[Arm-netbook] EOMA68 / Libre RISC-V team financing

[Philip Hands]

On Wed, 27 Dec 2017, Luke Kenneth Casson Leighton <lkcl at lkcl.net> wrote:
...
>  (3) this is quite LITERALLY the opposite of a ponzi scheme.  they are
> LITERALLY making the bitcoin that underpins the entire scheme.  this
> is a completely unique approach which is actually extremely clever.

It seems to me that one way of looking at this is that they are using
other people's money to bet that the BTC price will go up on average,
and then using the resulting profit to do a spot of mining as cover.

Whether they are paying people back from the speculation profit and/or
in the traditional ponzi manner from later investor's funds doesn't seem
to make much difference to me.

Most of the people involved in this to date would almost certainly have
been better off simply buying BTC at the start, and selling them some
time later on.

Likewise, saying that you're only putting BTC in, and hence its only
pretend money (or some such) ignores the opportunity cost of no longer
being able to sell those BTC for cold hard cash.

So this looks to me like a ponzi built on a speculation bubble, which
might be a way of making the ponzi survive longer than it would do
otherwise, but if and when the BTC bubble bursts[1] investors are going
to discover that the people in charge have done a runner with the
remaining assets and that any balance still held within the scheme is
just gone.

Luke, given your repeated assertions about the importance of ethics I'm
astonished that you'd be willing to be anywhere near such a scheme.

Cheers, Phil.

[1] The actual underlying value of BTC, if it has one, seems to me to be
a decentralised medium of exchange. The volatility has recently
convinced Storm to stop accepting them:

  http://steamcommunity.com/games/593110/announcements/detail/1464096684955433613

which seems like a pretty bad sign for the underlying value.  What's
left is 90% speculation and 10% criminality.
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