# Crypto is NOT a Ponzi scheme **URL:** \ **Category:** Great Debates\ **Created:** [November 23, 2022, 12:54am UTC](https://boards.straightdope.com/t/crypto-is-not-a-ponzi-scheme/975417 "2022-11-23T00:54:06Z")\ **Posts on this page:** 1\ **Showing post:** 24
**Author:** ![Atamasama](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/atamasama/32/12961_2.png) [@Atamasama](https://boards.straightdope.com/u/Atamasama)\ **Post date:** [November 23, 2022, 9:48pm UTC](https://boards.straightdope.com/t/crypto-is-not-a-ponzi-scheme/975417/24 "2022-11-23T21:48:52Z")
I only follow two YouTube personalities because they are very informative and entertaining. Coffeezilla (who you linked to) and LegalEagle. (Coffeezilla even made an appearance once in a LegalEagle video to explain crypto stuff.) You should take most things with a grain of salt on YouTube, but those places are pretty solid. Coffeezilla (who styles himself tongue-in-cheek as an “internet detective”) has actually been involved in busting real-life scams. > **[Blockchain community busts alleged $20M NFT drop scam before sale completion](https://cointelegraph.com/news/blockchain-community-busts-alleged-20m-nft-drop-scam-before-sale-completion)** > > OpenSea delisted NFT project Squiggles over scam allegations. _The New Yorker_ even wrote an article about him. > **[Coffeezilla, the YouTuber Exposing Crypto Scams](https://www.newyorker.com/news/letter-from-the-southwest/coffeezilla-the-youtuber-exposing-crypto-scams)** > > In the golden age of con artistry, self-proclaimed finance gurus are everywhere, with few checks on their claims. He’s pretty legit. I do personally decry the conflation of “Ponzi scheme” with general financial scams, but some crypto groups **do** operate as Ponzi schemes. > [@Help me Understand Non-Fungible Tokens](https://boards.straightdope.com/t/help-me-understand-non-fungible-tokens/938969/42): > > A Ponzi scheme requires some kind of fictitious business and an investment vehicle where early investors are led to believe that the shares are gaining value, but instead are being paid by later investors. That’s not what’s going on with NFTs. Sometimes that is what is going on with cryptocurrency, though. An example is the “Save the Kids” scheme. (Another one that Coffeezilla helped expose, and was [later sued for it](https://esports-news.co.uk/2021/07/14/frazier-kay-to-sue-coffeezilla-over-save-the-kids-crypto-investigation/).) > **[Scam the Kids: The ‘Save the Kids’ crypto scandal involving several UK...](https://esports-news.co.uk/2021/07/02/save-the-kids-cryptocurrency-scandal-faze-influencers-opinion/)** > > Let's not be so quick to forgive and forget our favourite influencers fibs or fraudulent behaviour, argues Esports News UK editor Dom Sacco in this opinion It was a scam from the beginning. They made a coin that they knew from the beginning was going to fail, just as you know a Ponzi scheme will eventually fail. They paid influencers to hype it up, and then when it went live, people bought in. Those people who bought in were inflating the price, which encouraged more investors, and more, and then those “in the know” who were part of the scam sold their shares, and the whole thing tanked. It was orchestrated from the beginning; it wasn’t a sincere attempt that failed. This is typically referred to as a “rug pull”, using the imagery of someone pulling the rug out from unsuspecting people who end up falling on their butts. It’s so ubiquitous among crypto schemes that many projects go out of their way to assure people that there is no rug pull intended as they start. (Even though often they are proved to be lying.) The New York Times even wrote a recent article describing how these online Ponzi schemes are done. > **[The Crypto Ponzi Scheme Avenger (Published 2022)](https://www.nytimes.com/2022/11/11/business/crypto-ponzi-scheme-hyperfund.html)** > > From his home in New Zealand, the YouTuber Danny de Hek assails what he calls a dangerous and deceptive scheme, one rant at a time. I would agree with you that not all NFTs or cryptocurrencies are Ponzi schemes. There are many that are legitimate, and they succeed or fail while the people operating them are making a sincere effort to succeed. But it’s also true that many of them are. It’s an area where there are no regulations and many people get away with fraud without prosecution, so it’s inevitable that this sort of scam is going to be rampant. --- _[View the full topic](https://boards.straightdope.com/t/crypto-is-not-a-ponzi-scheme/975417)._