[Bitcoin] question

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CodeMaster
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[Bitcoin] question

Post by CodeMaster »

Locked: See this post by the site owner: New Forum Policy Prohibiting Discussions of Cryptocurrency, Market Manipulation Schemes, etc as Investing Strategies

Hi, is it ok I ask a little bit about cryto currency?
I know bitcoin a bit more, its about $4500 right now per coin. But I see so many other currencies coming out.
~I was wondering, how do these currencies get created? i.e. how many bitcoins are there and who created it and why cant he created a million more?
~Also how come the other currencies are at all trustworthy? Did someone just go and make it up?
~Sorry for my rookie questions, truly appreciate any advice

:sharebeer
bta15
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Re: Bit Coin question

Post by bta15 »

-How the currencies created? They are the brainchild of some tech nerd

-How many bitcoins are there and why can't they create more? Bitcoins are mined through computer algorithms. You set up a high end computer and it works away at a complex problem, after so much effort it is awarded a bitcoin. The more machines that "mine" the fewer bitcoins that are awarded. At some point the cost of electricity to run the computers outweighs the benefits of getting a coin. So the creator can't just release millions more.

-How are new currencies at all trustworthy/did someone just make them up? Only time will tell if they are at all trustworthy and yes someone just made them up.
Topic Author
CodeMaster
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Re: Bit Coin question

Post by CodeMaster »

CodeMaster wrote: Tue Aug 29, 2017 11:15 am Hi, is it ok I ask a little bit about cryto currency?
I know bitcoin a bit more, its about $4500 right now per coin. But I see so many other currencies coming out.
~I was wondering, how do these currencies get created? i.e. how many bitcoins are there and who created it and why cant he created a million more?
~Also how come the other currencies are at all trustworthy? Did someone just go and make it up?
~Sorry for my rookie questions, truly appreciate any advice

:sharebeer
LOL WOW... those are some crazy answers and crazy people investing in FILES people can just MAKE UP.

So regarding the bitcoin made from complex problem... is it bascially a file with some kind of encrytpion on it that is very complicated and then some bitcoin app out there verifies this is a correctly encrypted file and validates it as a authentic coin? Im guessing the encryption is so complicated that it takes super computers forever to compile?

I dont understand why tons more cant be made... does the algorithm somehow get more complicated on purpose by building on each other somehow?
barnaclebob
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Re: Bit Coin question

Post by barnaclebob »

CodeMaster wrote: Tue Aug 29, 2017 11:44 am
LOL WOW... those are some crazy answers and crazy people investing in FILES people can just MAKE UP.
[/quote]

No crazier than investing in some paper with a picture and some numbers printed on it.
hicabob
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Re: Bit Coin question

Post by hicabob »

Using the public domain ethereum toolset you too can make your own cryptocurrency.
https://www.ethereum.org/token
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Pajamas
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Re: Bit Coin question

Post by Pajamas »

Most currencies, like the U.S. dollar or the Mexican peso, are backed by law and the issuing government's power of taxation and depends on the users' faith in it and willingness to accept it.

https://en.wikipedia.org/wiki/Fiat_money

Bitcoin is a cryptocurrency. ("Crypto" means "hidden.) They depend only on the users' faith and willingness. I think increasing government regulation of cryptocurrencies is inevitable, to the degree that it can be regulated.
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CodeMaster
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Re: Bit Coin question

Post by CodeMaster »

barnaclebob wrote: Tue Aug 29, 2017 11:56 am
CodeMaster wrote: Tue Aug 29, 2017 11:44 am
LOL WOW... those are some crazy answers and crazy people investing in FILES people can just MAKE UP.
No crazier than investing in some paper with a picture and some numbers printed on it.
[/quote]

LOLL SO TRUE
agottem
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Re: Bit Coin question

Post by agottem »

The above answer isn't quite correct. I'm rather well versed with bitcoin so allow me to try and clarify:

1. Bitcoin is a ledger of transactions. This ledger is composed of blocks, where a block contains a log of transactions. Something like: Peter sends Paul 1 bitcoin. Paul sends Jane 0.5 btc. etc.

2. In order to add a block to the ledger you must solve a complex math problem. This is called the proof of work and is what makes the ledger immutable.

3. Miners will fill out a block with a list of transactions and then attempt to solve the math problem. The first miner to solve the problem wins and their block is added to the blockchain. The miner then receives a reward (named the 'coinbase') for the block he mined.

4. The coinbase is defined by the bitcoin software to halve every X years. The first bitcoin came into existence by mining the first block -- this is the genesis block. The genesis block had 0 transactions (how could there be any? There were no bitcoin yet!) but had a coinbase of 50 btc.

5. As the coinbase continues to half the total supply of bitcoins will stop increasing. There will never be more than 21million bitcoin.

6. Once the coinbase reaches 0, you might wonder why miners continue to mine. In actuality, a transaction contains 2 outputs -- who you're sending to and a fee to be paid to the miner. A more realistic transaction is: Peter sends paul 0.9 btc and pays 0.1 btc to whichever miner includes his transaction in their mined block.

7. If you pay a higher transaction fee your transaction will likely be included in the blockchain faster than a smaller transaction fee. Hence, the hope is that when the mining reward goes to 0 the bitcoin ecosystem will be robust enough that transaction fees will be enough of an incentive to mine.

8. Miners are kept honest be bitcoin nodes. Nodes verify all the blocks mined by miners follow the rules. If a block is encoded incorrectly (e.g., a miner attempts to claim a coinbase that would result in more than 21million btc) the nodes would reject the block and it would not be included in the ledger.

9. Anyone can run a bitcoin node -- it is very cheap. The bitcoin software is 100% open source. It is recommended that any merchant transacting in bitcoin run their own node so they can verify the blockchain is following the rules themselves.


Bitcoin is the first currency that is trustless and decentralized. In my opinion it's gong to be huge. There's such an enormous amount of trust placed in central banks and eventually people are going to realize their trust was misplaced. Bitcoin provides instant transactions anywhere in the world. It provides a store of value (supply is known, no one can manipulate it). It provides a unit of account. The network is 100% open.

People like to point out the volatility of bitcoin...but what exactly do you expect in a currency that's bootstrapping itself from nothing? Bitcoin is incredibly undervalued at the moment. It's a huge investment opportunity for anyone who is concerned about the recent actions of central banks around the world.

Time will prove me correct.
Topic Author
CodeMaster
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Re: Bit Coin question

Post by CodeMaster »

So why do more and more banks and merchants start to adopt bit coins? Is the algorithm to create one so bullet proof from being hacked that banks and entire governments are willing to adopt it?

Would this be comparable to trusting the dollar from being remade faked I guess?
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buccimane
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Re: Bit Coin question

Post by buccimane »

CodeMaster wrote: Tue Aug 29, 2017 11:15 am i.e. how many bitcoins are there and who created it and why cant he created a million more?
There are 21 million bitcoins available. As each coin is mined, the next one becomes harder to mine. As far as the world knows, there is no "he". The coder(s) who created Bitcoin and has yet to reveal him or herself.
Last edited by buccimane on Tue Aug 29, 2017 12:21 pm, edited 1 time in total.
A man convinced against his will is of the same opinion still
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Pajamas
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Re: Bit Coin question

Post by Pajamas »

Banks are mostly just using the technology behind cryptocurrencies to ensure secure transactions, not adopting cryptocurrencies.

