Bitcoins worth more than gold
The value of those original coins doesn’t reduce (they are still 50 coins). It’s just you get less reward for more work now.
pew, pew, pew, pew!
Bitcoin mining and verification are two different things. There's a small reward for verification because it requires a small amount of computation power, but there are many transactions and every transaction needs verification, but verification and mining is not the same.
Bitcoin design takes Moore's law into consideration: computational power of computers increases every couple of years.
When a Bitcoin amount is transferred from one wallet to another the sender has to pay a transaction fee. The transaction fee is a voluntary amount with a minimum required value. The higher the transaction fee, the faster the transaction is verified by other Bitcoin connected peers. The transaction fee paid by the sender for the transaction is the "magical" reward.Orichá wrote: ↑Tue Mar 02, 2021 8:24 amAt the beginning of Bitcoin miners who "verified a blockchain" received 50 free bitcoins... What is the difference between "verifying a blockchain" and "actually mining" a single Bitcoin? ...Nothing online that I have read makes this mushy nonsense clear... Where do these magical free bitcoin rewards for "blockchain verifying miners" who win by verifying a current block first come from?[/i] Halving has continued to reduce miner's rewards from 50 to 25 to 12.5 and now 6.25 free per block verification... I guess that someone has a fat purse of free bitcoins just waiting to disburse to those who verify blocks first
Not only did the blockchain grow in size. The amount of available peers in the Bitcoin network grew (expected) and the amount of transactions increased (expected). The system is designed taking these things in consideration.Orichá wrote: ↑Tue Mar 02, 2021 8:24 amThe only possible mathematical explanation would be that, back at the beginning, the blockchain verification process took less time because the blockchain was "shorter"... and so Bitcoin blockchain transactions were being verified more quickly... But if it took one miner one blockchain verification to win an award of 50 free Bitcoins at the beginning, where did the free reward Bitcoins actually come from? If verifying a blockchain consists of verifying Bitcoin transactions, this still does not explain WHERE the new free Bitcoins COME FROM?
The new Bitcoins come from cracking encrypted blocks that were created at launch. Due to the limited number of blocks there is a deterministic limited number of coins that can be mined.
When Bitcoin was created a large amount of encrypted data was generated. Networked computers spend computational power to crack the cryptographic blocks. When a block is cracked the computers that partook end up with private keys for cryptographic blocks. The private keys are the currency, the amount of Bitcoin they receive for participating in "mining" the coin. The amount that they receive depends on the amount of computational power they spent to participate.
Like with any asymmetric cryptography there is a public and private key. The private key is used for signing transactions and the public key is used for verifying them.
The difference between mining and verification is that mining generates private keys and verification verifies transactions using public keys, like in other public key cryptography systems.
It is not contradictory and nonsensical. It uses private and public keys like any other asymmetric cryptographic system, for example SSL and PGP.Orichá wrote: ↑Tue Mar 02, 2021 8:24 amNone of the articles below hint remotely at how it would have been possible to award the first miner to verify a blockchain with "50 free" Bitcoins at the beginning of the enterprise -- when there were many fewer Bitcoins -- as compared to now, when a miner can only get 6.25 "free bitcoin" for "verifying a block..." even as there are millions more whole Bitcoins now in circulation than at the beginning stage... Doesn't it all sound contradictory and nonsensical?
The first Bitcoin block, the genesis block, was minded by Satoshi. From the genesis block he generated the first 50 Bitcoins. He sent 10 Bitcoins to Hal Finney. The transaction was verified using Satoshi's public key.
Bitcoins are never spontaneously generated. That would defeat the whole purpose. It's a long chain of verifiable math. They never appear randomly from thin air. That would be a very broken system.
In order to verify a Bitcoin transaction you must run a Bitcoin node, a computer with a Bitcoin software. If you are using a broker then you are not running a Bitcoin client and you will never verify any transactions and you will never receive a reward for doing so. The broker is your Bitcoin node and they're not in the business of giving you free money.
If you do run a Bitcoin client and you happen to verify a transaction the rewarding Bitcoins are transferred to your wallet.
No, the sender pays a transaction fee.
Yes, they do. They are cryptographically signed and verified.
By downloading a Bitcoin client and transferring a Bitcoin to your wallet. A Bitcoin is a piece of text. It's a variable for a large equation.
I don't really see what the argument against is.
It's gone up a lot - that is all.
If it's a tulip well lots of people made money from tulips too.
It's gone up a lot - that is all.
If it's a tulip well lots of people made money from tulips too.
