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 Frazzled wrote:

 gossipmeng wrote:
You basically log into a server with a team of other "miners" like yourself. You then wait until your computer or one of your team mates randomly finds a block of bit coins (25 coins in a block I think). Your computers then try cracking a long code (string of numbers).

When the code is cracked you can deposit those 25 coins into your online bitcoin wallet (a bank account type thing you setup). If you worked within a team, then you split the coins however it was determined would be done. The creators of bitcoin make the code increasingly hard to crack every once in a while so that bitcoins stay somewhat rare despite computers getting faster - maintaining the difficulty of mining bitcoin.

It isn't very profitable to mine coins these days as there is so much competition - you will get like 0.01 bit coin per day if you have a good machine going 24/7 (due to 100s of miners working together to split the 25 coins). It also isn't viable to solo mine as you could go weeks or months without finding a block of coins to attempt to mine. In most cases the energy cost to run the computer is higher than the value of the coins you mine.

So its more elaborate computer game and not regulated currency. Thats awesomely stupid.

Basically, you just chain together some computer tweaked with the right hardware, turn them on and walk away. People then purchase the coins on online exchanges similar to stock exchanges. The coin's value is extremely volatile and always has been with massive jumps and drops of 100's of dollars per coin. There isn't anything to anchor the value to - thats the problem. There isn't any reason for 1 coin to be worth $600 (or whatever it's exact value is). It's all based on the current popularity and speculation that reputable companies/services will recognize it as a payment option.

Edit: Just checked - Bitcoin's current value is $550 USD (only 3 weeks ago it was around $850 USD per coin) hehe.

 Frazzled wrote:

 gossipmeng wrote:
You basically log into a server with a team of other "miners" like yourself. You then wait until your computer or one of your team mates randomly finds a block of bit coins (25 coins in a block I think). Your computers then try cracking a long code (string of numbers).

When the code is cracked you can deposit those 25 coins into your online bitcoin wallet (a bank account type thing you setup). If you worked within a team, then you split the coins however it was determined would be done. The creators of bitcoin make the code increasingly hard to crack every once in a while so that bitcoins stay somewhat rare despite computers getting faster - maintaining the difficulty of mining bitcoin.

It isn't very profitable to mine coins these days as there is so much competition - you will get like 0.01 bit coin per day if you have a good machine going 24/7 (due to 100s of miners working together to split the 25 coins). It also isn't viable to solo mine as you could go weeks or months without finding a block of coins to attempt to mine. In most cases the energy cost to run the computer is higher than the value of the coins you mine.

So its more elaborate computer game and not regulated currency. Thats awesomely stupid.

My thoughts exactly. It's exchanging the coins you get from Farmville for USD.

 KamikazeCanuck wrote:

 Frazzled wrote:

 gossipmeng wrote:
You basically log into a server with a team of other "miners" like yourself. You then wait until your computer or one of your team mates randomly finds a block of bit coins (25 coins in a block I think). Your computers then try cracking a long code (string of numbers).

When the code is cracked you can deposit those 25 coins into your online bitcoin wallet (a bank account type thing you setup). If you worked within a team, then you split the coins however it was determined would be done. The creators of bitcoin make the code increasingly hard to crack every once in a while so that bitcoins stay somewhat rare despite computers getting faster - maintaining the difficulty of mining bitcoin.

It isn't very profitable to mine coins these days as there is so much competition - you will get like 0.01 bit coin per day if you have a good machine going 24/7 (due to 100s of miners working together to split the 25 coins). It also isn't viable to solo mine as you could go weeks or months without finding a block of coins to attempt to mine. In most cases the energy cost to run the computer is higher than the value of the coins you mine.

So its more elaborate computer game and not regulated currency. Thats awesomely stupid.

My thoughts exactly. It's exchanging the coins you get from Farmville for USD.

Or a Tesla, as one guy did

It's a novel idea, as speculative a way as any other to invest some money in that you don't mind possibly loosing, and no guarantee for anything.

 Frazzled wrote:


So its more elaborate computer game and not regulated currency. Thats awesomely stupid.