I have never seen a business that accepts cryptocurrencies in person, only read about them on the internet. When something is new it can grow at astounding rates. In a way it is no different from accepting a foreign currency that can be converted into the business's primary currency at an ever-changing rate.
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CodeMaster
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Re: Bit Coin question

Post by CodeMaster »

Would you say investing in bitcoins is about as risky as investing in the dollar? Given the dollar can be faked / replicated as well, it just depends on faith on the world adopting it or not?
Cycle
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Re: Bit Coin question

Post by Cycle »

I remember hearing about bitcoin on Planet Money when it was worth less than a dollar per bitcoin. There are 16.5 million bitcoin around today. The algorithm will peak at 21 million at which point no more can be mined. It's not very cost effective to mine the coin unless you are generating it very cheaply, like through hydro or solar. There is a 2% annual fee from most brokers to have them hold your bitcoins. The US dollar has inflation every year, 3.22% long term average.

Similar to stocks, the owners can vote to split the bitcoin, which recently happened with Bitcoin and Bitcoin Cash.

If you wanted to diversify your cash into cryptocurrencies, you could, but if you only have 6 months of expenses saved in cash you're probably not that exposed by having the cash in a government currency. Also, the liquidity of the US dollar is better than bitcoin today. If cryptocurrencies become the norm, i'll switch over at that time, but I plan to keep my cash in the USD for now.
Never look back unless you are planning to go that way
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CodeMaster
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Re: Bit Coin question

Post by CodeMaster »

gloss151 wrote: Tue Aug 29, 2017 12:47 pm I remember hearing about bitcoin on Planet Money when it was worth less than a dollar per bitcoin. There are 16.5 million bitcoin around today. The algorithm will peak at 21 million at which point no more can be mined. It's not very cost effective to mine the coin unless you are generating it very cheaply, like through hydro or solar. There is a 2% annual fee from most brokers to have them hold your bitcoins. The US dollar has inflation every year, 3.22% long term average.

Similar to stocks, the owners can vote to split the bitcoin, which recently happened with Bitcoin and Bitcoin Cash.

If you wanted to diversify your cash into cryptocurrencies, you could, but if you only have 6 months of expenses saved in cash you're probably not that exposed by having the cash in a government currency. Also, the liquidity of the US dollar is better than bitcoin today. If cryptocurrencies become the norm, i'll switch over at that time, but I plan to keep my cash in the USD for now.
thanks for the input... btw i have lot more then 6 months
mnaspbh
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Re: Bit Coin question

Post by mnaspbh »

CodeMaster wrote: Tue Aug 29, 2017 12:46 pm Would you say investing in bitcoins is about as risky as investing in the dollar? Given the dollar can be faked / replicated as well, it just depends on faith on the world adopting it or not?
Investing in bitcoins is incredibly more risky than investing in dollars--unless you mean the Zimbabwe Dollar. There are many deep technological risks with bitcoin that are not present with actual currency like the US dollar. There are algorithmic and protocol risks for cryptocurrencies that just don't exist for the US dollar. There are governance risks with bitcoin and other cryptocurrencies that are very different (and generally much bigger) than with the US dollar. There are political risks as well, but those aren't really a topic for this forum.

The amount of scamming, fraud, and outright criminal activity associated with cryptocurrencies is breathtaking. That doesn't mean they're intrinsically bad, just that "buyer beware" is even more true for cryptocurrencies than for pretty much any other potential investment.

Even if some cryptocurrency is destined to replace every other form of currency, there's zero reason why the winning cryptocurrency has to be bitcoin, or even any of the literally 1000+ that people have made up. Bitcoin, in particular, is technically inferior to quite a few of the more recently developed cryptocurrencies.

Why are you interested in investing in bitcoin now and not four years ago, or even 6 months ago?
vstariradev
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Re: Bit Coin question

Post by vstariradev »

To add to the uncertainty, quantum computing is going to have a major impact on cryptography. What will happen to the now perceived as unbreakable cryptographic algorithms when the computing power grows almost exponentially?

Crypto currencies give me that castle in the sky feeling.
bberris
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Re: Bit Coin question

Post by bberris »

barnaclebob wrote: Tue Aug 29, 2017 11:56 am
CodeMaster wrote: Tue Aug 29, 2017 11:44 am
LOL WOW... those are some crazy answers and crazy people investing in FILES people can just MAKE UP.
No crazier than investing in some paper with a picture and some numbers printed on it.
[/quote]
There is a world of difference. Besides, no one really invests in a dollar; they use dollars. LRQ
Eric76
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Re: Bit Coin question

Post by Eric76 »

CodeMaster wrote: Tue Aug 29, 2017 12:04 pm
barnaclebob wrote: Tue Aug 29, 2017 11:56 am
CodeMaster wrote: Tue Aug 29, 2017 11:44 am
LOL WOW... those are some crazy answers and crazy people investing in FILES people can just MAKE UP.
No crazier than investing in some paper with a picture and some numbers printed on it.
LOLL SO TRUE
[/quote]

The U.S. Dollar (with the picture and serial number on it) is backed by the full faith and credit of the U.S. Government, which is in turn backed by enormous military power and the legal power to imprison you if you don't pay your taxes (in U.S. Dollars). Crypto currencies don't have any of that. To me crypto currencies function a lot more like gold than legal tender.
Topic Author
CodeMaster
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Re: Bit Coin question

Post by CodeMaster »

Interesting. Ive heard and seem to have seen various new sources saying governments may be preparing to adapt using crytocurrency in to their system. Anyone heard or know anything about that?

here is one news i saw related and there were more i think with vietnam
https://bankitasia.com/bankitasia/regul ... lications/

Would this be a sign bitcoins are entering the system to be fully adapted and the future?
hicabob
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Re: Bit Coin question

Post by hicabob »

CodeMaster wrote: Wed Aug 30, 2017 11:19 am Interesting. Ive heard and seem to have seen various new sources saying governments may be preparing to adapt using crytocurrency in to their system. Anyone heard or know anything about that?

here is one news i saw related and there were more i think with vietnam
https://bankitasia.com/bankitasia/regul ... lications/

Would this be a sign bitcoins are entering the system to be fully adapted and the future?
Estonia seems to be in the forefront of blockchain adaption by the government.
The concept and implementation of blockchains are much more important the various cryptocurrencies which are built on top.
Being a technically competent and relatively low population country helps.
https://medium.com/e-residency-blog/wel ... 9b46c06fd4
mrb09
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Re: Bit Coin question

Post by mrb09 »

agottem wrote: Tue Aug 29, 2017 12:12 pm
Bitcoin is the first currency that is trustless and decentralized. In my opinion it's gong to be huge. There's such an enormous amount of trust placed in central banks and eventually people are going to realize their trust was misplaced. Bitcoin provides instant transactions anywhere in the world. It provides a store of value (supply is known, no one can manipulate it). It provides a unit of account. The network is 100% open.
Just adding to agottem's excellent description: exactly as agottem states, bitcoin is based on a decentralized authority. That has never been really possible before, you always needed a central authority. So that's the game changer. You might not trust some random authority if they have the only keys to the kingdom, but you might trust 100 of them if they can only game the system by all cheating the same way at the same time. Of course, inability to cheat doesn't guarantee currency valuation.

The technology that bitcoin is based on (blockchain) actually has all sorts of interesting uses, people are using it for all sorts of mundane purposes outside of currency, as an example for internal business record keeping where you might have multi-national offices and don't want a central database as system of record.
Last edited by mrb09 on Wed Aug 30, 2017 11:53 am, edited 1 time in total.
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tc101
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Re: Bit Coin question

Post by tc101 »

"Banking on Bitcoin" is a movie streaming on Netflix that will answer lots of your questions.
. | The most important thing you should know about me is that I am not an expert.
grayfox
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Re: Bit Coin question

Post by grayfox »

CodeMaster wrote: Tue Aug 29, 2017 11:15 am Hi, is it ok I ask a little bit about cryto currency?
I know bitcoin a bit more, its about $4500 right now per coin. But I see so many other currencies coming out.
~I was wondering, how do these currencies get created? i.e. how many bitcoins are there and who created it and why cant he created a million more?
~Also how come the other currencies are at all trustworthy? Did someone just go and make it up?
~Sorry for my rookie questions, truly appreciate any advice

:sharebeer
Watch this YouTube video from 3Blu1Brown: Ever wonder how Bitcoin (and other cryptocurrencies) actually work?

