
Is Filecoin a $257 million Ponzi scheme? [pdf] - mjnet
https://github.com/backender/filecoin-survey/releases/download/0.5/filecoin_survey.2.pdf
======
cocktailpeanuts
I think the top comment for this should be about Filecoin, instead of just
another uninformed comments about Bitcoin that we see here every day.

That said, one thing most people don't talk about is: I think most people
think IPFS is disruptive, but I think IPFS itself is susceptible to
disruption.

The main reason why IPFS is useful is because there's not an easy way to do
NAT traversal therefore it's super hard for people to run their own server on
their laptop or mobile devices.

IPFS introduces all kinds of technologies to get around this, but in my
opinion the ability to freely set up your own server on your device is the
core problem.

You don't really need a globally addressable immutable file storage, because
unless you're dealing with static images, a lot of files DO change all the
time, and people want to store and share files privately.

Which means, if there's a new type of technology that lets people do just that
--set up their own server anywhere and make it accessible via HTTP--then I
don't see why we really need IPFS. This could be done by startups or other
protocols, but even by some innovative ISPs, which decide to change their
business model to compete against edge nodes that capture most of the value
(such as Google, Facebook, etc.)

In my opinion, the reason IPFS is so hot nowadays is because it's riding the
DApps wave where people want to build Ethereum apps with IPFS as a file
storage. But after playing around with it a bit I think it's much better at
this point to just use Github to host your file and use Ethereum as database
because the whole point of immutable apps is in the data and transactions, not
in the static files.

But I would love to be corrected. If anyone actually think IPFS is essential
to DApps, feel free to correct me and educate me.

~~~
kodablah
> Which means, if there's a new type of technology that lets people do just
> that--set up their own server anywhere and make it accessible via HTTP--then
> I don't see why we really need IPFS

I have a ton to say here, but I'll keep it to a few point. Tor onion services
solve the setup-your-own-server issues, it's just not super easy yet. IPFS is
needed regardless, because there is a need to distribute things when your
machine isn't up and to solve discovery. What IPFS doesn't have natively is
anonymity (tho there are onion transports conforming to libp2p transport
iface) and distributed compute, but neither is that important.

~~~
cmars
> Tor onion services solve the setup-your-own-server issues, it's just not
> super easy yet.

Lately I've been trying to make this easier. I developed ormesh
([https://github.com/cmars/ormesh](https://github.com/cmars/ormesh)) in an
attempt to simplify setting up hidden services for private use.

I think both Tor and IPFS are both awesome and useful decentralization
projects, they just have different use cases & characteristics. AIUI IPFS
lacks fine-grained access controls. Last time I looked, it seemed like I
either had to run all my own infrastructure of IPFS nodes with pre-shared
private keys, or open everything to the public and encrypt on top of that... I
prefer the Tor hidden service model, where I can decide on a per-service basis
how I want to share it, revoke client access if necessary, and have my traffic
securely routed on existing infrastructure.

Edit: fixed link

~~~
kodablah
Saw this on /r/golang (I was the one asking why the full Tor browser). I have
considered similar [0]. A simple service (or portable exe) that has Tor
statically linked and lets you reach/manage a machine from anywhere (think
webmin-like web console on onion service) would have real value. Of course it
can be authenticated and have the option to open direct connection (webrtc?)
if you need fast media playing or direct download.

0 - [https://github.com/cretz/software-
ideas/issues/54](https://github.com/cretz/software-ideas/issues/54)

------
synctext
[Author here] short answer taken from our .PDF file:

"Considering that Dropbox [53] currently holds around 500 petabytes of user
data [54], one could argue that Filecoin is overvalued."

Study we conducted with a master student at Delft University of Technology.
Open lab notes when writing this paper:
[https://github.com/Tribler/tribler/issues/3097](https://github.com/Tribler/tribler/issues/3097)
Note TUDelft has currently 8 professors in their [http://blockchain-
lab.org](http://blockchain-lab.org) Various scientists and 38 master students
working on improving our own Filecoin-like system, based on our Trustchain
fabric:
[https://github.com/Tribler/tribler/issues?q=is%3Aissue+is%3A...](https://github.com/Tribler/tribler/issues?q=is%3Aissue+is%3Aopen+label%3A%22MSc+course+work%22)
It's home to one of the largest blockchain labs of Europe.

