49 replies to this topic

[beatsme]

Just thought this forum needed a Bitcoin thread, seeing as it's a pretty interesting topic.
http://www.bitcoin.org



From the FAQ (http://www.bitcoin.org/faq):

What is Bitcoin?
Bitcoin is a peer-to-peer network based anonymous digital currency. ''Peer-to-peer'' (P2P) means that there is no central authority to issue new money or to keep track of the transactions. Instead, those tasks are managed collectively by the nodes of the network. ''Anonymity'' means that the real world identity of the parties of a transaction can be kept hidden from the public or even from the parties themselves.

How are new Bitcoins created?
New coins are generated by a network node each time it finds the solution to a certain calculational problem (i.e. creates a new block), for which an average solution time can be calculated. The difficulty of the problem is adjusted so that in the first 4 years of the Bitcoin network, 10,500,000 coins will be created. The amount is halved each 4 years, so it will be 5,250,000 in years 4-8, 2,625,000 in years 8-12 and so on. Thus the total number of coins will approach 21,000,000 over time.

So your wealth is determined by the amount of CPU power you have?
No. There's a constant average rate of new Bitcoins created, and that amount is divided among the nodes by the CPU power they use. When Bitcoins start having real exchange value, the competition for coin creation will drive the price of electricity needed for generating a coin close to the value of the coin, so the profit margin won't be that huge. The easier way to gain a lot of wealth would be trading goods.

At the moment, though, you can generate new coins quite profitably, if you expect them to have real value in the future. If you choose to, be aware that Bitcoin is still experimental software.

Why should I use Bitcoin?

• Transfer money easily through the Internet, without having to trust middlemen.
• Third parties can't prevent or control your transactions.
• Bitcoin transactions are practically free, whereas credit cards and online payment systems typically cost 1-5% per transaction plus various other fees up to hundreds of dollars.
• Be safe from the instability caused by fractional reserve banking and bad policies of the central banks. The limited inflation of the Bitcoin system's money supply is distributed evenly (by CPU power) throughout the network, not monopolized to the banks.

Any thoughts? Currently the default software uses CPU for generation, but there are GPU applications on the Bitcoin forums which generate solutions (and therefore bitcoins) much more quickly. I've heard that 20% of bitcoins now are being generated by one person with a GPU farm. I've been running the software for about a week now and haven't generated any coins, but I figure I'll run it for a few months on one of my 4 cores and see what happens. It's particularly interesting that you can trade Bitcoins for cash or vice-versa and even buy things directly with the currency (http://www.bitcoin.org/trade). The Electronic Frontier Foundation (EFF) also recently started accepting donations in Bitcoin. You can read about that here: http://www.bitcoinbl...on-through.html

Edited by beatsme, 21 November 2010 - 05:51 PM.

[EmbraceUnity]

Cool.

[lunarsolarpower]

Wish I would have seen this thread when you posted it...

The current chart:


Anyone here get in early on this?

[niner]

Jeez, bitcoins are going parabolic. There was a report about them on NPR a week or two ago; I wonder if that explains the recent spike? What happened to the part about being "safe from the instability caused by fractional reserve banking"?

[lunarsolarpower]

It just started getting a lot of media coverage including these articles:

http://theweek.com/a...f-illegal-drugs
http://www.fool.com/...ned-300000.aspx
http://www.smartmone...3200/?mg=com-sm

When people read about it and want in the price jumps.

[rwac]

And people heard about Silk Road, where you're supposed to be able to buy anything (except WMD and assassinations).

[Sillewater]

I have been mining these coins for 2 years now on multiple computers. Originally for fun but with the huge jump in conversion rate recently it was a great investment for the last 2 years (beat my stock portfolio). But because of the recent increase in popularity more CPU power is required. As the number of coins reach the mathematical limit it gets exponetially harder to get more coins. Its a wonderful idea. Wonder if it will catch on.

[robomoon]

Who are these people who got multiple computers running? Yeah, I also would like to be one. But I got to wait until the Singularity arrives or if SENS keeps my brain stable for 200 years until I am at least wise enough (though not so intelligent like the others) for some serious business and stuff. Meanwhile they will have for-profit charity organizations for social reasons to gimme that bitcoin. All the computers will be so small that some of them will fit into the chip of a thin payment card for my supermarket shopping trips. There will be even more bitcoins I can generate directly in my purse with that card. So I would not even need to go to the ATM anymore. Can you software makers make that happen for me? Thanks in advance...

[Alex Libman]

I'm a big fan of Bitcoin, but in distributed security nothing is ever 100%, so there are some risks...

[rwac]

I hear a couple of senators are going after Silk Road and by extension maybe bitcoin.

http://www.npr.org/2...sells-narcotics

[Alex Libman]

LOL, governments... Mafia thugs with delusion of grandeur! If they declare war on Internet freedom, the illusion of benevolence that they're trying to perpetuate will collapse even faster!