KhanAcademy bitcoin playlist on YouTube: https://www.youtube.com/user/khanacadem ... ry=bitcoin
Topic Author
CodeMaster
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Re: Bit Coin question

Post by CodeMaster »

agottem wrote: Tue Aug 29, 2017 12:12 pm The above answer isn't quite correct. I'm rather well versed with bitcoin so allow me to try and clarify:

1. Bitcoin is a ledger of transactions. This ledger is composed of blocks, where a block contains a log of transactions. Something like: Peter sends Paul 1 bitcoin. Paul sends Jane 0.5 btc. etc.

2. In order to add a block to the ledger you must solve a complex math problem. This is called the proof of work and is what makes the ledger immutable.

3. Miners will fill out a block with a list of transactions and then attempt to solve the math problem. The first miner to solve the problem wins and their block is added to the blockchain. The miner then receives a reward (named the 'coinbase') for the block he mined.

4. The coinbase is defined by the bitcoin software to halve every X years. The first bitcoin came into existence by mining the first block -- this is the genesis block. The genesis block had 0 transactions (how could there be any? There were no bitcoin yet!) but had a coinbase of 50 btc.

5. As the coinbase continues to half the total supply of bitcoins will stop increasing. There will never be more than 21million bitcoin.

6. Once the coinbase reaches 0, you might wonder why miners continue to mine. In actuality, a transaction contains 2 outputs -- who you're sending to and a fee to be paid to the miner. A more realistic transaction is: Peter sends paul 0.9 btc and pays 0.1 btc to whichever miner includes his transaction in their mined block.

7. If you pay a higher transaction fee your transaction will likely be included in the blockchain faster than a smaller transaction fee. Hence, the hope is that when the mining reward goes to 0 the bitcoin ecosystem will be robust enough that transaction fees will be enough of an incentive to mine.

8. Miners are kept honest be bitcoin nodes. Nodes verify all the blocks mined by miners follow the rules. If a block is encoded incorrectly (e.g., a miner attempts to claim a coinbase that would result in more than 21million btc) the nodes would reject the block and it would not be included in the ledger.

9. Anyone can run a bitcoin node -- it is very cheap. The bitcoin software is 100% open source. It is recommended that any merchant transacting in bitcoin run their own node so they can verify the blockchain is following the rules themselves.


Bitcoin is the first currency that is trustless and decentralized. In my opinion it's gong to be huge. There's such an enormous amount of trust placed in central banks and eventually people are going to realize their trust was misplaced. Bitcoin provides instant transactions anywhere in the world. It provides a store of value (supply is known, no one can manipulate it). It provides a unit of account. The network is 100% open.

People like to point out the volatility of bitcoin...but what exactly do you expect in a currency that's bootstrapping itself from nothing? Bitcoin is incredibly undervalued at the moment. It's a huge investment opportunity for anyone who is concerned about the recent actions of central banks around the world.

Time will prove me correct.
Thanks for your reply... I dont know how I missed this huge reply! Its very informative.

Just curious, are you invested in bitcoins? :)

About adding coins for math problems... so Im trying understand how this works. Where does one go attempt to solve that math problem? like say I wanted to try today... how would I start? Is there a site? Am I suppose to download the open source, and Im guessing itll evaluate the last bitcoin added and somehow build on that to form a new math problem for me to attempt at?
violinhead
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Re: Bit Coin question

Post by violinhead »

In addition to agottem's excellent answer above, I thought this was a well written article that breaks down bitcoin to a very understandable level:

https://medium.freecodecamp.org/explain ... b4257ac833
mnaspbh
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Re: Bit Coin question

Post by mnaspbh »

CodeMaster wrote: Thu Aug 31, 2017 12:39 am About adding coins for math problems... so Im trying understand how this works. Where does one go attempt to solve that math problem? like say I wanted to try today... how would I start? Is there a site? Am I suppose to download the open source, and Im guessing itll evaluate the last bitcoin added and somehow build on that to form a new math problem for me to attempt at?
You download a program called a "miner". If you're used to building software from scratch, you can download the source code to an open-source miner, compile it, and run it yourself. Otherwise, you have to download a program that someone else compiled, and hope that it doesn't have malware built in--there are a lot of compromised mining programs out there that will steal your cryptocurrency or take over your computer. It's so much of a problem that many cryptocurrency forums have "sticky post" warnings to never download mining programs other people link to. Even if you compile the mining source code yourself, it may still have backdoors or malware built in--that's already happened with at least one open-source mining program (for a different cryptocurrency).

Mining bitcoins on an ordinary high-end graphics card is a money-losing proposition. Using an ordinary processor is even worse. As an example, I have a good CPU and a very good graphics card in my home PC (I do software development and gaming). If I used just the CPU to mine bitcoins, at the current difficulty factor I would expect to "solve" one instance of the math problem and get the 12.5 bitcoin reward after running for about 18 million years. If I use my fast graphics card instead, I'd expect it to take only 70 thousand years. I could get lucky and solve the problem on the first guess, but the odds of that happening are less than winning the lottery twice in a row.

To make any money mining bitcoin, you must have specialized hardware. The better bitcoin mining hardware costs about $3000 or more, and consumes 1-1.5 KW of electricity every hour. Due to backorders, it will probably take weeks to months to get the hardware after you pay for it. The most popular bitcoin mining hardware has been found to have backdoors that let the builder (who also runs the biggest bitcoin mining pool) shut down the hardware remotely so you can't even use it, but I'm sure they'd never do that.

In practice, a bunch of people tell their mining software to form a mining pool where they all work on parts of the same problem. When one person solves the problem, everyone who worked on it splits the reward based on how much work they did. Pool mining lets miners earn little bits more often instead of having to wait many years for a single larger payout. The amount you get is still proportional to how fast your computer can solve the math problem.

Using some handy bitcoin profit calculators, if I use my fast graphics card to mine bitcoins in a pool I could get about $0.04 worth of bitcoin every month. I'd have to spend about $15 worth of electricity, so I'd be losing about $14.96 every month. I have really cheap electricity for the US, too (barely $0.10/KWH). If your electricity costs more, then running a miner costs more so you earn less/lose more. If I bought a specialized bitcoin mining machine, I could earn a bit of money every day--the miner would pay for itself in about 8 months, assuming that bitcoin didn't go down in price at all, that the difficulty didn't go up, and a few other things that are also unlikely. In 8 months, the miner would be very obsolete, so profitability would keep going down.