~~~
eco
Dropbox feels like the wrong thing to compare it to. IPFS isn't really for
storing files privately. Public S3 buckets would be closer. I don't have any
numbers to say if it's overvalued based on how much public cloud storage there
is (I wouldn't be surprised if it were though).

~~~
api
Storage costs are hyper-deflationary. We have a NAS on a desk with 27
terabytes of storage and it cost under $1000 (with drives) and consumes about
40 watts of power. Ten years ago this would have cost closer to $5000-$10000
and consumed hundreds of watts of power. We bought it about a year and a half
ago and already we could replace it for less than $500.

The idea of distributed storage at the edge is interesting but it's not
something that would cost $250 million to build. We could probably build a
friendly system for doing this for under $500k in developer time.

It's also a mystery how efforts like MaidSafe or whatever it's called this
week have never managed to ship anything after getting multiple multi-million-
dollar golden showers. Distributed storage of immutable content-addressable
blobs is not _that_ hard of a problem. BitTorrent kind of solved it long ago,
albeit with a different UI/UX metaphor and use case. Just take those ideas and
pivot them a little and wrap them around the S3 UI/UX metaphor and add payment
channels or some other accounting mechanism and you're done. You don't
necessarily need the sexiest tech. In fact sexy tech probably makes it more
fragile and harder to use. DHT + hashing + RAID-type redundancy techniques +
wallets will do it.

Everyone over-thinks and over-engineers things these days and it drives me
crazy. Stop it. Intelligence is for the things you _can 't_ do, not for doing
the things you can already do in more baroque ways. Intelligence is also for
simplification. Complexification is stupidity.

~~~
okket
> we could replace it for less than $500

27 Terabytes of spinning rust with NAS hardware for $500? Not yet.

~~~
emmelaich
The sweet spot for drives is the 4Tb at about $100[1].

Seven of those will give you 28 raw Tb with $300 left over for case and power
supply.

So not impossible.

[1] [https://www.backblaze.com/blog/hard-drive-cost-per-
gigabyte/](https://www.backblaze.com/blog/hard-drive-cost-per-gigabyte/)

------
mads
Heh.. Yes, probably is now.

I dont know if the founders started out to make a Ponzi, but once the dollars
started rolling in, I can imagine, they probably got "different ideas".

Who am I to judge, but if I was a founder of this, I would be driving my
Ferrari in Thailand instead of slaving away trying to build some stupid file
system. Who the hell cares about file systems :P

~~~
thinkloop
Driving ferraris gets old, I'd much prefer to be inventing decentralized file
storage.

~~~
mads
I agree, but those cars and the attention is just so tempting. And then in
Thailand. Imagine kite surfing, drinks, anything you want for small cash.
Hell, you could even contract someone to write that damn file system people
are whining about.

------
jstanley
Filecoin is a huge disappointment to me.

IPFS is fantastic technology, but the main developers getting sidetracked with
yet another scammy ICO is the last thing we need.

~~~
whyrusleeping
Hey, ipfs dev here. The amount of work being done on ipfs has been increasing
continually. Work on filecoin is not detracting from ipfs development, and we
are bringing on more people for ipfs, libp2p _and_ filecoin.

~~~
throwawayico
That doesn't discount the fact you are involved in yet another ICO.
Cryptocurency integration and identity within IPFS could have been done
without a new coin. I know you know this, yet you choose to do it anyway. That
means we should question your intentions, across all your projects.

And, just for the record, a cryptocurrency fund raise is simply selling access
to given private/public key pairs which contain values, like a database. Even
hardened by mining, these values and keys are intrinsically worthless until
they are used widely for something valuable. It's when convincing someone it's
"valuable because you think it is" that it gets "tricky".

