Banks existed long before fiat currency and fractional reserve.  They will survive their downfall too.

They won't be happy with it, but when the scenario starts looking like "change or die", I fully expect many of them to change.  And I don't think they can prevent the rise of bitcoin, only delay it.

We've been with 5 cents of $6.20 for most of the day, and it looks like it is finally starting to wander up.  Could be the start of the breakout, or it could just be a small move up by 10 or 15 cents.

Would a glossary help?

Xilinx is a chip maker.  Spartan 6 is a line of FPGA chips.  LX-150 is a model in that line.

FPGA means Field Programmable Gate Array.  It is a chip with a large number of generic logic gates and programmable interconnections.  This means that it can be configured and reconfigured to do different tasks as needed.  Think of it as a CPU that can be optimized for a particular job.  That's a bit of a simplification, but I think it gives you the idea. 

Github is a public source code repository.  Someone has posted source code that can be loaded into a LX-150 FPGA chip to configure it as a miner.  ztex.de also hosts similar software.

PCB is a printed circuit board, the flat board that electronic components are usually attached to.  Most of them are green.  The board itself is usually a composite insulator material with sheets of copper bonded on the flat sides and then partially removed to leave different connections and circuits.  Commercial boards are etched with acid, but a variety of methods are used for prototyping and home production.  Milling when a rotary tool is used to mechanically cut out portions of the copper layer, usually using a computer controlled machine (a CNC mill, but that's just another acronym to define).  Connections between the sides are done by drilling the board and connecting the copper traces on both sides.  In commercial boards, interconnects are electroplated chemically using processes that aren't generally possible at home, so homemade boards usually use pieces of wire soldered on both sides.

Boards with more than two layers can be made by stacking single sided boards onto a dual layer board so that you end up with alternating layers of copper and insulator.  In commercial boards, the interconnect holes are plated as each layer is added, so it is possible to connect any layer to any other layer.  This is nearly impossible on homemade boards, which is unfortunate because you really need those internal connections (called "blind vias") when working with BGA chips.

BGA means Ball Grid Array.  It means that the chip's pins are all on the bottom, and not along the sides.  The chip is manufactured with a square grid of solder balls on the bottom of the chip, and it is placed onto a PCB with a matching square grid of copper pads and the assembly is heated in an oven until the solder melts and connects the board to the chip.  Because the grid has hundreds of balls (484 in this case) with very tight spacing, there is no room for all of the traces to leave the area on the surface, so they must be connected to internal layers in the board stack and routed out.  Even doing it with 4 layers is rough, 6 is way better.

Isn't international finance fun?  I've long been of the opinion that the rest of the world should be lined up around the block to suck our dicks as a thank you for picking the painful side of Triffen's Dilemma and keeping the world afloat.  Everyone loves to party, but they hate to clean up.

I think the quote would be along the lines of: "We have averaged X blocks per day over the last week.  We expect our next block to happen within Y hours.  If you get your transaction to us in the next M minutes and it includes a fee of at least Z, we will include it in our next block (which should happen within 2*Y hours).  To ensure that your transaction reaches us, please submit it directly to our node at address A.B.C.D, port E."

The quote doesn't promise that the miner is going to get the next block, they are only promising that if they do get the next block, your transaction will be in it, provided that the fee meets their criteria.

In a busy world, I would expect that the biggest miners (the ones that average like one block per hour or more) will start ignoring low fee transactions, while the smaller miners would accept a lot more.  A spender could check with a bunch of miners and make the time/fee trade off that they want.

Deepbit wants 0.01 BTC to include it in the next 30 minutes, but Joe's Mining Pool and Bait Shop will do it for 0.001 BTC in the next day.  What is more important to you, time or money?

Meh.  Your reasons are just as wrong as the reasons propping up your strawman.  You are ignoring the parts of the world that don't agree with your premise.

You say that the we "have contributed nothing of substance", but only because you don't understand the substance of what we are contributing.

How about you think really hard about what the early adopters are actually doing, and how it is valuable to the bitcoin community and also to the entire rest of the world.  After that, we can talk about how substantial our contributions are or are not.

I don't think an algorithm is going to cut it for fees, at least not in the long run.  In the long run, miners will need to provide quotes.

Meh.  I don't think the government really knows about or cares about bitcoin, at least not in any official way.  And the IRS doesn't care if you slice up babies for lunch meat as long as you pay taxes on the income, so quite likely the IRS is actually the part of the government most likely to embrace bitcoins, or at least taxes paid in dollars for bitcoin-based income.

Actually, it is a good thing.  It means that there is at least one entity willing to trade value inside of Somalia for dollars outside of Somalia.  And since bitcoins can be thought of as "dollars outside of Somalia" thanks to the exchanges that literally convert them into dollars, bitcoins can flow through as soon as one of the outflowing entities starts accepting them.

