I see the word Ponzi bandied about everywhere these days. Real Estate is a ponzi, crypto is a ponzi, fiat is the greatest ponzi of all. The debt ponzi. On and on. This seems to be based on a belief that all these things depend on a greater sucker coming along to pay you more in order to make a profit. Is that a fair assessment? Maybe.
The reality is that any asset you buy is entirely dependent on someone paying you more for it for you to generate a profit. If you buy a house, you have a negative balance until it sells for more. The same with Gold, or anything else.
So is Everything a Ponzi? Possibly, but that then makes it a meaningless assertion. Maybe we need a better definition of Ponzi then? https://www.investopedia.com/ give us this definition:-
A Ponzi scheme is a fraudulent investing scam which generates returns for earlier investors with money taken from later investors. This is similar to a pyramid scheme in that both are based on using new investors’ funds to pay the earlier backers.https://www.investopedia.com/terms/p/ponzischeme.asp
The key word in that definition being FRAUDULENT. If you buy a house, you are getting the house you paid for, as agreed. Your expectations of future profit are not what you are being sold, just a house to use and live in. Buying gold, that’s the same. You get your bar of gold in exchange for your cold, hard cash.
So what about crypto? You hand over your hard earned and you get? You get “ownership” of the token you bought, just like you agreed to. Future value of this is unknown in exactly the same way as that of a house, gold, shares or any other asset would be. Someone selling you any of these things with a promise of a future value of X may be committing a fraudulent act but the system itself is not fraudulent. This applies to the crypto’s as much as any of the other assets.
Given the crypto’s are providing that which they promise then they as a whole are not fraudulent and not a ponzi.
The debate of if they are worthless, overvalued, pointless or any other thing is a completely separate one that could be argued another time but they are providing what they claim and not lying about it so therefore not a Ponzi in any meaningful definition.