~~~
rklaehn
I don't get all the hatred for ICOs. Nobody is forcing anybody to invest in
them, and for something like filecoin there is at least a chance of something
extremely useful coming out of it. Many other ICOs seem pretty strange to me,
but as long as I am not forced to invest in them, what's the problem?

~~~
nileshtrivedi
Can't say so if it is a Ponzi scheme.

------
soneca
_edit: Weird, I thought I was commenting on another thread, about Nobel
laureates criticizing Bitcoin. I saw it on my phone, then opened HN at my
notebook to comment. I misread the title and commented here, but now I can 't
find the correct thread (was it flagged?)._

I am growing this idea that Bitcoin (and any cryptocurrency that is affected
by aggressive price growth) is an anti-fragile indirect multilevel marketing
scheme, the "diamond" of the digital era.

It is anti-fragile because it does not have a single point of failure, it is
decentralized, its creators are unknown, it is adaptable to several use cases.
So each attack on Bitcoin (be it exchange hacking, scams or celebrities'
critics) that doesn't kill it, make it stronger.

It is a multilevel marketing scheme because it is mostly a zero-sum game, all
earnings of bitcoin owners come from new money entering the game. It is
indirect because the ones that are most fervourous advertising and defending
bitcoin are holding it, not selling.

I believe it is the diamond of the new era because of some key similarities:

Both BTC and Diamond:

\- Its original bump in value come from a marketing campaign (even if with
Diamond it was centralized and offline, and with BTC is decentralized and
viral)

\- Its scarcity is artificially controlled

\- Its main use case is black market commerce (for one side of the argument)
or money laundry (for the other side).

For BTC owners the good news is that the "diamond bubble" it is still strong
decades (centuries?) after its modern boom. The bad news is that Diamond was
able to correlate to status, a strong (if subjective) value that is part of
humanity since always. BTC only appeal is its value as money, so bubbly
reinforcements (up and down) apply.

~~~
pavlov
_The bad news is that Diamond was able to correlate to status, a strong (if
subjective) value that is part of humanity since always. BTC only appeal is
its value as money ..._

Startup idea: Bitcoin wedding rings.

A beautiful gold ring with a private key engraved on the inside. Give your
loved one the gift of BTC! Your commitment to each other, eternalized on the
global blockchain.

Gentlemen may prefer blondes, but the modern woman prefers Bitcoin to carats
of squeezed carbon. Status, store of value, it's all there.

(This is satire, but now I'm worried it will actually happen if the coinmania
doesn't subside soon.)

~~~
PetoU
I think that jewelry should have a property of showing off, so hidden private
key wouldn't work that well. You need to have some mechanism how to show
status. And that nicety factor was driven mostly by women decorum.

~~~
pavlov
That's just a question of recognizable design and enough marketing spend, i.e.
branding.

