BTC, as it operates today, bears all the hallmarks of a Ponzi scheme masquerading as a revolutionary financial tool. Friedrich Hayek warned of such distortions in the market—when the true purpose of an asset or a system is buried under layers of false promises and unsustainable growth mechanisms. BTC, in its current state, is no different.

First, consider the core of a Ponzi scheme: early participants profit at the expense of those who come later. The value of the system is artificially inflated, not by creating new value, but by convincing new participants to buy in at increasingly higher prices, all while the initial players quietly cash out. BTC’s astronomical price growth isn’t driven by any tangible use as money. It’s driven by speculation and the constant influx of new buyers who are told they must invest or be left behind.

BTC's value is not based on utility or productivity. It cannot function as a medium of exchange, with fees so exorbitant that it’s unusable for daily transactions. It cannot store value with the kind of volatility that makes it a gambler's dream, but a nightmare for anyone who seeks stability. So what drives its price upward? Nothing but the hope—the belief—that someone else will pay more for it tomorrow than you did today. This, at its heart, is a Ponzi mechanism.

And what of its governance? BTC is dominated by a small elite—those who control mining power and those who dictate the narrative, creating the illusion of decentralisation while consolidating power. This central group benefits most as new investors flood in, buying into a system that pretends to be about freedom and financial independence, but in reality offers no real innovation. Those at the top of the pyramid profit from this influx, while the later entrants are left holding a stagnant asset, waiting for the next round of greater fools.

The promises of BTC—that it will replace money, that it will liberate economies—are simply unattainable within its current structure. BTC requires more and more new buyers to sustain its value, but offers little in return except the hope of future gains, gains that are entirely dependent on others continuing to believe in the myth. Just as in a Ponzi scheme, the moment that belief falters, the entire system collapses, leaving the later participants with nothing but losses.

In essence, BTC's structure is a house of cards built on speculation, not utility. Its price is propped up by nothing more than the continual need for new participants to buy in at ever-higher prices. This isn’t the foundation of sound money. It’s a classic Ponzi scheme, with all the eventual devastation that comes when the pool of new entrants inevitably dries up.