- Orichá
- I have some social problems
- Reactions: 70
- Posts: 551
- Joined: Sat Jun 27, 2015 10:20 pm
- Location: unknown
Thanks for the interesting reply, Alexandra... you can tell I have only read a few articles (months ago) about Bitcoin, lol... need to do more research before writing a short story or novella about this...
But I just thought of a great scenario... imagine the potential vulnerability of the blockchain, when you conceive of it as a single entity. Imagine some troll hacker who invents and then injects a virus that scrambles the encryption system of the entire blockchain instantly all around the world -- dissolving all the Bitcoins in existence into numerical gibberish...
♻
Did you hear the tale about the Canuck entrepreneur, Jerry Cotten, founder of Quadriga, who died? And supposedly only he knew the code/password containing access to encrypted accounts from investors valued in the hundreds of millions of dollars? None of which monies they have recovered, lol...
https://www.vanityfair.com/news/2019/11 ... cotten/amp
But I just thought of a great scenario... imagine the potential vulnerability of the blockchain, when you conceive of it as a single entity. Imagine some troll hacker who invents and then injects a virus that scrambles the encryption system of the entire blockchain instantly all around the world -- dissolving all the Bitcoins in existence into numerical gibberish...
♻
Did you hear the tale about the Canuck entrepreneur, Jerry Cotten, founder of Quadriga, who died? And supposedly only he knew the code/password containing access to encrypted accounts from investors valued in the hundreds of millions of dollars? None of which monies they have recovered, lol...
https://www.vanityfair.com/news/2019/11 ... cotten/amp
"Storytelling reveals meaning without committing the error of defining it."
...Hannah Arendt
...Hannah Arendt
- spitthedog
- Is the World Outside still there ?
- Reactions: 123
- Posts: 5708
- Joined: Mon Feb 17, 2014 10:19 pm
Viable businesses (15 to 20% return compounded over decades), with a competitive advantage and moat just never go off like a rocket like this one has.
They are slow and steady like the elephant they become.
The price action of Bitcoin on the stock market is the opposite, like its being supported. It trades like a microcap or penny stock.
I still smell BS.
They are slow and steady like the elephant they become.
The price action of Bitcoin on the stock market is the opposite, like its being supported. It trades like a microcap or penny stock.
I still smell BS.
"I don't care what the people are thinking, i ain't drunk i'm just drinking"
Sure they do. Microsoft, eBay, PayPal, FB, Airbnb, even Tesla. They all had a tipping point when they became the dominant player.Viable businesses (15 to 20% return compounded over decades), with a competitive advantage and moat just never go off like a rocket like this one has.
Bitcoin didn't "go off like a rocket", it's taken 7 years or so.
-
- MerkinMaker
- Reactions: 62
- Posts: 3232
- Joined: Wed Mar 21, 2012 11:04 am
It's not a business, it's not a stock, it's not a commodity. It's a protocol, the unique property of this protocol is that it stores value.
If you want some graphs to compare it to, then forget the markets, go take a look at HTTP or SMTP traffic from the 90's until now.
If you want some graphs to compare it to, then forget the markets, go take a look at HTTP or SMTP traffic from the 90's until now.
-
- MerkinMaker
- Reactions: 62
- Posts: 3232
- Joined: Wed Mar 21, 2012 11:04 am
-
- MerkinMaker
- Reactions: 62
- Posts: 3232
- Joined: Wed Mar 21, 2012 11:04 am
If the number of transactions that happen on chain (any chain, and any protocol) follow an exponential growth curve like that, then a single Bitcoin will be worth millions as it will be underpinning all of that activity as the reserve currency of the entire ecosystem.
-
- MerkinMaker
- Reactions: 62
- Posts: 3232
- Joined: Wed Mar 21, 2012 11:04 am
And forget crypto as some kind of replacement for MasterCard, it's so much more that that, eventually all data and all physical items with any value whatsoever will exist on chain with a full verifiable audit trail. At that point you won't need money, your whole life will be a massive peer to peer barter deal, with tiny streams of value inputs and outputs maximising your purchasing power by removing the middlemen men from every exchange of value, however large or small.
- Orichá
- I have some social problems
- Reactions: 70
- Posts: 551
- Joined: Sat Jun 27, 2015 10:20 pm
- Location: unknown
From my amateur's perspective, intuition tells me that there are a few big weaknesses in the defining nature of Bitcoin... here are two of the biggest ones, as far as I can see...
