Ponzi Scheme... submitted by BitcoinAllBot to BitcoinAll [link] [comments]

Economist Explains Why Why Bitcoin Is NOT a bubble or a Ponzi Scheme...

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Why Bitcoin is not a pyramid scheme (or ponzi scheme)

Why Bitcoin is not a pyramid scheme (or ponzi scheme) submitted by JockyKurzwell to Bitcoin [link] [comments]

PRICE, FUD and Future

Hi Everybody!
I wanted to make another post because the amount of fear mongering is significant. Please ignore grammar. I wrote this in about 10 minutes and didn’t check it.
Firstly, the price drop has been disappointing. It doesn’t matter the quantum of loss, $1000 or $100k can feel equally bad depending your position in life. Losing 35% of value in 1 week is significant. What this tells me is that the real float of CRO is extremely low. There were likely some early adopters (i.e. Whales) that had been enjoying price appreciation and 18% and they bailed at the news. In any case, we don’t know how “real” the price of CRO ever was. This is true with Bitcoin as well, but the float is liquid enough where it takes a massive groundswell to truly move the price whereas CRO can move with only a few sellers. I don’t have any great insight, unfortunately.
In terms of CDC being a scazm (remove the z), this feels like total fear mongering from my vantage point. If CDC was a ponzi scheme, why would they lower the interest rate of CRO? There is absolutely no incentive if this was always a big Ponzi scheme. This is the exact kind of change that takes down scams. They can literally give CRO away at no cost to themselves. If this was a scazm, the logical decision would have been to lower every other interest rate while keep CRO unnaturally high to keep to pumping, so they could slowly sell into it. Anyways, this feels like a real business decision that was for profits while at the same time annoying customers.
Where I am disappointed is communication. CDC has been weak here for a long time and they need to get better. Kris’ unusual comment around staking amounts is another sign bad potential communication. They need to be more deliberate in these decisions. A 1 week price change should not force them to make a decision like this. I could understand a 3 to 6 month depressed price or conversely if it pumped. I would like to see them provide real guidance on how they plan to approach staking amounts so users can feel more confident in the product. For instance, be clear that current stakes would or would not get impacted by adjustments, etc.
In terms of the future, from my vantage point, CDC is one of the few crypto companies actually creating a compelling product. They have some issues, but at least there is a fundamental business behind it. The world needs crypto on ramps that are easy to use and CDC is building it. That said, they are at an important point of their life cycle and need to grow-up. If they want to become a big business, they need to start acting like one. Snap decisions are not “ok”. If they continue this path of changing massive items overnight, they will never break out as a go to company. This is what I will be watching going forward. I want the core of CDC to become boring for the most part while offering new products that may or may not work as they build out a platform.
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Do you think cryptocurrency is 'ripe' for adoption by developing countries? - Civil discussion

Do you think cryptocurrency is 'ripe' for developing countries?

Hi everyone, I am u/Mierenknager and I struggle with this question a lot. Because I am not sure if it is good to push developing countries to use Bitcoin/Alt-coins.

Why this question is important:

You can't deny cryptocurrency will change the future, of course. But right now we are still in the speculating and developing phase. While we research and test different coins or algoritms, we are already pushing developing countries to use Bitcoin/alt-coins.

Why crypto can be good and bad for developing countries:

The good points about crypto:

Bad points about crypto at the moment:

And now?

I really hope to hear your opinions about this ethical problem. Do you support crypto-currency for developing countries or not, and why?
Thanks for reading!
View Poll
submitted by MierenKnager to CryptoCurrency [link] [comments]

Bitcoin Forex Trading Possible 'Scam'

