Bulldozer00's Blog

The figure below shows the one time boom-bust pattern of a Ponzi scheme (Bernie Madoff anyone?) We have a meteoric rise in value based on smoke and mirrors where a few get rich, and then an instantaneous dive during which many poor souls lose their shirts. Note that when the bubble pops, the party  is over, finished, kaput.

The next figure shows the slow and steady rise in value of a viable, value-creating, system. Since the value the system creates is real, the system achieves stability and remains operational for an enduringly long time. It becomes woven into the fabric of society. At some point, the populace starts taking the system for granted and assumes the system has been influencing their behavior forever.

Here is my sketchy interpretation of what’s happening in the Bitcoin space:

Bitcoin has already experienced several heart-stopping boom-bust cycles throughout its steady march toward stability and widespread acceptance. But note that unlike a Ponzi scheme, which many dooms-mongers (like textbook economists and obsolete, fat-cat, bankstas) loudly claim Bitcoin is after every bust, Bitcoin has not gone kaput. It’s robust, resilient, and dare I say, anti-fragile. The system adapts and get stronger after withstanding every technical and political attack – improving itself via the community driven BIPs process.

Photo credit imgur.com gallery.