It's kinda random, more like a lottery.  If your computer is the one that finds the solution to a block first, then you will get 50 coins; no more and no less.  This problem is designed to grow more difficult as the total computational power of the network grows, in order to keep the average time between blocks at about 10 minutes.  So 7200 coins are created each day, and given out in 50 coin sets.  It could be weeks before you are the winner, or it could be twice in the next 30 minutes.  No one can predict this, and that is the point.

I started another thread along this line elsewhere, but for an individual vendor, a simple watchdog daemon that tracks the average time between blocks since the last official change in difficulty and alerts the vendor if a single block takes more than twice as long as the average, perhaps suspending the acceptance of new coins until the vendor checks to see what is happening.  Each block in a row that takes longer than the average increases confidence against a false positive.  So if one block takes twice as long as average, followed by a series of blocks that take 75% longer than average, then you can be fairly certain that you are no longer on the majority network.

Another thread that asked what would happen if the bitcoin network were to split over a period of time and reconnect got me thinking....


One way to protect against such an unlikey event would be to have a watchdog process that kept track of the average time between blocks since the last change in difficulty, and alert the owner if the time between blocks were to jump significantly and uncharacteristicly over one or more consecutive blocks.  This would also help protect a vendor from a double-spending scam if the theives involved were talented enough to be able to spoof his client's connections to delay another spend event from reaching him.

But then I realized that a server running a modified client on another machine, without a hard connection limit, could do the above for a collection of vendors, while monitoring the vendor's client by maintaining a connection to it and notifying the vendor by other means if the connection is lost.  Also, if a war, internet virus, or other were to divide the bitcoin network for an extended time; the watchdog would be able to deterimine *where* the problem on the Internet actually is by analysis of it's customers' connections that were lost, and notify all customers in the affected zone that, presumedly, they are on the wrong side of the split.

The watchdog would also work quite well as a rapid annouce clearinghouse, improving the odds for it's customers that if they are subjects of a double-spending scam, that it's less likely that they are those left holding the raw deal.

Any talented programmers willing to take this up?

http://globaleconomicanalysis.blogspot.com/2010/08/readers-chime-in-on-union-productivity.html

Looks like bitcoins would benefit from a Spanish translation for the same reasons it may be attractive to Russians.  The chart also implies that the US is the last place on Earth that bitcoins would ever be accepted by the mainstream.

Um, no.

Digitally signed bearer bonds.  Pity that bearer bonds are illegal in the US, so that any company/bank that wished to try it would have to be founded in some nation that doesn't prohibit bearer bonds.

Creighton

Dollar General Stores!

http://www.dollargeneral.com/ourstores/pages/storelocationsmap.aspx

They are the market leader in dollar stores with storefronts within 10 miles of a very large percentage of the urban American population, and have a solid website.  Not perfect, mind you, but it would give them a small edge within an already competitive market.

And I love the 'bitcoin card' idea, also.  It would allow bitcoins to be sold *anywhere* just like prepaid phone cards are now.  Still not the most cost effective solution, but a workable one that should appeal to the privacy concerned.

I did notice, while I was a Walmart today, that the space that used to be occupied by a tax prep company is now occupied by a "Walmart Money Center".  There is already a bank branch, so I did a quick looksee on my way out.  It appears to be a currency exchange/international transfer desk.  Has anyone else seen this?  And if I'm right, and Walmart is now manning a full time currency exchange (most likely for hispanics sending money back to the motherland for family) why would Bitcoins be objectionable?  Sure, Walmart is a corporation and as such is a 'legal entity' created by the state, and not likely to push back if the feds ever get sideways with bitcoin; but Walmart is actually *bigger* than many governments, and has plenty of their own influence with the state.  As long as no one is actively trying to portray bitcoins as a subversive subculture, things should be fine.  I've noticed that many forum members seem to view themselves as proto-monetary-revolutionaries, but I certainly don't look at things like this.  If the public were to view bitcoins in a similar light, there is no way it can ever succeed.  It's just commerce, guys.  Free trade of the freest form, and nothing else.  That might seem revolutionary to some in our modern world, but it should only seem that way to those whom have a deep vested interest in the status quo, and that is exactly the kind of person that we don't want to attract attention from.  Nor are they the kind of people that tend to shop at Wal-mart, Dollar General or online most anywhere; and *certainly* don't buy anonymous phone cards for a pre-paid cell phone.

