View Full Version : Bitcoins gaining credibility and use
This article http://www.csmonitor.com/Business/Saving-Money/2014/0115/Bitcoin-goes-mainstream-Digital-currency-now-accepted-at-major-retailers?utm_source=Sailthru&utm_medium=email&utm_term=BizTech&utm_campaign=20140115_Newsletter%3ABizTech_Sailthr u&cmpid=ema%3Anws%3ABizTech%2520Weekly%2520%2801-15-2014%29 is amazing to me.
The world of finance may be going bonkers maybe? Would you use bitcoin?
Simplicity
1-15-14, 6:18pm
I just wish I would have bought some a year or two ago!
Teacher Terry
1-15-14, 6:50pm
My son has been mining Bitcoin for about a year and we have invested as well as others. Right now we are ahead of the game. Will let everyone know how it works out in the long run. I consider it a totally risky investment so only invested the amount that I was willing to lose.
Central banks throughout history have always succumbed to the temptation to print, print, print money until it becomes worthless. In the years since the meltodwn in 2008 the federal reserve is showing itself to be no different from all the others. Because of that I'm very much in favor of the idea of bitcoin. However, the value of them is not stable enough for me to consider them useful as money at this time. I'd consider buying them as a speculative investment since I expect the price to go higher, but not as somewhere to store and preserve my wealth. At least for now.
Also, the mining, now being done by some big players who have invested big bucks in computer equipment designed specifically for the purpose of mining them, uses lots of electricity in the process. http://www.zerohedge.com/news/2013-12-25/trip-through-bitcoin-mines
Teacher Terry
1-16-14, 1:22pm
I agree jpl that I would not put wealth in them. They do use alot of electricity but we just consider that the cost of doing business. Also they require air conditioning even in the winter since they get so hot but we have a dirt basement which keeps them cool so we don't need air. People that bought small amounts of them 5 years ago are now millionaires. The computers my son uses are specifically for mining-they don't look like a computer at all. However, some very wealthy individuals have bought alot of them because they expect them to go up to $20,000/per coin. It will be interesting to see what happens. None of his investors bought more then they were willing to lose. We emphasized that alot because we did not want anyone hurt.
Ok, so bitcoins are invisible 'something' with a number that only exist on the internet (which could also be said for credit card balances I suppose) and people are willing to accept them as payment for real stuff? And the value changes daily? so you sell a ton of flour for some bitcoins and then the next day (or even the next hour) that group of bitcoins could be worth a totally different amount. Am I getting this right? So now you have to find somewhere to spend your bitcoins (do electric companies accept them for your outstanding bill?) and you might need more or less than you needed yesterday to pay the same Dollar balance or something? I don't get it.
Help please?
Teacher Terry
1-16-14, 1:40pm
You have some understanding of the process. You can cash out your bitcoins for real $ but pay an exchange a fee to do this. The price changes constantly-varies thru out the day. There are many other coins to be mined besides bitcoin but this is the most well known one. Some businesses accept them and some do not. We started in June & keep reinvesting our profits instead of cashing out. Each person decides when the value is high enough that they want to cash out. What you are mining is that the computers are solving math algorithms and you are being paid to do so. All those computers can solve probs faster then a person could.
http://www.srgc.org.uk/bulblog/log2007/170707/Tulip%20bulbs.jpg
IshbelRobertson
1-16-14, 2:54pm
Sad story from this side of the pond!
http://news.sky.com/story/1175103/bitcoin-blunder-man-throws-away-4m-laptop
http://www.srgc.org.uk/bulblog/log2007/170707/Tulip%20bulbs.jpg
Exactly.
ToomuchStuff
1-17-14, 8:45am
In part, it is like any foreign currency speculation, and in part, it is similar to the US dollar (based on trust). I haven't seen any companies accepting them locally, but I do expect at some point to read about them from a tax perspective. (evade verses avoiding taxes, and two different arguments).
The recent seizures though, is what would have me more worried. http://www.forbes.com/sites/kashmirhill/2014/01/16/the-feds-are-ready-to-sell-the-silk-road-bitcoin-kind-of/ Below is the quote that I think is a dangerous precedent. By it, if someone in a higher position at your bank, was assisting in money laundering at your bank, any money you have in it, could be forfeited by that precedent.
"Any Silk Road users who had legitimate holdings on the site are out of luck. All Silk Road assets are forfeited because they were “being used to facilitate money laundering,” per the order from U.S. District Judge J. Paul Oetken"
The seizures of the Silk Road bitcoins wouldn't concern me too much. The site's main consumer group, from what I've read, were people purchasing illegal drugs, not people storing bitcoins as if it was a bank. Anyone who had their bitcoin there could reasonably be assumed to have been planning to make illegal purchases. Anyone looking for a secure place to store their bitcoins can do much better than a Tor site that is known for illegal activity.
ApatheticNoMore
1-17-14, 12:26pm
Well the seizures do reduce what was one of the major real values of bitcoin, which was the ability to buy things like drugs, part of the bet on bitcoin I think was a bet on the black market (the was the part of bitcoin's value that represents real value ironically as in it represents REAL trade and it's better than $s for, as opposed to the part of bitcoin's value based on pure ponzi and speculation).
ToomuchStuff
1-19-14, 1:42am
The seizures of the Silk Road bitcoins wouldn't concern me too much. The site's main consumer group, from what I've read, were people purchasing illegal drugs, not people storing bitcoins as if it was a bank. Anyone who had their bitcoin there could reasonably be assumed to have been planning to make illegal purchases. Anyone looking for a secure place to store their bitcoins can do much better than a Tor site that is known for illegal activity.