[lunarsolarpower]

I have been mining these coins for 2 years now on multiple computers. Originally for fun but with the huge jump in conversion rate recently it was a great investment for the last 2 years (beat my stock portfolio). But because of the recent increase in popularity more CPU power is required. As the number of coins reach the mathematical limit it gets exponetially harder to get more coins. Its a wonderful idea. Wonder if it will catch on.

Satoshi is that you?

[Sillewater]

Haha no. I wish though. Probably be rich now.

[e Volution]

EconTalk one of my favourite Podcasts just did an episode with Gavin Andresen, Principal of the BitCoin Virtual Currency Project... Get it free here: Andresen on BitCoin and Virtual Currency

[Pour_la_Science]

First of all, a word of caution: I'm not your finance adviser and only a stranger on the Internet.

 

I'm not particularly rich, I don't work in biology (I did that a long time ago but I really HATED bench work, the constant hunt for grants, etc...).

Now I'm desperate to help what seems to me the greatest endeavor of the humanity but also for anyone of us on a personal level: the conquest of aging.

I strongly believe that this will appear in the future, even if people like it or now. The question of course is when? current people living now may not see that... 

 

I know that, but whatever! I want at least to be part of the movement

So here's my plan: Invest massively in Bitcoin! this is a bold idea, but my reasoning is that this cryptocurrency, despite all its "deaths" promised by lot of journalists, is still here after 8 years. If you look at this chart, you can see all the massive bubbles and falls, but the average is a constant growth of Bitcoin.

https://blockchain.i...ce?timespan=all

 

I'm reading about Bitcoin since 2013 and learned since about the mechanisms behind Bitcoin, so I know the problems and difficulties that this money have, but I'm confident that they can all be overcome with time.

 

So, here's my personal plan: Invest massively in Bitcoin on the long term, to be able eventually to have a real impact on the project that drives us all here.

 

 

 

 

Edited by Pour_la_Science, 25 January 2017 - 02:46 PM.

[Danail Bulgaria]

Bold and risky. I dont know much people, who are buying bitcoins. You may end up with many bitcoins, that nobody buys in the future.

[Pour_la_Science]

"I dont know much people, who are buying bitcoins."

 

Do you know a lot of people around you speaking about aging?

I'm saying this because this community thinks on the long term, and recognizes the (very) likely risk of dying of aging, not being able to do anything against it.

 

By the way, if everybody were buying bitcoin, tt would already worth 10x than now (currently: 1 BTC = $800) and there would be no point talking about investing in it.

 

 

Edited by Pour_la_Science, 25 January 2017 - 07:46 PM.

[Danail Bulgaria]

How about investing in something else, I dont know what ... gold maybe

[Pour_la_Science]

It's a bit technical but it's NOT advised to invest in Gold.

 

I just let you see this graph:

https://www.bullionv...-price-chart.do

 

It doesn't look very good, does it?

 

Gold is the "standard" reserve for people when they feel that the govt and its finance is faling.

The truth is that gold is heavily manipulated by governments, since around 2008 (what a coincidence...), using "paper gold" not real gold in bullion.

(The market of "derivatives" based on Gold represents 3'000 tons of "paper Gold" a day, which represents the total world Gold production in one year!)

 

 

 

 

Edited by Pour_la_Science, 26 January 2017 - 11:53 AM.

[Danail Bulgaria]

Alright. I wish you a good luck in investing in bitcoins. 

 

I found some videos that claim that you can "mine" bitcoins for free. Have you tried making (mining) them? Or do you think, that it is better buying and selling them? If mining bitcoins is worthy, then people may devote one computer to making bitcoins for developing immortality related projects. This sounds me with a much lower risk. Have you been thinking about that option? 

 

There seems to exist many other coins simmilar to the bit coin. I have found 

Dogecoin, Litecoin, Feathercoin, Worldcoin, Earthcoin, Fedoracoin, Digitalcoin, Infinitecoin and Virtacoin

It is possible there to be others. 

The situation with that coins seems to me strange and unreliable. Everyone can start making SomethigCoin. Does it mean, that te cost of all of these coins will be rising? 

[Pour_la_Science]

You can begin mining bitcoin but you will be in competition with other miners living in countries where electricity is cheaper (think Norway, Iceland and China of course).

 

I don't want to speculate on cryptocurrencies. I think on Longecity most of us think long term, and I don't see the point of day trading with the other cryptocurrencies.

First, they are much more volatile than Bitcoin: their price go up and down very rapidly.

And honestly, I don't see a real future for them. Bitcoin is an enormous human endeavor, in terms of developers and money invested in it. I am not sure that the world could sustain 2 projects on that.

