But selling Bitcoin is _exactly_ an older investor being paid out by a newer investor.
IMO it's Bitcoin in combination with Tether that's the actual Ponzi. Unfortunately unlikely to unwind until and unless people start needing to redeem Tether rather than selling it on.
> IMO it's Bitcoin in combination with Tether that's the actual Ponzi.
Bingo.
The problem is, the big players have no interest in unwinding the scheme. As long as exchanges can wash trade USDT:BTC to drive the inflow of retail investment, things keep going.
What'll be interesting is if BTC continues to fall. I think the low $30k is a support level; if it crashes below that, I bet we're going to see more outflow from undercapitalized exchanges and things will adjust hard.
That is pretty much the accusation against tether. Most exchanges use it, so rather than the exchanges being knowingly undercapitalized, they are by virtue of using tether. Which is supposed to be 1=1 backed with the $. Which it isnt, and it is not clear how backed it actually is.
They always claimed it was backed 1:1 with the US dollar. Then they paid a fine to the NY AG because it was not backed 1:1, and as part of that they had to produce quarterly reports about how it was backed.
Dude I think you are kidding yourself. There is something not legit about Tether, or at least it feels that way. And neither Bitfinex or ifinex have done anything to help that through their misleading and sometimes outright lying, about Tether and its reserves.
IMO it's Bitcoin in combination with Tether that's the actual Ponzi. Unfortunately unlikely to unwind until and unless people start needing to redeem Tether rather than selling it on.