Is Bitcoin a “giant Ponzi scheme”? Based on how Ponzi schemes work in law and economics, the answer is no, even if some people do lose money speculating on it.
Johnson’s accusation
In his Daily Mail column, Boris Johnson wrote that he has “long suspected” Bitcoin and other cryptocurrencies are basically a “giant Ponzi scheme.” He argued that their value rests on “collective belief” and a constant flow of “new and credulous investors,” not on any clear underlying asset or cashflow.
Johnson illustrated his point with a case of an older acquaintance who put in an initial 500 pounds, paid repeated fees over several years, and ultimately lost around 20,000 pounds via a Bitcoin-related pitch. For Johnson, this story shows how ordinary savers can be misled in the name of Bitcoin, and he warns that as more such losses emerge, public faith in crypto will “melt away.”stocktwits+1
What a Ponzi scheme actually is
In finance and law, a Ponzi scheme is a specific type of fraud. It has three key elements:
- A central operator or organizer.
- Explicit or implied promises of fixed or high returns.
- Payouts to earlier participants funded mainly from money put in by later participants, not from real economic activity.
Classic examples include Charles Ponzi’s 1920s scheme and Bernie Madoff’s investment fraud, where clients were assured consistent returns and funds were secretly recycled from new investors to old ones. Regulators shut such schemes down when inflows slow, because the structure is unsustainable by design.
By contrast, Bitcoin does not promise any return, has no single organizer who controls the system, and does not pay “yield” to early adopters from new buyers’ deposits. Its price can rise or fall sharply, but those moves come from open market trading, not from a central operator running a payout hierarchy.
Saylor’s defense of Bitcoin
Michael Saylor, chairman of business-software and Bitcoin-treasury firm MicroStrategy (referred to in some coverage as Strategy), responded directly to Johnson’s charge on X. He stated that “Bitcoin is not a Ponzi scheme,” arguing that a Ponzi “requires a central operator promising returns and paying early investors with funds from later ones.”
Saylor emphasized that Bitcoin has “no issuer, no promoter, and no guaranteed return,” describing it instead as an open, decentralized monetary network governed by software code and market demand. His rebuttal also comes in the context of MicroStrategy’s very large Bitcoin position, amounting to hundreds of thousands of coins and several percent of the total eventual supply, so he is a highly exposed and self-interested defender of the asset.
Johnson’s comments land in a UK political environment where views on Bitcoin are sharply divided. While he now attacks Bitcoin as a “giant Ponzi,” his own period in office laid groundwork for today’s UK crypto regulatory framework, which aims to bring digital assets into a supervised financial regime rather than ban them outright. At the same time, other figures such as former chancellor Kwasi Kwarteng and politician Nigel Farage are actively backing Bitcoin-focused businesses, seeing it as part of Britain’s future as a financial hub.
What Johnson accurately highlights is that people can and do lose money through scams that use Bitcoin as the hook. In the anecdote he cites, the real problem is a fraudulent intermediary who promised to “double” a small stake, then extracted more funds and blocked withdrawals. That pattern closely matches how high-yield scams operate, but the fraud lies in the sales pitch and custody arrangement, not in the Bitcoin protocol itself.
Clear conclusion
If we apply the standard definition of a Ponzi scheme, Bitcoin does not qualify: it has no central operator, no guaranteed or advertised fixed return, and no mechanism that systematically pays old investors with new investors’ deposits. Bitcoin is a highly volatile, speculative asset that can be misused by fraudsters and can cause serious losses to uninformed or unlucky buyers, but that does not make the network itself a Ponzi scheme.
