Bitcoin Forum

Hey guys, ive been looking at the blockchain and wondering what miners do with their coins. Maybe even a random lucky GPU miner who happens to mine the block first. What does he then do with those 25 coins?

Are there a unique use to them that can't be applied in coins that have been teammates l transacted multiple times?

Yeah some sell the untainted coins for unsurprisingly, amount higher than the untainted coin itself.

for instance, BTCC hoard their fresh coins.. they move them maybe once a month into smaller stashes

and their expenses and costs are covered from their other enterprises such as exchanges, etc.

Im not quite sure why anyone would actuall want a newly mined coin over one thats been round the block a few times, The whole tainted coins thing should be irrelevent in that just because your coin has been used possibly for something illegal in the past should be of no concern to the current holder.

I dont think ive ever even looked back though any of my addresses to see how new any of my coins are because i really dont care, i guess for some this may be a big thing though.  who knows.

There is a small market since there are some people willing to pay a premium to get themself a fresh 25BTC block mined into one of their wallets. To me this doesn't matter. 1 Bitcoin = 1 Bitcoin, no matter if it is freshly mined, or has been 2 years in circulation.

its more about the paranoid people that sell drugs and then want to cash out on coinbase. they dont want coinbase logging info that coins attached to user XYZ originated from a known darknet service, as coinbase also holds personal real life information about user XYZ. so they would rather send fresh coins to coinbase and leave the pool owner to spend coins with taint on electric

Personally I'd be ready to pay a premium for a fresh coin, but of course if the price is no more than +10% of the regular price. This has nothing to do with illegal activities (I don't care at all about that). That's more to tell you that you own an unique coin, that will surely have a really high value in a decade or so, when there will have a lot less coins put on the market each day.

i've always wonder are people willing to pay more for those coins?

it would be fun if there is a two kind of demand for bitcoin

I think this is a psychological effect. This way you can say that it YOUR Bitcoin, that no one on Earth ever used before you, that no one ever owned.

I wonder if people get paranoid then if they get coins that look  like they have obviously been mixed, Ive never mixed any myself since i dont see the need for my circumstances (although i would like this feature built into a wallet).

But if you have coins that have a load of addresses all within a short time span then surely these are mixed coins, Unless they varie the amount of time before they are sent etc, Cause chances are if you have mixed coins they probably got mixed for a reason, either way even if mine were mixed im not caring.

Freshly mined coins are considered more valuable then used ones:
http://cointelegraph.com/news/114806/mint-exchange-service-for-newly-mined-coins-rebuffs-bitcoins-fungibility

Makes no difference to me if its freshly mined or not. But others may prefer coins with clean slates of history, not linked to any illegal activities. But paying premium for it? I don't think so. 1 btc is 1btc, freshly mined or not.

Same here. Why should we care whether the coins "new and clean" or "old and dirty"? They are all just like any other money ffs, we can't know about their hystory and we shouldn't bother either IMO.

for me, no difference. because if you mix up the freshly mined coins with old traded coins up, then we won't know how to consider whether that kind of bitcoin is more valuable or not. FYI the coins can be mixed up within a simple transaction with old and new one.

I also find no difference between tainted and untainted fresh coins why to pay more for fresh one.

People care, because you never know when you can be in such situation like this one: https://www.reddit.com/r/Bitcoin/comments/3mea6b/bitpay_is_blacklisting_certain_bitcoins_rejecting
http://www.bitedge.co/blog/coinbase-restricts-users-for-gambling-transactions/

Unfortunately, bitpay finds a differerence between tainted and untainted coins:
https://www.reddit.com/r/Bitcoin/comments/3mea6b/bitpay_is_blacklisting_certain_bitcoins_rejecting

Similar with coinbase:
http://www.bitedge.co/blog/coinbase-restricts-users-for-gambling-transactions/

I think, it's all forms to ensure safety from BTC that they save.
and it could be a coin that recently she's mine and send to addres their.

HEY GUYS,
"how can you say that the coin is fresh or old". Each and every coin bearred value for something, it doesn't matter that it is old or new. :)

As time progresses I think there will be very little bitcoin which weren't used in some sort of illegal activity - it either can be straight on black market activity, or gambling in casino
(gambling in online casinos if you are on US soil is considered illegal). In the end clean coins will be the one newer used before in any transaction.

Actually it does meter, as it results in 1 btc != 1btc. This is recognized as a problem by bitcoin core developers:
https://github.com/bitcoin/bitcoin/issues/6568

One quote from that link

And with the advent of blockchain analysis techniques like this one:
http://bravenewcoin.com/news/the-bitcoin-big-bang-tracking-tainted-bitcoins

this problem might get worse.

The idea of tainted coins is something new to me. With learning more and more every day about bitcoin, the term tainted was something I had never thought of before I dont know what issue it would have because just like normal money there is a good chance it has being used for something illegal at some point and it is something I have never thought was a issues

Interestingly you people are classifying some bitcoin under "collectible" category.
The rare things are usually priced higher than normal. So, it's fair to pay more for newly mined coins. This way Satoshi's hoardings have more worth than the market value.

