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Bitcoin

Discussion in 'General Chat' started by payattention, May 19, 2013.

  1. payattention

    payattention Archived Member

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    This weekend, the Bitcoin 2013 - The Future of Payments conference is being held in the US. I know there has been little discussion of it here (mostly negative too!) but I would encourage you all to take a second, much deeper look. I'm sure the love of technology here goes beyond just domain names and websites.

    The videos should be available after the conference has ended but you can watch the keynote by the Winklevoss twins here - part 1 - part 2.

    This 30 minute talk from 2012 is a bit more in depth and explains a lot of the functions in the Bitcoin protocol that most people are unaware of.

    A good analogy for Bitcoin to domains is that it's currently in the land grab stage. How many people laughed off and disregarded premium domains in the early days? When it was too late, just about everyone could appreciate the value in them.

    To give you some perspective of the land grab, over 90% of the total coins will be mined by 2022 - that's only 9 years away yet the remaining 10% will be mined between 2022 and 2140.

    2013 - 56% mined
    2017 - 78% mined
    2021 - 89% mined
    2024 - 96% mined
    2032 - 99% mined

    Anyway, just some food for thought.
     
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  2. Blue Wren

    Blue Wren Membership: VIP

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    mined? I have no idea what that means.

    I really should read up on this.

    Any "for dummies" links around?
     
  3. payattention

    payattention Archived Member

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    https://www.youtube.com/watch?v=GmOzih6I1zs

    That video explains it on a basic level but at face value it sounds like a really stupid thing. It's not until you do some further reading and take it all in that you have that light bulb moment (which feels the same way as it did with my first computer, getting online and to a lesser extent, mobile phone).
     
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  4. Ash

    Ash Membership: Trader

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    Is bitcoin.org the official site?

    First heard of BTC a couple of months ago but your post has got me looking at it again. Sounds interesting... I don't think I'd have the ability to mine it but the idea of accepting it as payment is interesting.
     
  5. payattention

    payattention Archived Member

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    Yeah, that's the official site.

    As for mining, unless you can get very cheap (or free) GPU's (free or cheap electricity is a big help too!), it's pointless to begin mining this way because you're unlikely to break even for quite a while (if at all some might suggest).

    ASIC hardware is scarce at this point but they are slowly making their way into the hands of miners. The problem with that is they are most profitable to run right now, once everyone can get one, the profitability will drop as the difficulty increases.

    An alternative to mining is to invest in bonds issued by a mining company like ASICMINER. Since their IPO, price per share has increased by about 20x and they've begun paying dividends as well (you get x amount of bitcoin per share).

    I think it's clear that the days of the hobbyist miner are coming to an end and it's difficult to predict what will happen next, it's pretty interesting though. I think GPU mining will be completely gone before the next block halving (sometime in 2017).

    Prior to this, I was into folding@home, so I heard about it from that community around the beginning of 2011 but I dismissed it as a stupid idea. I took another look at it after the crash mid 2011.

    Anyway, try not to focus too much on the price but it's use. I think it's inevitable we will move to an electronic currency and I think Bitcoin will succeed for the same reasons the Internet - because it's open and available to all on a global scale.
     
  6. findtim

    findtim Membership: VIP

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    can i buy milk and bread with it ?

    tim
     
  7. payattention

    payattention Archived Member

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    Try to think a little bigger tim.. ever cash a Clickbank check? Currency exchange + international check fees + time for it to clear.

    But even with something as simple as bread/milk, speak to your cornershop about their merchant fees.

    How about paypal fees while we're at it?
     
  8. findtim

    findtim Membership: VIP

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    i must be totally reading it wrong, so i am happy to be slagged as i just don't get it, it sounds like "internet bartercard" to me, and i have been there with bartercard.... you have all these "dollars" and no person wants them but you have done all the work to get them ( don't get me started :mad: )

    i LIKE that you are saying "its the next big thing when we all ignored domain names years ago " , but i also have a few clients who have HEAVILY invested in the carbon tax and they are not to happy right now !

    i also wished i had invested that spare 20K in apple shares in 2002 ! then i could have bought heaps of facebook shares and lost it all ?

    what do others think?

    tim
     
  9. payattention

    payattention Archived Member

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    I don't see how the carbon tax has anything to do with this discussion? Maybe you're high off fumes so it's a good idea.
     
  10. findtim

    findtim Membership: VIP

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    the analogy of the whole reply was "thanks for the info" but i am yet to be convinced because of other investiments that have also gone wrong, if i am wrong in 10 years time then i was wrong not to take your advice.

    also i stated i was wrong on apple in 2002 !

    thats all

    tim
     
  11. payattention

    payattention Archived Member

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    Sorry tim but I find you frustrating to speak with. Bitcoin isn't the stock market so apple shares and/or carbon tax don't make for a good analogy. Don't look at it as an investment, ignore the price and look at what the technology actually does.
     
  12. findtim

    findtim Membership: VIP

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    ok, i obviously don't get it, so i will no longer post so i do not distrub the thread.

    and go do some more research.

    tim
     
  13. Scott.L

    Scott.L Membership: Trader

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  14. payattention

    payattention Archived Member

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    Videos are soon to be available (bit of a frustrating wait) but in the meantime, there is an article today on techcrunch regarding more VC coming into the space.
     
  15. Lucas

    Lucas Membership: Trader

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    Bitcoin is on a dangerous path.