If you just want to have some fun mining bitcoin or some other cryptocurrency, have at it--just be careful to keep your computer safe. Don't expect to get rich, or even to avoid losing money. The time to make money mining bitcoin was about 4 years ago.
Topic Author
CodeMaster
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Re: Bit Coin question

Post by CodeMaster »

mnaspbh wrote: Thu Aug 31, 2017 2:12 am
CodeMaster wrote: Thu Aug 31, 2017 12:39 am About adding coins for math problems... so Im trying understand how this works. Where does one go attempt to solve that math problem? like say I wanted to try today... how would I start? Is there a site? Am I suppose to download the open source, and Im guessing itll evaluate the last bitcoin added and somehow build on that to form a new math problem for me to attempt at?
You download a program called a "miner". If you're used to building software from scratch, you can download the source code to an open-source miner, compile it, and run it yourself. Otherwise, you have to download a program that someone else compiled, and hope that it doesn't have malware built in--there are a lot of compromised mining programs out there that will steal your cryptocurrency or take over your computer. It's so much of a problem that many cryptocurrency forums have "sticky post" warnings to never download mining programs other people link to. Even if you compile the mining source code yourself, it may still have backdoors or malware built in--that's already happened with at least one open-source mining program (for a different cryptocurrency).

Mining bitcoins on an ordinary high-end graphics card is a money-losing proposition. Using an ordinary processor is even worse. As an example, I have a good CPU and a very good graphics card in my home PC (I do software development and gaming). If I used just the CPU to mine bitcoins, at the current difficulty factor I would expect to "solve" one instance of the math problem and get the 12.5 bitcoin reward after running for about 18 million years. If I use my fast graphics card instead, I'd expect it to take only 70 thousand years. I could get lucky and solve the problem on the first guess, but the odds of that happening are less than winning the lottery twice in a row.

To make any money mining bitcoin, you must have specialized hardware. The better bitcoin mining hardware costs about $3000 or more, and consumes 1-1.5 KW of electricity every hour. Due to backorders, it will probably take weeks to months to get the hardware after you pay for it. The most popular bitcoin mining hardware has been found to have backdoors that let the builder (who also runs the biggest bitcoin mining pool) shut down the hardware remotely so you can't even use it, but I'm sure they'd never do that.

In practice, a bunch of people tell their mining software to form a mining pool where they all work on parts of the same problem. When one person solves the problem, everyone who worked on it splits the reward based on how much work they did. Pool mining lets miners earn little bits more often instead of having to wait many years for a single larger payout. The amount you get is still proportional to how fast your computer can solve the math problem.

Using some handy bitcoin profit calculators, if I use my fast graphics card to mine bitcoins in a pool I could get about $0.04 worth of bitcoin every month. I'd have to spend about $15 worth of electricity, so I'd be losing about $14.96 every month. I have really cheap electricity for the US, too (barely $0.10/KWH). If your electricity costs more, then running a miner costs more so you earn less/lose more. If I bought a specialized bitcoin mining machine, I could earn a bit of money every day--the miner would pay for itself in about 8 months, assuming that bitcoin didn't go down in price at all, that the difficulty didn't go up, and a few other things that are also unlikely. In 8 months, the miner would be very obsolete, so profitability would keep going down.

If you just want to have some fun mining bitcoin or some other cryptocurrency, have at it--just be careful to keep your computer safe. Don't expect to get rich, or even to avoid losing money. The time to make money mining bitcoin was about 4 years ago.
That is soooo fascinating.

So regarding the open source and math problems... im guessing you compile it and you simply just run it? It does the math problem solving on its own giving your CPUs power abilities correct? So you just get the powerful hardware then click MINE GO and like a video game, you wait and hope your computer solves it and if it does, itll generate a file which can be authencated by trading platforms as a legit bitcoin or not based on its encryption somehow.

Is that generally correct?

If so, the bitcoin currency seems to almost be a video game yet people are trying to invest in it and use it as a standard way of digital currency!?? It sounds crazy to me, did you say it makes sense to you and you'd invest?

:beer
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HomerJ
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Re: Bit Coin question

Post by HomerJ »

CodeMaster wrote: Thu Aug 31, 2017 12:39 am
agottem wrote: Tue Aug 29, 2017 12:12 pm The above answer isn't quite correct. I'm rather well versed with bitcoin so allow me to try and clarify:

1. Bitcoin is a ledger of transactions. This ledger is composed of blocks, where a block contains a log of transactions. Something like: Peter sends Paul 1 bitcoin. Paul sends Jane 0.5 btc. etc.

2. In order to add a block to the ledger you must solve a complex math problem. This is called the proof of work and is what makes the ledger immutable.

3. Miners will fill out a block with a list of transactions and then attempt to solve the math problem. The first miner to solve the problem wins and their block is added to the blockchain. The miner then receives a reward (named the 'coinbase') for the block he mined.

4. The coinbase is defined by the bitcoin software to halve every X years. The first bitcoin came into existence by mining the first block -- this is the genesis block. The genesis block had 0 transactions (how could there be any? There were no bitcoin yet!) but had a coinbase of 50 btc.

5. As the coinbase continues to half the total supply of bitcoins will stop increasing. There will never be more than 21million bitcoin.

6. Once the coinbase reaches 0, you might wonder why miners continue to mine. In actuality, a transaction contains 2 outputs -- who you're sending to and a fee to be paid to the miner. A more realistic transaction is: Peter sends paul 0.9 btc and pays 0.1 btc to whichever miner includes his transaction in their mined block.

7. If you pay a higher transaction fee your transaction will likely be included in the blockchain faster than a smaller transaction fee. Hence, the hope is that when the mining reward goes to 0 the bitcoin ecosystem will be robust enough that transaction fees will be enough of an incentive to mine.

8. Miners are kept honest be bitcoin nodes. Nodes verify all the blocks mined by miners follow the rules. If a block is encoded incorrectly (e.g., a miner attempts to claim a coinbase that would result in more than 21million btc) the nodes would reject the block and it would not be included in the ledger.

9. Anyone can run a bitcoin node -- it is very cheap. The bitcoin software is 100% open source. It is recommended that any merchant transacting in bitcoin run their own node so they can verify the blockchain is following the rules themselves.


Bitcoin is the first currency that is trustless and decentralized. In my opinion it's gong to be huge. There's such an enormous amount of trust placed in central banks and eventually people are going to realize their trust was misplaced. Bitcoin provides instant transactions anywhere in the world. It provides a store of value (supply is known, no one can manipulate it). It provides a unit of account. The network is 100% open.

People like to point out the volatility of bitcoin...but what exactly do you expect in a currency that's bootstrapping itself from nothing? Bitcoin is incredibly undervalued at the moment. It's a huge investment opportunity for anyone who is concerned about the recent actions of central banks around the world.

Time will prove me correct.
Thanks for your reply... I dont know how I missed this huge reply! Its very informative.

Just curious, are you invested in bitcoins? :)
Ugh of course he is. He has one post, and it's a very likely a troll account to get guliable people to buy bitcoin to push up the prices so he can profit.

CodeMaster, do a search on BitCoin on these boards... There are already 2-3 very good threads about it. I'm not sure why you had to start another one.

Crypto-currencies and ledger transactions may indeed be the future, but BitCoin is not the only crypto-currency. You can believe in crypto-currencies, but that doesn't mean investing in BitCoin will make you rich. New crypto-currencies can be (and have been) built at will. It's just code you can copy.
About adding coins for math problems... so Im trying understand how this works. Where does one go attempt to solve that math problem? like say I wanted to try today... how would I start? Is there a site? Am I suppose to download the open source, and Im guessing itll evaluate the last bitcoin added and somehow build on that to form a new math problem for me to attempt at?
You really need to read some of the links people have already provided you.
User avatar
HomerJ
Posts: 21246
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Re: Bit Coin question

Post by HomerJ »

CodeMaster wrote: Thu Aug 31, 2017 11:41 am
mnaspbh wrote: Thu Aug 31, 2017 2:12 am Don't expect to get rich, or even to avoid losing money. The time to make money mining bitcoin was about 4 years ago.
did you say it makes sense to you and you'd invest?
No, he said the exact opposite.
Topic Author
CodeMaster
Posts: 819
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Re: Bit Coin question

Post by CodeMaster »

HomerJ wrote: Thu Aug 31, 2017 12:08 pm
CodeMaster wrote: Thu Aug 31, 2017 12:39 am
agottem wrote: Tue Aug 29, 2017 12:12 pm The above answer isn't quite correct. I'm rather well versed with bitcoin so allow me to try and clarify:

1. Bitcoin is a ledger of transactions. This ledger is composed of blocks, where a block contains a log of transactions. Something like: Peter sends Paul 1 bitcoin. Paul sends Jane 0.5 btc. etc.

