I seriously don't know the difference between the concept for bitcoin and what Bernie Madoff.

[Baitball Blogger]

They are both Ponzi schemes. At least Madoff was careful to allow in investors that had huge sums of money to pay the initiation fee, which he then used to redistribute to the older members.

Bitcoin is just a ponzi scheme. If they stop taking on new investors, the pyramid will fall.

Why was one illegal? And the other legal?

[WarGamer]

1. No, not really...

A Ponzi scheme is... invest $1000 in my firm and I'll pay out a 30% return annually... those who request their funds back are paid with interest by newer investors. If everyone wants their money back, it's front page news on the WSJ.

Bitcoin is a traded commodity, like corn or platinum. Or tulips?

It went from a penny to $100,000 because it's a "perceived" token of value.

So... a Ponzi scheme? No. But an investment in the strictest sense? Hell no.

Think of Bitcoin like Pokemon cards... or Beanie Babies.

[hedda_foil]

6. ... or tulips?

[WarGamer]

8. 17th Century "Tulip Mania"

[sakabatou]

10. I see it this way too

[hlthe2b]

2. Maybe Madoff's ghost will haunt these Crypto grifters.

But, don't ask me. I regret the concept was ever created. As we ALL will when we pay exorbitant electricity prices for both the Crypto and AI industries, which consume more than we can supply locally or regionally.

[RockRaven]

3. Madoff was a Ponzi, but individual cryptocurrencies are something else.

Still scammy in a variety of ways, absolutely, but not Ponzi specifically.

[rampartd]

4. bitcoin gets a soft crash

the "crypto reserve" invests taxpayer dollars at the base of the pyramid, allowing visionary investors to cash out.

we save the billionaires and gamer punks. all it costs us is health care.

[bucolic_frolic]

5. It's very conflicted in my mind too

First they said there would be bitcoin. And only X number would ever be minted. Now they're up to 21,000? And there are other crypto's proceeding apace. Euthereum, etc. And mining company after mining company. And StableCoin is linked to US Treasuries. And all the tech and electric to use it and mint them. To me it's infinite expansion of the money supply. Off the books of the US Dollar so to speak. It will be used for political control. Every transaction public. Cash will all but disappear. Soon.

The last bio of Madoff was fascinating, though I had to give it up 1/2 way through. 11% of Madoff's business was legitimate. Traded covered calls off the stocks he owned, and he turned a profit on it. But eventually he had so much cash and so much stock that the options markets were too small to execute the strategy. So he warehoused everything and invented financial statements and client reports. Or at least that's what I thought I read.

https://www.goodreads.com/book/show/199797519-madoff

[WarGamer]

7. theoretical max number of BTC is 21 million

There can't be more after that and we're at almost 20 million now.

[Bernardo de La Paz]

11. Not Ponzi, but still a house of cards. Nothing stopping bitcoin holders selling out and buying etherium etc.

There is not backing behind it. No intrinisic value. No industrial usefulness. No "full faith and credit of the government".

The closest it comes to Ponzi is "the greater fool theory" of stock ownership. People buying Tesla stock are thinking "Regardless of what happens later, I will be able to sell to a greater fool than I". It's like "meme stocks" that get pumped up far beyond natural value by retail investors buying a wave.

The only reason bitcoin has value is people think other people value it. They used to think it had value for dark web transactions and it still does, but more and more authorities are able to trace transactions.