It's well known that people pay a major premium for things solely because they
have words printed on them like "Calvin Klein", "Guess?" or "YSL". Jewelry
branding is actually easier to make visually recognizable than clothes.

~~~
Retra
People don't pay a premium for the label, they pay a premium for the middlemen
who host the label, because that is a presumably exclusive group and culture
that they have access to.

------
patrickaljord
tl;dr conclusion from the article: "Filecoin’s economic feasibility is hard to
predict and, given a simple summary of risk related points, the biggest
hurdles are probably going to be acceptance from the users. In addition,
Filecoin shows certain characteristics of a Ponzi scheme but the trust built
by the team members in the past leads us to believe that it is not one.
Filecoin’s Whitepaper introduces novel concepts and predecessor projects by
the team members which prove their technical capabilities. Hence, it appears
that Filecoin is poised to be an outstanding project although it remains to be
seen if it will be adopted by the average cloud storage user."

------
XR0CSWV3h3kZWg
It's pretty frustrating to see something that has an easily accessible value
(M MBs stored for N seconds consuming X bandwidth) is denominated in the same
way that all the other cryptocurrencies are denominated in, as a deflationary
good that encourages speculation. If you want to create some token that scale
with the value of the system, that's fine, but don't force your users to price
their contacts in something that is untethered from the thing they are trying
to buy.

What I'd do instead is allow people to store random data to mint new MBseconds
at a fractional rate and then the cost of a new contract is trivial. If you
want someone to store 1GB for a day the cost of that is well known. The price
of storage constantly drops, but the price of a deflationary good that is
actually desired will continue to rise. This encurages contact churn.

If you want to have a token that scales with the value of the network/product
then just create tokens that generate MBseconds proportional to the fees paid.

------
saas_co_de
No, it's a buy the dip scheme.

[https://www.youtube.com/watch?v=0akBdQa55b4](https://www.youtube.com/watch?v=0akBdQa55b4)

------
notheguyouthink
I'm so lost, there are so many conversations here talking about IPFS compared
to things like Dropbox and S3. Why?

To me, IPFS aims to solve a _completely_ different problem. IPFS does not
exist because we don't have means to host and distribute files - that is a
problem solved by a hundred different entities. IPFS, as advertised in many
mediums (video/etc), is a platform to distribute data from a local-first P2P
medium. Like Bittorrent, but without ever leaving the local network/etc. Eg,
transferring a file/video/site to someone next to you would not download the
data from across the world _twice_.

Has the marketing changed? Because all of the videos I watched on it from
months ago were all about reducing global bandwidth usage, utilizing local and
distributed sources of the data as much possible.

Why is everyone acting like IPFS is trying to solve file hosting?

~~~
detaro
Filecoin is trying to solve (paying for) file hosting through IPFS. Many of
the existing projects around IPFS are "host X, but on IPFS".

~~~
lgierth
No, it's more generally about hosting _any_ content-addressed data. That's
much much more than files/directories, as S3/Dropbox/Sia are doing.

Files and directories are just one particular data structure you can store on
IPFS. Think of it as a global unified content-addressed graph database really,
and Filecoin can store any arbitrary (sub)graphs within that.

~~~
notheguyouthink
> No, it's more generally about hosting any content-addressed data.

Back to my original points, I don't think it _is_ about _hosting_ the data.
It's the _location_ of the data. Eg, a room full of people downloading a large
video don't need to leave the room for the majority of the data, they can
share the data between each other - seamlessly. Leading to less clogging of
the network of data when there's absolutely no need for us to be downloading
from youtube/etc.

For me personally, another thing IPFS does is allow access to immutable data.
Seeing as websites love to change data on the fly, it's hard to know what
someone else saw, compared to what you saw. Was the article modified? Did X
political candidate change what s/he's saying on their site? IPFS solves this,
and this is my favorite part, tbh.

~~~
lgierth
> Back to my original points, I don't think it is about hosting the data. It's
> the location of the data. Eg, a room full of people downloading a large
> video don't need to leave the room for the majority of the data, they can
> share the data between each other - seamlessly. Leading to less clogging of
> the network of data when there's absolutely no need for us to be downloading
> from youtube/etc.

You're absolutely right here of course

~~~
notheguyouthink
Didn't mean to imply you meant otherwise of course - nor was my intent to
argue. I just thought it was an important point for anyone _(you or
otherwise)_ to read. I thought it came off a little ... wrong, so my apologies
for that, if anything was perceived.

~~~
lgierth
Not at all :) There's multiple important points about IPFS and I always forget
at least one, so thanks :)

------
CalChris
How is Filecoin fundamentally any different from Bitcoin?

    
    
      Filecoin gave a deal to their buddies
      Bitcoin and Ethereum were premined
    

Both are variations on a Ponzi scheme where early 'investors' benefit from
latter day victims.

------
pmorici
Anyone interested in reading the Filecoin offering info you can find it on the
CoinList.co site

[https://coinlist.co/filecoin](https://coinlist.co/filecoin)

------
tromp
From the paper:

> a total of $257 million – so far the biggest initial coin offering (ICO) as
> of today (September 2017).

This appears incorrect, as the Sales Summary on
[https://eosscan.io/](https://eosscan.io/) shows EOS having raised over $400
million by September (first 68 days).

------
ertand
I think it would be helpful if the authors disclosed whether they invested in
Filecoin. I didn't really see it anywhere. Did I miss it?

