Bitcoin discussion and news

[King Biscuit Time]

Incidentally I just read that 1000 Megawatt hours a day of energy is used to mine bitcoins. Depends where you get your leccy from I suppose, but a back-of-a-fag-packet calculation works that out as about half a million kilos of CO2 per day.

 

[lt35]

Price seems to be leveling off around the $1150 mark the past couple of days discounting all the volatility. Would love it to stay around there so we don't end up with a crash!

 

[Idaho]

Incidentally I just read that 1000 Megawatt hours a day of energy is used to mine bitcoins. Depends where you get your leccy from I suppose, but a back-of-a-fag-packet calculation works that out as about half a million kilos of CO2 per day.

I think most modern money uses a fair amount of electricity. ATMs, bank servers, online banking, credit card machines, etc.

 

[camouflage]

Price seems to be leveling off around the $1150 mark the past couple of days discounting all the volatility. Would love it to stay around there so we don't end up with a crash!

I wonder if that's possible, when something goes into parabolic ascent like that, or if the typical behavior is inherently extremist.

If bitcoin will accommodate larger more global volumes of trade it might have to get to the necessary price levels in a long series of panicky leaps into the unknown, like a bunny-on-meth ascending a staircase.

If the history of bubbles has taught us anything it's that we learn nothing from the history of bubbles.

 

[ddraig]

you think Newport council would have a go looking for the hard drive
go 50% 50% and get some much needed £££'s in the bank

 

[lt35]

I wonder if that's possible, when something goes into parabolic ascent like that, or if the typical behavior is inherently extremist.

If bitcoin will accommodate larger more global volumes of trade it might have to get to the necessary price levels in a long series of panicky leaps into the unknown, like a bunny-on-meth ascending a staircase.

If the history of bubbles has taught us anything it's that we learn nothing from the history of bubbles.

Fair point - the bigger the market, the harder it is to manipulate.

I reckon the worst case scenario for the bubble bursting would be governments pulling the rug from beneath users feet by enforcing ISP-blocking of Bitcoin sites. Luckily there's no chance of this in the West but what about China?

 

[butchersapron]

Speculators got to keep on speculating.

 

[Buckaroo]

Speculate to accumulate

 

[Idaho]

It is a bubble, but it's a particularly strange kind, that may not pop in the same way.

It's akin to someone throwing out a bunch of strange shiny glowing discs in the middle of a medieval town and saying that they are money. A mania takes hold, people find out they can make them too - but only very slowly, and a limited total amount. It distorts the existing coinage's value.

The questions in this case are:

- Will the shiny discs be worth anything when the mania subsides?
- How much will they distort the existing coinage's value?

 

[not-bono-ever]

this whole BC thing spooks me, despite some of the arguments here

if you have got a load of BC, cash the fuckers in and use the cash for something worthwhile- the train has left the station by like several years now- its unlikely you will make millions now that you can trade BC CFDs and professional speculators are into it- you will only kick yerself if it goes to shite.

sorry to put a downer on it ! good luck.

 

[Dr Jon]

Incidentally I just read that 1000 Megawatt hours a day of energy is used to mine bitcoins. Depends where you get your leccy from I suppose, but a back-of-a-fag-packet calculation works that out as about half a million kilos of CO2 per day.

How do you recover (the value of) your bitcoins if the internet is cut off / falls over / blocked ?
I'm thinking that cash, gold - or any physical token of value is inherently more secure. I was just talking to a mate who said his folks had their electricity cut off for 4 years when he was a kid - said I couldn't imagine what it was like to struggle with candles & paraffin stoves in a house designed for electricity. If the internet fails, we can still use physical tokens for trade. My mate won't touch online banking or debit cards, never mind bitcoins.

 

[camouflage]

How do you recover (the value of) your bitcoins if the internet is cut off / falls over / blocked ?
I'm thinking that cash, gold - or any physical token of value is inherently more secure. I was just talking to a mate who said his folks had their electricity cut off for 4 years when he was a kid - said I couldn't imagine what it was like to struggle with candles & paraffin stoves in a house designed for electricity. If the internet fails, we can still use physical tokens for trade. My mate won't touch online banking or debit cards, never mind bitcoins.

Maybe use some money to buy a generator. I don't think it matters which currency you choose to do so with.

 

[Cheesypoof]

moving swiftly on....if a friend of mine with a dog deposits money this way, is it safe?

 

[Giles]

I think it needs to become a more mainstream, mass-market, "respectable" way of storing money, and of buying and paying for stuff online.

As long as the general perception is that there are only two reasons for buying Bitcoins:

1) Pure speculation - that the value will continue to go up massively, for no logical reason

2) In order to buy drugs, porn, weapons, hire hitmen or whatever other dodgy shit

There's going to come a day that the whole thing is jumped on by "law enforcement" around the world.

Giles

 

[mauvais]

It will definitely burst. As soon as it drops a little, any holder paying any attention will sell out in the fear that it's all over, starting a chain reaction, which will bring the whole house toppling down.

The same happens with other commodities, but other commodities have inherent value. Gold is a trading token, but gold has actual physical uses and derives consistent value from them; not in direct proportion to the gold price, but good enough. Currency has no inherent value but enormous momentum, e.g. governmental debt. Shares are somewhere in between.

Bitcoin has fuck all.

 

[Maurice Picarda]

My father in law hasn't got involved yet, which is my "greater fool" test. This means they still have room to climb.

