This has little to do with a ponzi scheme and more to do with trusting the community (creator included) vs trusting the one person you trade with at a time (and ref system). Even if some guy buys 1,000,000 points after the first six months and the whole community sends him what he wants, he'll pay market value for cards and the community will take his points. The creator certainly deserves any donations he gets, just like most sites have donations available and we do the MOTL stack thing here from time to time. The only issue is your level of trust in the system.

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Originally posted by NukeMoose:
Even if some guy buys 1,000,000 points after the first six months and the whole community sends him what he wants, he'll pay market value for cards and the community will take his points.

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I can't find this on the site but is there a way to get your value out of the system? Let's say I trade this guy 1,000,000 points of cards. Now I'm stuck with them, unless I eventually manage to get people to send me this value. If they don't...I'm out 1,000,000 (and it's equal in $) worth of cards.
The only way would be to list easy to move cards, hope they show up and put in time and effort in selling them outside of the system.

So in theory, I understand the system. I'd rather not be committed to it if I don't want to lose out.

Also, cardvalues. Is it based on Magiccards.info? How accurate is that? (speculation and stuff, points changing while in the mail etc.)

You can always contact me any time at Eric@PucaTrade.com, if my voice mysteriously falls silent from this site or anything.

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Originally posted by Devonin:
Almost 3 million books have been given through bookmooch.com

This model is not inherently a scam, and you do a disservice to a model designed to help facilitate people getting what they want, even if they can't find a direct trade for what they have by characterising the entire formula as a scam.

I honestly don't even care whether this guy is a scam artist or not, because I don't even have the option of using his service, but condemning the whole concept as a scam is a little silly.

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On a long enough timeline, any model designed as the one you've described in your post ends up being a scheme in which the Owner/Recipient of the site donations has a net positive when he or she decides to cash out. This is just one concern of many I have with the guy's site.

1. Assigning card value across the board creates a multitude of problems, most of which crop up with new releases and VERY rare cards, since few retailers ever have a consensus for those types of card.

2. I can't wait to see how lost mail disputes are handled. Between user bannings, point refunds, point deductions, and the general sliminess of points for donations, you've got a can of worms just waiting to happen.

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Originally posted by JasonX-NL:
Also, cardvalues. Is it based on Magiccards.info? How accurate is that? (speculation and stuff, points changing while in the mail etc.)

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It's true that cards change value while they're in the mail. The Sender will always be credited points at the time that he/she initiated the trade. Likewise, the Points will be debited from the Recipient at that moment as well.

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Originally posted by Zeckk:
On a long enough timeline, any model designed as the one you've described in your post ends up being a scheme in which the Owner/Recipient of the site donations has a net positive when he or she decides to cash out.

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This is interesting to me. The notion that there's some sort of "Cash Out" that we're planning is simply not true. Our goals are to make the best possible trading platform for Magic the Gathering cards. And the amount of positive feedback we've received for this shows the tremendous need for it.

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Originally posted by Zeckk:

1. Assigning card value across the board creates a multitude of problems, most of which crop up with new releases and VERY rare cards, since few retailers ever have a consensus for those types of card.

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Originally posted by NukeMoose:
The creator certainly deserves any donations he gets, just like most sites have donations available and we do the MOTL stack thing here from time to time.
If this thing sticks around for a year or so and develops a friendly vibe then I could definitely see myself using that site.

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Originally posted by junichi:
It doesn't matter if it is the end user that is out $10, or every users out a penny that totals up to $10, the system is out $10 per donation!

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Originally posted by Devonin:
Lousy "US Only" *grump*

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Originally posted by paragondave:
Do you have a resolution process for that or any other kinds of disputes? My only issue with MOTL is that in situations like that, the sender is on the hook.

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Originally posted by LaysanRail:

This is actually not true. When a user donates $10 and receives 1000 Points, those points trickle down through the entire community. No one is "out" anything. The one who donated gets cards in an equal proportion to the donation, and the ones who gave him cards get points equal to their value. No value is lost or removed from the system.

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This is absolutely misleading, and is actually very similar to pyramid scheme, where you always need a new transaction to fund the previous one, and the last person in the chain of transactions will always end up with useless credits and no cards to redeem for.

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Originally posted by LaysanRail:

That's actually not true either. As I think folks are starting to realize, the economy of the site wouldn't survive a hypothetical event like the one you're describing. And what could we really gain from a collapse of the site we just spent 3 years building?

PucaTrade is a labor of love. We want nothing more than to watch it grow, flourish, and support the vibrant community of online Magic Traders. No one's trying to pocket your Kird Apes and bounce.

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I am sorry, but this sounds like con artist talk to me. No one cares how long you spent making this website, or how much you love your site. The question I want to know is, what is stopping you from giving yourself or your buddy an extra 10,000 in points? That is $100 worth of cards we are talking about, and the value is not significant enough to collapse the system, but someone will be out $100 worth of cards to fund your "free" 10,000 points.

