Bitcoin thread anyone?

Mining Bitcoin is from selling out your computer idling power to other who need computer processing power, basically you trade your electricity for bitcoin. and of course, you can sell your product and services in bitcoin.

problem with bitcoin is that forwarding looking, it can't store value like gold, if power line goes off line and internet goes offline, you can't sell your computer power. you may have hard time to take transaction to exchange for food.

It claims has anonymity, but as we know, or suspected, internet data traffic can be traced, and can easily tempered with governmental regulations, it is likely be manipulated down the road by people who is governance it. It is just a fancier form of cash in electronic form, this market will be dominated by power companies, because they can set the price of electricity.

after spend thousand doallar to upgrade computers you can't make it back after turnning it on for nonstopping mining bitcoin in years, and yet, your computer will soon be outdated. never recover the initial investment.:D
 
why buy gold? why use paypal?

It has a investment crowd

And it has a crowd of people using it make peer to peer transfers cheaply.

And it has, or probably will have a crowd of crooks looking to hide money or transfer money anonymously that are not too worried about its value. As it is very anonymous if you use an internet cafe to access your account.

I would imagine that that is the main use for it.

As far as using it to buy things over the internet, based on when i originally looked at it , there was really not must you could buy.

I think it started off mainly as a peer to peer transfer (I could see it having value in India). Form there, investors came in, and now crooks. Crooks are a good market to add to the bunch. They are not siting in front of there PC every day looking at its value. They probably check it every month or so.

But yes, it would help if there was a better use for the currency. For this reason selling items for bitcoins can be very lucrative as mentioned above

my 2 bit coins
 
Quote from newguy05:

You have no idea what you are talking about, you cannot dominate the production process...Even now the miners are barely breakeven on the electricity used to mine 1 bitcoin, and it's a geometric series... Just read the wikipedia man, this is not rocket science. Computer guy....

The real risks are 1) a major holder flooding the market to cause a temp crash. 2) a more popular p2p currency comes into play backed by a major company etc.., phases out bitcoin.

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You are 100% wrong. You are reading forum posts from 2010 when a bitcoin was worth $1.

Go back to stocks.
 
Quote from gnode:

Their very demand to utilize the combined computation power of the net (including your computer when you aren't using it) can potentially be the driving force of bitcoin value. If demand for computation pool power goes up, ie, google wants to add capacity dedicated to their software, they can pay in bitcoins. This would lead people to divert their resources from "mining" bitcoins to serving google's demand.

Bitcoins serve to commoditize computational power. One bitcoin will represent x number of computational time/production.

This creates a trade off for a "miner": mine/create more bitcoins (gold) or sell your computation time for other pursuits, such as to run google.

This leads to a currency backed by computation. If you compare gold to a computer, which is more useful?
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Quote from number22:

Mining Bitcoin is from selling out your computer idling power to other who need computer processing power, basically you trade your electricity for bitcoin. and of course, you can sell your product and services in bitcoin.
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I believe these statements seriously misrepresent what bitcoin mining is about. There is a pre-dermened rate at which new bitcoins are added to the sysytem. This rate decreases over time till teh last "new" bitcoin is produced around 2040. The cryptographic process involved in creation of new bitcoins is shared between all "miners"... and it scales with the number of participants in such a way that the total number of bitcoins is detrmined by the predifined rate of bitcoin expansion. A higher number of participants of the process supposedly increases security of all bitcoins transactions. However, there is no limit based on "enough is enough". So, the ever expansiding pool of miners share the ever decreasing amount of new bitcoins.

So, "mining" is nothing like selling computational power. It's more akin donating computaional power for the good of the community with an added small chance of getting a small amount of "free" bitcoins.

Selling computational power never caught up because commercial organisations are concerned with the intellectual property and "availability". In other words, they are not happy with sending their data and code (intellectual property) to potentially tens of thousands random people. Also home users can't guarantee availability. Their computer or internet connection could be down for days or weeks in a row.

The only application of mass computing I have seen is solving huge non-commercial problems like the SETI project.

If "trusted computing" catches up, maybe we'll see the first commercial project of this kind.
Quote from gnode:

2. It is very volatile right now. For better or worse, swings from $10 to $30 are commonplace within a couple days, sometimes intraday. You can't short (yet, mtgox is working on bitcoin margin so who knows?). You can only buy low and sell high. You can't sell high and buy low.
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Very much like stock market of the past. This suggests "shorting" should have massive upside.
 