It's really more elaborate computer work than a game. Game implies some level of entertainment or interactivity. This is closer to some kind of SETI or Folding@Home project that, instead of making the world a better place, you're making gray market money that is worth a lot to someone, somewhere, maybe. It is certainly not regulated currency.

I've been thinking about mining some myself. I'd kind of love to have some to exchange to USD next time it goes up. I am not the sucker who would ever convert USD into BTC however.


Automatically Appended Next Post:
Bitcoin is also great because without it, we'd never have the gak /r/bitcoin says twitter feed, which could basically be a facepalm generator.


Automatically Appended Next Post:
Like this one:

Money is now free from state control. The whole industry is about to be shaken to its knees. The current elites don't stand a chance.

Ahhh. Oh god, it's like a drug.

Bitcoin is essentially a credit bubble with nothing to back it. Basically the only reason to buy Bitcoin is the hope of selling in on to someone else at a higher price before they catch on.

I looked into it after a friend of mine mentioned mining them, and quickly saw that it's pants on head slowed.

It's the ultimate fiat currency!

For the first time in history, taxation and inflation aren't just wrong in the ethical sense, but [mathematically] wrong.

Teehee.

 daedalus wrote:

For the first time in history, taxation and inflation aren't just wrong in the ethical sense, but [mathematically] wrong.

Teehee.

ermghad... I need to check that out.

 whembly wrote:
It's the ultimate fiat currency!

And if purely electronic money was embraced as the ultimate fiat currency, it would be an improvement. All the advantages of modern currency, without any of the costs of maintaining physical notes.

Instead it's been latched on to by the goldbugs, the people who think fiat currency is a conspiracy, and other nutters. Unable to understand that any currency is just a means to an end, they instead fixate on wanting a currency that increases in value over time. And so they end up with just another currency that works like a gold backed currency - long term increase in value (and all the problems that come with people choosing to sit on the money rather than circulate it), and they don't even get the (small) advantage of gold having some level of inherent worth.


Automatically Appended Next Post:

 n0t_u wrote:
And the idea is alright, a unified global currency is something we could potentially go to. But obviously not for quite a long while.

International finance is sophisticated enough that most of the major economic costs of multiple currencies can be negated for a fairly small price. At the individual level it costs a lot still, but the added cost to people's holidays is pretty minor in the scheme of things.

If anything, the last few years have taught us that what we need are more currencies, not less. As long as different nations have different economic circumstances, then it is best for them to have their own currency so they can set their own monetary policy. The EU model where large economies set monetary policy according to their own needs, and the small economies just have to accept it is not a good thing.

 gossipmeng wrote:

 Frazzled wrote:

 gossipmeng wrote:
You basically log into a server with a team of other "miners" like yourself. You then wait until your computer or one of your team mates randomly finds a block of bit coins (25 coins in a block I think). Your computers then try cracking a long code (string of numbers).

When the code is cracked you can deposit those 25 coins into your online bitcoin wallet (a bank account type thing you setup). If you worked within a team, then you split the coins however it was determined would be done. The creators of bitcoin make the code increasingly hard to crack every once in a while so that bitcoins stay somewhat rare despite computers getting faster - maintaining the difficulty of mining bitcoin.

It isn't very profitable to mine coins these days as there is so much competition - you will get like 0.01 bit coin per day if you have a good machine going 24/7 (due to 100s of miners working together to split the 25 coins). It also isn't viable to solo mine as you could go weeks or months without finding a block of coins to attempt to mine. In most cases the energy cost to run the computer is higher than the value of the coins you mine.

So its more elaborate computer game and not regulated currency. Thats awesomely stupid.

Basically, you just chain together some computer tweaked with the right hardware, turn them on and walk away. People then purchase the coins on online exchanges similar to stock exchanges. The coin's value is extremely volatile and always has been with massive jumps and drops of 100's of dollars per coin. There isn't anything to anchor the value to - thats the problem. There isn't any reason for 1 coin to be worth $600 (or whatever it's exact value is). It's all based on the current popularity and speculation that reputable companies/services will recognize it as a payment option.

Edit: Just checked - Bitcoin's current value is $550 USD (only 3 weeks ago it was around $850 USD per coin) hehe.

