Virtual metalworking - Bitcoin mining

Didn't I just read about one of the main bit coin sites being hacked? The figure of $375 million was mentioned.

Everything I read, suggests that it is a low margin, capital intensive business. The hardware is expensive and the yield is low.

i

The news I heard was Bankrupt. Closed. Gone. But it was my understanding that bitcoin data was stored on a "cloud" multi-redundant so your coins cannot ever be "lost" as long as you know your login. Don't trust them, will never buy them.

Remove 333 to reply. Randy

Here are some things to know about Bitcoins:

1) Bitcoins really are currency, because they are transferable bits of universal value. Bitcoins are no less of a currency than Ukrainian Hryvna or $100 bills.

2) Supply of bitcoins is limited and cannot be manipulated.

3) Transfer of bitcoins is somewhat anonymous and cannot be reversed. It is also all-electronic and cannot be easily regulated or surveilled.

4) Here's most crucial aspect of bitcoins: they are stolen very easily.

It is much more easy it is to steal bitcoins than to steal cash from banks.

Because of this, any bitcoin-based institutions, like bitcoin banks, bitcoin funds of any kind, exchanges etc, are vulnerable to complete theft of all funds by insiders or oursiders. It is, therefore, very risky to entrust your money to any such institution.

This means that institutions that we take for granted, like exchanges, lenders, banks, mutual funds etc will have great difficulty operating with bitcoins.

5) It is very difficult to price "what a bitcoin is really worth". I find the discussion of "bitcoin bubble" to be very shallow, in the worst traditions of financial journalism and know-nothing stock market pundits.

I do not own a single bitcoin at this time.

i

Heating your shop is about all you will accomplish. Mining bitcoins is a race to be the first in the world to find, by brute force guessing, a solution to a mathematical puzzle. You are pitted against a total computing power estimated at over 1 exaFLOP, which is 256 times that of the top 500 supercomputers combined. And that was back in last November -- it's probably more than that now. The only machines that stand any chance of winning one of those races are built from scratch with custom integrated circuits and can't do anything else.

Maybe new computing breakthroughs will follow. People will go to great lengths of time and money to get something for nothing. That's the part that gets me - why is so much computing power needed to tend to the transactions? It seems to be proven that the security is not enough. If Iggy won't get in on a revenue stream they you KNOW something's wrong with it!

you're wrong on #1.

nothing has the universal acceptance of US currency- not bit coins or rubbles.

Euro is also not universally accepted, try to buy an ice cream in Chicago with a 5 euros bill.

The point is that enough people are interested in bitcoin to make it a currency. It is a currency, just not associated with a particular country.

i

You need money to buy stuff. euros, rubbles and bitcoins are all garbage of no value. calling them currency is just salesman talk.

Years ago I tried to pay for something, in a little shop in Georgia, with a 2 dollar bill and the guy asked me if I had "any other money" as, he said, he had "never seen one of those".

They use big stone "wheels" for money on some S. Pacific island. The wheels are too big to be easily transportable so they are leaned up against trees at various places around the island.

Makes it pretty easy to tax people when money is that big. You know who has how much.

i

The requirement of computing effort is by design. As with mining for gold, you need to put in effort and investment (for bitcoins, it's called "Proof of Work") to get the reward, and the "difficulty metric" goes steadily up as more worldwide computing power enters the race. There is a good conceptual description of the process at

.

I'll not repeat the details here other than to say that without highly specialized hardware, the value of the bitcoins you can produce will be less than the cost of the power to run your processor. As I said before, you will heat your shop, and that's about all you will get.

I had read that and others. I had no intention of doing it, I just found it fascinating. Hmmm. free money? NOT! But I do hope something will come of it on the hardware end that will spill out to other situations.

First, it is the nature of bitcoins.

Second, they are so easy to steal, that any officer or custodian of those bitcoins would be very tempted to steal them.

In other words, they are easy to steal by outsiders and insiders, and someone will steal them eventually -- and customers and law enforcement will not even know who stole them, an outsider or an insider.

Fun!

Yes, but it does not really add any value to the discussion. In addition, I believe that it is untrue and that a value of bitcoins can be somehow modeled economically. I just do not know how.

Another bunch of PHP-using retards.

"PHP is easy for idiots to learn", so all idiots flocked to PHP...

i

On 3/3/2014 12:17 PM, Cydrome Leader wrote: ...

Well, at the moment the euro is trading at almost a 40% premium relative to USD... :)