Topic: The Multi-level Marketing scheme argument - page 3. (Read 5988 times)

Don't really need an argument on /. for this one, as it's obvious and should be apparent to anyone who's ever read:

http://en.wikipedia.org/wiki/Multi-level_marketing

From the wiki:


"Criticism has focused on their similarity to illegal pyramid schemes, price-fixing of products (BITCOIN BOTS, "EARLY ADOPTERS," EXCHANGE OPERATORS MANIPULATING MARKET PRICE), high initial start-up costs, emphasis on recruitment of lower-tiered salespeople over actual sales (RAMPANT SPECULATION VS. REAL ECONOMY), encouraging if not requiring salespeople to purchase and use the company's products (BITCOIN "ECONOMY"), potential exploitation of personal relationships which are used as new sales and recruiting targets (DITTO), complex and sometimes exaggerated compensation schemes (DITTO), and cult-like techniques which some groups use to enhance their members' enthusiasm and devotion (NEED I SAY MORE)."

AND:

"Independent, unsalaried salespeople of multi-level marketing, referred to as distributors (or associates, independent business owners, dealers, franchise owners, sales consultants, consultants, independent agents, BITCOIN MINERS, BITCOIN EVANGELISTS, etc.), represent the company (BITCOIN P2P NETWORK) that produces the products or provides the services they sell (ONLINE TRANSACTION PROCESSING, COMMODITY SPECULATION). They are awarded a commission based upon the volume of product sold through their own sales efforts as well as that of their downline organization (USD ENTERING THE MARKETS).

Independent distributors develop their organizations by either building an active customer base (BITCOIN EVANGELIZING), who buy direct from the company (BITCOIN EXCHANGE OPERATORS), or by recruiting a downline of independent distributors who also build a customer base (BITCOIN MINERS, BITCOIN MERCHANTS) thereby expanding the overall organization. Additionally, distributors can also earn a profit by retailing products they purchased from the company at wholesale price (EARLY ADOPTERS, BITCOIN MINERS)."

Which very few people chose to do because it makes no sense to take the unnecessary risk and put up with the associated problems inherent to the medium.*

No. Demand for Bitcoins sets  any real value to it. You don't have to inject real currencies to acquire them, you can sell products or provide service in exchange for bitcoins.

Yeah but what gives the blocks any actual value?

Answer: New blood injecting real currencies into the markets.

I've edited my OP to more clearly illustrate the parallels.

Profits are not distributed, whoever finds solution first to the next block gets reward.  Bitcoin is and was never intended solely for mining. As Bitcoin grows and matures miners will be minority group performing a task of processing transactions and being rewarded for their effort.

The Bitcoins. Although really it doesn't matter, because you could look at either the dollar or the Bitcoins as commodities that one might exchange for the other. When we talk about MLM, we're talking about selling a system of selling a system. When we talk about Bitcoin, we're talking about a digital commodity whose value depends (just as any other commodity) on supply and demand. I can't profit directly just because I get 100 friends to use Bitcoin who then each get 100 of their friends to use Bitcoin.

Ok so Camp bx pays for referrals therefore bitcoin is a MLM... got ya.

 

I dunno, depends on what you get from CampBX, apparently.

Wait, I'm still new to this stuff. What's the Coca-Cola in this example, the Bitcoin or the Dollars?


The Bitcoins. Although really it doesn't matter, because you could look at either the dollar or the Bitcoins as commodities that one might exchange for the other. When we talk about MLM, we're talking about selling a system of selling a system. When we talk about Bitcoin, we're talking about a digital commodity whose value depends (just as any other commodity) on supply and demand. I can't profit directly just because I get 100 friends to use Bitcoin who then each get 100 of their friends to use Bitcoin.

Wait, I'm still new to this stuff. What's the Coca-Cola in this example, the Bitcoin or the Dollars?

I dunno, depends on what you get from CampBX, apparently.

Isn't that how any commodity works? Somebody exchanges dollars for something that isn't currency (like Coca Cola) only to later exchange it back to dollars.

Please tell me the different % payouts I get from the different levels of referrals.  Thanks.

Bitcoin's requirement of a continuing injection into the market for a currency which isn't used as one, bears similarity to the token-product, recruitment-focused nature of MLM schemes.

Bitcoin's requirement of a continuing injection into the market for a currency which isn't used as one, bears similarity to the token-product, recruitment-focused nature of MLM schemes.