I trie to see if forgeworld would accept my Bitcoins... They told me to shove it where the sun dont shine..

The BBC wrote: ...another Bitcoin bank - Flexcoin - has announced that it too is going out of business, following a hack attack which saw 896 coins stolen.

In the last episode of Almost Human someone gives a homeless man bitcoin. In the future there is only bitcoin!

This article does a really good job of explaining what's going on with bitcoin. The issue isn't really with the tech, which is interesting and potentially useful (though the article points out the number of non-state currencies in existance, which I hadn't thought of before)... the issue is with the crazy that surrounds bitcoin. The true-believers and crusaders who get confused about how money works and conclude it's all a conspiracy, and think bitcoin is the answer to that. Ultimately, if you want to 'fix' money, you first have to understand what it really is, and why we've built the institutions we have to facilitate money. The bitcoiners have no idea about that stuff, so they charging off with bitcoins thinking that a limited currency with wildly fluctuating value is what the world's been waiting for.

http://harvardpress.typepad.com/hup_publicity/2014/02/bitcoin-the-cryptopolitics-of-cryptocurrencies-david-golumbia.html

 lord_blackfang wrote:
Bitcoin is essentially a credit bubble with nothing to back it. Basically the only reason to buy Bitcoin is the hope of selling in on to someone else at a higher price before they catch on.

Or you buy Bitcoins to spend Bitcoins, just like the main reason to "buy" $50 notes (in exchange for the virtual currency in your bank account) is to spend $50 notes.

Am I the only one who dislikes the way Mike (or is it Jerry?) from Penny Arcade draws the characters these days? His style has changed so much over the years.

 Frazzled wrote:

 gossipmeng wrote:
You basically log into a server with a team of other "miners" like yourself. You then wait until your computer or one of your team mates randomly finds a block of bit coins (25 coins in a block I think). Your computers then try cracking a long code (string of numbers).

When the code is cracked you can deposit those 25 coins into your online bitcoin wallet (a bank account type thing you setup). If you worked within a team, then you split the coins however it was determined would be done. The creators of bitcoin make the code increasingly hard to crack every once in a while so that bitcoins stay somewhat rare despite computers getting faster - maintaining the difficulty of mining bitcoin.

It isn't very profitable to mine coins these days as there is so much competition - you will get like 0.01 bit coin per day if you have a good machine going 24/7 (due to 100s of miners working together to split the 25 coins). It also isn't viable to solo mine as you could go weeks or months without finding a block of coins to attempt to mine. In most cases the energy cost to run the computer is higher than the value of the coins you mine.

So its more elaborate computer game and not regulated currency. Thats awesomely stupid.

That's it. It's probably some self-aware malignant AI exploiting our weaknesses in order to secure processing power for itself

 Breotan wrote:
Am I the only one who dislikes the way Mike (or is it Jerry?) from Penny Arcade draws the characters these days? His style has changed so much over the years.

No, I agree with you.

 gossipmeng wrote:

Edit: Just checked - Bitcoin's current value is $550 USD (only 3 weeks ago it was around $850 USD per coin) hehe.

Which still doesn't mean much of anything - a year or so back during one of the big price drops, I looked into bitcoin speculation as an easy way to make some money. The effort, and sheer WTFness of taking dollars, turning them into bit coins, and then successfully turning them back into dollars when the price was in my favor made me write the whole endeavor off.

 Co'tor Shas wrote:

 Breotan wrote:
Am I the only one who dislikes the way Mike (or is it Jerry?) from Penny Arcade draws the characters these days? His style has changed so much over the years.

No, I agree with you.

Bitcoin is even more of a pyramid scheme then normal fiats...

and that is saying something...

literally, there is 0 difference between running an algorithm to mine bitcoins, and actively playing WOW to farm gold for $...

only the return on investment is different, both are just using computer code to enforce a relative scarcity on what is otherwise an infinite supply of data(coins).


someone commented that bitcoin owes its success to gold bugs... which is ludicrous, the people who like gold like it for the qualities that make it completely anathema to things like bitcoin or fiats...

bitcoins surge was driven 100% by the "easy money that jumps on the band wagon" and by the illegal drug/market trade via silk road, and the (silk road by a different name) type exchanges that keep popping up.

