Slashdot Mirror
As Value of Cryptocurrencies Falls, a Lot of New and Risk-Taking Investors Are Suffering Immensely (nytimes.com)
After the latest round of big price drops, many cryptocurrencies have given back all of the enormous gains they experienced last winter. The value of all outstanding digital tokens has fallen by about $600 billion, or 75 percent, since the peak in January, according to data from the website coinmarketcap.com. The New York Times: The virtual currency markets have been through booms and busts before -- and recovered to boom again. But this bust could have a more lasting impact on the technology's adoption because of the sheer number of ordinary people who invested in digital tokens over the last year, and who are likely to associate cryptocurrencies with financial ruin for a very long time. [...] By many metrics, more people put money into virtual currencies last fall and winter than in all of the preceding nine or so years. Coinbase, the largest cryptocurrency brokerage in the United States, doubled its number of customers between October and March. The start-up Square began allowing the users of its mobile app, Square Cash, to buy Bitcoin last November.
[...] Kim Hyon-jeong, a 45-year-old teacher and mother of one who lives on the outskirts of Seoul, said she put about 100 million won, or $90,000, into cryptocurrencies last fall. She drew on savings, an insurance policy and a $25,000 loan. Her investments are now down about 90 percent. "I thought that cryptocurrencies would be the one and only breakthrough for ordinary hardworking people like us," she said. "I thought my family and I could escape hardship and live more comfortably, but it turned out to be the other way around."
[...] In the United States, Charles Herman, a 29-year-old small-business owner in Charleston, S.C., became obsessed with virtual currencies in September. He said he now felt that he had wasted 10 months of his life trying to play the markets. While he is essentially back to the $4,000 he put in, he has soured on the revolutionary promises that virtual currency fanatics made for the technology last year and has resumed investing his money in real estate. "I guess I thought we were 'sticking it to the man' when I got on board," Mr. Herman said. "But I think 'the man' had already caught on, and had an exit strategy."
[...] Kim Hyon-jeong, a 45-year-old teacher and mother of one who lives on the outskirts of Seoul, said she put about 100 million won, or $90,000, into cryptocurrencies last fall. She drew on savings, an insurance policy and a $25,000 loan. Her investments are now down about 90 percent. "I thought that cryptocurrencies would be the one and only breakthrough for ordinary hardworking people like us," she said. "I thought my family and I could escape hardship and live more comfortably, but it turned out to be the other way around."
[...] In the United States, Charles Herman, a 29-year-old small-business owner in Charleston, S.C., became obsessed with virtual currencies in September. He said he now felt that he had wasted 10 months of his life trying to play the markets. While he is essentially back to the $4,000 he put in, he has soured on the revolutionary promises that virtual currency fanatics made for the technology last year and has resumed investing his money in real estate. "I guess I thought we were 'sticking it to the man' when I got on board," Mr. Herman said. "But I think 'the man' had already caught on, and had an exit strategy."
How does the currently bearish press resemble (or not) that after the previous Bitcoin bubble, or the one before that? Also, to those who enjoy citing tulip mania, how many bubbles did tulip mania go through before it crashed, and what as the approximate peak market cap of each bubble?
A Ponzi scheme is one where returns for early investors are paid out by later investors.
That is a necessary, but not sufficient condition for a Ponzi Scheme. Ponzi schemes masquerade as legitimate investments, generating dividends. They are frauds. Bitcoin does NOT do this. There are no dividends and EVERYBODY KNOWS THAT. If you own a stake in a Ponzi scheme, you make money from the dividends, and you have no incentive to sell your stake. With Bitcoin, you can ONLY make money by selling to a "greater fool" at a higher price, and EVERYBODY KNOWS THAT.
Ponzi schemes have a single authority. Bitcoin does not.
Ponzi schemes are fraudulent, with hidden information. Bitcoin is not, it is transparent.
Ponzi schemes pay dividends. Bitcoin does not.
Ponzi schemes do not rely on "greater fools". Bitcoin does.
Ponzi schemes go up in value, and then suddenly collapse to zero once the truth comes out. Bitcoin is declining slowly, and no "truth" is being hidden.
I want to know where the hundreds of people who used to post here about how Bitcoin had no limits, that every last Bitcoin would soon be worth a million bucks went to. They've been embarrassingly silent lately.
Come back! We want to say "told you so!".
Seriously, where are they now?
No sig today...