The Bitcoin Bullshit List

If you hand around the Bitcoin space for awhile, you will inadvertently come across a few or a few hundred copycoins, scamcoins, scams, ponzi schemes and what have you. Whether it's a large scam like Paycoin, small scale pump and dumps like Quarkcoin, or something that might look like an earnest project that got too big for its own good like The DAO, after awhile you start seeing the same pattern and red flags repeat themselves over and over again.

Being inspired by the ever timely SpamSolutions.txt (a quick checklist of "why your idea to solve the problem of spam won't work"), awhile back I started compiling "The Bitcoin Bullshit List" (also available at http://tiny.cc/Bullshit). It should be expansive enough to cover most of the common scenarios, but if you think it's missing something, let me know and I'll add it in the future revisions.

So, how does the Bitcoin Bullshit List work? You simply read up on or listen to a project pitch and start filling in the checkboxes in the "Your Crypto Idea Will Not Work" section. Once you're done, you can summarise your thoughts and give the project a short "Bitcoin Bullshit Tier".

Let's go through an example to show how this might work in practice (and cutting out the unnecessary parts of the lists).

Example - The DAO

Your post advocates a new:
(x) Altcoin
(x) Investment scheme

Your idea will not work.  Here is why it won't work.

(x) Your target audience is too small to support the project
(x) The proposed security model is (x) flawed / ( ) not enough / ( ) completely wrong and therefore you will be (x) scammed / (x) hacked / (x) stolen from / ( ) ________ quickly
(x) You promise unreasonable return on investment without a clear business model of where the money is coming from
(x) Your project cannot be run legally at your jurisdiction
(x) Your project will not be compliant with the current (x) KYC / (x) AML / ( ) gambling / (x) securities regulations
(x) The solution would work better as a (x) centralised / (x) decentralised / ( ) distributed solution
(x) Your product is poorly implemented
(x) Your presale tokens have no economic value
(x) Your adoption goals are unrealistic

Specifically, your plan fails to account for:
(x) The existing regulations
(x) The required Money Services Business license
(x) The anonymous nature of cryptography
(x) Public reluctance to accept weird new forms of money
(x) The human factor

and the following philosophical objections may also apply:
(x) Ideas similar to yours are easy to come up with, yet none have ever been shown practical

Furthermore, this is what I think about you:
(x) Sorry dude, but I don't think it would work.

Bitcoin Bullshit Tier
You are advertising a new Bitcoin / crypto related project. Based on the information provided, you have reached the Bullshit Tier of 4 for the following reasons:

Bitcoin Bullshit Tier 1 - marketing babble, technology misunderstanding
(x) Dropping names of crypto celebrities to bolster one’s credibility


Bitcoin Bullshit Tier 2 - willful misinformation, bait and switch
(x) Claiming your project can accomplish something hard without a clear explanation of how to do so

Bitcoin Bullshit Tier 3 - Many red flags
(x) Assuring your product is legal
(x) Speaking about profits / return on investment
(x) Presale
(x) Token IPO
(x) Providing no company contact information


Bitcoin Bullshit Tier 4 - Outright scams
(x) Describing a financial security and claiming it’s not a security

Well, that was pretty straightforward. Now, let's compare that to something that is generally not considered a scam and see how well it fares.

Example - Litecoin

Your post advocates a new:
(x) Altcoin

Your idea will not work.  Here is why it won't work.

(x) There is already a product on the market that does exactly what you’re doing, but ( ) faster / ( ) cheaper / (x) better / (x) is more established / ( ) ______________ You are proposing exuberant fees for the use of your product that are unsustainable in the long run


Specifically, your plan fails to account for:
(x) Public reluctance to accept weird new forms of money
(x) Huge existing software and hardware investment in Bitcoin

and the following philosophical objections may also apply:


Furthermore, this is what I think about you:
(x) Sorry dude, but I don't think it would work.



Bitcoin Bullshit Tier
You are advertising a new Bitcoin / crypto related project. Based on the information provided, you have reached the Bullshit Tier of 1 for the following reasons:

Bitcoin Bullshit Tier 1 - marketing babble, technology misunderstanding
(x) “As good as / better than Bitcoin”



Generally, not that bad - some tick boxes will apply to even the most benign and well meaning projects, and that's fine.

Conclusions

With many new crypto projects cropping up and vying for your money, it's useful to step back once in awhile and see how many flags certain projects raise before buying into them. Whether it's for laughs or as a sanity check, the Bitcoin Bullshit List might be a useful tool to run through when looking at new Bitcoin and crypto-related projects:

http://tiny.cc/Bullshit