~~~
mjnet
Author here: we did not invest; nor are we invested in any of the competitor
projects mentioned in the article.

~~~
synctext
other author here, no ICO investments. We're actually working for many years
on a similar system, non-profit non-ICO based. We know this scientific area a
bit (see my other comment).

~~~
declarisse
>>We're actually working for many years on a similar system... Hmm, this is
what you neglected to mention in the paper

------
enderwilde
Good discussion on the technical merits. However, let's take a look at the
'overvalued' claim and a critical error the authors make.

The analysis rests on this ratio calculated for Airbnb: "Airbnb is valued
today at approximately $31 billion while holding around 3 million listings in
total. The average apartment in the United States was 934 square feet in 2016.
In a hypothetical scenario, Airbnb is therefore valued at $11.06 per square
feet. If one compares this number to the median price per square foot in the
United States, which is $123, the Airbnb ecosystem diminishes the median price
by a factor of 11.12."

I get this is back of the envelope so let's ignore the international
dimension. The critical error in these calculations is the apples-to-apples
comparison of the square feet of an Airbnb listing to a purchased square foot.

Basically - when someone pays $123 per square foot (median price in the U.S.)
they are paying for the use of that space for an entire year. Said another
way, they are paying $0.34 per day per square foot. Airbnb listings are not in
general year-long, which means the same square foot of space is rented out
over and over again throughout the year, adding revenues along the way. The
11.12 scaling factor is therefore off and too high. This leads the authors to
apply an erroneous scaling factor to the Dropbox sizing to come up with an
invalid valuation assessment for Filecoin.

It looks like a good average stay for an Airbnb property is about 5 days
([https://blog.atairbnb.com/economic-impact-
airbnb/](https://blog.atairbnb.com/economic-impact-airbnb/)). Let's also
assume 50% occupancy rate ([https://www.mashvisor.com/blog/what-airbnb-
occupancy-rate-ca...](https://www.mashvisor.com/blog/what-airbnb-occupancy-
rate-can-you-expect/)).

That means an Airbnb listing is rented out about 37 times a year (365 / 5 days
* 50%). The $11.06 per square foot times 37 revenue-generating occasions is
$409.22 per square foot ($1.12/day/sq ft v. $0.34/day/sq ft for a purchase).
So the correct apples-to-apples comparison here is to say that Airbnb
_increases_ the median price of the asset by a factor of 3.32. Aka Filecoin
would need to deliver 2,580 petabytes - not 95,185. That's only 5x Dropbox,
which is a minnow compared to S3 etc.

Why would that be? Most directly, because Airbnb allows the owners of the
asset (sq ft in this case) to ask for a higher per day charge since the length
of stay is shorter and thus the owner of the asset has more uncertainty over
utilization - it's part of why 30 nights in a hotel costs much more than a
month of rent. This is a well-understood economic dynamic and one that would
apply to Filecoin storage miners given how miners using Filecoin could
theoretically 'rent out' the same gigabyte over and over again to different
buyers throughout the year - but also cover the risk of less than 100% annual
utilization rates of their fixed-cost asset.

Honestly, reading this article made me more confident in the future of
Filecoin. The authors highlight multiple times the better technical features
than competition, proven dev team, and unwittingly call out why economically
speaking owners of gigabytes under Filecoin could expect a higher return than
if you were going to buy the gigabytes yourself for your own use.

Thoughts?

------
KasianFranks
Where did the funding for this research paper come from, specifically?

~~~
amelius
It seems like the first author is still a student. So this could be a
BSc./MSc. project, for example.

~~~
pandler
[https://github.com/backender/filecoin-
survey/releases](https://github.com/backender/filecoin-survey/releases)

Seeing as the release is named "Release to turn in", I'd say so too.

~~~
amelius
I think it would be fair if the title is changed from

"... by Delft University"

to

"... by student of Delft University".

Or just drop it altogether and shorten the title.

~~~
synctext
Please don't alter our title. I'm the second author and tenured staff member
of TUDelft, associate professor.