2. In order to add a block to the ledger you must solve a complex math problem. This is called the proof of work and is what makes the ledger immutable.

3. Miners will fill out a block with a list of transactions and then attempt to solve the math problem. The first miner to solve the problem wins and their block is added to the blockchain. The miner then receives a reward (named the 'coinbase') for the block he mined.

4. The coinbase is defined by the bitcoin software to halve every X years. The first bitcoin came into existence by mining the first block -- this is the genesis block. The genesis block had 0 transactions (how could there be any? There were no bitcoin yet!) but had a coinbase of 50 btc.

5. As the coinbase continues to half the total supply of bitcoins will stop increasing. There will never be more than 21million bitcoin.

6. Once the coinbase reaches 0, you might wonder why miners continue to mine. In actuality, a transaction contains 2 outputs -- who you're sending to and a fee to be paid to the miner. A more realistic transaction is: Peter sends paul 0.9 btc and pays 0.1 btc to whichever miner includes his transaction in their mined block.

7. If you pay a higher transaction fee your transaction will likely be included in the blockchain faster than a smaller transaction fee. Hence, the hope is that when the mining reward goes to 0 the bitcoin ecosystem will be robust enough that transaction fees will be enough of an incentive to mine.

8. Miners are kept honest be bitcoin nodes. Nodes verify all the blocks mined by miners follow the rules. If a block is encoded incorrectly (e.g., a miner attempts to claim a coinbase that would result in more than 21million btc) the nodes would reject the block and it would not be included in the ledger.

9. Anyone can run a bitcoin node -- it is very cheap. The bitcoin software is 100% open source. It is recommended that any merchant transacting in bitcoin run their own node so they can verify the blockchain is following the rules themselves.


Bitcoin is the first currency that is trustless and decentralized. In my opinion it's gong to be huge. There's such an enormous amount of trust placed in central banks and eventually people are going to realize their trust was misplaced. Bitcoin provides instant transactions anywhere in the world. It provides a store of value (supply is known, no one can manipulate it). It provides a unit of account. The network is 100% open.

People like to point out the volatility of bitcoin...but what exactly do you expect in a currency that's bootstrapping itself from nothing? Bitcoin is incredibly undervalued at the moment. It's a huge investment opportunity for anyone who is concerned about the recent actions of central banks around the world.

Time will prove me correct.
Thanks for your reply... I dont know how I missed this huge reply! Its very informative.

Just curious, are you invested in bitcoins? :)
Ugh of course he is. He has one post, and it's a very likely a troll account to get guliable people to buy bitcoin to push up the prices so he can profit.

CodeMaster, do a search on BitCoin on these boards... There are already 2-3 very good threads about it. I'm not sure why you had to start another one.

Crypto-currencies and ledger transactions may indeed be the future, but BitCoin is not the only crypto-currency. You can believe in crypto-currencies, but that doesn't mean investing in BitCoin will make you rich. New crypto-currencies can be (and have been) built at will. It's just code you can copy.
About adding coins for math problems... so Im trying understand how this works. Where does one go attempt to solve that math problem? like say I wanted to try today... how would I start? Is there a site? Am I suppose to download the open source, and Im guessing itll evaluate the last bitcoin added and somehow build on that to form a new math problem for me to attempt at?
You really need to read some of the links people have already provided you.
I found great quality posts from past... thanks for that however I would really appreciate my last question answered instead of searching books of past post or youtube links as it helps my understanding of this a lot.

I dont sense hes trying to bring up the cost of bitcoin through me btw lol
mnaspbh
Posts: 204
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Re: Bit Coin question

Post by mnaspbh »

CodeMaster wrote: Thu Aug 31, 2017 10:12 pm I found great quality posts from past... thanks for that however I would really appreciate my last question answered instead of searching books of past post or youtube links as it helps my understanding of this a lot.
There are a lot of resources out there that claim to teach people how to mine bitcoins; any search engine can find plenty by searching for how to mine bitcoins.

I looked at 3 of the guides, and all 3 had critical flaws, outright misinformation, or were so out of date as to be dangerous to follow. At least two of them had a lot of warnings after each step pointing out the scams and fraud in the past. If you follow their instructions without understanding them, it's very likely you will lose money in the best case. If you're lucky, it will only be a small amount of money due to unprofitable mining. If you're unlucky, an attacker may take over your computer, steal your bitcoin wallet, and/or be able to drain your bank account. Be careful.

I do not own or invest in bitcoin, or any other cryptocurrency. I do not have any short positions, or any other financial interest in any cryptocurrency. The only exposure I have is very indirect, through companies that are in Vanguard's Total Stock Market mutual fund. I do not recommend that anyone get involved in cryptocurrencies.
Topic Author
CodeMaster
Posts: 819
Joined: Sun Mar 18, 2007 3:03 pm

Re: Bit Coin question

Post by CodeMaster »

mnaspbh wrote: Thu Aug 31, 2017 11:26 pm
CodeMaster wrote: Thu Aug 31, 2017 10:12 pm I found great quality posts from past... thanks for that however I would really appreciate my last question answered instead of searching books of past post or youtube links as it helps my understanding of this a lot.
There are a lot of resources out there that claim to teach people how to mine bitcoins; any search engine can find plenty by searching for how to mine bitcoins.

I looked at 3 of the guides, and all 3 had critical flaws, outright misinformation, or were so out of date as to be dangerous to follow. At least two of them had a lot of warnings after each step pointing out the scams and fraud in the past. If you follow their instructions without understanding them, it's very likely you will lose money in the best case. If you're lucky, it will only be a small amount of money due to unprofitable mining. If you're unlucky, an attacker may take over your computer, steal your bitcoin wallet, and/or be able to drain your bank account. Be careful.

I do not own or invest in bitcoin, or any other cryptocurrency. I do not have any short positions, or any other financial interest in any cryptocurrency. The only exposure I have is very indirect, through companies that are in Vanguard's Total Stock Market mutual fund. I do not recommend that anyone get involved in cryptocurrencies.
Thank you mnaspbh and thank you all, it has been most fascinating ...
agottem
Posts: 44
Joined: Tue Aug 29, 2017 11:55 am

Re: Bit Coin question

Post by agottem »

CodeMaster wrote: Thu Aug 31, 2017 12:39 am
agottem wrote: Tue Aug 29, 2017 12:12 pm The above answer isn't quite correct. I'm rather well versed with bitcoin so allow me to try and clarify:

1. Bitcoin is a ledger of transactions. This ledger is composed of blocks, where a block contains a log of transactions. Something like: Peter sends Paul 1 bitcoin. Paul sends Jane 0.5 btc. etc.

2. In order to add a block to the ledger you must solve a complex math problem. This is called the proof of work and is what makes the ledger immutable.

3. Miners will fill out a block with a list of transactions and then attempt to solve the math problem. The first miner to solve the problem wins and their block is added to the blockchain. The miner then receives a reward (named the 'coinbase') for the block he mined.

4. The coinbase is defined by the bitcoin software to halve every X years. The first bitcoin came into existence by mining the first block -- this is the genesis block. The genesis block had 0 transactions (how could there be any? There were no bitcoin yet!) but had a coinbase of 50 btc.