 

[Danail Bulgaria]

So, your advice is buy Bitcoins, wait and sell them later. Who knows? You may be right. 

Wish you good luck ! 

[orion602]

I have nearly 1 BTC and some altcoins as a speculative investment, also doing some trading time to time.

 

I would not dare to invest 80% of my money into cryptos though.

Bitcoin price is quite high now ($1033 at the moment of writing). If you want to buy for holding long term, i would advise to buy on price corrections in smaller amounts. (i can imagine buying monthly with small part of income). there were people who invested big time when the price was below 100 and got rich, but I dont think it will happen again with buying at current price. it would have to go above $10 000 for 1 bitcoin and that seems unlikely to me at the moment. not impossible though

 

but lots of things can happen, so its still risky

[Pour_la_Science]

Bitcoin price is quite high now(...)

there were people who invested big time when the price was below 100 and got rich, but I dont think it will happen again with buying at current price. it would have to go above $10 000 for 1 bitcoin and that seems unlikely to me at the moment. not impossible though

 

"Quite high" compared to what? with before?

I guess when it was at $100 in April 2013 when it was at $5 a year before, people thought just the same thing.

Why do you think the rise won't "happen again"? Since the chart is showing more that the rise is already happening (minus the big dips and rises)

 

I think everybody in this community knows a lot about risk. It's something we have to take into account. Like the risk of dying of aging/disease for example.

Edited by Pour_la_Science, 05 February 2017 - 09:03 AM.

[orion602]

not comparing, but taking rate of the recent price rise into account it seems overbought to me at the moment.

It will require very large amount of money influx into bitcoin for it to reach $10 000. In order of billions of dollars. Its not likely to happen very fast.

 

 

[Pour_la_Science]

not comparing, but taking rate of the recent price rise into account it seems overbought to me at the moment.

It will require very large amount of money influx into bitcoin for it to reach $10 000. In order of billions of dollars. Its not likely to happen very fast.

 

here's the rate of the price:

https://blockchain.i...=1&timespan=all

 

If you remove the large dips and rises (July '11, January '13), the rate seems pretty constant to me.

 

 

"It will require very large amount of money influx into bitcoin for it to reach $10 000. In order of billions of dollars. Its not likely to happen very fast."

I am curious how you calculate that, since it's admittedly very difficult to compute (for example: https://www.weusecoi...bitcoin-price/)

 

Even if you'll need "billions" to move the price up, I like to remember this:

The current market cap is 16 Billions $.

Other payment services like Mastercard is worth 115B$, Visa 180B$

And total gold is worth 8'000B$ (Bitcoin is 0.2% of this)

So bitcoin is still small fry apparently.

Edited by Pour_la_Science, 05 February 2017 - 05:39 PM.

[orion602]

your link is to logarithmic scale chart, i was judging from linear one https://blockchain.i...e?timespan=all ,as I don't think bitcoin price will expand exponentially

 

Even if you'll need "billions" to move the price up, I like to remember this:

The current market cap is 16 Billions $.

Other payment services like Mastercard is worth 115B$, Visa 180B$

And total gold is worth 8'000B$ (Bitcoin is 0.2% of this)

So bitcoin is still small fry apparently.

 

yeah, i have seen this somewhere as well. It took lot of time for Mastercard/visa to reach that level and its much easier to use than bitcoin.

I suspect at some point usage of other cryptocurrencies will start to increase, and we would rather have to take overall cryptocurrencies usage into account. But the question is which ones will be the winners (there are hundreds of them already). Few years ago, there was talk that litecoin will be second to bitcoin, lots of people bought into it, but now it seems almost forgotten.

its hard to imagine some coin surpassing bitcoin now, but we dont know what can happen in few years.

I hope you are right with bitcoin price rise - I have almost 1 bitcoin and plan to buy some more when i have spare funds. Im just trying not to get overexcited with unrealistic expectations. If it reaches $10 000 within 5 years , I'll be happy, but if it doesn't i will be ok with it as long as bitcoin still exists and keeps its value at least.

 

Edited by orion602, 05 February 2017 - 07:09 PM.

[Danail Bulgaria]

May I ask one maybe very stupid question.

 

Lets imagine, that right now - today - in very this moment - someone starts selling lets say 1 Bitcoin. For how much time will he sell it?

Will someone buy it at all and after how much time (averagely)

[orion602]

seivtcho: 1 bitcoin its nothing. you can sell or buy it in an instant on large exchanges: There are tens, sometimes hundreds of bitcoins listed on each one dollar increment of order book.

 

this is the recent trades list from one such exchange from couple of minutes ago:

                                           

 

[Danail Bulgaria]

So, selling the bitcoin is easy.

 

Have you received a real cash (that you can hold in your hand and put it directly in yout pocket) from trasing Bitcoins?