Yes, there is people that wants a full bitcoin block freshly mined, and pay a plus for it. Why? Some times collectionist people, that likes it. They know that the real price is the same. One recently mined bitcoin has the same price of a used bitcoin.

Yes, normal maney also can be tainted. But for fiat, there is a law making fiat money fungible:
http://jpkoning.blogspot.co.id/2016/01/what-makes-money-special-lawyers.html


For now, there is no such law for Bitcoin or any other cryptocurrency.

Yes, Erkallys is on to something here.  A scarcity value, especially after several years (after a couple of halvings, for example).

Even now, some American Gold Eagle (1 oz) coins are a little more scarce than others, there are buyers who pay more for some dates even though the gold bullion value is no different.

it could be that people want the freshly mined coins to maintain their privacy. but this can also be achieved by simply mixing the "not fresh" coins.

They do sell it at higher prices and I guess these exchanges buy it .I honestly don't understand why would someone pay extra for it ? If you have to pay for a buyer ,he can't accept those coins as they are formerly new coins so he will give you a discount.Its all same anyway .

Its not really the case that 1btc == 1 btc, becasue bitcoin has weak fungability. This means that some bitcoin are "distinguishable". Thus mine 1 btc is different then yours 1 btc. This can lead to blacklists of certain bitcoins, if they are found to be related with crime. Its slowly starting to be a problem, for example,
https://www.reddit.com/r/Bitcoin/comments/3mea6b/bitpay_is_blacklisting_certain_bitcoins_rejecting

Core Bitcion devs are aware of this problem: https://github.com/bitcoin/bitcoin/issues/6568 :

Adams Black lecture about this is good, if you interested:
https://www.youtube.com/watch?v=3dAdI3Gzodo

If need more, just google bitcoin fungability, and will find lots of articles about this problem, e.g.,
http://cointelegraph.com/news/113897/bitcoin-violates-the-principle-of-fungibility
http://www.coindesk.com/bitcoin-fungibility-essential/
https://www.weusecoins.com/adam-back-confidential-transactions/
http://bravenewcoin.com/news/the-bitcoin-big-bang-tracking-tainted-bitcoins

Off course mined bitcoins, have no history, thus no taint, and are cleanest. For this reason they are considered more valuable.

and many more

Uncirculated fiat currency is worth more than circulated, I suppose some people feel the same about bitcoin, but I don't really get it.  It's all just data, but some people pay more for things "just because".

Its not only about this. Because if you can differentiate two bitcoins from each other, censorship and blacklisting of certain bitcoins are possible.

Andreas Antonopoulos explains that to avoid this:
https://www.youtube.com/watch?v=ak1iojpiHpM&feature=youtu.be&t=33m6s

I don't get it either, UN-circulated fiat currency have collectors which increase their price and its a physical thing which can be traded based on its rarity and condition but don't know why would some one pay more for freshly mined coins when old or new they're exactly the same.

For the same reason ppl pay for mixing services or in jointmarket. Freshly mined coins have no history, and provide greater privacy and anonymity. And there is market for such coins:
http://cointelegraph.com/news/114806/mint-exchange-service-for-newly-mined-coins-rebuffs-bitcoins-fungibility

From the proposed short term solutions listed in the github link, IMO this should be implemented as soon as possible:

"Include a private transaction submission tool enabled by default"

This inherently doesn't really matter, because essentially, you would be mixing cow manure with other cow manure... mixing something with taint, A.K.A "shit", means that the coins are still shit.  This is why you don't see too often people taking fresh coins and putting them in mixers for god knows what reason.

Fungibility is and should matter to people who want to use a currency anywhere without bias of the previous transactions someone else made with that coin. 

The other day, I found a dollar bill at work that had a B and R before and after respectively on the back of the dollar bill which, of course spells "BONER". Doesn't necessarily mean that it won't be accepted in most stores, because the one I work at did, but, would you rather have a bill with just "ONE" on the back rather than a "BONER"? Would you be more willing to spend your dick bill somewhere to get rid of a graffitied dollar, incase you where to go a bank to deposit it into your checking account; and to avoid the potential of having your perfectly accepted dollar denied?

Same concept. 

I never treat a mined coin any different than a exchanged or earned coin.  I end up moving them from one wallet to another before the end of the lifetime of that coin, but I do this as a warm/hot/cold wallet thing, not to avoid any traces.  In the end, I could not tell you what percentage of the coins I have right now come from any given source.

unfortunately there will always be a slight appeal to new coins. let's hope it does not become too large, because it does so at the expense of fungibility.

Wow! thanks for the links. Somehow I didn't know about this stuff happening. Blockchain analysis is real business now as they say. I should read more about this stuff.

I think there is yes, it's pretty niche and selective but this shouldn't be happening at any levels. It shows Bitcoin still fails at being completely fungible. We need more privacy and the blockchain to be less transparent if we want to gain more fungibility. In the future with the BIPs that are coming we will reach this goal tho.

Actually is quite impossible for a miner mining with GPU hardware to find a block; Unless he has a very large quantity of GPUs and free electricity it wont be feasable to use GPUs for bitcoin mining. However you can mine other coins and profit even more than mining new Bitcoins.
But answering directly to your answer, miners usualy sell most of their coins to cover expenses. even the ones who are already in profit, tend to dump some. Of course that they also hold some coins and pay for loans or simply reinvest those coins. So, if you take a look at it, most of these coins end up being dumped!