5. As the coinbase continues to half the total supply of bitcoins will stop increasing. There will never be more than 21million bitcoin.

6. Once the coinbase reaches 0, you might wonder why miners continue to mine. In actuality, a transaction contains 2 outputs -- who you're sending to and a fee to be paid to the miner. A more realistic transaction is: Peter sends paul 0.9 btc and pays 0.1 btc to whichever miner includes his transaction in their mined block.

7. If you pay a higher transaction fee your transaction will likely be included in the blockchain faster than a smaller transaction fee. Hence, the hope is that when the mining reward goes to 0 the bitcoin ecosystem will be robust enough that transaction fees will be enough of an incentive to mine.

8. Miners are kept honest be bitcoin nodes. Nodes verify all the blocks mined by miners follow the rules. If a block is encoded incorrectly (e.g., a miner attempts to claim a coinbase that would result in more than 21million btc) the nodes would reject the block and it would not be included in the ledger.

9. Anyone can run a bitcoin node -- it is very cheap. The bitcoin software is 100% open source. It is recommended that any merchant transacting in bitcoin run their own node so they can verify the blockchain is following the rules themselves.


Bitcoin is the first currency that is trustless and decentralized. In my opinion it's gong to be huge. There's such an enormous amount of trust placed in central banks and eventually people are going to realize their trust was misplaced. Bitcoin provides instant transactions anywhere in the world. It provides a store of value (supply is known, no one can manipulate it). It provides a unit of account. The network is 100% open.

People like to point out the volatility of bitcoin...but what exactly do you expect in a currency that's bootstrapping itself from nothing? Bitcoin is incredibly undervalued at the moment. It's a huge investment opportunity for anyone who is concerned about the recent actions of central banks around the world.

Time will prove me correct.
Thanks for your reply... I dont know how I missed this huge reply! Its very informative.

Just curious, are you invested in bitcoins? :)

About adding coins for math problems... so Im trying understand how this works. Where does one go attempt to solve that math problem? like say I wanted to try today... how would I start? Is there a site? Am I suppose to download the open source, and Im guessing itll evaluate the last bitcoin added and somehow build on that to form a new math problem for me to attempt at?
Yep, as HomerJ put it: of course I am! I'm not trying to troll or con anyone. We all need to evaluate this new technology on our own and decide if it has potential or not. Additionally we need to decide which cryptocurrency is "the one."

The math problem that is solved requires an understanding of cryptographic hashing. Basically you take all the binary data of the block and the previously mined block and compute a hash -- a 256bit number. The hash will look like a random number. A valid block needs to find a hash with N zeroes at the start of it. The miner is free to change the block (include different transactions) or tweak some data to create a different hash. The mining software continuously changes the contents of the block until a hash with N leading zeroes is found. First miner to do so wins and the process begins again.

Bitcoin is designed to mine a block on average every 10minutes. If more CPU power is added blocks will start to be mined faster. When this happens, the network performs a difficulty adjustment and N will increase -- maybe now the network requires a hash with 20 leading zeros instead of 19.

An analogy: supppse in order to mine a block you needed to roll a dice. The network requires you to roll the dice a hundred times. It also requires that the first 20 rolls must be the number 1. Whichever miner succeeds in doing this first gets to enter his block into the ledger and claim the bitcoin reward and transaction fees. You can now see how the blockchain becomes immutable: the chain with the most blocks is the valid chain, and for someone to catch up and create a fake "longest chain" they would need to roll a lot of dice in a very short timespan to catch-up to the real one and overtake it.
Topic Author
CodeMaster
Posts: 819
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Re: Bit Coin question

Post by CodeMaster »

agottem wrote: Thu Aug 31, 2017 11:48 pm
CodeMaster wrote: Thu Aug 31, 2017 12:39 am
agottem wrote: Tue Aug 29, 2017 12:12 pm The above answer isn't quite correct. I'm rather well versed with bitcoin so allow me to try and clarify:

1. Bitcoin is a ledger of transactions. This ledger is composed of blocks, where a block contains a log of transactions. Something like: Peter sends Paul 1 bitcoin. Paul sends Jane 0.5 btc. etc.

2. In order to add a block to the ledger you must solve a complex math problem. This is called the proof of work and is what makes the ledger immutable.

3. Miners will fill out a block with a list of transactions and then attempt to solve the math problem. The first miner to solve the problem wins and their block is added to the blockchain. The miner then receives a reward (named the 'coinbase') for the block he mined.

4. The coinbase is defined by the bitcoin software to halve every X years. The first bitcoin came into existence by mining the first block -- this is the genesis block. The genesis block had 0 transactions (how could there be any? There were no bitcoin yet!) but had a coinbase of 50 btc.

5. As the coinbase continues to half the total supply of bitcoins will stop increasing. There will never be more than 21million bitcoin.

6. Once the coinbase reaches 0, you might wonder why miners continue to mine. In actuality, a transaction contains 2 outputs -- who you're sending to and a fee to be paid to the miner. A more realistic transaction is: Peter sends paul 0.9 btc and pays 0.1 btc to whichever miner includes his transaction in their mined block.

7. If you pay a higher transaction fee your transaction will likely be included in the blockchain faster than a smaller transaction fee. Hence, the hope is that when the mining reward goes to 0 the bitcoin ecosystem will be robust enough that transaction fees will be enough of an incentive to mine.

8. Miners are kept honest be bitcoin nodes. Nodes verify all the blocks mined by miners follow the rules. If a block is encoded incorrectly (e.g., a miner attempts to claim a coinbase that would result in more than 21million btc) the nodes would reject the block and it would not be included in the ledger.

9. Anyone can run a bitcoin node -- it is very cheap. The bitcoin software is 100% open source. It is recommended that any merchant transacting in bitcoin run their own node so they can verify the blockchain is following the rules themselves.


Bitcoin is the first currency that is trustless and decentralized. In my opinion it's gong to be huge. There's such an enormous amount of trust placed in central banks and eventually people are going to realize their trust was misplaced. Bitcoin provides instant transactions anywhere in the world. It provides a store of value (supply is known, no one can manipulate it). It provides a unit of account. The network is 100% open.

People like to point out the volatility of bitcoin...but what exactly do you expect in a currency that's bootstrapping itself from nothing? Bitcoin is incredibly undervalued at the moment. It's a huge investment opportunity for anyone who is concerned about the recent actions of central banks around the world.

Time will prove me correct.
Thanks for your reply... I dont know how I missed this huge reply! Its very informative.

Just curious, are you invested in bitcoins? :)

About adding coins for math problems... so Im trying understand how this works. Where does one go attempt to solve that math problem? like say I wanted to try today... how would I start? Is there a site? Am I suppose to download the open source, and Im guessing itll evaluate the last bitcoin added and somehow build on that to form a new math problem for me to attempt at?
Yep, as HomerJ put it: of course I am! I'm not trying to troll or con anyone. We all need to evaluate this new technology on our own and decide if it has potential or not. Additionally we need to decide which cryptocurrency is "the one."

The math problem that is solved requires an understanding of cryptographic hashing. Basically you take all the binary data of the block and the previously mined block and compute a hash -- a 256bit number. The hash will look like a random number. A valid block needs to find a hash with N zeroes at the start of it. The miner is free to change the block (include different transactions) or tweak some data to create a different hash. The mining software continuously changes the contents of the block until a hash with N leading zeroes is found. First miner to do so wins and the process begins again.