    I believe it will end up being controlled by a few large corporations sooner or later. With the advent of ASICs the power is shifting away from the community who made bitcoin what it is today. The ASIC manufacturers, Avalon and BFL for example, are holding back releasing the mining units, in my opinion so they can mine with their own technology (why wouldn't they?). This will eventually drive the difficulty through the roof and the general community will start looking for the next best thing. As soon as that happens people will start moving en masse to alternate coins such as litecoin and digitalcoin which cannot be mined with the current generation of ASICs.

    <shameless-plug>If you feel like getting in early and mining some digitalcoins (released a week or so ago) head on over to http://www.digitalcoinpool.com</shameless-plug>
     
  16. Honan

    Honan Membership: VIP

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  17. payattention

    payattention Archived Member

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    Lucas, ASIC's are a good thing; they increase the power of the network which ensures the integrity of it. It's not possible for the altcoins you mentioned to ever gain ground over Bitcoin due to the network effect amongst many other reasons (which I'm happy to go into after I cook dinner).

    As for ASIC's.. it's the same story from CPU's to GPU's to FPGA's.. eventually ASIC's will become easily obtainable (although not as profitable). Increased difficulty is a good thing, not a bad thing, this is something altcoiners refuse to grasp.

    The detriments you mention are just the next step in the evolution of Bitcoin and they are what's required for mass adoption and use. The altcoins you talk about serve no use.. hell, even Atlantis had to adopt BTC because no vendors were interested in accepting LTC let alone whatever flavour of the week altcoin it is this week.
     
  18. Lucas

    Lucas Membership: Trader

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    The difference is when GPUs came into the picture AMD didn't stop selling them to us they made and sold us more of them.

    If ASICs get into the hands of the general public anytime soon - yes I know there are a few (expensive) Avalons around, and some FPGA units etc.. But the wait on pre-order BFL units has been over a year for early customers. There is a post on bitcointalk somewhere where someone has calculated that if BFL units, at current prices, are not received by something like November they will never return the investment - except for the lucky few who get theirs before everyone else. Note: I have ordered a unit - just for the fun of it, but don't expect it to ship anytime soon and as such will probably make little if anything on my investment.

    The point I am trying to make is that at some point surely ASIC manufacturers will decide it is more profitable in the short term to use their technology to mine rather than pass the benefits around - I mean who wants to sell what is essentially a mint rather than use it themselves. It will be so hard for the average miner to compete with the super ASIC farms that they will move on to the harder (from an ASIC point of view) altcoins. This, I believe, will cause the community that has built BTC to cash out of it and move on because they can no longer really participate. When there are only a handful of super ASIC farms left - whats in it for the community to keep up network security, keep updating the code etc.

    Hopefully I am wrong and it surely wont happen any time soon - but it is a valid concern I think.

    I do believe altcoins have a role to play whatever ends up happening to bitcoin. Only time will tell I suppose.
     
  19. payattention

    payattention Archived Member

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    Everyone wants an ASIC, no doubt about that and very few people have them at this time. Yes, it's all a bit of a mess, on one hand you have people like friedcat and his ASICMINER doing very, very well (as well as block erupter otw). On the other hand, you have a company like BFL who have run into problem after problem. A lot of people are labeling them scammers but I think they just took on more than they could handle. I'm sure they will eventually get them out beyond a few samples to various people. In the middle you have Avalon who have been shipping to those who took the risk of an early pre-order.

    The important thing to remember is that these issues are unrelated to Bitcoin itself. This is a people problem, not a Bitcoin problem. Contrary to popular belief, ASIC's are not a licence to print money (unless you are one of the very lucky few to have one atm). Eventually everyone will have them and it'll just be the next step up from GPU's and FPGA's. ASIC's also consume less power, less space and will continue to evolve.

    The point you raised about ASIC manufacturers opting to mine bitcoins themselves has already occurred. ASICMINER did that and it's proven to be the most successful way of doing ASIC's to date. Instead of buying an ASIC from them, you purchased shares and get paid a dividend from what they mine.

    All were high risk investments and the people who took on that risk early are now justly rewarded or lost out big (depending on who they went with). It's early days and that's how it works, it truly is the wild west.

    Change is upon us but to suggest people will simply move to another coin implies they are only in it for the money. There is more to Bitcoin than just participating in mining.

    In fact, most people (who are few in number) in altcoins are solely in it for the quick buck, this is why you continue to see a new one every few days which gets pumped and dumped yet Bitcoin continues on with development, investment, media coverage, adoption and a steady rise in demand.

    Altcoins serve zero purpose. Proponents of Litecoin often cite faster confirmation times but they ignore the fact that A) 51% attack is not a realistic possibility, even less so with ASIC's coming online and there is no real financial incentive to do so B) Merchants can simply use a service such as Bitpay to get paid straight away. Every day type transactions are already happening and no-one is standing around waiting 20 minutes for 6 confirmations, 0 confirms are fine for most low value transactions.

    Secondly, the network hashpower of Litecoin is quite low (even much, much lower for the other altcoins) which in actual fact makes it far more likely a target for such attacks. Altcoins also suffer from a complete and utter lack of support from not only the developers of the coin itself but from the majority of the crypto currency community itself.

    You also have the issues of altcoin premining which is pretty much necessary to ensure some fly by night exchange will list it for a large sum of coins which they can use to trade for Bitcoin.
     
  20. payattention

    payattention Archived Member

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    1 person likes this.