Your certainty is misplaced. BitInstant charges a fee of 3.99% (which is clearly indicated on the site), in addition to the fee charged by MoneyGram, which varies but I think it's something like 8%, so that's about 12% lost in fees altogether. The rest was probably lost in exchange rate fluctuations: remember, bitcoins and dollars are completely different currencies, and the exchange rate fluctuates constantly. The bitcoin/US dollar exchange rate has dropped slightly over the last couple of days, so the bitcoins you purchased are currently worth slightly less than what you paid for them. But tomorrow they might be worth more. Or less. Nobody knows. That's the risk you take when dealing with other currencies.

I really don't think any fraud has occurred, I think you just misunderstood how the fees and exchange rates work.

You didn't answer my question. What clock speed are you running them at? If they're overheating at stock speeds, there's something drastically wrong with your cooling. If you're overclocking, you need to remember to test your settings under 100% CPU load - that makes a huge difference to your temps.

Why not, if that's what he/she is willing to do and others are willing to pay for it? That's the whole purpose of money: if a person is willing to offer something (anything) that other people want, money allows them to make a fair and equitable trade.

Nobody mines gold with their hands either, or even picks and shovels. It's all done with big, expensive machines.

Asked and answered. See my previous post.

Scarcity, in economics, simply means that people want more of something than they've got and can get. For example, people want lots of gold, but they don't all have lots of gold and they can't all get lots of gold - that's what it means to say "gold is scarce". A moments thought will make it clear why scarcity is an absolute requirement for something to be used as money, which cannot be "bypassed": if money isn't scarce, that means everybody has all the money they'll ever want, and they don't want any more than they've got. But if nobody wants any more money than they already have, why would they accept your money as payment? It doesn't make any sense.

I think you're confusing money and wealth again. Money is not wealth. Money is a representation of wealth. You want everyone to be wealthy. Who doesn't? But there's only so much stuff of value in the world, and not everyone will necessarily have all the things of value that they want. That's not fair, but life isn't fair, and it's got nothing to do with money, as money is just a representation of value: if you have money, it means you provided something of value to someone, which they paid you for. And that's the only thing it means to have money. If everyone were given money that they didn't obtain by producing things of value, what would that money represent? Nothing! That money would be worthless, as it does not represent actual value that someone produced.

Various governments have taken notice. Bitcoin has been mentioned in reports by the FBI, the ECB (European Central Bank) and AUSTRAC (Australian Transaction Reports and Analysis Centre). But why would they take action? More importantly, what action is there for them to take? Any attempt to stop Bitcoin is doomed to failure, and Bitcoin isn't even illegal in any case, so why would they even bother trying?

It's your job now. It's up to you to decide who you can trust, and to only send money to trusted people.

That begs the question, if people are unable to trust each other, how can they trust a third party? (Especially if that third party is someone they've never met, never talked to, never voted for, and enforces arbitrary rules on transactions while taking an exorbitant fee for their "services" which in many cases are neither requested or desired.)

Transactions are stored in blocks, which are linked together in a structure called the blockchain. The blockchain is stored on everyone's computer. To prevent the blockchain from being modified, Bitcoin uses a proof-of-work system (mining). Each block requires a certain amount of computational to produce it, and it is impossible to produce a modified block without redoing that computational work. Furthermore, since each block builds on the one that came before it in the chain, modifying one block causes all the blocks that came after it to become invalid (since they're built on a block that no longer exists), so you have to redo the work for all those blocks, too.

When confronted with two conflicting blockchains, the software will accept whichever one required the most work to produce (and is not otherwise invalid, see below). In order to produce a malicious blockchain that will be accepted by the network, you have to produce malicious blocks faster than everyone else is producing good blocks (since while you're working on your malicious chain, everyone else is blissfully ignoring you and adding blocks to the good chain, forcing you to work even harder in order to keep up). To only way to do this is to have more processing power than the rest of the network combined (the 51% attack). Otherwise all your efforts will be wasted.

Also note that even if you do have this much processing power, you're still limited in what you can do with it, since proof-of-work is not the only thing that determines if a block is valid. A block which breaks the rules of Bitcoin will never be accepted (and nor will any blockchain that includes such blocks), regardless of how much work was involved. You can't create bitcoins out of thin air. You can't spend other people's coins (they're protected by public-key cryptography). Basically the only things you can do are reverse recent transactions (and, in case of your own coins only, spend those coins elsewhere to prevent the transaction being un-reversed later), and prevent other people's transactions from being confirmed.