Quote from 1a2b3cppp:

So when you buy bitcoin, what can you buy with it? Why not just buy whatever with real cash?
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Good point.

"As of May 2011, no major retailer accepts the currency for payment."

But you can buy a Linden dollar with it:

"Currency exchanges also exist between bitcoins and other virtual currencies, such as the Linden Dollar."

Its inflation rate seems to go much hugher than the US dollar's:

"As of June 2011, there are just over 6.5 million bitcoins in existence.The total number of bitcoins is programmed to approach 21 million over time."

Let's say it becomes very popular and retailers will accept it as legal tender. Then 21 millions wouldn't be enough and they have to create more and more...
 
Quote from LeeD:

I believe these statements seriously misrepresent what bitcoin mining is about. There is a pre-dermened rate at which new bitcoins are added to the sysytem. This rate decreases over time till teh last "new" bitcoin is produced around 2040. The cryptographic process involved in creation of new bitcoins is shared between all "miners"... and it scales with the number of participants in such a way that the total number of bitcoins is detrmined by the predifined rate of bitcoin expansion. A higher number of participants of the process supposedly increases security of all bitcoins transactions. However, there is no limit based on "enough is enough". So, the ever expansiding pool of miners share the ever decreasing amount of new bitcoins.

So, "mining" is nothing like selling computational power. It's more akin donating computaional power for the good of the community with an added small chance of getting a small amount of "free" bitcoins.

Selling computational power never caught up because commercial organisations are concerned with the intellectual property and "availability". In other words, they are not happy with sending their data and code (intellectual property) to potentially tens of thousands random people. Also home users can't guarantee availability. Their computer or internet connection could be down for days or weeks in a row.

The only application of mass computing I have seen is solving huge non-commercial problems like the SETI project.

If "trusted computing" catches up, maybe we'll see the first commercial project of this kind.

Very much like stock market of the past. This suggests "shorting" should have massive upside.
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I believe the 2040 time estimate is based on what is currently attainable with modern hardware. By 2040, computers will be far more powerful.

My understanding is that it throttles to an asymptope of 0, not 0 itself.

Also, bitcoin valuation is just like any other commodity. It doesn't matter that the production of nominal bitcoins will slow to near 0. What matters is what you can get for a bitcoin relative to the supply of bitcoins. As the world runs out of oil, the value of oil goes up. No different for bitcoins. As nominal bitcoin production slows, what you can get for a bitcoin will go up, -if- people are still using bitcoins widely.

It is an inherently deflationary currency, if bitcoin use increases while nominal bitcoin production falls.

Most people here are probably not used to thinking in deflationary currency terms.

I would just recommend that none of you take out a loan in bitcoins. It would not be favorable long term as bitcoins become harder to come by.


Also, you can get and use fractions of bitcoins. You can spend .02 bitcoins, for example.
 
My thoughts exactly....

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Bitcoin Mining Accidents - Miner Who Reported Brain Damage Tells All

The unabridged full story from Bitcoin Mining Accidents, the site with the tagline “Get Rich Or Die Mining”:

"My 4 mining rigs were still mining bitcoins (I left them on 24/7), generating lots of heat. It was extremely hot. I eventually woke up due to the heat, but it was already too late.
I had a terrible heat stroke, and it was quite frightening and disorienting. I not only felt physically terrible, having trouble breathing and terrible nausea."

The miner claims to be done with mining and now plans to sell the equipment. The brain damage could be more severe than is being reported as no miner with full faculties would even consider selling his rigs outright.
 
I guess with Bitcoins I could buy corn for my chickens on Farmville....

Oh wait, I have found some real world usage:

"Underground Website Lets You Buy Any Drug Imaginable"

http://www.wired.com/threatlevel/2011/06/silkroad/

"Sellers feel comfortable openly selling hard-core drugs because the real identities of those involved in Silk Road transactions are utterly obscured. If the authorities wanted to ID Silk Road’s users with computer forensics, they’d have nowhere to look. TOR masks a user’s tracks on the site. As for transactions, Silk Road doesn’t accept credit cards, PayPal or any other form of payment that can be traced or blocked. The only money good here is Bitcoins."
 
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