I am also interested to know if you have any other means to increase the amount of points in circulation, other than through donation? Correct me if I am wrong, but base on reading your site's FAQ, the only way that any points would enter the circulation is through donation only. If the site has 50,000 points in circulation, you get $500 in your pocket.

edit:
If you are serious about your site, you should drop the $10 donation = 1000 points gimmick, and find a new way to put points into circulation.

It is fine to take in donation, but if you provide credits/points in exchange for donation, it becomes a scheme.

edit 2:
To anyone who has any basic accounting knowledge, just draw up a T account regarding to the donation transaction, and you will realize why I said the whole equation will not balance, unless a 3rd party takes a loss.
__________________
MOTL Fantasy NBA 2010 Champion

Keep in mind that this is still in beta. The process has to evolve from something small. The bigger and bigger it gets the easier and more efficient the process will get. I personally hope it grows quickly and successfully.

As far as the donation issue, most sites have some sort of donation system in place. People that run sites like this don't just get money out of thin air to keep things running. Donations are given freely, if you don't want to donate then don't, leave that to people that want to see the site succeed.

As far as unbalancing the system by issuing points unfairly, that would be unwise for the creator. I doubt he would want to sabotage the integrity of the system by being unfair to the community. The community is what will keep the ball rolling.

I personally have almost 900 rares sitting in a binder that never go anywhere. Most traders won't trade 100 cheap rares for one expensive rare... and that is why my binder is overpopulated. However, with this process I can send send several people several cards and end up with enough credit to receive a more expensive card. No website is perfect but I like this idea and the process has been used successfully in other markets, I personally can see why.

Here is the thread on reddit if anyone is interested.
http://www.reddit.com/r/magicTCG/comments/tcs8f/i_really_hope_this_website_takes_off_check_out/

But also, if everyone starts with no points and nobody ever donates money, how does anyone ever make deals happen?

__________________
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(My 2008 Nationals)

The idea is great. But the seller is wrong. You should have the option to propose buying points FROM ANOTHER USER. And I feel like the best way to do that is to put them at a bit of a premium. You send out a 10 dollar card you get 1000 points from them. Maybe they can trade in 1000 points to the bank (where they simply vanish) which gives them a cash-out token that costs 9 dollars and is worth 900 points. That way when you're -done- with the site, you can "cash out" at 90% of the value you put in, but the buyers are still breaking even on their purchase.

The only way points can get into the system is by cash, but you can't cash out. That dosen't sound so fair...

If this site wants to survive you have to be able to cash out or it is pointless.

This is a ponzi scheme at its finest.

An investment scheme where the actor solicits investors in a business venture, promising extremely high financial returns or dividends in a very short period of time. The actor never invests the money, however, does pay dividends. The dividends consist of the newest investors funds. The first investors, pleased to receive dividends, encourage new investors to invest. This scheme falls apart when the actor no longer has sufficient new investors to distribute dividends to the old investors or the actor simply takes all the funds and leaves the area.

By getting points you are actually investing in this site. If the owner kills the site you are left high and dry while he walks away with the money. The more points that are in circulation the more chance the owner could "cash out" so to speak.

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Originally posted by AGO:
Why not just change the points system to just cash? This is just a crappy version of Magic Card Market without the shipping added in. It is very easy to get ripped by this since you have to spend money or send cards to get points.

The only way points can get into the system is by cash, but you can't cash out. That dosen't sound so fair...

If this site wants to survive you have to be able to cash out or it is pointless.

This is a ponzi scheme at its finest.

An investment scheme where the actor solicits investors in a business venture, promising extremely high financial returns or dividends in a very short period of time. The actor never invests the money, however, does pay dividends. The dividends consist of the newest investors funds. The first investors, pleased to receive dividends, encourage new investors to invest. This scheme falls apart when the actor no longer has sufficient new investors to distribute dividends to the old investors or the actor simply takes all the funds and leaves the area.

By getting points you are actually investing in this site. If the owner kills the site you are left high and dry while he walks away with the money. The more points that are in circulation the more chance the owner could "cash out" so to speak.

Caveat emptor....

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Originally posted by Kyosukee:
Wait, are you saying that older users who don't use their points will end up losing a portion of those due to degeneration?

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Bear in mind I don't work for, with or in connection to this guy. What I meant was that if someone is sitting on a bunch of crap so as to avoid sending out, people will choose to not give them cards. Also, in talking with the guy who runs the place, I've suggested and he likes the idea of requiring a ratio of points sent:received to be maintained in order to be able to receive cards.

So if someone -does- send out a bunch of stuff and then scale back their list, to sit on one expensive want, good for them. They sent out an equal value of cards and so are fine to receive such a card, but if they are deliberately trying to come out numerically ahead, people will just see what they're doing and choose to not give them things. It's like the people who don't give their WoW gold to the 1 copper undercutters.

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The only way points can get into the system is by cash, but you can't cash out. That dosen't sound so fair...

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He added the ability to buy points for cash at user request, and has been receptive to suggestions of alternate ways to get baseline credits into the system, and not supporting selling credits for money.

There've also been some pretty fair ways to allow cashouts suggested in this thread, and I expect he'll be pretty receptive to thinking about those too.