Rabid Wombat <wombat@mcfeely.bsfs.org> writes:
On Sun, 10 Nov 1996, Clay Olbon II wrote:
Pyramid schemes could be a growth market in a crypto-anarchic world. It is yet another market such as gambling, or the lottery, that could be conducte with anonymity. And it appears to be much more widespread on the internet
How is it like gambling? If I get a pyramid letter instructing me to send money to five people on the list, add my name to the bottom, send to 5 people, or whatever, there's nothing stopping me from removing all the names, adding my name and those of four friends, and passing the letter along. With an anonymous system, I could easily be all five people, without even the bother of getting five different post office boxes.
There's no gambling involved; only blantant stupidity.
I agree - MMF is stupid. Gambling in Las Vegas is stupid. Buying lottery tickets is stupid (except in rare cases when the jackpot is very large.) The way most investors play the market is stupid. It's unbelieavble how many billions of dollars move around in non-productive activities which can only be described as stupid. Coming back to MMF, I recall the famous quote from Dave Rhoad's original post which said approximately: "The success of this project depends on the honest and integrity of each participant." (By the way, DR is a real person, living in California.) My small-scale survey indicates that almost all the people who post MMF try to "cheat" in a minor way by not sending the $5 to the 5 people upstream of them. I think this casn be prevented cryptograhicaly if the MMF post includes digitally signed assertions from the 5 upstream people certifying that they've received their $ from this particular poster. A slightly more sophisticated form of "cheating" is described by RW above: the poster generated 5 nyms, generated 5 receipts from these nyms, and effectively starts a new pyramid. A partial response to that would be to require each new nym to be certified by its immediate upstream neighbor: sort of like the web of trust, rooted in Dave Rhoades himself. But that too can be circumvented by a single person "spamming" the pyramid by multiple nyms all belonging to him. There's no good way to ascertain that mutliple nyms don't belong to the same person.
--- Dr.Dimitri Vulis KOTM Brighton Beach Boardwalk BBS, Forest Hills, N.Y.: +1-718-261-2013, 14.4Kbps