Honestly, farming WoW for gold is probably more profitable

I've heard that WoW gold trades at higher rates than some real world currencies anyway. It is bought and sold like any other commodity.

 LordofHats wrote:
Honestly, farming WoW for gold is probably more profitable

its definitely more FUN!


less computing power used too!


I can see it now

"MR PRESIDENT! the economy is collapsing, no one has a job! we are totally screwed!"

POTUS: "get everyone to aseroth and farm the crap out of the lich kings lair! weez needz moar purples"

and thus the world economy was saved by naked dancing elf bots

 easysauce wrote:


literally, there is 0 difference between running an algorithm to mine bitcoins, and actively playing WOW to farm gold for $...

only the return on investment is different, both are just using computer code to enforce a relative scarcity on what is otherwise an infinite supply of data(coins).

There is a finite (albeit large) number of bitcoins available. Also, Bitcoin mining doesn't require one to actively be working on anything. You start an application that does the mining, and then you walk away. Actively playing WOW to farm gold for money requires, well, actively playing WOW.

I suppose other than those two differences, yes, it's similar. Kind of.

WOW gold, is limited in the same sense that bitcoins are limited... if not more so..

What makes wow gold MORE valuble.. you need human man hours to get it (or bots, so again no real work, just processing power)

the only thing "limiting" the # of bitcoins is (processing power devoted to it+ cost of electricity) x time = bitcoins, and trust that it hasnt already been hacked (it has) to create bitcoins or to steal them (it has).

add to the mix the large black market section of online currency exchanges with silk road and its clones, and you start to see how it might not be the best "investment".

Bitocoin does do a very good job of being an anonymous means of exchange,for those that need to be anonymous to deal with silkroad or just to hide their money or whatever. And it is electronic so doesn't suffer the draw backs of cash, or valuables such as art/gold/jewerly/ect,

but it wont hold value in the way that valuables such as art/gold/jewelery/ect, hold value.

and bitcoins have a tendency to magically "disappear"

CEO of a Bitcoin exchange died in Singapore of mysterious circumstances.

Yeah, he had so much tied up in Bitcoins he died penniless.

 easysauce wrote:

the only thing "limiting" the # of bitcoins is (processing power devoted to it+ cost of electricity) x time = bitcoins, and trust that it hasnt already been hacked (it has) to create bitcoins or to steal them (it has).

You do your argument more harm than good with poor information:

http://bitcoin.stackexchange.com/questions/161/how-many-bitcoins-will-there-eventually-be
Every block introduces 50 new coins in the system. This quantity (50) halves every 210,000 blocks. So, getting the limit of coins it is possible to generate is quite easy : it's the sum of a geometric series.

Also, note that this is an upper bound ; the actual quantity will probably be a bit lower due to rounding issues (BTC has a finite number of decimals, 8).

The interesting thing is what that will do for the "bitcoin economy" when the max number of coins have been defined, and coins begin to become lost.

add to the mix the large black market section of online currency exchanges with silk road and its clones, and you start to see how it might not be the best "investment".

Or it's a fantastic investment, depending on your goals.

Bitocoin does do a very good job of being an anonymous means of exchange,for those that need to be anonymous to deal with silkroad or just to hide their money or whatever. And it is electronic so doesn't suffer the draw backs of cash, or valuables such as art/gold/jewerly/ect,

but it wont hold value in the way that valuables such as art/gold/jewelery/ect, hold value.

and bitcoins have a tendency to magically "disappear"

What's been happening at the exchanges is interesting. From everything I know about cryptology and what I've heard experts in the matter say, it's not an issue with the protocol, it's an issue with what happens when you let bozos with no idea of how to implement security run a "bank".

 Frazzled wrote:
CEO of a Bitcoin exchange died in Singapore of mysterious circumstances.

Yeah, I just saw a very short article about that. Apparently, she died in late February and we're just now hearing about it. Considering one Bitcoin "bank" just went under not too long ago, the subsequent death of the CEO under "mysterious circumstances" has "potential Hollywood movie" written all over it.