Should Matt Damon and Reese Witherspoon Go to Jail for Promoting a Ponzi Scheme?
A trillion dollars in losses requires accountability
More than a trillion dollars in market value has been wiped off the cryptocurrency exchanges in the past two weeks.
(I called it back in November.)
But until two weeks ago, all sorts of celebrities were shilling for their favorite coin — or rather, whichever coin company paid them the most endorsement money.
And dozens more.
They made untold millions by convincing the ignorant public to late-join a Ponzi scheme.
Now they’ve all gone silent.
Because now that the industry is crashing back to reality, real people are losing their shirts.
Call me old-fashioned, but I think someone needs to be held accountable.
Should celebrity crypto boosters go to prison for promoting Ponzi schemes?
Let’s think about it for a beat.
The Ponzi scheme was the brainchild of an Italian thief with the grandiosely magnificent name of Carlo Pietro Giovanni Guglielmo Tebaldo Ponzi.
Ponzi guaranteed his investors he could double their money within 90 days, telling them he was an expert in IRC coupon arbitrage. In reality, Ponzi simply paid his earlier investors with the investments of later investors.
Such schemes obviously cannot last forever — doubling your profit every quarter forever is mathematically absurd. For a while, Ponzi lived like a king, buying himself a mansion, honeymooning in Italy, opening a winery, and even buying a macaroni factory on the side. When one reporter grew suspicious of Ponzi’s rapid rise, the con man sued for libel and won $500,000.
In the end, Ponzi’s scheme ran for just over a year before collapsing, shuttering six banks and costing thousands of investors the equivalent of $250 million in today’s money.
Ponzi went bankrupt in the court cases that followed and was sentenced to more than a decade in prison. Upon release, he set up a Florida swampland scheme that also eventually failed. After serving another seven years in prison he was deported back to Italy, before eventually dying in poverty in Brazil.
Crypto was always a textbook Ponzi scheme…
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