1) and the first weakness is exactly what makes Starkmonster think it is so great... he writes, "It's not a business, it's not a stock, it's not a commodity. It's a protocol, the unique property of this protocol is that it stores value." ...but that i why I think it is weak -- it does not exist except as a digital entity. Encrypted maybe.... (but further, and at risk of an embarrassing reference to classical economy and even Marxism, Bitcoin does not produce anything other than its placeholder value. There is no work attached to it. Okay, neither does productive work attach to the fabulous schisms of funny money known as derivatives and traditional bonds.... but hey, who cares..? A few dozen guys get to buy fabulous palaces on the Upper West side... )
2) as I see it, herein lies the greatest weakness of Bitcoin: its singularity... it is all (only) one unit. One chain. If that unit should be vaporized or broken into a multitude of, say, "hardforks" by some crafty coupon composer of nasty viral code... or, simpler, what if our saboteur makes it all suddenly just disappear? The whole system could literally evaporate instantly. In that case, is Mr. S. going to crawl out from under his rock with a NAS or RAID HDD array full of conveniently backed up records of all the world's Bitcoin and their owners? Not likely... Read this... "Is bitcoin just one long block chain or are there multiple chains?"
https://bitcoin.stackexchange.com/quest ... 0chain-tip.
To me, Bitcoin's diaphonous insubstantiality -- as a protocol, and a digital entity (no matter the cleverness of it encryptions) -- is also actually its greatest drawback. It is brittle... Less than crumbs, and all the brokerages are so scammy... From reading this thread in its entirety, it looks like it can be quite a pain to cash out. Also, everyone rambles on about how strong it is compared to fiat... But everyone wants to sell it back to dollars after an upswing. Hypocrisy of value? Mere greed for gain? Unless crypto becomes as easy to use for buying your groceries as paper money or debit cards, etc... It won't win. Of course, some of you may be right, it may take up much wider public use, but it is still very small compared to currency and commodities.... Did you really need London and NYC to make it safe enough of a roller coaster? Because that is why the price went up: institutions and other late-coming fat cats...
Bitcoin is not a book, it is a bookmark... So, it is nothing, really...
1) and the first weakness is exactly what makes Starkmonster think it is so great... he writes, "It's not a business, it's not a stock, it's not a commodity. It's a protocol, the unique property of this protocol is that it stores value." ...but that i why I think it is weak -- it does not exist except as a digital entity. Encrypted maybe.... (but further, and at risk of an embarrassing reference to classical economy and even Marxism, Bitcoin does not produce anything other than its placeholder value. There is no work attached to it. Okay, neither does productive work attach to the fabulous schisms of funny money known as derivatives and traditional bonds.... but hey, who cares..? A few dozen guys get to buy fabulous palaces on the Upper West side... )
2) as I see it, herein lies the greatest weakness of Bitcoin: its singularity... it is all (only) one unit. One chain. If that unit should be vaporized or broken into a multitude of, say, "hardforks" by some crafty coupon composer of nasty viral code... or, simpler, what if our saboteur makes it all suddenly just disappear? The whole system could literally evaporate instantly. In that case, is Mr. S. going to crawl out from under his rock with a NAS or RAID HDD array full of conveniently backed up records of all the world's Bitcoin and their owners? Not likely... Read this... "Is bitcoin just one long block chain or are there multiple chains?"
https://bitcoin.stackexchange.com/quest ... 0chain-tip.
To me, Bitcoin's diaphonous insubstantiality -- as a protocol, and a digital entity (no matter the cleverness of it encryptions) -- is also actually its greatest drawback. It is brittle... Less than crumbs, and all the brokerages are so scammy... From reading this thread in its entirety, it looks like it can be quite a pain to cash out. Also, everyone rambles on about how strong it is compared to fiat... But everyone wants to sell it back to dollars after an upswing. Hypocrisy of value? Mere greed for gain? Unless crypto becomes as easy to use for buying your groceries as paper money or debit cards, etc... It won't win. Of course, some of you may be right, it may take up much wider public use, but it is still very small compared to currency and commodities.... Did you really need London and NYC to make it safe enough of a roller coaster? Because that is why the price went up: institutions and other late-coming fat cats...
Bitcoin is not a book, it is a bookmark... So, it is nothing, really...
Last edited by Orichá on Wed Mar 03, 2021 12:14 am, edited 1 time in total.
"Storytelling reveals meaning without committing the error of defining it."
...Hannah Arendt
...Hannah Arendt
starkmonster wrote: ↑Tue Mar 02, 2021 11:19 pmFind anything in finance that has ever performed like that:
Ok here you go
It is not possible because there is nothing to hack. It is like saying imagine if electricity was hacked.Orichá wrote: ↑Tue Mar 02, 2021 7:47 pmBut I just thought of a great scenario... imagine the potential vulnerability of the blockchain, when you conceive of it as a single entity. Imagine some troll hacker who invents and then injects a virus that scrambles the encryption system of the entire blockchain instantly all around the world -- dissolving all the Bitcoins in existence into numerical gibberish...
