what is bitcoin?

[python]

what is bitcoin?

[1713593879]

1713593879

[tosha]

it's a race to the bottom.

the thing about bubbles is that by the time you know it's been a bubble, the early idiots are rich and the late fools are poor, and everyone else is a smartass.

[KenJackson]

it's a race to the bottom.

the thing about bubbles ...

So are you saying that bitcoin is a short-lived phenomenon that will make early-adopters rich cause others to just lose the money we invest?

I worry about that.  I'm still looking around for assurance that that's not the case.

[tosha]

So are you saying that bitcoin is a short-lived phenomenon that will make early-adopters rich cause others to just lose the money we invest?

I worry about that.  I'm still looking around for assurance that that's not the case.

I do worrying too!
the hassle is, that if it will prosper it will be banned by the governments,
if it will fail only the early adopters will be payed out.

But i suppose, there is no assurance never.
Lets take the risc as a game, but the fiscal background as a fight!

[KenJackson]

the hassle is, that if it will prosper it will be banned by the governments, ...

That's a reasonable fear.  I was horrified when I learned that the protectors of the Liberty Dollar were raided, arrested and convicted.

I know the Liberty Dollar and bitcoin have more differences than similarities, but the real issue is the threat they both pose to evil-doers in government that lust for total control of all wealth.

[chuckypalumbo]

So are you saying that bitcoin is a short-lived phenomenon that will make early-adopters rich cause others to just lose the money we invest?

I worry about that.  I'm still looking around for assurance that that's not the case.

I do worrying too!
the hassle is, that if it will prosper it will be banned by the governments,
if it will fail only the early adopters will be payed out.

But i suppose, there is no assurance never.
Lets take the risc as a game, but the fiscal background as a fight!

It's hard to prosper without taking some risks, the price could either go through the roof or maintain it's ground, but right now it just looks to be very stable and steady around $16.8.

[jeremiahbuddha]

Bitcoin is a nerd/libertarian godsend. I agree that all the real money mining has already been made by the early adopters. I'm personally in it just to learn more about bitcoins, hopefully pay off my GPU's, and just be apart of something I think is great.

Even though the real money has already been made in mining, don't forget that we all get the benefit of using bitcoins for all our anonymous, online purchasing needs. Governments will certainly try to ban them if they really catch on, but who cares. Lets enjoy the internet while it's still undomesticated.

[wolf902]

myrkul said...

BTC are mined by doing mathematics. The network has a target that all the miners are trying to match buy guessing a number and then running it through a set of algorithms with the transactions. the result of the guessed number + the transactions is a block. if the block matches the target, it's valid and gets accepted. Bitcoins are created as the first transaction in any block, paid to the miner.

[SimplePanda]

The interesting thing about Bitcoin is it's decentralized nature.

A government may make it's use illegal, but they can't stop it. No controlling interest to raid / neutralize means no real target to shut down.

All they can do is prevent it from becoming mainstream.

[Anonymous]

what is bitcoin?

Bitcoin, is a disaster waiting to happen.   

[Auspician]

The interesting thing about Bitcoin is it's decentralized nature.

A government may make it's use illegal, but they can't stop it. No controlling interest to raid / neutralize means no real target to shut down.

All they can do is prevent it from becoming mainstream.

I'm not even convinced they can do that.  Since Bitcoin is both decentralized and global, no single government could make much of an impact.  The worst they could do is to ramp up the propaganda machine full swing about why "bitcoin is bad", but in so doing they'd also be spreading the word about Bitcoin.  Since trust in government and MSM is at all time lows, many people would be unconvinced and research Bitcoin for themselves.  Likewise if a government passed a law making Bitcoin illegal; since there is no way of knowing who is using Bitcoin, prosecution for violations of the law will be as rare as prosecutions for burning DVDs.

