By The original uploader was Mgreason at English Wikipedia. — Transferred from en.wikipedia to Commons., Public Domain,

The Grand Energy Ponzi

The greatest Ponzi of all time is bigger than most of us can imagine, and involves more than just money.

Frederick Bott
4 min readApr 17, 2021


Updated 02/05/2021

The news of Bernie Madoff’s recent passing brings us to thinking about the strange nature of Ponzi schemes.

Is a Ponzi only a Ponzi when the founder(s), and those taking part know beforehand that the scheme is unsustainable?

I would say not.

I absolutely hope not.

Otherwise we are all guilty of taking part in the biggest Ponzi ever.

There seems many activities which begin purely as something simple which provides gain to someone or another, without anyone realising that ultimately, the activity is unsustainable.

Like the first tree cut down and sold for profit, for example.

Where we are now, is massive removal and exploitation of all things supplied by nature, driven entirely by profit, where profit itself is only possible because of the scarcity of the source goods.

All of us are locked into this scheme, some with great enthusiasm, but an increasing number falling foul of it and developing a growing sense of unease with it, that things are not quite right, in fact, we are prisoners, and even slaves of a kind, within it.

My recent, earlier article on Bitcoin as a Kardashev Hinge, highlights the source of the problem.

To be truthful, I am not an extraordinary individual, who is able to, or be claiming to be able to see things that others can’t, I am just a systems Engineer, trained to use the tools of formal Systems Engineering.

Without those tools, I know I would be none the wiser to the great energy Ponzi.

But hopefully I can present the story in a way others can understand it.

Producing it, and I hope reading it, and thinking more about it, might help us realise that in fact we are practicing a massive Ponzi scheme, as a species:

The Great Energy Ponzi.

The removal of all things on Earth, effectively all various forms of stored energy, created entirely by the free energy of the sun, is obviously unsustainable.

Gold, diamonds, copper, salt, grain, in fact all commodities, are all just various forms of stored energy.

Even Bitcoin, is just stored energy.

But the thing that might be special about Bitcoin, and any timestamped POW crypto-currency token, is that it is energy converted directly to information.

Information which has encoded within it, a capacity of continuous solar energy, around 1MW per Bitcoin, if we are to recognise it as such.

Conceptually, what we have to get our heads around, is that we have to decide whether money should continue to exclusively represent fixed quantities of things, or whether it should really represent a supply of things.

There seems maybe a case for having two kinds of money, the kind that flows freely, like energy, generating value where it is actually used, rather than where it might be stored.

And a second kind which is limited, where each token of it represents a supply of the first kind.

Whats Next

It might be thought that we could somehow continue the great Ponzi by branching out to doing something similar on other planets before we exhaust those on Earth, but in all practicality, will we really? Can we really?

Fifty years on from the first claimed human footfalls on another planetary mass, our own moon, and we have seen nothing close to that achievement, ever since.

Instead, we have a few billionaires carrying out various sensational exercises, including sending their sportscars, and collections of shrapnel satellites into space, using the same old rocket technology as used when it was state of the art, fifty years ago.

Fifty years before that, we were in horses and carts.

(Has everyone forgotten those shrapnel satellites were a response to China leading 5G, developed over twenty years with our collaboration, when suddenly we decided not to cooperate any further?)

Shareholders love sensation. By that, short term profit is assured, explaining completely the motivation behind the exercises.

But is it sustainable? Of course not. We are already on a sharp trajectory downwards, towards extinction if nothing changes.

The Bubble is bursting.

Our very existence to date has been a Ponzi, the great energy Ponzi.

If we ever did manage to colonise other planets using an extension of the same scheme, transporting wealth back to the origin of our expansion, planet Earth, by the mechanisms of profit, we will be celebrating figures like Charles Ponzi, and Bernie Madoff, forever, as heroes, rather than villains.

They showed us how to do it.

Do check out what appears to be the only real alternative.

It is in the Kardashev Hinge story linked above.