Good evening everyone,
Before the story commences, I am unsure if posting it on this subreddit will be of any help, but I do have a certain faith in the overall Reddit community.
About two weeks ago my mother informed me about a conversation she was having with a real friend of hers. They were talking about investing money in something (it was quite vague and unspecified). So naturally I asked some questions; 'What are you investing in? What is the company name?'. It turned out to be a investment in Bitcoin through a company by the name of MTI. Mirror Trading International. Then of course I did some digging, made myself more familiar with how cryptocurrency works and what the processes behind it entail. The search results of MTI show multiple links to news articles disputing the legitimacy of MTI.
My mother joined a Zoom call with the friend from before and some others that already partook in this movement. There they asked questions and answered questions about MTI and how it works.
MTI claims this: " You too can start to benefit from this marvellous opportunity. Remember, your trading pool balance will fluctuate with the changing Bitcoin price, but your Bitcoin WILL be growing, and when the price of Bitcoin rises, you will be perfectly placed to take full advantage thereof. "
Seemingly you invest money in bitcoins and the money of all the investors is gathered in a forex trading pool. Every day investors are able to see the trades in the pool (made my an AI trading bot). Without doing anything you can passively build or grow your balance. I honestly think the revenue that comes back to investors are the funds provided by new members (like in a Ponzi scheme). The returns they promise are way too optimistic to be genuine. The CEO of the company has participated in other fraudulent activities like the Kipi scam.
Somehow I tried talking to the people from the Zoom call my mother attended, explaining why I do not trust the company and its intentions. Sadly, all falls on deaf ears and they are unconditionally sure about the legitimacy of MTI.
My question: What are your regards on this topic and on MTI? How should I convince those involved that this is not a risk worth taking. It makes me worry more than I want to.
Thank you for your time in advance!
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A Theory: The Crypto Ecosystem Hasn't Fully Collapsed Because It Has Found A Truly Ingenious Way To Monetize Human Stupidity and Greed

It's true that most traditional ponzi/pyramid schemes (Madoff etc...) collapse because they're obligated to provide unsustainable returns to their investors. However, pyramid schemes that force their sucker "investors" to eat their own losses typically don't collapse, at least not for a long time . Crypto is a perfect example of this dynamic at play, since exchanges are able to establish a consistent revenue stream of hard currency by manipulating the market against butters stupid enough to gamble on margin. The whole thing basically has the business model of a casino/pyramid scheme combined into one. Bitcoin doesn't run on electricity or software. It runs on sheer human stupidity, gullibility, and greed. MLMs like Harbalife largely function on the same principle (forcing the vast majority of suckers to eat their losses instead of guaranteeing an ultimately unsustainable return), which is why many MLMs have lasted for literally decades.
Something that u/thehoesmaketheman said on here that really stuck with me is that governments make pyramid schemes illegal because people love to "invest" in pyramid schemes otherwise. This can actually do profound damage to society if taken far enough, and while any given pyramid scheme might eventually collapse (depending on its structure), there will always be new schemes and new suckers. Crypto is a perfect space for generating both, as it is both digital and laughably unregulated. So I predict the Bitcoin/Crypto/Tether Rube Goldberg machine of stupidity and greed will keep going until governments finally wise up and make it illegal (if they ever do) because its just another scam at the end of the day. Unfortunately for our society and the planet, a lot of people in power seem to be fooled by trendy tech buzzwords like blockchain.
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Don't blindly follow a narrative, its bad for you and its bad for crypto in general

