IDEAS home Printed from https://ideas.repec.org/a/blg/msudev/v16y2024i1p37-44n4.html
   My bibliography  Save this article

A New Approach To Create Sustained Ponzi-Like Systems By Incorporating Perpetual Liquidity And Time Epochs

Author

Listed:
  • DUGULEANĂ Andreea Raluca

    (Lucian Blaga University of Sibiu, Romania)

  • TĂNĂSESCU Cristina Roxana

    (Lucian Blaga University of Sibiu, Romania)

  • DUGULEANĂ Mihai

    (Transilvania University of Brasov, Faculty of Mechanical Engineering, Brasov, Romania)

Abstract

This paper leverages the transformative capabilities of blockchain technology to introduce a new approach to developing Ponzi-like systems by integrating perpetual liquidity and time epochs within immutable smart contracts. Blockchain’s transparent nature establishes a foundation for trust in the ecosystem. Departing from the unsustainable nature and inevitable collapse associated with traditional Ponzi schemes, the proposed framework ensures continuous token availability, mitigating supply depletion and thus minimizing system failure risk. The introduction of time epochs is a key feature that enhances the sustainability of our system. It enables continuous rebalancing, predictability, and transparency within the system. Through predetermined intervals, users can claim a percentage of tokens from previous epochs, ensuring a fair distribution mechanism and preventing stagnation. This predictable cycle fosters the user’s confidence in the longevity of the protocol. The mechanics of the proposed system are designed to incentivize rational behaviour and trust among participants. Users are motivated to contribute to the ecosystem, knowing that their efforts will be reciprocated with proportional rewards. We design, implement and present the new model as a paradigm shift in Ponzi-like structures. Through a multidisciplinary lens encompassing economics, game theory, and sustainable development, this research aims towards fostering long-term viability and ethical financial practices.

Suggested Citation

  • DUGULEANĂ Andreea Raluca & TĂNĂSESCU Cristina Roxana & DUGULEANĂ Mihai, 2024. "A New Approach To Create Sustained Ponzi-Like Systems By Incorporating Perpetual Liquidity And Time Epochs," Management of Sustainable Development, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 16(1), pages 37-44, June.
    • Handle: RePEc:blg:msudev:v:16:y:2024:i:1:p:37-44:n:4
    DOI: https://doi.org/10.54989/msd-2024-0004
    as

