From: Chris Rasch (crasch@openknowledge.org)
Date: Sun Feb 18 2001 - 22:11:38 MST
hal@finney.org wrote:
> I think you misread the article; the growth was from mid 1999 to the
> end of 2000, or 18 months rather than six. Still that is a substantial
> growth rate.
Yes, you're right--thanks for pointing that out. Sorry for the error.
> We had some discussion here last year about online "virtual stock"games like
> StockGeneration. Most of these are Ponzi schemes and fail
> eventually, leaving a lot of unhappy "investors". Several of these
> companies were using e-gold as their payment service because it did not
> have the provision for customers to contest payments as they can with
> credit cards. I had the impression that a substantial part of e-gold's
> growth in early 2000 was due to these games, but I haven't been following
> it lately.
That seems like a plausible explanation for the growth rate. Which is
unfortunate, because it gives regulators an excuse to go after e-gold.com, to
"protect" the Ponzi victims. However, such marginal "businesses" (Ponzi schemes,
gambling, porn) seem to be quite helpful in initially overcoming the chicken/egg
problems that often plague new technologies like this--e.g. no customer wants to
go to the trouble to sign up to use e-gold unless many online businesses accept
e-gold payments and vice versa. Lust and greed often seem to be required to
overcome the inertia of the status quo.
Incidentally, a nice summary of the history of the original Ponzi scheme is
available at http://www.mark-knutson.com/
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