I mostly lurk around here but I see a pattern repeating over and over again here and in multiple communities so I have to post. I'm just posting this here because I appreciate the fact that this sub is a place of free speech and maybe something productive can come out from this post, while bitcoin is just fucking censorship, memes and moon/lambo posts. If you don't agree, write in the comments why, instead of downvoting. You don't have to upvote either, but when you downvote you are killing the opportunity to have discussion. If you downvote or comment that I'm wrong without providing any counterpoints you are no better than the BTC maxis you despise.
In various communities I see a narrative being used to bring people in and making them follow something without thinking for themselves. In crypto I see this mostly in BTC vs BCH tribalistic arguments:
- BTC community: "Everything that is not BTC is shitcoin." or more recently as stated by adam on twitter, "Everything that is not BTC is a ponzi scheme, even ETH.", "what is ETH supply?", and even that they are doing this for "altruistic" reasons, to "protect" the newcomers. Very convenient for them that they are protecting the newcomers by having them buy their bags
- BCH community: "BTC maxis are dumb", "just increase block size and you will have truly p2p electronic cash", "It is just that simple, there are no trade offs", "if you don't agree with me you are a BTC maxi", "BCH is satoshi's vision for p2p electronic cash"
It is not exclusive to crypto but also politics, and you see this over and over again on twitter and on reddit.
My point is, that narratives are created so people don't have to think, they just choose a narrative that is easy to follow and makes sense for them, and stick with it. And people keep repeating these narratives to bring other people in, maybe by ignorance, because they truly believe it without questioning, or maybe by self interest, because they want to shill you their bags.
Because this is BCH community, and because bitcoin is censored, so I can't post there about the problems in the BTC narrative (some of which are IMO correctly identified by BCH community), I will stick with the narrative I see in the BCH community.
The culprit of this post was firstly this post by user u/scotty321 "The BTC Paradox: “A 1 MB blocksize enables poor people to run their own node!” “Okay, then what?” “Poor people won’t be able to use the network!”". You will see many posts of this kind being made by u/Egon_1 also. Then you have also this comment in that thread by u/fuck_____________1 saying that people that want to run their own nodes are retarded and that there is no reason to want to do that. "Just trust block explorer websites". And the post and comment were highly upvoted. Really? You really think that there is no problem in having just a few nodes on the network? And that the only thing that secures the network are miners?
As stated by user u/co1nsurf3r in that thread:
While I don't think that everybody needs to run a node, a full node does publish blocks it considers valid to other nodes. This does not amount to much if you only consider a single node in the network, but many "honest" full nodes in the network will reduce the probability of a valid block being withheld from the network by a collusion of "hostile" node operators.
But surely this will not get attention here, and will be downvoted by those people that promote the narrative that there is no trade off in increasing the blocksize and the people that don't see it are retarded or are btc maxis.
The only narrative I stick to and have been for many years now is that cryptocurrency takes power from the government and gives power to the individual, so you are not restricted to your economy as you can participate in the global economy. There is also the narrative of banking the bankless, which I hope will come true, but it is not a use case we are seeing right now.
Some people would argue that removing power from gov's is a bad thing, but you can't deny the fact that gov's can't control crypto (at least we would want them not to).
But, if you really want the individuals to remain in control of their money and transact with anyone in the world, the network needs to be very resistant to any kind of attacks. How can you have p2p electronic cash if your network just has a handful couple of nodes and the chinese gov can locate them and just block communication to them? I'm not saying that this is BCH case, I'm just refuting the fact that there is no value in running your own node. If you are relying on block explorers, the gov can just block the communication to the block explorer websites. Then what? Who will you trust to get chain information? The nodes needs to be decentralized so if you take one node down, many more can appear so it is hard to censor and you don't have few points of failure.
Right now BTC is focusing on that use case of being difficult to censor. But with that comes the problem that is very expensive to transact on the network, which breaks the purpose of anyone being able to participate. Obviously I do think that is also a major problem, and lightning network is awful right now and probably still years away of being usable, if it ever will. The best solution is up for debate, but thinking that you just have to increase the blocksize and there is no trade off is just naive or misleading. BCH is doing a good thing in trying to come with a solution that is inclusive and promotes cheap and fast transactions, but also don't forget centralization is a major concern and nothing to just shrug off.
Saying that "a 1 MB blocksize enables poor people to run their own" and that because of that "Poor people won’t be able to use the network" is a misrepresentation designed to promote a narrative. Because 1MB is not to allow "poor" people to run their node, it is to facilitate as many people to run a node to promote decentralization and avoid censorship.
Also an elephant in the room that you will not see being discussed in either BTC or BCH communities is that mining pools are heavily centralized. And I'm not talking about miners being mostly in china, but also that big pools control a lot of hashing power both in BTC and BCH, and that is terrible for the purpose of crypto.
Other projects are trying to solve that. Will they be successful? I don't know, I hope so, because I don't buy into any narrative. There are many challenges and I want to see crypto succeed as a whole. As always guys, DYOR and always question if you are not blindly following a narrative. I'm sure I will be called BTC maxi but maybe some people will find value in this. Don't trust guys that are always posting silly "gocha's" against the other "tribe".
EDIT: User u/ShadowOfHarbringer has pointed me to some threads that this has been discussed in the past and I will just put my take on them here for visibility, as I will be using this thread as a reference in future discussions I engage:
When there was only 2 nodes in the network, adding a third node increased redundancy and resiliency of the network as a whole in a significant way. When there is thousands of nodes in the network, adding yet another node only marginally increase the redundancy and resiliency of the network. So the question then becomes a matter of personal judgement of how much that added redundancy and resiliency is worth. For the absolutist, it is absolutely worth it and everyone on this planet should do their part.