Think of the blockchain as the result of a very long complicated equation. The blockchain is distributed peer-to-peer. There is no single point to attack because it's distributed networking. All data is distributed and replicated across the network and data that isn't mathematically valid are refused by the network as a whole.
No but this is a very common scenario.Orichá wrote: ↑Tue Mar 02, 2021 7:47 pmDid you hear the tale about the Canuck entrepreneur, Jerry Cotten, founder of Quadriga, who died? And supposedly only he knew the code/password containing access to encrypted accounts from investors valued in the hundreds of millions of dollars? None of which monies they have recovered, lol...
https://www.vanityfair.com/news/2019/11 ... cotten/amp
There are some people who instead of mining coins generate random Bitcoin wallets as a type of collision attack. I find this very interesting personally because in theory at one point mining Bitcoins becomes harder and more resource consuming than generating wallets.
By generating a large amount of random wallets over time there is a chance that one randomly generates somebody else's wallet key, just like they themselves generated it randomly, and that way gain access to somebody else's coins.
Randomness does not exist without quantum computing. Computers use so called cryptographically secure pseudorandom number generators. The way they work is that they gather data from various internal parts of the computer, for example network traffic, and use that data as entropy to generate pseudorandomness.
Not all CSPRNGs are equal and there are differences between different versions of Windows, MacOS and Linux for example, but also different systems use different CSPRNGs. For example Linux distros (Android phones) have both /dev/random and /dev/urandom. A software developer may choose their own preference depending on performance vs security requirements if they want to use entropy from the slower but more secure /dev/random or if they want to use entropy from the faster but more deterministic /dev/urandom. In turn developers of the OS internals also had to make the choice between them.
Because entropy for pseudorandom generation takes time to generate many computers are out of the box configured to write the available entropy to unencrypted parts of the disk and load the saved entropy at boot. Such entropy can be captured and stolen by someone able to read disk contents, either through software or physical access.
I know that I've drifted a bit off the track with complications but the point I'm trying to make is that if someone has a snapshot of the entropy in the CSPRNG for example at the time a Bitcoin node generates a wallet then the same entropy can be copied to generate an identical wallet on another computer. This is not a very likely scenario, but private keys can also be bruteforced like I briefly mentioned earlier.
In the computer world there is no such thing as random but the world is very good at pretending that that is the case. While the Bitcoin protocol itself may be theoretically secure the Bitcoin protocol does not exist in isolation. It depends heavily on other components, for example CSPRNGs, which may be broken either sometimes or always and through that have fatal consequences on specific use cases involving the Bitcoin protocol.
Software exists in a very chaotic landscape where critical parts are always moving and changing. Most software in use today is written by humans and the signature of humans is that they are very prone to error and have a high risk of fucking things up in very creative ways.
If I was interested in making money from Bitcoin I wouldn't mine coins. I'd mine wallets to steal existing coins from other people.
When all is said and done, private keys, public keys, mining, wallets, verifications, blah blah blah, bitcoin is a password.
-
- Similar Topics
- Replies
- Views
- Last post
-
-
There're gold in them thar hills. (Dammitt!)
by Hairy-nosed Otter » Tue Oct 20, 2020 8:54 pm » in Cambodia News - 2 Replies
- 1551 Views
-
Last post by tarariverboat
Wed Oct 21, 2020 4:46 am
-
-
- 0 Replies
- 1972 Views
-
Last post by mhong7
Thu Jun 11, 2020 10:27 pm
-
-
4,000 tons of gold buried in Vietnam: myth or reality?
by kungfufighter » Sun May 24, 2020 1:05 am » in Thailand, Vietnam, Myanmar and Lao forums - 18 Replies
- 5984 Views
-
Last post by hairdo
Sun Aug 02, 2020 8:27 pm
-
-
-
Is it worth buying a condo to live in? (PP)
by nerdlinger » Wed Dec 21, 2022 6:01 pm » in Houses, Apartments and Real Estate - 15 Replies
- 5156 Views
-
Last post by nerdlinger
Sat Jul 29, 2023 8:13 pm
-
-
-
Landfills worth more than US$10 million in Kep and Kampot inaugurated
by Londo » Tue May 30, 2023 2:35 pm » in Cambodia News - 3 Replies
- 384 Views
-
Last post by Baconroll
Thu Jun 01, 2023 8:00 am
-