------
DaniFong
y'all are forgetting that juan is a genius and still alive...

------
_prometheus
Hey HN, this is jbenet -- an author of Filecoin.

We think it's great that people ask hard questions, and get involved. It's
great to see others studying our work and we really appreciate the open
discourse. There are a few things from this article I’d like to address.
(Despite the length of this post...) these are quick comments, and not a
proper in-depth response.

\- (a) The article gets some things right and some things wrong -- there is
good summarizing of several of our projects, and discussion of many difficult
aspects in these projects. The article discusses many technological aspects in
good depth, and highlights difficulties in building these systems, aligning
incentives, and the trials of past projects. The article also has significant
inaccuracies. For example, the sale figure -- which appears in the title and
impacts the analysis -- is incorrect. We raised $205M -- officially here:
[https://protocol.ai/blog/filecoin-sale-
completed/](https://protocol.ai/blog/filecoin-sale-completed/)

\- (b) The authors chose a provocative title. As some commenters have already
pointed out, the conclusion is “[we] believe that it is not one.” Despite
Betteridge’s law (
[https://en.wikipedia.org/wiki/Betteridge's_law_of_headlines](https://en.wikipedia.org/wiki/Betteridge's_law_of_headlines)
), many people who only read the headline will come to the opposite
conclusion, and now we (not they) will have the burden of correcting those
misunderstandings. Provocative titles, though they may drive imagination and
clicks, can do a huge disservice to everyone in the space, and contribute to
misinformation. Most people will only read the title, maybe the abstract, and
use that to form and drive opinions. We choose titles of our research with
diligence and care, and hope others do the same.

\- (c) The article has a great technical overview of the Filecoin stack, and
how it fits with IPFS and libp2p. This is a large structure with many pieces,
and it is rare to see articles grasping how all the pieces fit together so
well, and then explaining it cogently. In particular, it’s great to see this
article diving deep and discussing advantages and disadvantages of low level
technical structures (multihash, ipld, libp2p, and more). We modularized
everything in the hope to generally improve peer-to-peer systems, and improve
reusability. We hope these components will be useful to the author’s Tribler
project (a network similar in goals to Filecoin), and we hope that we can also
learn from and leverage solutions they have made.

\- (d) many of the objectionable things described in this article are common
in ICOs in general. Put another way, consider those claims also in terms of
other significant token sales, such as Ethereum, Tezos, Polkadot, Blockstack,
Cosmos, Golem. People were saying similar things about Ethereum when they did
their sale in 2014. Perhaps worth doing a survey / analysis over all of them,
comparing and contrasting the different things groups have done, how the
ecosystem has improved, and suggest new directions.

\- (e) It’s worth mentioning that the analysis gives a definition of a ponzi
scheme, but their discussion does not map to that definition. Instead, the
discussion centers on claims about future investor sentiment or speculation as
the driver of value in the token, which is not the only way to establish value
in token networks, and ignores the value of the services provided. That kind
of analysis does not work for projects like Ethereum and other live and
functioning crypto tokens. If the network is __useful __, and there is a way
to __generate __or __introduce __value, by providing new or better services,
and if the network can capture that value in the token itself (important
step), then the tokens can hold value, based on the utility of the network as
a service and not just or primarily speculation. Networks like Ethereum,
Bitcoin, Zcash, and Filecoin aim to provide useful services, and much of the
value stored in their tokens will be thanks to the utility of the networks.