I'm sure all of my coins are dripping in filth, blood and drugs. I really couldn't give a shit though and I've never bothered to check their history and never will. They get the job done.

All these people screaming 'blacklist' are really just seeing private companies exercising their rights to cover their arses from the heavies breathing down their necks. It's all laid out in their terms and conditions and easily avoided.

if you play in bittrex trading, I think most good coin today is MEC or megacoin, you can start by checking whether the coin is really good or not  ;D

Same here, I can't be bothered to check whatever origin my coins got, since that's a waste of time, but ultimately even if you don't care, the person you are paying to may care, and sure he can't reject whatever Bitcoins you are paying with, but I wouldn't like to be paying with some money that was used previously for illegal stuff because what if the receiver notices and reports it or something? This is why we need increased privacy, and integrated CoinJoin like feature in all wallets, like coins get mixed by default and in a decentralized fashion, only then we can start talking about e cash.

Aren't you guys concerned that in the future there won't be really 'fresh' coins anymore and every coin will be tainted more or less?
Situation with bitcoin will the be same as with US banknotes eventually - where more than 90% of total banknotes had contact with a cocaine.

Isn't that a good thing overall? People would have to get on with using those disgusting coins or send the entire economy up in smoke. I think sense would be seen pretty rapidly.

So what's happening is that people are betting that Bitcoin will not be able to maintain its fungibility -- that blacklists will eventually be implemented somehow -- thus hoarding/hodling "untainted" freshly mined coins? Wow.

See, I would think just the opposite.  With no history it is much simpler to trace the coin to it's origin address and see who mined it.

Exactly how would you do that?

16cv7wyeG6RRqhvJpY21CnsjxuKj2gAoK2 is an address that has received newly-generated bitcoins.  Can you tell me who mined them?

I think its not much about me or you knowing this, or random person on the street knowing this. This is more about about blockchain analytic companies doint this, such as elliptic, about a merchant who knows your identity behind an address by virtue of transacting with them, or exchanges or surveillance organizations v knowing  this information. And all this information can be used, at worst case, for blacklisting your bitcoins, if they deem bitcoins to dirty. And for fresh bitcoins have no history, so no risk of the being tainted.

Andreas Antonopoulos explains that to avoid this:
https://www.youtube.com/watch?v=ak1iojpiHpM&feature=youtu.be&t=33m6s

And blacklisting is already happening, e.g.,
https://www.reddit.com/r/Bitcoin/comments/3mea6b/bitpay_is_blacklisting_certain_bitcoins_rejecting

No, I didn't miss anything.  The whole point of using coins from a generation transaction for privacy is exactly because you cannot use data-mining techniques to trace them, like you can with 'used' coins.  And that is what this thread is about, right?

Coins from a generation transaction are never blacklisted, because they cannot, by definition, be tainted coins.

You right. I was edit my post when you replied. I misunderstood it at first.

I didn't mean to imply that I could tell you anything about any coin history, I'm just a hobby miner, but people who know how to trace stuff can figure things out.

To try and answer your question, I would assume that they mined the coins as that seems to me to be the only way to receive them with no prior inputs, and that was the point of my post above.

It doesn't have to be you personally - there is no way anyone can map just an arbitrary bitcoin address to any individual or organization.  Who is the 'they' you refer to above?

With 'old' coins, it is potentially possible to link addresses to individual entities, through data-mining techniques - but not with original generation-transaction coins.

The "they" I refered to is the address you posted.  I assume they, the address controller, mined those coins.

No, but the converse can happen.  If someone know who controls and address and that address generates fresh coins it's just a matter of 1 + 1.

I am so sure there s always a market for the coins even though it may not be well established. The process and cost of mining the coins is always very high and therefore nobody will leave anything to chance. I am sure that there must even be a better deal where they get to sell these coins. I tried to ask my friend who is active in the mining department and refused to share the experience and where they take them. It means there might be a better deal than we think.

The point is that knowing the address, in the case of generated coins, generally tells you nothing about who owns that address.  In the case of 'used' coins, that is not necessarily true.

Newly-mined coins typically either go to a new address auto-generated by the bitcoind, or to an address the miner has specified.  If the miner specifies an address that has he has exposed publicly, then it's true that the ultimate origin of those coins would not necessarily be anonymous, but it is still guaranteed that they are not 'tainted' in any way, by definition, as they have never been spent.

So... People buy fresh coins for the sole purpose of anonymity?

I understand that there would be a market for these coins, so how much more are they worth than a normal coin that's been traded hundreds of times?

10% more, at least according to this article:

http://cointelegraph.com/news/114806/mint-exchange-service-for-newly-mined-coins-rebuffs-bitcoins-fungibility

i was expecting more for now, however 10% now may seems underwhelming, but when the value will skyrocket it can be soemthing significant

Old and dirty coins are worthless, do yourself a favor and get rid of them. I'll be glad to help you by providing an address where you can send that garbage ;D