What is the magical number of nodes that makes it counterproductive to add new nodes? Did he do any math? Does BCH achieve this holy grail safe number of nodes? Guess what, nobody knows at what number of nodes is starts to be marginally irrelevant to add new nodes. Even BTC today could still not have enough nodes to be safe. If you can't know for sure that you are safe, it is better to try to be safer than sorry. Thousands of nodes is still not enough, as I said, it is much cheaper to run a full node as it is to mine. If it costs millions in hash power to do a 51% attack on the block generation it means nothing if it costs less than $10k to run more nodes than there are in total in the network and cause havoc and slowing people from using the network. Or using bot farms to DDoS the 1000s of nodes in the network. Not all attacks are monetarily motivated. When you have governments with billions of dollars at their disposal and something that could threat their power they could do anything they could to stop people from using it, and the cheapest it is to do so the better
You should run a full node if you're a big business with e.g. >$100k/month in volume, or if you run a service that requires high fraud resistance and validation certainty for payments sent your way (e.g. an exchange). For most other users of Bitcoin, there's no good reason to run a full node unless you reel like it.
Shouldn't individuals benefit from fraud resistance too? Why just businesses?
Personally, I think it's a good idea to make sure that people can easily run a full node because they feel like it, and that it's desirable to keep full node resource requirements reasonable for an enthusiast/hobbyist whenever possible. This might seem to be at odds with the concept of making a worldwide digital cash system in which all transactions are validated by everybody, but after having done the math and some of the code myself, I believe that we should be able to have our cake and eat it too.
This is recurrent argument, but also no math provided, "just trust me I did the math"
The biggest reason individuals may want to run their own node is to increase their privacy. SPV wallets rely on others (nodes or ElectronX servers) who may learn their addresses.
It is a reason and valid one but not the biggest reason
If you do it for fun and experimental it good. If you do it for extra privacy it's ok. If you do it to help the network don't. You are just slowing down miners and exchanges.
Yes it will slow down the network, but that shows how people just don't get the the trade off they are doing
I will just copy/paste what Satoshi Nakamoto said in his own words. "The current system where every user is a network node is not the intended configuration for large scale. That would be like every Usenet user runs their own NNTP server."
Another "it is all or nothing argument" and quoting satoshi to try and prove their point. Just because every user doesn't need to be also a full node doesn't mean that there aren't serious risks for having few nodes
For this to have any importance in practice, all of the miners, all of the exchanges, all of the explorers and all of the economic nodes should go rogue all at once. Collude to change consensus. If you have a node you can detect this. It doesn't do much, because such a scenario is impossible in practice.
Not true because as I said, you can DDoS the current nodes or run more malicious nodes than that there currently are, because is cheap to do so
Non-mining nodes don't contribute to adding data to the blockchain ledger, but they do play a part in propagating transactions that aren't yet in blocks (the mempool). Bitcoin client implementations can have different validations for transactions they see outside of blocks and transactions they see inside of blocks; this allows for "soft forks" to add new types of transactions without completely breaking older clients (while a transaction is in the mempool, a node receiving a transaction that's a new/unknown type could drop it as not a valid transaction (not propagate it to its peers), but if that same transaction ends up in a block and that node receives the block, they accept the block (and the transaction in it) as valid (and therefore don't get left behind on the blockchain and become a fork). The participation in the mempool is a sort of "herd immunity" protection for the network, and it was a key talking point for the "User Activated Soft Fork" (UASF) around the time the Segregated Witness feature was trying to be added in. If a certain percentage of nodes updated their software to not propagate certain types of transactions (or not communicate with certain types of nodes), then they can control what gets into a block (someone wanting to get that sort of transaction into a block would need to communicate directly to a mining node, or communicate only through nodes that weren't blocking that sort of transaction) if a certain threshold of nodes adheres to those same validation rules. It's less specific than the influence on the blockchain data that mining nodes have, but it's definitely not nothing.
The first reasonable comment in that thread but is deep down there with only 1 upvote
The addition of non-mining nodes does not add to the efficiency of the network, but actually takes away from it because of the latency issue.
That is true and is actually a trade off you are making, sacrificing security to have scalability
The addition of non-mining nodes has little to no effect on security, since you only need to destroy mining ones to take down the network
It is true that if you destroy mining nodes you take down the network from producing new blocks (temporarily), even if you have a lot of non mining nodes. But, it still better than if you take down the mining nodes who are also the only full nodes. If the miners are not the only full nodes, at least you still have full nodes with the blockchain data so new miners can download it and join. If all the miners are also the full nodes and you take them down, where will you get all the past blockchain data to start mining again? Just pray that the miners that were taken down come back online at some point in the future?
The real limiting factor is ISP's: Imagine a situation where one service provider defrauds 4000 different nodes. Did the excessive amount of nodes help at all, when they have all been defrauded by the same service provider? If there are only 30 ISP's in the world, how many nodes do we REALLY need?
You cant defraud if the connection is encrypted. Use TOR for example, it is hard for ISP's to know what you are doing.
Satoshi specifically said in the white paper that after a certain point, number of nodes needed plateaus, meaning after a certain point, adding more nodes is actually counterintuitive, which we also demonstrated. (the latency issue). So, we have adequately demonstrated why running non-mining nodes does not add additional value or security to the network.
Again, what is the number of nodes that makes it counterproductive? Did he do any math?
There's also the matter of economically significant nodes and the role they play in consensus. Sure, nobody cares about your average joe's "full node" where he is "keeping his own ledger to keep the miners honest", as it has no significance to the economy and the miners couldn't give a damn about it. However, if say some major exchanges got together to protest a miner activated fork, they would have some protest power against that fork because many people use their service. Of course, there still needs to be miners running on said "protest fork" to keep the chain running, but miners do follow the money and if they got caught mining a fork that none of the major exchanges were trading, they could be coaxed over to said "protest fork".
In consensus, what matters about nodes is only the number, economical power of the node doesn't mean nothing, the protocol doesn't see the net worth of the individual or organization running that node.
Running a full node that is not mining and not involved is spending or receiving payments is of very little use. It helps to make sure network traffic is broadcast, and is another copy of the blockchain, but that is all (and is probably not needed in a healthy coin with many other nodes)
He gets it right (broadcasting transaction and keeping a copy of the blockchain) but he dismisses the importance of it
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Frustrating talking to people who don't understand Bitcoin, but force their opinion