Perhaps it’s worth pointing out that most crypto token projects are compared
to ponzi schemes at some point :(

    
    
      - http://www.google.com/search?q=is+bitcoin+a+ponzi+scheme
      - http://www.google.com/search?q=is+ethereum+a+ponzi+scheme
      - http://www.google.com/search?q=is+zcash+a+ponzi+scheme
      - http://www.google.com/search?q=is+tezos+a+ponzi+scheme
    

\- (f) The article discusses the SAFT and assurances to investors, but does
not discuss them in contexts of other token sales and ICOs. Most ICOs are
structured as __donations __(not investments) to a project, with little to no
legal recourse -- even though many people refer to these “donations” as being
“investments”. In our case, we raised investment through an instrument (the
SAFT) that is a direct liability to us, and gives investors greater guarantees
on the completion of the project, or consequences otherwise. If we fail to
deliver the network, we must return the proceeds of the token sale. Few token
sales ever have such a clause. Our structure gives investors greater
accountability, not less. The article discusses this in sec IV, but does not
take into account that startups are similarly risky (i.e. that startup
dissolution events return only remaining capital from the efforts), and does
not mention how our structure improves on the ICO landscape in general.

\- (g) We do share the legitimate concern that ICOs need stronger
accountability, and some are structured in a way that leads to abuse. The
community as a whole needs to raise the bar on accountability and ethical
behavior. We have taken significant steps in this direction, not just in our
sale but to improve the ecosystem -- the SAFT project, which was a gargantuan
undertaking that many other networks are now using, is one example. Many other
networks are introducing and improving structures. We believe token networks
present a very important new way to form capital, with promising advantages to
users, investors, and creators, but the space is still in its infancy, and
significant changes are still ahead. Token sales have improved dramatically in
the last three years, and we hope they continue to improve to find the right
balance and protection of the interests of all parties involved with the
network.

Thanks, Juan

------
brndnmtthws
Filecoin is one of the ones I'd stay far away from. VCs got in before anyone
else with special preferences, which taints the whole project. There are
alternatives which don't come with the VC problem attached to them.

~~~
j_s
What is your recommended alternative? Is there any unusual involvement beyond
participation as a user that you should probably disclose?

~~~
brndnmtthws
Sia is more legitimate. I don't own any Siacoin or Filecoin, but I would hold
Siacoin if it was supported by the Ledger hardware wallet.

~~~
hobofan
[https://sia.tech/funding2016/](https://sia.tech/funding2016/) ? How is this
any different? I realize that this doesn't concern an ICO, but still there is
plenty of VC involvement to "taint" the project.

~~~
brndnmtthws
Sia didn't do an ICO. Every coin has been mined, with no premine (although I
assume the developers mined the first few blocks at least). The investors
could have mined too, if they wanted, along with anyone else. This seems more
egalitarian to me.

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chvid
Are they not all (bitcoin, eth etc.) ponzi schemes?

~~~
SippinLean
You're aware that a Ponzi has a _very_ specific definition, more specific than
"scam," correct?

Neither Bitcoin nor Ethereum have a central operator generating returns for
older investors by disproportionately funneling revenue paid by new investors
to them. When the price rises, new and old investors profit equally. You could
use BTC as a currency _in_ a Ponzi, Bitcoin _being_ a Ponzi would be
impossible by definition.

------
ajross
All XXXcoin currencies are Ponzi schemes, in effect. Their "growth" is fueled
almost entirely by new investors dumping cash into the system from which no
one takes (can take[1]) anything out.

That's a pyramid. Eventually when the investment money runs out[2], the
support will fall over. The only distinction between this and a Ponzi scheme
is that there are (probably) no single fraudsters at the top ready to run off
with the money. It's an unintentional Ponzi scheme.

Coin boosters simply don't get this: there's not enough money in the world to
keep bitcoin (and all the copycat coins) growing forever. _What is your plan
for when the investment money runs out?_. There is no plan, because you can't
get your money out.

[1] You simply can't dump a large bitcoin holding. There's not nearly enough
liquidity to do that in reasonable time.

[2] And it will.

~~~
jcoffland
What a load of BS. Of course you can sell off a large Bitcoin holding. People
do it all the time. That you think otherwise is ignorance and bias.

~~~
marcofiset
You can sell as long as people are buying.

~~~
quickthrower2
That also applies to shares, real estate, apples, Teslas, ...

~~~
marcofiset
Yes. I was just stating the obvious, which appeared to be not so obvious to
the commenter.

~~~
quickthrower2
Not sure we should bash that comment. If large means 1 million dollars it
isn't hard to find liquidity to sell 100BTC.