 

[Idaho]

It will definitely burst. As soon as it drops a little, any holder paying any attention will sell out in the fear that it's all over, starting a chain reaction, which will bring the whole house toppling down.

The same happens with other commodities, but other commodities have inherent value. Gold is a trading token, but gold has actual physical uses and derives consistent value from them; not in direct proportion to the gold price, but good enough. Currency has no inherent value but enormous momentum, e.g. governmental debt. Shares are somewhere in between.

Bitcoin has fuck all.

Currency has no intrinsic value other than its functional ability to be exchanged, and the shared sense that it has a value. A new currency is rightly going to be treated with suspicion and caution. The large potential returns at the start are needed to offset the risk that it may well collapse.

It's a paradox. If the price stabilizes, it suggests that btc can be a stable currency, and therefore the price goes up. If the price goes up then it attracts speculators.

 

[camouflage]

I think it needs to become a more mainstream, mass-market, "respectable" way of storing money, and of buying and paying for stuff online.

As long as the general perception is that there are only two reasons for buying Bitcoins:

1) Pure speculation - that the value will continue to go up massively, for no logical reason

2) In order to buy drugs, porn, weapons, hire hitmen or whatever other dodgy shit

There's going to come a day that the whole thing is jumped on by "law enforcement" around the world.

Giles

Limited supply + increasing demand is basic economic 'logic' as far as reasons go. What drives demand can be tire-kicked and questioned obviously, but you'd need a lot more than a cursory glance to say anything useful there. The reasons for the limited supply is open source and can be examined by anyone with a mind to do so.

It's a paradox. If the price stabilizes, it suggests that btc can be a stable currency, and therefore the price goes up. If the price goes up then it attracts speculators.

Minksy capitalism in action.

 

[spacemonkey]

In the early days I think big university computers were "borrowed" for such like. I think these days, you need the custom designed asics to make it economic.

Mining isn't a matter of banging out coins one at a time. New coins get created as a "reward" for whichever miner completes a processing "block". So it's more of a long or medium term project. X amount of processing power will on average give you a Y chance of being the lucky one who gets the block reward.

Some interesting debate about whether to raise the minimum size of a block above 1mb.

If they do raise the block size, more transactions can be completed per second, but the blockchain's total size will grow quicker, meaning fewer people will be able to store it in its entirety.

If they don't, lower priority transactions with smaller fees will be delayed and pushed into the next block. Meaning it will be a lot slower overall.

There are only really a handful of developers working on it, and any changes have to be agreed by all the miners.

Interesting stuff.

 

[Crispy]

The size of the blockchain is gonig to become a problem at some point isn't it?

 

[ddraig]

not that i've got any so not speculating in that way but wondered whether the value changes due to losses like the hard drive in Newport landfill?

 

[camouflage]

The size of the blockchain is gonig to become a problem at some point isn't it?

Not for a while but yes. Apparently Satoshi anticipated btc handling much larger volumes of transactions though.

 

[camouflage]

not that i've got any so not speculating in that way but wondered whether the value changes due to losses like the hard drive in Newport landfill?

Attrition, and yes this means there not only will never be more than 21 million coins, but that there will in fact be actively fewer of them in the economy over time.

 

[King Biscuit Time]

Last night I dreamt that I had to keep checking www.preev.com and let this bloke know when the price of bitcoins started to drop. If course I forgot and couldn't do it for some reason and the price rapidly dropped to about 5p. Now, I'm not saying I can see the future, but there must be something in that, right?

 

[Idaho]

It's either going up 20% or down 20%. The crack cocaine of speculation.

I wonder if it will turn into a never ending global lottery rollover. Rising to new heights on each wave of optimism, greed and market manipulation and dropping again each time the latest cohort shouts "bank".

 

[lt35]

Don't worry King Biscuit! I reckon it's still just a short term effect of people cashing out to take advantage of Black Weekend/Cyber Monday. It might end up reaching a price floor of $700 - i.e. the level before the political debates started - but I don't see a mega-crash on the horizon. I think that It would several years of coordinated international government to see that sort of situation evolving

 

[King Biscuit Time]

Don't worry King Biscuit! I reckon it's still just a short term effect of people cashing out to take advantage of Black Weekend/Cyber Monday. It might end up reaching a price floor of $700 - i.e. the level before the political debates started - but I don't see a mega-crash on the horizon. I think that It would several years of coordinated international government to see that sort of situation evolving

It was only a dream. I'm not holding any Bitcoins (and never have!)

 

[King Biscuit Time]

It was only a dream. I'm not holding any Bitcoins (and never have!)

And as an interested bystander I'm not convinced. I think the vast majority of those holding bitcoins are doing so as an investment, or for idiological reasons, and not because bitcoins are inherently more useful to them than fiat currency. Thus a crash will easily precipitate as people are spooked.

I have a noob BC question regarding mining. Is the work that the computer has to do while mining necessary for the creation of the bitcoin? Or is it just some work that needs to be done in order that a bitcoin is created by some other means - in other words are the miners actually making the currency, or is mining a way of distributing a currency that could be generated using much less computing power?

 

[Idaho]

Miners are processing transactions. This process gives a reward per block of transactions - the reward is btc.

 

[rover07]

Miners are processing transactions. This process gives a reward per block of transactions - the reward is btc.

How will the transactions be processed when all 21 million coins have been produced? (or mining is no longer profitable)