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RE: Is Bitcoin a Ponzi too? A Simple Explanation about Where Does Money Come From for Dummies

in #steemit8 years ago (edited)

What business model? Bitcoin does not produce anything. It is free, so it does not have earnings.

That's the economic innovation that crypto-currencies have introduced: you don't need to have a profitable (in accounting terms) business model to be able to survive. You stay sustainable by expanding contentiously.

This very feature makes people think it's a Ponzi, but it's not. The key difference preventing crypto-currencies from being a Ponzi is the fact that the outcome of their existence is perceived as valuable - you can't say this regarding a regular Ponzi.

The point is, Bitcoin (or Ethereum or any other major crypto-platform) faces exactly the same problem as Steem: they need to contentiously expand to remain sustainable. Having transaction fees solves nothing and it just a hindrance for the user.