The anonymous nature of bitcoins is not it's most important feature.  That's just a side effect of it's cash-like nature.  The most important feature for it's success, now and forever, is that it does not require the implicit support of any single political structure; be it a single wealthy individual, corporation or government.  Such support wouldn't hurt matters; but the death of a man, nor the bankruptcy of a corporation, nor the overthrow of a government could not doom bitcoins to destruction.  The balkenization of the international Internet might, but maybe not even that.  Only the complete and permanent destruction of the Internet itself could stop bitcoins from becoming the future money of "Snow Crash" and "The Diamond Age", and if that ever happens very few people are going to be worried about their checking account balance either.

It occurs to me that bitcoin would achieve an unassailable position once there are physical places that a person can get to within his own city in order to trade US$ for bitcoins in person, and therefore completely eliminating the artificial transaction costs that are the largest problem with using Paypal, credit cards or even the postage stamp needed for cash through the mail.  The quickest way to achieve something like this would be to get a nationwide retailer to accept bitcoins on their website and also be willing to sell bitcoins for cash at their storefront.  This would be something trivial for Walmart.com, since they already have a means of displaying the currency pricing local to the customer, and the pricing isn't static.  If a retailer as big and widespread as Walmart were to suddenly start accepting bitcoins in such a fashion, the trade value of bitcoins would rise considerablely due to the sudden expansion of the total market that bitcoin represents.  However, the downside is that any retailer anywhere near the size of Walmart would be able to manipulate the value of bitcoins at their will for a very long time.  So if Walmart were to accept bitcoins as payment, even just on their website, the value would increase; but if the central bank started to lean on Walmart over the issue, walmart might back out and the value of the bitcoin would crash, potentially destroying the currency.

Furthermore, being the market leader, Walmart doesn't really have any incentive to start using bitcoins, as it offers them no advantages.  But it might to a smaller competitor.  One that doesn't already have a "real" bank branch within their stores like Kroger and Meijer both do.  Are there any "small time" chain retailers that compete with these places that also have a nationwide website and at least one store in most cities?  It would be in the best interests of any such small chain retailer, but it would be an easier pitch if their website was already set up to handle pricing in different currencies. 


Unfortunately, I can't think of any that might fit that set of requirements to approach.

Creighton

Anyone else in the greater Louisville, Kentucky area?

Although I would be interested, 500 bitcoins per month is a bit sttep at the current exchange rate.  I can think of a couple of commercial setups that charge about the same with stronger specs and unlimited throughput.

Creighton

I figured that the transaction would have to be announced eventually, but I was considering the possibility of a trade occuring in the absence of internet service for one or both parties and in person.  For example, me buying a gallon of milk at the corner store for half price because there is a power outage after a storm.  Or I want to buy a rick of firewood from a farmer on my way to the campground, but I am out of my cell service area while the farmer might not be.  Basicly, I'm asking if the cash like properties of bitcoin can be extended beyond an ever present Internet for a period of time, allowing a bitcoin 'cash' exchange to take place in the absence of connectivity.


Creighton

I'm new to Bitcoin, and I've been reading up as much as I can find, but I still have some unanswered questions....

1)  The 'wallet' seems to be mis-named.  As I understand it, it's a cryptographic ID and account number in one; but does not actually hold 'coins' within itself.  Is this correct?

2)  If I'm right about the wallet, then the block chain is basicly a massive ledger of all the 'coins' and most of the transactions that have occured with each coin.  If this is correct, then what prevents the size of the block chain file from going parabolic in growth once the number of people who actually trade in bitcoins hits critical mass?

3)  Is it possible that two people, say using idependent Android clients on smartphones, could trade directly over Bluetooth or Ad-hoc Wi-Fi rather than over the Internet?  Is there any talent working on such an app?

4)  I understand that the odds of an attacker overtaking the block chain is remote, but what if the attacker artificially reduced the difficulty of his chain, do the clients consider the difficulty of the blocks in dispute, or just consider the longest one to be authoritative without regard to the difficulty of the blocks?

5)  If the block chain is a massive collective ledger, is there any app out there that can crunch market stats from the block chain?  Such as total trade volume or total trade velocity across time?  Or total number of traders in a day?

And I *really* don't understand how change works.

Creighton