In the end, the only foreseeable way that they could cripple bitcoin would be by co-opting a major pool such as deepbit.  But we can prevent even this possibility by mining in smaller, decentralized pools.  Currently deepbit represents ~50% of all mining going on.  This means that for every hour that goes by, there is a 1.5% chance that Deepbit will solve all of those blocks.  In other words, if deepbit were co-opted, there would be a 1.5% chance per hour that the network could be corrupted by faulty transactions.  If deepbit only controlled 20% of the mining going on, this would instead be a 0.0064% chance. 

I'm doing what I can to encourage people to mine with smaller pools to increase diversity and strengthen the bitcoin network for the future.  Instead of mining with the big established pools, you can take your place in history by helping one of the smaller pools get started.  If this sounds appealing to you, I'd recommend Triple Mining as my favorite small pool to mine with right now.  You can even earn more than other pools by referring your friends to join and mine with you.  You can check it out by clicking the link in my sig if you're interested.

Lets make Bitcoin prosper like we know it can.  Lets diversify the network and make it impossible for any gang, hacker or government to shut us down.

[joepie91]

Bitcoin is a decentralized 'cryptocurrency'. I don't believe it will ever be a short-lived phenomenon.

An iPad, to just name one thing, is a 'hype product'. It doesn't really do anything new, it doesn't really do anything great, it doesn't really do anything you could not already do. When people realize that, the iPad will not sell anymore, become less popular, and eventually fade away.

Bitcoin is practically the first completely decentralized currency. It solves problems that nothing else can solve so far (also refer to the Myths page on the Bitcoin wiki for more about this). It is something that will have a use in 1 year, and will still have a use in 10 years, and most likely in 100 years, etc.... Yes, a better system may come along in time, a better decentralized system. Does that mean that Bitcoin is a hype product? No, it just means that evolution happens. Bitcoin can be seen as the evolution of currency... but that does not make fiat money a hype product.

There may be a bubble regarding the exchange rate (as, despite it not being a hype product, there IS a newness factor, and people may drop out after a while until it becomes bigger), but the concept in itself is technically sound, and is not expected to disappear or become unusable any time soon.

[silverchair]

what is bitcoin?

Lots of definitions for bitcoins, one thing is for sure...Its tax free.

[SimplePanda]

what is bitcoin?

Lots of definitions for bitcoins, one thing is for sure...Its tax free.

As long as it remains bit coin. But if you start converting your BTC to traditional currency at high levels expect some interest from the tax man.

[joepie91]

what is bitcoin?

Lots of definitions for bitcoins, one thing is for sure...Its tax free.

Not entirely true. I believe it was established a while ago that Bitcoin would technically fall under barter tax.

[silverchair]

what is bitcoin?

Lots of definitions for bitcoins, one thing is for sure...Its tax free.

Not entirely true. I believe it was established a while ago that Bitcoin would technically fall under barter tax.

"would technically fall under barter tax" still to happen or no longer will, not happening till this writing...It will not happen that's for sure...I Hope.

[joepie91]

what is bitcoin?

Lots of definitions for bitcoins, one thing is for sure...Its tax free.

Not entirely true. I believe it was established a while ago that Bitcoin would technically fall under barter tax.

"would technically fall under barter tax" still to happen or no longer will, not happening till this writing...It will not happen that's for sure...I Hope.

If you somehow have a nice expensive car, and a nice expensive house, and a nice expensive <everything> yet your income in USD is labeled as being 0.... I think IRS (or your local equivalent of choice) will be asking some nasty questions.

[silverchair]

Bitcoin is the world’s first peer to peer electronic currency! It’s like bittorrent, except totally legal. If you understand that Paypal = money, then you can apply the same thinking for bitcoins – it’s like paypal without all the huge fees and restrictions. If you understand how gold and silver = money, then think of bitcoins as the electronic version of gold & silver. There’s only a limited supply of them, and people trade them for items and money.

[MKW2012]

what is bitcoin?

Lots of definitions for bitcoins, one thing is for sure...Its tax free.

Which I love. No 15% capital gains tax for us. 

[TiagoTiago]

Bitcoin is.