One of the most common misconceptions regarding Bitcoin is that it is a form of Ponzi or pyramid scams. This is due to a variety of factors, including the fact that very few people understand what a Ponzi scheme is, and there is good reason to suspect that even fewer people comprehend Bitcoin and cryptocurrencies.

 

So the only way to address this issue is to disassemble Ponzi schemes and determine whether there is any resemblance to cryptocurrency. This is exactly what we plan to achieve in this blog post.

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What is a Ponzi Scheme?

 

Investment scams that promise huge returns with little to no risk are known as Ponzi schemes. Clever advertising often leads people to invest, but only after they discover the hook. In most cases, only the initial investors stand to gain from such schemes. The reason behind this is that they receive funds from investors who have invested more recently.

 

When the money coming in stops being sufficient, the Ponzi scheme will end. The amount of the necessary investment determines this, as more people can join up with a smaller investment and the plan will be active for longer.

 

There are very subtle but important distinctions between this and a pyramid scam. Pyramid schemes, sometimes known as “get-rich-quick” schemes, rely on enticing new members with the promise of money just for joining, rather than for actually selling or providing the service or product. Pyramid scams and Ponzi schemes are both against the law. For the purpose of keeping this blog simple, we will refer to both as one and the same.

 

 

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Is Crypto a Ponzi Scheme?

 

What most people don’t realize is that the vast majority of Ponzi scheme investors end up broke. Even in the cryptocurrency market, some people have lost money, although for very different reasons. The skeptics will continue to claim that any cryptocurrency is inherently fraudulent regardless of this.

 

It is a combination of bad luck, human frailty, and market dynamics that causes some people to lose money when investing in cryptocurrency. I will explain in a nutshell.

 

The value of Bitcoin and other cryptocurrencies fluctuated wildly over the years. If you want to know what to do in bullish and bearish markets, read up on Bitcoin price cycles. Near the year’s end, one of the most recent and substantial “ups” occurred. Because of the widespread interest in cryptocurrencies, many people behaved in a herd mentality and began investing heavily in the market.

 

Due to the quick increase in price, everyone started dumping their money into Bitcoin. As soon as it seemed like buying and trading virtually any cryptocurrency could yield quick profits, FOMO levels skyrocketed.

 

Ironically, it’s generally the case that an investment is already overvalued when people start getting enthused about it.

 

Some dissatisfied clients in the cryptocurrency sector will constantly buy high and sell low, going against the conventional wisdom of purchasing cheap and selling high, because many individuals start selling at a loss if the price starts to fall due to market cycles. This, however, does not prove that they were victims of fraud.

 

Catch: it’s not always easy to tell if the pricing is excessive or low. People were still anticipating bitcoin to reach even higher prices while it was trading at 15,000 EUR. Although we now know they were incorrect, they may have been correct had the price hit greater figures.

 

 

Is Bitcoin a Scam?

 

In contrast to Ponzi schemes, where the recipients of losses are essentially predetermined, cryptocurrency investing places the onus on the individual investor to select whether to take a profit.

 

To be sure, there have been some obvious frauds in the annals of cryptocurrency history, particularly with some of the initial coin offerings from the previous year, but by definition, cryptocurrencies are not Ponzi schemes. Why? It is, first and foremost, supported by a strong, open, and creative technology. The existence of the blockchain and the digital money known as Bitcoin will not end simply because someone chose to purchase and sell it at an inconvenient time. Furthermore, Bitcoin is a transparent, trustless network that depends on random computers called nodes rather than a central team that may be sued or held accountable.

 

With Bitcoin, there is a pretty straightforward formula that determines who makes money and who loses money based on consistent, healthy market swings.

 

On the other side, the primary reason individuals lose money in Ponzi schemes is that they are intentionally misled, which leaves them ignorant of the nature of the investments and, more crucially, the ins and outs of trading and/or investing. It’s also possible to compare this to cryptocurrency, where some people are just unfit to make informed investing decisions, but it’s crucial to remember that in this case, there is no deliberate deception involved.

 

As you can see, those who firmly believe in the technology are supporting cryptocurrencies and will keep doing so as they continue to grow.

 

For instance, I think Bitcoin, other cryptocurrencies, and blockchain technologies are really valuable. But keep in mind that there is no assurance of profit while using any cryptocurrency! Because of this, you should always exercise caution when considering investment offers that provide “a guaranteed profit.” Do your own research at all times.

 

In actuality, conventional stocks, commodities, and other things that trade on conventional stock exchanges can coexist with cryptocurrency. Although they may serve a variety of purposes and have distinct connotations, they are fundamentally made to operate networks or be utilized by them. Since all of them were intended to be used for something—such as making payments or using the network—there is no assurance that any of them will be profitable.

 

Make sure you understand how the markets and the technology operate before using cryptocurrency as a speculative investment.  When you are ready to enter the world of cryptocurrencies in a safe and easy way, register to BTCC.

 

 

 

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How to Trade Bitcoin Futures on BTCC?

 

 

Now you can trade BTC on  BTCC. BTCC supports a diverse selection of cryptocurrencies for trading. This includes popular cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Bitcoin Cash (BCH), and others. BTCC also offers products such as crypto, gold, and tokenized stocks to help investors rationally allocate their assets.

 

1. Register an Account

 

Join BTCC now and get up to 10,055 USDT when you deposit and trade. Click the button below to sign up now.

 

 

2. Deposit Funds

 

Once your account is set up, you’ll need to deposit funds into your BTCC account. BTCC may offer various deposit methods such as bank transfers, cryptocurrency deposits, or other payment options. Choose the method that works best for you and follow the instructions provided to deposit funds into your account. BTCC mainly offers USDT margin and future trading. Therefore, you need to buy USDT  before trading.

 

 

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3.How to Trade BTC?

 

Here are the steps to trade BTC on BTCC

 

1) First, tap “Futures” on the website homepage

 

 

2) Select a product you would like to trade from the list here. BTCC currently offers daily and perpetual futures

 

 

 

3) Check time to settlement.  The settlement time of these futures type is different, you can check the time for settlement for each product here.

 

 

 

 

4) After choosing product, you can decide whther you would like to buy or sell it.  You only need to own USDT to trade USDT-margined futures.  That is to say you can sell BTCUSDT futures without owing any BTC Coin.

 

 

 

5) Then select your order type, and choose your leverage.

 

 

 

 

If you choose Limit or SL/TP order, you will need to enter your order price here.

 

 

 

Enter the quantity or choose the percentage under the quantity field.

 

 

 

 

You can also set up stop loss or take profit targets to limit losses or maximise earnings.

 

 

 

 

6)After everything is set up, Buy or  Sell to play your order. A confirmation window will show up,  check if all info is correct and click [Confirm] to open the position.