Virtual Currency Dubbed as the "Largest Ponzi Scheme in Human History" by BSN Top Executives

Virtual Currency Dubbed as the "Largest Ponzi Scheme in Human History" by BSN Top Executives

The Chairman and Executive Director of China’s Blockchain Service Network (BSN) Development Alliance, Shan Zhiguang, and He Yifan have together published that virtual currency is "undoubtedly the largest Ponzi scheme in human history." However, they have said the "value of blockchain technology should not be ignored because of virtual currency."

Bad-Mouthed Virtual Currency

The Chairman of the Chinese Blockchain Service Network (BSN) Development Alliance, Shan Zhiguang, and Executive Director He Yifan have said virtual currency is "undoubtedly the largest Ponzi scheme in human history." They also claimed that this Ponzi scheme has since mutated into one that is "no longer just about cash."

In a recent opinion piece published by the People Daily Online newspaper, the BSN chairman and his colleague have pointed their guns at virtual currency and bitcoin by targeting the fact that it has been "bad-mouthed" by at least 90% of the 100 richest people in the world. They have also given the reasons which compelled them to similarly view BTC or any virtual currency negatively. They wrote:

"This type of Ponzi scheme can be classified as 'equity-type,’ and it has three main characteristics: first, it is based on the equity that can be denominated; second, the equity can be traded and circulated; and finally, and most importantly, this equity is not associated with any asset, productive labour, or social value, but is entirely fictional."

According to them, the equity in virtual currency Ponzi schemes is not linked to any real asset or labour, hence the risk is "close to infinity." The characteristics of virtual currency, Zhiguang and Yifan said, are consistent with those of a so-called equity Ponzi scheme.

Blockchain Should Not Be Ignored

In the same opinion piece, the BSN chairman and Yifan cited the example of ‘Dogecoin’ to show how one influential individual can manipulate or control the value of a virtual currency.

"So it’s easy to understand that Musk can turn hands-on Dogecoin into a cloud, and turn his hands into the rain. Sending a tweet can make the price of virtual currency flat," the duo claimed.

Despite their stance on virtual currency, Zhiguang and Yifan in their opinion piece backed the blockchain technology, which anchors most cryptocurrencies, and "should not be ignored." Both of them have suggested regulation as technology is still needed to ensure the blockchain plays "a huge role in various application fields."