Bitcoin is designed to mine a block on average every 10minutes. If more CPU power is added blocks will start to be mined faster. When this happens, the network performs a difficulty adjustment and N will increase -- maybe now the network requires a hash with 20 leading zeros instead of 19.

An analogy: supppse in order to mine a block you needed to roll a dice. The network requires you to roll the dice a hundred times. It also requires that the first 20 rolls must be the number 1. Whichever miner succeeds in doing this first gets to enter his block into the ledger and claim the bitcoin reward and transaction fees. You can now see how the blockchain becomes immutable: the chain with the most blocks is the valid chain, and for someone to catch up and create a fake "longest chain" they would need to roll a lot of dice in a very short timespan to catch-up to the real one and overtake it.
right i suspected it was a technology that built on the last one, making it more complicated, allowing authentication to be more secured and having the ability to max out bit coins at 21m coins and prob many more reasons...

however im surpirsed you can mine one in 10 mins.... the last posted said it would an enourmous amoutn of unreasonable time (thousands of years or something)
User avatar
HomerJ
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Re: Bit Coin question

Post by HomerJ »

CodeMaster wrote: Fri Sep 01, 2017 12:15 amhowever im surpirsed you can mine one in 10 mins.... the last posted said it would an enourmous amoutn of unreasonable time (thousands of years or something)
YOU don't mine one every 10 minutes. One computer in the world mines one every ten minutes. And there are millions of computers running 24/7 hoping to be that lucky one.
Topic Author
CodeMaster
Posts: 819
Joined: Sun Mar 18, 2007 3:03 pm

Re: Bit Coin question

Post by CodeMaster »

HomerJ wrote: Fri Sep 01, 2017 12:50 am
CodeMaster wrote: Fri Sep 01, 2017 12:15 amhowever im surpirsed you can mine one in 10 mins.... the last posted said it would an enourmous amoutn of unreasonable time (thousands of years or something)
YOU don't mine one every 10 minutes. One computer in the world mines one every ten minutes. And there are millions of computers running 24/7 hoping to be that lucky one.
Got cha, thanks!
kayanco
Posts: 761
Joined: Sat Jun 07, 2014 12:20 am

Re: Bit Coin question

Post by kayanco »

I've recently looked into Bitcoin .. it's just mind boggling and also awe inspiring.

Within a month it went from $2000 to $4500, and currently I'm seeing it go up even more, close to $5000 now.

On one hand it looks too expensive, but people are saying it'll go up to 100 K.

Don't know what to make of this.
Valuethinker
Posts: 48944
Joined: Fri May 11, 2007 11:07 am

Re: Bit Coin question

Post by Valuethinker »

kayanco wrote: Fri Sep 01, 2017 2:50 pm I've recently looked into Bitcoin .. it's just mind boggling and also awe inspiring.

Within a month it went from $2000 to $4500, and currently I'm seeing it go up even more, close to $5000 now.

On one hand it looks too expensive, but people are saying it'll go up to 100 K.

Don't know what to make of this.
I think it will go to $100k

I also think it will go to effectively 0 ;-).

Due to quantum indeterminacy, this may happen simultaneously ;-).

The point about Bitcoin is that because there's no good external yardstick of the "right" value in the way there is with a stock market listed company or a bond, one can justify any valuation.
Topic Author
CodeMaster
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Joined: Sun Mar 18, 2007 3:03 pm

Re: Bit Coin question

Post by CodeMaster »

Anyone ever use localbitcoins.com?

If I buy it in Taiwan, do you know if I can sell my bitcoin anywhere later or is limited to Taiwan users?
kayanco
Posts: 761
Joined: Sat Jun 07, 2014 12:20 am

Re: Bit Coin question

Post by kayanco »

Valuethinker wrote: Fri Sep 01, 2017 5:13 pm
kayanco wrote: Fri Sep 01, 2017 2:50 pm I've recently looked into Bitcoin .. it's just mind boggling and also awe inspiring.

Within a month it went from $2000 to $4500, and currently I'm seeing it go up even more, close to $5000 now.

On one hand it looks too expensive, but people are saying it'll go up to 100 K.

Don't know what to make of this.
I think it will go to $100k

I also think it will go to effectively 0 ;-).

Due to quantum indeterminacy, this may happen simultaneously ;-).

The point about Bitcoin is that because there's no good external yardstick of the "right" value in the way there is with a stock market listed company or a bond, one can justify any valuation.
For me it's fascinating/interesting because it's for the 1st time I'm seeing something like this unfold in real time.

Also, it might turn out to be something that if you do it, you might regret it, and if you don't, you might regret it.
mnaspbh
Posts: 204
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Re: Bit Coin question

Post by mnaspbh »

CodeMaster wrote: Fri Sep 01, 2017 10:13 pm Anyone ever use localbitcoins.com?

If I buy it in Taiwan, do you know if I can sell my bitcoin anywhere later or is limited to Taiwan users?
I suggest you do a web search for that site, and read about all the people who got scammed using it. Even if the site is fully legitimate, it may be easy for scammers to make use of it; people used to sell guides on how to scam people with that site. If you do use it, be sure to follow all of the security recommendations on the site and elsewhere, and expect to pay over market price (plus escrow fees) for the convenience of not signing up with an exchange. I have no experience with that site, I just spent less than 5 minutes doing a few web searches about it.

If you get actual bitcoins into a real bitcoin wallet that doesn't get stolen from you, you should be able to sell the bitcoins anywhere you can transfer them. Don't get scammed when you try to sell them; there have been some big-name exchanges that failed, were hacked, and/or committed fraud and caused all of their users to lose some or all of their money. Also make sure that wherever you sell them can actually transfer the funds from the sale to you. Be sure you keep all needed records for any taxes or other reporting due in your jurisdiction.

Do you know how to create a bitcoin wallet, and how to keep it secure when performing transactions? If not, I'd suggest doing more research before risking your money and bank accounts.

If you're looking for a simple guide of "click here, download this, type this" to buy bitcoins, it's very likely you will get scammed or worse. Be careful.
Topic Author
CodeMaster
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Re: Bit Coin question

Post by CodeMaster »

mnaspbh wrote: Fri Sep 01, 2017 11:14 pm
CodeMaster wrote: Fri Sep 01, 2017 10:13 pm Anyone ever use localbitcoins.com?

If I buy it in Taiwan, do you know if I can sell my bitcoin anywhere later or is limited to Taiwan users?
I suggest you do a web search for that site, and read about all the people who got scammed using it. Even if the site is fully legitimate, it may be easy for scammers to make use of it; people used to sell guides on how to scam people with that site. If you do use it, be sure to follow all of the security recommendations on the site and elsewhere, and expect to pay over market price (plus escrow fees) for the convenience of not signing up with an exchange. I have no experience with that site, I just spent less than 5 minutes doing a few web searches about it.

If you get actual bitcoins into a real bitcoin wallet that doesn't get stolen from you, you should be able to sell the bitcoins anywhere you can transfer them. Don't get scammed when you try to sell them; there have been some big-name exchanges that failed, were hacked, and/or committed fraud and caused all of their users to lose some or all of their money. Also make sure that wherever you sell them can actually transfer the funds from the sale to you. Be sure you keep all needed records for any taxes or other reporting due in your jurisdiction.

Do you know how to create a bitcoin wallet, and how to keep it secure when performing transactions? If not, I'd suggest doing more research before risking your money and bank accounts.

If you're looking for a simple guide of "click here, download this, type this" to buy bitcoins, it's very likely you will get scammed or worse. Be careful.
Thanks, Im using this only cause Im in Asia rigth now and its the only way I can really buy BC.
They show how many transactions youve done and the success / review rate on there so it feels / seems pretty cool. Also what they do is upon purchasing, they have to put the bitcoin in escrow and then I send money then coin is released after confirmation.