Just had a conversation with a friend of a friend who works in cyber security. She basically shit on Bitcoin security and said exchanges can be hacked, but she didn't understand what a hard wallet was when I tried to explain. Then she said the government will step in and take it over. I explained how the decentralization aspect is essentially the core of Bitcoin and that the government can't just come in and change that and that that's why Bitcoin is so special. This seemed over her heard. Then she proceeded to tell me it was just a ponzi scheme held up by market manipulation and will eventually crash when the market manipulators want it to. Finally, she said she when she heard about it in 2017 she assumed a Bitcoin would be worth 400 dollars max right now. I calmly tried to explain these things to her and it was in one ear out the other. I have experienced this a few times with people who for some reason adamantly dismiss Bitcoin for no valid reason and feel the need to force their thoughts down your throat and not listen to the truth. Guess it'll be her loss on the way to the moon
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Stablecoins Are Not as Safe as You Think. How Your USDT, PAX, BUSD Get Frozen in a Moment

Stablecoins Are Not as Safe as You Think. How Your USDT, PAX, BUSD Get Frozen in a Moment
Being created on the basis of blockchain, stablecoins were considered to be a safe haven for investors… until recently. Why is their immunity elusive and how does the Financial Action Task Force (FATF) plan to control them?
Established in 1989 by the G7, the FATF inter-governmental organization develops policies to resist money laundering and financing of terrorism. It sets standards and implements legal and regulatory measures to combat illegal financial transactions.
They developed recommendations for the monitoring of money laundering and keep revising them regularly. In case of non-compliance, law enforcement is executed via regional financial organizations. As of 2019, there are 39 full members of FATF, including the USA, UK, Australia, most EU countries, Singapore, India and the Russian Federation.
Since 1st July, the FATF organization has been headed by Marcus Pleyer. During the last FATF meeting, the new president expressed his concerns about global stablecoins and organizations that issue them. Although the organization had already dealt with these cryptocurrencies, it highlighted that, “it is essential to continue closely monitoring the ML/TF risks of so-called stablecoins, including anonymous peer-to-peer transactions via unhosted wallets”.
Is it ever possible to control crypto wallets that are not hosted on online exchanges? – you’d ask. We’re used to the fact that cryptocurrencies are outside the reach of banks and governments. However, when it comes to stablecoins, things are different.

