Topic: Honest Ponzi Sceme? (Read 2295 times)

These are just math terms. k is a variable that represents a number, so that means if k is 3, then kth is 3rd. If k is 5, kth means 5th, etc. d_k represents the amount of the kth deposit. So if k is 5, then d_k is whatever the 5th depositor put in. The underscore is just used to indicate that k is a subscript on d, but that is hard to type in ASCII. These notations aren't really specific to this site, you can find them other places also.

in the formula what is meaning:
kth
d_k
d_(
?
thx

honest ponzi is not run by me, in case you were wondering.

Oh that'd be nice.  Unless he's used that address for other transactions.  Woohoo nice to meet another newbie ^^

He probably just blockchained my address =D

Thank you Captain Obvious!

SCHEME*

I can tell you I'm number 1. If you say you're number 14, sign a message with the receiving address private key and everyone will believe you. Or maybe not because 3.2733832 BTC isn't the double of 2 BTC

How is yesterday a technical impossibility, when 19 hours ago WAS yesterday?    at least for PST...

Love your avatar btw!  Oh yes, 1 post newb, .  I guess you can do the math and check "http://www.pon-z.com/static/received.txt" if you so decided.  I am number 14 on the list.  Or maybe I'm just hoping you get excited, pay and puff my wallet a little bit more eh .  

It seems even more legit when you look at the confirmed deposits and see the timestamp of the first one

Those times should be GMT, so that was only 19hrs ago.

seems legit.

Messaged signed with the address private key or it didn't happen, 1 post newb.

New member, looked into this last night and doubled my BTC.  Oh how cute!

In this pyramid scheme, you split payments by (up to 100) new members according to your portion of the pool. The portion is determined by how much you pay to join. Let's look at some scenarios.

To make it simple, let's suppose that everyone pays 1BTC to join. That means that in order to break even, 100 more people have to join because you have to split the incoming 100BTC with 100 people (because of the 100 member rule). In fact, if everyone pays the same amount, the best you can do is break even.

Now, let's suppose you want to do better than break even, so you pay 100BTC while everyone else pays 1BTC. That means your share of the pool is 100/199 and you receive 50.25BTC (100/199 of 100BTC) from incoming payments. In fact, if you pay more than other people, you cannot even break even.

Aha! Let's suppose you pay 1BTC and everyone else pays 100BTC. That means your share of the pool is 1/9901 and you receive 1.01 BTC (1/9901 of 10000BTC). Hurray! You made .01BTC! Unfortunately, if the winning strategy is to pay less than everyone else then everyone will try to pay less everyone else. Since 0 is the lowest amount you can pay, not paying anything is the best strategy.

In this pyramid scheme, the only way that "everyone" makes money is if there are always new members joining and they pay a constantly increasing amount. That means that you need an infinite supply of new members who can pay an infinite amount of money.

In short, you need 100 fools to join in order for you to make money. How do you know you aren't one of the fools? That is why pyramid schemes are dishonest and stupid.

It is a ponzi in that they cover the fractional lending system by printing new money that devalues the savings of the next generation. The fact is that if everyone asked for their money at once they would simply add a couple of zeros to the bill and pay everyone with new devalued money. This would cause a loss of faith in the currency both locally and nationally causing a collapse of the scam.

It is clever and devious but is essentially the same trick that Charles Ponzi himself pulled. Just on a much grander scale and with complete impunity.

fractional reserve is not ponzi , please As long as the bank has more money in than out, it's a legit business, stop.
That of course makes the whole economy "sort of Ponzi", in the sense that if everyone wanted his money in good old phisical USD, it would collapse and most wouldn't get anything back. But hey, so is for bitcoins 

That is called a "pyramid" scheme, not a ponzi scheme, and it is not honest. Unlike a ponzi scheme, everyone in a pyramid scheme understands exactly how it works, except for the fact that it doesn't work.

In a pyramid scheme, the new members pay the current members to join, and then they hope that even newer members will pay them at least enough to cover their initial investment. Unfortunately, for a pyramid scheme to work, there must be a constant exponential increase in the number of members, and the number of new members needed quickly exceeds the population of the earth. The originators of the scheme might make money, but the rest don't.

A ponzi scheme has to be unlawful by default since it's built on paying out less than is coming in and keeping people on the hook for as long as possible, thinking their deposits are safe, while not actually having them at all (the money coming in is used to cover withdrawals and the difference goes into the owner's pocket).  Kind of like every bank on the planet (fractional reserve is just a nice way of saying "ponzi").

P.S. I'd recommend having a read up on Wikipedia about the actual guy who the scheme is named after.  It's a pretty crazy story.

Okay, that's fast.