I assume that we'll all know about it when it happens.  I don't expect the IRS to do anything until either they audit someone that happens to be a trader or a miner, or a trader or a miner specifically asks them for a written ruling.  Either way, it will very likely be a member of the community, and they'd let us know.

I keep waiting for someone to post an actual official decision letter from the IRS.

Sounds like a lot of work for not much gain.  Also, it reduces security unless nodes make more connections.  That means it costs us something that is already scarce (sockets) for something that isn't even remotely scarce yet (disk space to store the 875 MB block chain).

When bitcoin gets really big, I can see entities using something like this for their own internal clusters, maybe.

Check your CPU usage.  You can tell.

Or are you running GPU miners connecting to a node, and want to see if the node is actually doing anything with the returned work?  If so, check your debug.log.  I'm not positive, but I think that you should get some indication there.

Interesting.  Going to watch this thread.

By my estimation, 2 THash/sec is about 5000 moderately high end GPUs, or several times that number of GPUs if they are the sort that normally end up in supercomputers, and needs a large fraction of a megawatt of power (at least).  It is also larger than most pools.

Yeah, agreed on the police thing.  They might even treat it as attempted murder (but then probably deal it down).

I'm not familiar with insulin packaging.  Did it look legit?  Are there normally any tamper seals or anti-counterfeiting measures?

Except that you are wrong; your chart shows the exact opposite.  Do you see the huge area between the red and blue lines to the right?  It tells you that the correlation is very low.  Actually, worse than that, it tells you that the amount of correlation actually gets worse as one of the variables changes.  Price seems to lead difficulty when difficulty is low but appears almost totally unrelated when difficulty is high.  Do you see it?  You've found an indicator that predicts nothing more than its own invalidity.


Well, obviously, he's wrong too.   

He's wrong because he forgot the first law of technical analysis:  Your perfect indicator becomes useless as soon as you explain it to someone else.  He was using difficulty as a heuristic to figure out if market moves were "legit" or not.  Actually, that indicator was crap from the start, but the joke was still funny.  If you look at your chart, you can see that this heuristic would have signaled "buy" all the way down from $30+ to $6.

Oh, here's a fun one.  Try to look at your chart and predict what the price will be when (or before) the difficulty passes the previous peak.  Will it be like $8 or $10, just enough to make rigs operationally viable with even relatively expensive power costs (ignoring capital costs)?  Or will it be closer to $30, the price that (maybe sorta) sparked the massive capital investment that allowed the difficulty to attain the previous peak the first time?  Or will it be more like $50 or $100 or beyond, high enough to make the last bubble seem tiny and pathetic and convince everyone's grandmother that she needs to get in on this too?

I would be really nervous about making that prediction, because the two charts show a spike and an almost square digital 0 -> 1 transition.  With the right scaling factors, those two will always look like the early one caused the late one, and the price spike almost certainly really did cause the difficulty jump.  But what happens next?  Was difficulty primed before, like supercritical water, just waiting for a nucleation site to boil over, but now spent?  Or is mining primed now, with the people that missed the first bubble now waiting for the ROI to get short enough to buy their own rigs?  Or is it something else?

Try not to take this so seriously man.  I wasn't trying to be insulting, I just don't think that you know the things that you think you know, or at the very least, you don't know the things you do know for the reasons you think you know them.  I grew up on fractals.  Check out the chaos that emerges from the incredibly simple Lotka-Voltera equations, and shudder at what equations you'd need to really model the financial, technical and psychological properties of bitcoin.

Unless the dollar is inflating at a pretty heavy rate against goods inside of Somalia, there is already an outflow.

If only some international standards organization existed that could help us come up with an unambiguous date format...

Your graph clearly does not show the relationship that you are claiming.  Difficulty does not equal price times a factor, even with a delay.  It doesn't even equal price times a polynomial.

You need a more complex model.  There are more than two quantities, and the connections between them aren't linear.  For one thing, the amount of mining that happens is correlated to the value that miners see in bitcoin, which is only weakly related to the price.

The simple model has no predictive power.  The price has just gone from $2 to $5 for the second time ever.  Look closely at your chart and ask it what the difficulty is going to be, and when.  Is it going to triple in a few weeks?  Or is it going to increase by a hundred thousand or so?  Seven months ago, tripling and increasing by about 100,000 were the same thing.  This time, they are not.  And look at November and December, the price and difficulty seem to be decreasing and then increasing, but this time together.  What happened to the lag?

An increase in price can cause an increase in difficulty, but it is far from clear that it will always.  Like ol' Ludwig said, your graph shows a unique historical fact, not an eternal principle.

This should be tattooed on the hand of any person that is about to speak authoritatively about economics.  Teachers, TV news fodder, drunks in bars, internet idiots, etc.