It’s in the code

What makes stablecoins special is that they are pegging to fiat currency, for example, 1 TUSD = $1 USD. This means that such assets should be backed up by real money stored in the bank accounts of the issuing organization. Consequently, stablecoin creators need to comply with the requirements of the SEC, FATF and other controlling agencies, if they are to operate in the cryptocurrency sphere and be authorised to sell stablecoins. Transparent reports are not the only requirement, stablecoins must also provide the possibility of account blocking.
Surprisingly, this feature is implemented in each stablecoin. The experts from QDAO DeFi are covering several stablecoin protocols that enable this function.


Issued by Tether Limited, USDT is a stablecoin that was originally created to be worth $1 with each token backed by a $1 real fiat reserve. The currency was successfully promoted and added to major cryptocurrency exchanges but stayed a controversial asset. Despite the claims of Tether Limited, they failed to provide any contractual right or other legal claims to guarantee that USDT can be swapped for dollars or be redeemed.
In April 2019, Tether’s lawyers explained that each USDT was backed by only $0.74 in cash or equivalent assets. No audit of dollar collateral was done. A month before that, it changed the backing to include loans to affiliate companies. The scandal also involved the Bitfinex exchange that was accused of using USDT funds to cover $850 million in funds lost since 2018. They were also accused of manipulating USDT to push the BTC price.
Tether is available on five blockchains: Omni, Ehereum, EOS, Tron and Liquid. Only the latter does not have a freezing feature. Omni was the first protocol for USDT. Blocking of users’ accounts is possible, thanks to the following piece of code:

Apparently, it’s used to blacklist addresses and contracts.


The concerns about PAX were centered around the notorious MMM BSC Ponzi scheme. Before the widespread adoption of DeFi services, it was the second-largest gas consumer after Ethereum. Out of 25,000 daily transactions, 5,000 were performed by MMM BSC. It was reported to be a scam but none of the accounts were frozen. Does it mean PAX lacked the resources to regulate illicit activities?
Evidently, not. The protocol code has a LAW ENFORCEMENT FUNCTIONALITY function that allows for the freezing/unfreezing of contracts or burning assets on blacklisted accounts. It turns out, anyone risks having their PAX coins destroyed during an investigation process while their accounts stay blocked.

History of frozen accounts

In 2019, the ZCash Foundation and Eric Wall conducted research on the privacy of stablecoins and revealed several frozen addresses. It’s not clear why exactly they were blocked. Most probably, it happened shortly after the exchange withdrawal – users took this action after witnessing platforms being hacked.

USDT was implicated at least twice in scandals to do with freezing. In April 2019, about $850 million in Tether dollars sent by Crypto Capital Corp. were frozen by a New York court. Tether and Btfinex were accused of participating in a cover-up to hide about $850 million worth in clients’ funds. By July 2020, Tether had frozen 40 Ethereum addresses with millions of USDT (some of them are shown in the screenshot above).
The Centre Consortium was the next to follow their lead; about a month ago, it blacklisted an address with USDC worth $100,000. That was done in response to law enforcement.
Yet, it’s not only Europe and the USA imposing control over cryptocurrencies. Since June 2020, the Chinese government managed to block several thousands of users’ bank accounts. It was done to resist illicit activities, especially money laundering. On some of those accounts, no activity had been detected for several months. Meanwhile, prior to April 2020, Chinese residents moved over $50 billion worth of crypto outside the country borders – more than is officially allowed (a maximum of $50,000 per person).
The authorities claim that USDT and other stablecoins are often used in illegal activities. Together with the People’s Bank of China (PBOC), they are developing new ways of investigating digital crimes and money laundering operations involving exchanges and crypto wallets. Local financial bureaus and police are working tight-lipped about investigating startups and crypto exchanges. And they are succeeding at it.
In July 2020, Chinese authorities confiscated BTC, ETH and USDT worth $15 million from people who allegedly ran a fake cryptocurrency scheme.
By the way, not only corporate accounts are being closed. One investor claims his account had been frozen after using yuan to purchase crypto. Also, users who transfer illegally obtained money outside of the mainland in large amounts are under suspicion. Does it mean the Chinese government has started tightening the screws on cryptocurrency users?

