Sigh, it's frustrating that some people in here don't even know what the term "ponzi" means. Let me unfold it for you then:
Bitcoin is not a ponzi scheme
Wikipedia defines a ponzi scheme in the following way:
"A Ponzi scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned by the operator. Operators of Ponzi schemes usually entice new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent. The perpetuation of the high returns requires an ever-increasing flow of money from new investors to sustain the scheme."
Now let's see if that fits bitcoin:
-Does bitcoin have central authority? No.
-Does bitcoin pay returns to its investors? No.
-Does bitcoin require an ever increasing flow of money to sustain it? No.
Bitcoin is not a Ponzi scheme. It's a true innovation in computer science and solves a well known problem called the Byzantine Generals problem.
It's a new type of monetary system based on mathematics and rare numbers. That's why it's a game changer. That's why we see 5-10 million investments to bitcoin startups every week. It has nothing to do with a Ponzi scheme.
The first sentence in the Wikipedia quote is the definition. The rest tells what ponzi operators
usually have been doing. It is not part of the definition, and nee not be true for something to be a ponzi.
Bitcoin does have an organization: the collection of miners and other players, that interact according to a definite protocol. It does not have a central authority, true, but note that the Wikipedia definition does not requre one.
Bitcoin surely pays return to investors (and that is why most bitcoiners, including most people here, invest in bitcoin). It does not pay
dividends, but the Wikipedia entry does not require that either. The key thing in the ponzi is that the profit of early adopters comes entirely from the investments of later entrants.
Bitcoin certainly requires an increasing flow of new investment money to pay the mining bills and to enable the early entrants to spend and sell the coins at a profit. Mining alone now consumes 1 million dollars per day of new investment. If the price were to rise 10x, the mining network would consume 10 million dollars per day, still coming entirely from new investments. The extra investment going in now, above that 1 M$/day -- say, another 500'000 $/day -- feeds the profit of those who bought at 30 $/BTC and are cashing out now. In order for the current investors to make the same level of profit, more investors will have to be found that will buy bitcoins at 3000 $/BTC, providing 5 million dollars per day. And so on.
New investors are obviously lured with the "almost certain" prediction of fabulous profits, "guaranteed by math", "critics are retards or statist shills", and so on. How many bitcoin entrepreneurs and holders are now saying that the price may never again rise above 270 $/BTC? What do they say instead, when asked about future prices? (Didn't the Winkles say "maybe a trillion" to reporters? )
So, bitcoiners may quibble at whether it fits exactly the definition of a ponzi, or whether it is another knind of pyramid scheme, or belongs to a new category of its own -- but the essence of Bitcoin, as an investment, is the same as a standard ponzi: some people will get rich by taking money from new investors, which are lured by the promises of fabulous profits.
EDIT: Sorry, I posted this before seeing the other posts that say the same thing.