My friends use it all time apparnetly and also online consensus seem to recommend it for those in Asia a lot....

It seems legit / safe enough based on all of my research :)
User avatar
HomerJ
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Re: Bit Coin question

Post by HomerJ »

kayanco wrote: Fri Sep 01, 2017 2:50 pm I've recently looked into Bitcoin .. it's just mind boggling and also awe inspiring.

Within a month it went from $2000 to $4500, and currently I'm seeing it go up even more, close to $5000 now.

On one hand it looks too expensive, but people are saying it'll go up to 100 K.

Don't know what to make of this.
Oh, if "people are saying", then you better buy a lot! :oops:
Topic Author
CodeMaster
Posts: 819
Joined: Sun Mar 18, 2007 3:03 pm

Re: Bit Coin question

Post by CodeMaster »

HomerJ wrote: Sat Sep 02, 2017 1:20 am
kayanco wrote: Fri Sep 01, 2017 2:50 pm I've recently looked into Bitcoin .. it's just mind boggling and also awe inspiring.

Within a month it went from $2000 to $4500, and currently I'm seeing it go up even more, close to $5000 now.

On one hand it looks too expensive, but people are saying it'll go up to 100 K.

Don't know what to make of this.
Oh, if "people are saying", then you better buy a lot! :oops:
lol... well i think the site is ok cause my freind referred it , then when i asked a fb group where to buy Bitcoins, there were MANY who referred localbitcoins as well....

:beer
minimalistmarc
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Joined: Fri Jul 24, 2015 4:38 pm

Re: Bit Coin question

Post by minimalistmarc »

If Bogleheads discussing Bitcoin isn't a sign it's a massive bubble I don't know what is.

Perhaps crypto currencies are the future, but there could be any number of different crypto currencies.

I find it highly unlikely that all bitcoin holders today are going to be multimillionaires in the next few years, unless we have some kind of global hyperinflation.

Bitcoin bugs are just like "trendy" Gold Bugs.
mmcmonster
Posts: 615
Joined: Sun Jan 12, 2014 12:18 pm

Re: Bit Coin question

Post by mmcmonster »

agottem wrote: Tue Aug 29, 2017 12:12 pm 7. If you pay a higher transaction fee your transaction will likely be included in the blockchain faster than a smaller transaction fee. Hence, the hope is that when the mining reward goes to 0 the bitcoin ecosystem will be robust enough that transaction fees will be enough of an incentive to mine.
Blockchain technology is being used by financial institutions for a wide variety of things. I don't see that going away anytime soon.

That being said, Bitcoin had essentially priced itself out of the microtransaction realm. If the cost of your transaction is 0.1BTC (to get it included in the ledger) and a BTC = 4706 dollars (this morning's price), you're not going to use it to buy groceries.

See this Reddit post regarding someone trying to buy $9 of goods with bitcoin recently. https://www.reddit.com/r/Bitcoin/commen ... irmations/
laohan
Posts: 34
Joined: Sun Feb 28, 2016 2:13 am

Re: Bit Coin question

Post by laohan »

mmcmonster wrote: Sat Sep 02, 2017 5:25 am Blockchain technology is being used by financial institutions for a wide variety of things. I don't see that going away anytime soon.
I don't see this happening right now. I see a bunch of banks trying to look like they are "with it", but nobody is actually using it for anything serious. Modern finance shifts 100s of billions in value daily without too many hiccups. Most frictions that are left are either because the problem is hard, or because removing them would take away somebody's profit margin, not because they don't have a reasonable database (or "ledger").

re: finite supply of bitcoins

Sure, there's a finite supply of Bitcoin A, but what happens is people just make Bitcoin B, or whatever, and get people to buy that, instead. There can be any number of internet tokens like this, so the supply is only bounded by human imagination.
objectivefunction
Posts: 132
Joined: Wed May 04, 2016 10:20 am

Re: Bit Coin question

Post by objectivefunction »

laohan wrote: Sat Sep 02, 2017 7:25 am I don't see this happening right now. I see a bunch of banks trying to look like they are "with it", but nobody is actually using it for anything serious. Modern finance shifts 100s of billions in value daily without too many hiccups. Most frictions that are left are either because the problem is hard, or because removing them would take away somebody's profit margin, not because they don't have a reasonable database (or "ledger").
Completely agree. Bitcoin solves the double spending problem by being distributed, open, and public. No one node has the only copy of the blockchain, but instead it is distributed around to many different nodes. Many different miners compete to create new blocks. No miner or node can unilaterally decide to change the rules, because all the others would just reject it. Anyone can run a node or try to mine. The blockchain is available for inspection and audit by anyone.

If you take any of these attributes away it just becomes a unilaterally controlled database or a distributed database with no way to securely modify or audit it. It becomes much less interesting and much less compelling compared to existing technologies.

I also don't buy it when people say that governments will just issue fiat on their own blockchains. You have the problems above. It either becomes centralized, in which case just use existing technology. Or it is distributed and by its nature no one entity can force everyone to change the rules. I suppose you could make it work by threatening prison, but then you'd have to solve the scaling problem that bitcoin has been struggling to solve. Imagine trying to track every dollar and every person using every dollar. Then you run into privacy and civil rights concerns.
laohan wrote: Sat Sep 02, 2017 7:25 am re: finite supply of bitcoins

Sure, there's a finite supply of Bitcoin A, but what happens is people just make Bitcoin B, or whatever, and get people to buy that, instead. There can be any number of internet tokens like this, so the supply is only bounded by human imagination.
First of all, bitcoin is more than just software. It is a network of users, miners, nodes, mechants, etc. Just because someone can create a cryptocurrency does not mean that they can actually attract anyone to it.

Also, your argument cuts both ways. Anything that another currency can do bitcoin can do, which is the "maximalist" argument for bitcoin dominance. At least technically its possible, but bitcoin is also a political system. You have to convince everyone else in the system to also change the rules. Maybe if you can only convince half of the people to follow you, then you split into a separate currency, but in that case it's not exactly bitcoin and has different attributes and different uses and a different reason for existing, which is fine. Saying there only has to be one cryptocurrency is like saying the invention of the internal combustion engine means there will only be one kind of car on the road.
mmcmonster
Posts: 615
Joined: Sun Jan 12, 2014 12:18 pm

Re: Bit Coin question

Post by mmcmonster »

laohan wrote: Sat Sep 02, 2017 7:25 amI don't see this happening right now. I see a bunch of banks trying to look like they are "with it", but nobody is actually using it for anything serious. Modern finance shifts 100s of billions in value daily without too many hiccups. Most frictions that are left are either because the problem is hard, or because removing them would take away somebody's profit margin, not because they don't have a reasonable database (or "ledger").

re: finite supply of bitcoins

Sure, there's a finite supply of Bitcoin A, but what happens is people just make Bitcoin B, or whatever, and get people to buy that, instead. There can be any number of internet tokens like this, so the supply is only bounded by human imagination.
Talking to a friend in a financial institution, they are looking at ways to use blockchain technology (not Bitcoin, but the tech underneath it) to create a standard that can be used to exchange goods on the Foreign Exchange markets.

Basically eliminate the U.S. Dollar as a middleman when trading between two foreign countries. China is really interested in this sort of thing, as you could imagine.
Serje
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Joined: Sat Sep 02, 2017 2:53 pm

Re: Bit Coin question

Post by Serje »

I know its off topic but as per some analysts reports BTC may reach over $6k by the end of this year. Also, ETC is coming along nicely and targeting $500 soon :sharebeer
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