DAI, USDT on Liquid and USDQ are the main options for stablecoin deposits

So, where can you store your crypto assets? USDT on Liquid and DAI are not the only solutions available. Consider making a deposit in USDQ, the stablecoin of the QDAO ecosystem. Like other stablecoins, it’s 1-to-1 pegged to USD. However, it cannot be frozen by a government, financial organization or anyone from the QDAO team. You can check it yourself by reading our Smart contract and USDQ Audit.
In QDAO, users’ accounts are never frozen by a single person – all account issues are solved by the entire QDAO community, with the help of a QDAO governance token.
In case of blocking (the chances of which are almost non-existent), you can address the QDAO community and get timely help.

Bottom Line

With FATF taking this new course of action, we might witness serious pressure on stablecoin providers. Some projects will resist it, but it’s still not safe to store your assets in popular stablecoins, especially USDT. Your account can be frozen by authorities for dozens of reasons without the possibility of retrieval.
Yet, there are a number of reliable alternatives and USDQ stablecoin is one of them. QDAO DeFi platform users feel free to manage their crypto reserves and make profitable deposits.
Want to be the first to hear QDAO DeFi news and updates? Visit our website and stay in touch with us on social media: Twitter, Facebook, Telegram and LINE (for the Japanese-speaking community).
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Is Bitcoin a Pyramid or Ponzi Scheme? Is Bitcoin a Ponzi scheme?  7 reasons why you should not invest in Bitcoins, cryptocurrencies Why BitConnect is a Scam and Ponzi Scheme - Stay AWAY!!! Bitcoin is NOT a Ponzi scheme.  MaiView  20190719 Bitcoin is a PONZI SCHEME

By:Sudhir Khatwani In:Bitcoin Last Updated:13/10/2018 One of the biggest myths regarding Bitcoin is that many consider it as a fraudulent, Ponzi scheme. But very few actually understand what a Ponzi scheme is.. It is not wise for people to draw conclusions without a proper understanding of any topic whatsoever. Here’s Why Bitcoin Is Not a Ponzi Scheme. Money Morning Cryptocurrency Expert – our guide on all things Bitcoin and blockchain – David G. Zeiler wrote in depth about this common misbelief in 2015. In the years since, he’s seen various Bitcoin-related scams play out. But he fervidly points out to this day that the digital asset itself is not a Ponzi scheme. For starters, David says that ... I will explain in detail why Bitcoin is not a Ponzi scheme, but before that let’s understood and examine what a Ponzi scheme actually means. What Is A Ponzi Scheme? A Ponzi scheme is a fraudulent investment operation where the operator generates returns for older investors through revenue paid by new investors, rather than from legitimate business activities or profit of financial trading ... Bitcoin does not fit the definition of Ponzi scheme for various reasons: ... Miners collecting transaction fees doesn’t make Bitcoin a Ponzi scheme. Miners operate like a business and offer the valuable service of securing transactions on an immutable public ledger. By that logic we could call NASDAQ, NYSE, Banks, Paypal and just about any business that charges a fee a Ponzi scheme. Another ... The last reason why Bitcoin is not a ponzi scheme is simply because it is money. It’s just as easy to call the USD a ponzi scheme because it has equally as little inherent value as bitcoin does. The only reason Bitcoin and the USD have value is because people believe it does. Without a sufficient amount of individuals willing to exchange something useless for something useful, the money ...

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Is Bitcoin a Pyramid or Ponzi Scheme?

Remove all; Disconnect; The next video is starting MaiCoin Group - Taiwan's largest and longest running digital asset trading platform. MaiCoin _ https://www.maicoin.com MAX _ https://max.maicoin.com Register... It seems to be a controversial subject in the community as to whether or not BitConnect is a scam / pyramid / Ponzi scheme. In this video, I layout why I believe it is clearly a scam and how the ... Why Bitcoin Is a Ponzi Scheme with David Heinemeier Hansson - Duration: 52:52. Make More Marbles Recommended for you. 52:52. The $65-Billion Ponzi scheme, notorious insider trading · Eugene ... In this video, I discuss whether or not Bitcoin is a Pyramid scheme or a Ponzi scheme. I conclude that it is neither, simply because: 1) Bitcoin is decentralized, not run by a corporation or ...