For example, if you were to apply this definition of a ponzi to a cryptocurrency it would be applicable to many blockchains such as Bitcoin, Bitcoin Cash, Dogecoin
Not applicable. These projects never promissed any gains for just having the coins. Gains are coming from open market trading.
Yes, but Bitcoin is only valuable if enough people keep agreeing it is.
Yes, as anything in the world. But Bitcoin have a solid technological structure, and have already proven it's protocol security and reliability for around 10 years now. There is a reason people believe bitcoin have value. It's not only "buy and get rich".
HEX is precisely the same as Bitcoin in this way
No it isn't. HEX is a smart contract built on a valuable blockchain (Ethereum). It doesn't have anything of value except grow within itself.
Again, Bitcoin have a technological infrastructure that solve real problems like centralization, trustless exchanges, and transaction cost (and a few others).
which in theory will result in scarcity.
There is no scarcity if there is inflation. Bitcoin scarcity comes from a maximun amount of coins that will enter circulation. HEX will alwasy generate more HEX. Locking it up doesn't make it more scarce.
HEX was designed to reward actors that do things deemed more beneficial for its internal economy
Really? I read that i have to lock it up for one year before unlocking. Meanwhile, in one year, the creators of the scam have already dumped his whole stack on the market, bringing the price near zero.
What does it matter if you are recieveing more HEX than before if it's price is near zero? You would only be recieving a lot of coins that are worth nothing.
A ponzi is called what it is because it has a very specific feature of it, which is that return on investment to early participants comes from later participants and not from any real value
Ponzi Scheme 101:
I convice person A that i will make his money grow, but he need to find 5 more people to invest.
A gets 5 more people, but they also have to find 5 people (people Bs) each to invest.
People Bs money goes to the creator, and pay the "investment" profit to A, who then start to look for more people to invite.
People Bs get 5 more people each (people Cs) to joint the amazing investment. Now there is 25 more people on the system.
People Cs money pay the creator, pay people A profit and people B get a bit from the leftover.
The process continue until there is no more people joining the "amazing investment".
HEX is just more of the same, with a new shell.
Think what will happen when the dump start, and people start to see there is no reason to have a worthless coin that pay more worthless coins?
HEX promises you that if you stake HEX you will receive more HEX at the rate of between 3.69%-369%
So, what is paying this interest? On bank deposits you money will be used to finance some one else, and you will get a share of the interest paid by the borrower.
HEX just print more "money". And since there is no use to have HEX, it's just a increase in supply.
At some point, there won't be enough people interested in buying it for the "amazing gains", and whoever got in first will start the sell, and the price will go to zero.
A sucky Nintendo game that no one enjoyed playing as a kid went for $80K in one auction
There is emotional value for the person that bought it. I might not be worth for you, but this guy probably had a emotional attachment to this item that made him want to buy it.
I don't think there is anything emotional about HEX.
So, you cannot fail to get paid what you are promised.
Yes, but you will eventually get paid in something that is totally worthless.
But think about this, why is inflation a negative to people? Because they are not the ones getting the inflation.
I don't think you understand. How inflation works.
Nobody receive inflation. Inflation/deflation is a measure of how much value a currency have lost over time.
It's calculated by how much money is needed to buy something now and how much it will cost at some point in the future.
Let's say you buy a burger for 10 USD. One year later, the same burger costs 11 USD. That's 10% inflation.
Yet, its whole reward system revolves around inflation. Similarly, HEX does this too. In fact, all blockchains use an inflation system, including Bitcoin, to motivate certain participants to perform some action believed to be beneficial to the network.
STEEM doensn't pay inflation. Inflation happens because of there is always reward being paid. an 8% year inflation on STEEM means that, not considering other factors, 1 STEEM will buy 8% less stuff because there is 8% more STEEM circulating, therefore more steem need to be sold to reach the same value than one year before.
Bitcoin have a decreasing inflation (called deflation), because there is a limit of how many BTC will exist, and the rate that they are issued lower with every halving.
It also went through 3 auditing companies that verified its economics.
2 Audits are published, so there is only 2 so far.
Have you read them? Here is a resume:
The contract work as coded, with 3 minor problems. Here is one problem that is really interesting:
"This function is not accessible to users but internally it is called to close a stake from
endStake or goodAccounting. Running out of gas will cause the user to be unable to
close the stake. Fail to close a stake will cause the owner to lose funds on late
penalties."
So, there is a possibility that at some point in the future, users won't be able to close their stakes. Interesting...
Basically with is saying here is that, the longer you stake, you will have to pay more gas to unstake, even reaching the max time of 50 years, where the gas needed to unstake will be even higher than the amount an Ethereum block can hold.
So, you keep on recieving a soon-to-be worthless coin, and you even pay more to withdraw to longer you wait?
Only answer the question: Will people get more HEX if they stake for longer of shorter time?
The answer: Longer.
There is no evaluation about economic sustainability here. This just give a "reasonable" reason for people to hold the coind for a longer time (while the creators dump their stakes on the market).
Also, both audits are from the same company that was paid by HEX creators, so, that is only one opinion funded by it's owners.
Let me know when you find an independet audit.
Very true. However, given the incredible success of HEX so far, especially with all the naysayers out there that call it a scam before looking into it, I'd say HEX already passed that threshold.
Really? What have HEX offered so far for people to think this is not a shitcoin? not much really.
The only thing happening here is "buy more to get rich faster".
its a fascinating economic experiment.
It's not. It's a clear SCAM with a new look.
Anyway, that's enough for me. It's pretty clear it's another elaborate scam looking to lure people without much knowledge about economics and value, based only on the promisse of easy gains.
And as every scam, it will be higly profitable to those joining early, and a big loss for those who come later.
Don't doubt. It will break sooner or later.
If you get money with it, fine, just don't lure people that have no clue how things work to these kind of things.
It's your money. Burn it as you will.
RE: "HEX is a Scam! HEX is a Ponzi!!! HEX is a Shitcoin!!!!!"