Regarding whether this is a ponzi scheme the correct answer is no.

Please read http://www.investopedia.com/ask/answers/09/ponzi-vs-pyramid.asp for further details.

This is not a ponzi because a ponzi scheme deceives the investor by not disclosing the pyramidal structure underlying the return of profits. The game is clearly based on a pyramidal structure therefore there is no deception. Pyramid scheme is a better comparison as the emphasis is on the player to recruit (i.e. try and sell the Spud), however the proper description would be that bitSpud is a gambling game based upon a pyramidal structure. There is no guarantee of return but these are characteristics of both gambling and pyramid schemes. Also ponzis and pyramid schemes do not offer consolations. We offer 50% consolations which is by far higher than any of our competitors.

We hope this has helped to clarify the game.

Best Wishes

the bitSpud support team