    Download full text from publisher

    File URL: https://msdjournal.org/wp-content/uploads/vol16issue1-4.pdf
    Download Restriction: no
    File URL: https://libkey.io/https://doi.org/10.54989/msd-2024-0004?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Keith Blois & Annmarie Ryan, 2013. "Affinity fraud and trust within financial markets," Journal of Financial Crime, Emerald Group Publishing Limited, vol. 20(2), pages 186-202, May.
    2. Jiahua Xu & Krzysztof Paruch & Simon Cousaert & Yebo Feng, 2021. "SoK: Decentralized Exchanges (DEX) with Automated Market Maker (AMM) Protocols," Papers 2103.12732, arXiv.org, revised Mar 2023.
    3. Stacie Bosley & Maggie Knorr, 2018. "Pyramids, Ponzis and fraud prevention: lessons from a case study," Journal of Financial Crime, Emerald Group Publishing Limited, vol. 25(1), pages 81-94, January.
    4. Paul Manning, 2018. "Madoff’s Ponzi investment fraud: a social capital analysis," Journal of Financial Crime, Emerald Group Publishing Limited, vol. 25(2), pages 320-336, May.
    5. Catherine Carey & John K. Webb, 2017. "Ponzi schemes and the roles of trust creation and maintenance," Journal of Financial Crime, Emerald Group Publishing Limited, vol. 24(4), pages 589-600, October.
    6. Bhattacharya, Utpal, 2003. "The optimal design of Ponzi schemes in finite economies," Journal of Financial Intermediation, Elsevier, vol. 12(1), pages 2-24, January.
    7. Frankel, Tamar, 2012. "The Ponzi Scheme Puzzle: A History and Analysis of Con Artists and Victims," OUP Catalogue, Oxford University Press, number 9780199926619, December.
    8. Vasant Raval & Vivek Raval, 2019. "Differentiating risk factors of Ponzi from non-Ponzi frauds," Journal of Financial Crime, Emerald Group Publishing Limited, vol. 26(4), pages 993-1005, October.
    9. Artzrouni, Marc, 2009. "The mathematics of Ponzi schemes," Mathematical Social Sciences, Elsevier, vol. 58(2), pages 190-201, September.
    10. Forslid, Rikard, 1998. "External Debt and Ponzi-Games in a Small Open Economy with Endogenous Growth," Journal of Macroeconomics, Elsevier, vol. 20(2), pages 341-349, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mário Cunha & Hélder Valente & Paulo B. Vasconcelos, 2013. "Ponzi schemes: computer simulation," OBEGEF Working Papers 023, OBEGEF - Observatório de Economia e Gestão de Fraude;OBEGEF Working Papers on Fraud and Corruption.
    2. Artzrouni, Marc, 2009. "The mathematics of Ponzi schemes," Mathematical Social Sciences, Elsevier, vol. 58(2), pages 190-201, September.
    3. Hofstetter, Marc & Mejía, Daniel & Rosas, José Nicolás & Urrutia, Miguel, 2018. "Ponzi schemes and the financial sector: DMG and DRFE in Colombia," Journal of Banking & Finance, Elsevier, vol. 96(C), pages 18-33.
    4. Sara Cerasoli & Amilcare Porporato, 2023. "Optimal Resource Allocation for Carbon Mitigation," Sustainability, MDPI, vol. 15(13), pages 1-22, June.
    5. Klarita Sadiraj & Arthur Schram, 2018. "Inside information in Ponzi schemes," Journal of the Economic Science Association, Springer;Economic Science Association, vol. 4(1), pages 29-45, July.
    6. Yu Zhang & Tao Yan & Jianhong Lin & Benjamin Kraner & Claudio Tessone, 2024. "An Improved Algorithm to Identify More Arbitrage Opportunities on Decentralized Exchanges," Papers 2406.16573, arXiv.org.
    7. Ajithakumari Vijayappan Nair Biju & Ann Susan Thomas, 2023. "Uncertainties and ambivalence in the crypto market: an urgent need for a regional crypto regulation," SN Business & Economics, Springer, vol. 3(8), pages 1-21, August.
    8. Raphael Auer & Bernhard Haslhofer & Stefan Kitzler & Pietro Saggese & Friedhelm Victor, 2024. "The technology of decentralized finance (DeFi)," Digital Finance, Springer, vol. 6(1), pages 55-95, March.
    9. Leung, Hing-Man, 2000. "Trade and growth: a theoretical exploration into foreign debts by NICs," Economic Modelling, Elsevier, vol. 17(1), pages 35-47, January.
    10. Kenan Wood & Maurice Herlihy & Hammurabi Mendes & Jonad Pulaj, 2024. "Expiring Assets in Automated Market Makers," Papers 2401.04289, arXiv.org.
    11. Giannetti, Mariassunta, 2007. "Financial liberalization and banking crises: The role of capital inflows and lack of transparency," Journal of Financial Intermediation, Elsevier, vol. 16(1), pages 32-63, January.
    12. Lilia Quituisaca-Samaniego & Juan Mayorga-Zambrano & Paúl Medina, 2013. "Simulación estocástica de esquemas piramidales tipo Ponzi," Analítika, Analítika - Revista de Análisis Estadístico/Journal of Statistical Analysis, vol. 6(2), pages 51-66, Diciembre.
    13. Phuong Duy Huynh & Son Hoang Dau & Xiaodong Li & Phuc Luong & Emanuele Viterbo, 2023. "Improving the Accuracy of Transaction-Based Ponzi Detection on Ethereum," Papers 2308.16391, arXiv.org, revised Jul 2024.
    14. Zhu, Anding & Fu, Peihua & Zhang, Qinghe & Chen, Zhenyue, 2017. "Ponzi scheme diffusion in complex networks," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 479(C), pages 128-136.
    15. Sareh Pouryousefi & Jeff Frooman, 2019. "The Consumer Scam: An Agency-Theoretic Approach," Journal of Business Ethics, Springer, vol. 154(1), pages 1-12, January.
    16. Kensuke Ito, 2024. "Cryptoeconomics and Tokenomics as Economics: A Survey with Opinions," Papers 2407.15715, arXiv.org.
    17. Jiahua Xu & Yebo Feng, 2022. "Reap the Harvest on Blockchain: A Survey of Yield Farming Protocols," Papers 2210.04194, arXiv.org, revised Dec 2022.
    18. Shan Yang & Kaijun Su & Bing Wang & Zitong Xu, 2022. "A Coupled Mathematical Model of the Dissemination Route of Short-Term Fund-Raising Fraud," Mathematics, MDPI, vol. 10(10), pages 1-23, May.
    19. Hosain, Md Sajjad, 2018. "Bitcoin: Future transaction currency?," MPRA Paper 87588, University Library of Munich, Germany.
    20. Daniel Kirste & Niclas Kannengie{ss}er & Ricky Lamberty & Ali Sunyaev, 2023. "How Automated Market Makers Approach the Thin Market Problem in Cryptoeconomic Systems," Papers 2309.12818, arXiv.org, revised Sep 2023.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:blg:msudev:v:16:y:2024:i:1:p:37-44:n:4. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Camelia Oprean-Stan (email available below). General contact details of provider: https://edirc.repec.org/data/feulbro.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.