Is BTC a decentralized Ponzi scheme? Ripple's CTO gave a bid of 2 cents

The debate over whether BTC is a Ponzi scheme has risen on Crypto X, and the CTO of Ripple shares his thoughts on the topic.

Recently, comedian and conspiracy theorist Owen Benjamin sparked a heated debate when he labeled BTC (BTC) as a “decentralized Ponzi scheme.” The claim drew a response from several people in the crypto space, including Ripple CTO David Schwartz, adding complexity to the ongoing debate.

**BTC: Is decentralized money still a Ponzi scheme? **

Owen Benjamin’s argument revolves around the idea that BTC operates more like a decentralized Ponzi scheme than a decentralized currency. He argues that people don’t consume BTC because they hope that its value will rise, and likens it to a “hot potato” that people don’t want to give up.

Benjamin believed that assets with intrinsic beauty, utility, and value, such as silver, gold, and land, were more reliable stores of wealth. He further claimed that BTC lacked an identifiable individual, which is crucial in traditional Ponzi schemes, allowing the media to control price fluctuations for profit.

It is noteworthy that Saifedean Ammous, the author of The BTC Standard, makes a point contrary to Benjamin’s point of view. Ammous argues that despite inflation, the dollar’s success shows that people are willing to use a currency that is declining in value. He attributes BTC’s popularity to its scarcity, making it a superior store of value over fiat currencies.

Ripple CTO David Schwartz chimed in, questioning whether people really understand the impact of the expected dollar depreciation on consumer behavior. Schwartz noted that sellers may be dampened if they know they will receive dollars that are expected to depreciate.

This sparked a heated debate among followers, with some questioning the need for inflation for economic development and others emphasizing the psychological impact of currency depreciation on spending.

BTC Regulation and Suspicion

As the debate over the nature of BTC continues to unfold, it is necessary to consider the broader regulatory ecosystem. In May of this year, the governor of Ireland’s central bank, Gabriel Makhlouf, classified BTC and other unbacked cryptocurrencies as a “Ponzi scheme”, raising suspicions.

He hinted at the possibility of regulatory action against crypto influencers who promote digital assets without disclosing their financial interests.

Overall, whether BTC is a decentralized Ponzi scheme or a legitimate decentralized currency is still a hotly debated topic. The crypto space continues to evolve as a variety of voices engage in conversations, challenging traditional notions of value, utility, and economic principles.