Have you found the button that says "I understand that I will initially be unable to post to most forum sections"? You must have, since you had to click it to register.

Yes. Or 1 in 1,461,501,637,330,902,918,203,684,832,716,283,019,655,932,542,976 if you prefer. (Actually, it's <number of addresses that have coins> in 2^160 but it's still such long odds that it'll almost certainly never happen before the heat death of the universe.)

I'd say it's almost certainly an overheating problem. In my experience AMD chips tend to run hotter under load than their Intel brethren (though it's generally not a problem if you've got adequate cooling). What clock speed are you running them at?

Wrong, wrong, wrong. It is not the same process. It is not even remotely similar. Bitcoins are not generated "from nothing", bitcoins are generated by the useful and valuable work done by miners. The Bitcoin network, and the fast, cheap, and secure transactions it makes possible, absolutely requires the continued efforts of miners to be useful. Mining does not merely make Bitcoin "more safe", it is absolutely critical to prevent double-spending, which would make bitcoins completely worthless. Without mining, bitcoins are worthless. The security provided by mining is the only thing that gives bitcoins value. Bitcoins are generated by the very process that gives them value, and these newly generated bitcoins are given to the very people who contributed their resources to produce that value. Is that, or is that not, a completely fair and moral system?

What is this even supposed to mean? Are you suggesting that free money be given to people simply because they are intelligent, creative, or artistic? Because that's never going to happen; that's not what money represents. Money is a representation of value. You pay money to obtain things you think are valuable, and you receive money for producing things which other people think are valuable. Intelligence and creativeness and other virtues are not valuable in and of themselves, what is valuable is the application of these virtues to produce things of value. Merely being intelligent or creative or whatever is completely worthless if you don't actually do something productive with your skills.

You seem to misunderstand what mining is. The purpose of mining is to secure the Bitcoin network from attack. Nothing else. Mining rewards those who can muster the computational resources needed to do this. To make money mining, you need to contribute real resources to provide security for the network - and do it more efficiently than everyone else, who are all competing for a limited reward.

I'm not sure why you think intelligence has, or should have, anything to do with it. Intelligence alone won't make you money, not in mining or any other field; you also need to be able to apply your intelligence to produce something of real value.

Also, don't lose sight of the big picture: the purpose of money (whether it be bitcoins, dollars, or gold) is to facilitate trade. Trade is necessary because different people are good at doing different things. If there's something you're not good at doing, it's no problem because you can buy the services of someone who is good at doing it, using money you obtained by doing what you're good at doing. Not everyone is able to mine bitcoins efficiently enough to make a profit, but that's okay because they can produce other things of value to trade for bitcoins.

No, not one address for each client, one for each transaction. A single client who makes several different purchases will (normally) be given a separate address for each one. It's not difficult to manage at all. Most merchants will already have a database to keep track of individual orders; the bitcoin address that goes with each order is just another entry in that database, and it's easy to automatically monitor these addresses for incoming payments (and a payment processor such as BitPay will do the latter automatically).

Assuming a reasonably efficient market, you can expect the returns from mining to be (on average) about equal to the cost of mining (which is mostly just electricity costs). This means that profit margins are razor thin and only the most efficient miners can make a lot of money. Mining is not a get-rich-quick scheme. It is a business, in which you provide security for the Bitcoin network, and get paid based on results. It is a highly competitive business, and if you can't mine as efficiently as your competitors, you won't make a profit. It's as simple as that.

There are no guarantees with solo mining, it all depends on luck. Every hash you calculate has a (very small) chance of meeting the "target". There is no way to know, apart from actually calculating the hash, whether it will meet the target or not. The more hashes you produce, the better your chances are that one of them will meet the target. This element of chance with solo mining is the whole reason pooled mining exists.

You're not the first person to ask that. Spend Bitcoins only accepts cash deposits. No form of electronic transfer will be accepted.

Why do you care if your exchange or your bank reports your transactions? You yourself will be reporting it on your tax return (all money you make from bitcoins is taxable income). And there's nothing illegal about Bitcoin itself, so as long you keep records of your transactions and pay your taxes, you've got nothing to worry about.

I predict $27 quinoctogintillion in 12 months, which will be just enough to purchase two hamburgers and a large coke with a side order of fries.

Merry Saturnalia, everyone!

He's talking about business practices, not the nature of the business itself. For example, if I pay a contract killer to kill my wife, and he just takes my money without killing her, that would be a breach of contract (which is unethical), and I have a right to complain about his business practices. Frauds such as these are far too common in Bitcoinland, and we must put a stop to it!