Anyone who follows Islam is a terrorist. Anything from China is junk. Any car made on a Monday sucks. Anyone who lives in SF is queer. etc.
The law is SUPPOSED to PRESUME innocents, UNTIL PROVEN GUILTY in a court of law. You listed Main consumer group, what other groups did you find? I don't do drugs and don't suggest anyone get into it, but I do expect our rights to be protected instead of eroded.
Anyone who follows Islam is a terrorist. Anything from China is junk. Any car made on a Monday sucks. Anyone who lives in SF is queer. etc.
The law is SUPPOSED to PRESUME innocents, UNTIL PROVEN GUILTY in a court of law. You listed Main consumer group, what other groups did you find? I don't do drugs and don't suggest anyone get into it, but I do expect our rights to be protected instead of eroded.
According to a Carnegie Mellon study cited on the Silk Road wikipedia page 70% of sales were illegal drugs. I agree with you that the law is supposed to presume innocence, but unfortunately we know that often that is not the case. I've never understood how the various property forfeiture laws can be legal, even in the absence of a conviction.
If someone was using Silk Road for legal purposes I suppose they could try to get their bitcoins back.
Recently someone in Las Vegas was selling a 2 million dollar house & said he would take bit coins. However, this would be difficult to do since the value changes constantly. Some businesses are also taking them but the electric co does not. It will be very interesting to see what happens in the long run.
https://www.technologyreview.com/f/613201/nearly-all-bitcoin-trades-are-fake-apparently/
Teacher Terry
7-7-19, 7:02pm
It’s worked out well for us. We have made 30k and my kids 100k. We no longer mine as it’s not profitable. We still each have some.
iris lilies
7-8-19, 9:17am
It’s worked out well for us. We have made 30k and my kids 100k. We no longer mine as it’s not profitable. We still each have some.
That is amazing! Good job.
”mining bitcoins” is utterly mysterious to me in the way it works.
Teacher Terry
7-8-19, 9:55am
I can’t say I totally understand it but my son was the brains of the operation. Also we had a partial cool, dirt floor basement so just needed fans down there to keep it cool enough. When it was over he sold the computers.
Bitcoin isn't very eco....
https://digiconomist.net/bitcoin-energy-consumption
An I reading ir correctly? Bitcoin uses 1/3 of the total world's electric consumption? :0! Facebok wants to start a banking system based on a similar currency? What am I not understanding here?
It's 0.32%, not 32% of all electricity, but that's still a huge amount of electricity.
It's 0.32%, not 32% of all electricity, but that's still a huge amount of electricity.
Especially considering it isn't really doing any useful work.
Especially considering it isn't really doing any useful work.
Indeed. And imagine if people were actually using bitcoin in any sort of sizable numbers how much electricity that would take.
Teacher Terry
7-8-19, 7:51pm
It’s not using bitcoin but mining that uses electricity. That actually bothered me.
My understanding is that mining is essentially propagating the bitcoin transaction database, which will only become more energy intensive as the number of transactions increases, thus making the transaction database ever larger. Because of the distributed nature of the transaction database there's no way to make doing a transaction energy efficient. It's not like doing a credit card transaction where the data only gets posted to the buyer's bank and to the merchant's bank. Every bitcoin transaction gets posted to every one of countless copies of the entire transaction registry. That's the secret sauce of how cryptocurrencies work, but it also means that it's wildly inefficient energy-wise.
The part that's not clear to me is what will happen once the finite supply of bitcoin have all been mined. At that point no one will be interested in providing mining services so it's unclear to me who will actually be providing all the processing necessary to keep the database of transactions propagated.
It’s not using bitcoin but mining that uses electricity. That actually bothered me.
Alas, using bitcoins uses a lot of power to verify the transaction. "Mining" also incorporates doing the transactional processing.
https://www.economist.com/the-economist-explains/2018/07/09/why-bitcoin-uses-so-much-energy
When I looked about two years ago, it took about 200KWh to process a single transaction. That's enough to power my 4500 sq. ft. home for about 2 weeks. You can see why micropayments using bitcoin are having trouble getting off the launchpad.
Teacher Terry
7-8-19, 11:02pm
Thanks Bae for the explanation:))
iris lilies
7-8-19, 11:03pm
...When I looked about two years ago, it took about 200KWh to process a single transaction. That's enough to power my 4500 sq. ft. home for about 2 weeks .
good lord. And this transaction gets you— a bit? A coin???
No answer needed I am too ignorant to ask real questions I just I just don’t get it.
good lord. And this transaction gets you— a bit? A coin???
No answer needed I am too ignorant to ask real questions I just I just don’t get it.
No, actually you DO get it. You get that it just doesn't make sense.
They are easier to store than tulip bulbs or beanie babies.
ApatheticNoMore
7-9-19, 10:59am
it seems basically immoral because of the energy consumption yea (although accounting for total lifecycle energy use seems hard to do as it's always "as compared to what?". But still, we do know this stuff burns through energy).
good lord. And this transaction gets you— a bit? A coin???
Well, a representation of a coin. It's a convenient unit of measure, much as paper currency at one time represented an amount of gold. And one Bitcoin is worth almost $US 12,400 today. That's one reason why people go to the trouble of mining.
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