It is shocking how dumb the press is -

[TKeenan]

http://www.washingtonpost.com/blogs/wonkblog/wp/2013/11/19/bitcoin-needs-a-central-banker/
This guy argue that bitcoin needs a central banker.  He doesn't understand that the reason bitcoin is good - it doesn't have currency manipulation via a central banker.  

This shows his level of understanding:
"Bitcoin is "mined" by technologists solving difficult problems. Which means that its supply is set to increase at a constant rate, not a rate tied to demand"

'difficult problems'?  My $8 block erupter guesses a number (nonce) @333Mhash/sec.  It's number guessing.  It is not a 'difficult problem'.  Either it's '0000000000000000' or it's not.  

"supply is set to increase at a constant rate" - didn't this guy even bother to attempt to understand the basics?  Clearly the Washington Post doesn't have any editors who even remotely care whether writers are being factual.  Such deviation from accuracy in journalism should definitely get a writer fired.

Shouldn't the Washington Post expect their writers to have some minimal understanding of the topics on which they write?

[Barek]

Here's another nugget.

http://money.cnn.com/2013/11/18/investing/bitcoin-china/index.html?iid=HP_LN

In terms of geopolitics, the implications of Chinese support for Bitcoin are clear and complicated for the U.S. The more bitcoins a person or entity control, the higher their influence in all things Bitcoin. While it is unlikely anyone will ever control more than 51% of Bitcoin, such an event could put the currency under control of that actor.

[Gabi]

Epic fail for the mighty and famous cnn

Yeah, press is mostly useless these days.

[BurtW]

Here's another nugget.

http://money.cnn.com/2013/11/18/investing/bitcoin-china/index.html?iid=HP_LN

In terms of geopolitics, the implications of Chinese support for Bitcoin are clear and complicated for the U.S. The more bitcoins a person or entity control, the higher their influence in all things Bitcoin. While it is unlikely anyone will ever control more than 51% of Bitcoin, such an event could put the currency under control of that actor.

I remember reading that one.  What a crock.

I have been in the news a hand full of times in my life.  Every single time there was at least one error in the copy/story.  Usually some small matter of fact and not that important.

When ever this topic comes up in conversation I ask people "Have you ever been in the news?"  If they say yes I then ask "Was the story 100% accurate?"  The answer is almost always no.

Accuracy is not even in the top 100 things most important to news organizations.  Selling your time to advertisers is their top 100 most important items.

[cdog]

I dont think there is any factual errors, the author simply doesnt "grok" that the central premise of Bitcoin is decentralization.

Articles like this by college educated professionals with big 401Ks make me think mainstream adoption might be 10+ years away.

Bitcoin is so revolutionary, people dont even get it. Their mind cant even comprehend why something like BTC could be useful, even essential.

[Barek]

Epic fail for the mighty and famous cnn

Yeah, press is mostly useless these days.

The article is actually pretty good and for once does not focus on speculation/mining/drugs. The paragraph I quoted is clearly a misunderstanding of the author. One I had not read before and thought was funny.

[Peter Lambert]

This shows his level of understanding:
"Bitcoin is "mined" by technologists solving difficult problems. Which means that its supply is set to increase at a constant rate, not a rate tied to demand"

'difficult problems'?  My $8 block erupter guesses a number (nonce) @333Mhash/sec.  It's number guessing.  It is not a 'difficult problem'.  Either it's '0000000000000000' or it's not.  

"supply is set to increase at a constant rate" - didn't this guy even bother to attempt to understand the basics?  Clearly the Washington Post doesn't have any editors who even remotely care whether writers are being factual.  Such deviation from accuracy in journalism should definitely get a writer fired.

Shouldn't the Washington Post expect their writers to have some minimal understanding of the topics on which they write?

I see this explanation of mining in most articles introducing bitcoins. What they should say, instead of "solving difficult problems" is "solving computationally intense algorithms" or something like that, the important part is not that the problems are difficult but that the algorithim for generating the random number requires the computer to do a specific amount of work. It is not just guessing a random number, it is running that random number through the complicated formula to see if it is the right number. It would be nice if the articles somehow mentioned that doing this work also verifies the transactional data for the network.

They should describe mining as "Verifying transactions and running random numbers through a complicated formula which requires intense computational power" Or something like that.

With regard to the constant rate of coin generation: The algorithm is meant to produce a rather constant coin generation rate over the short term. From November 2012 to about November 2016 bitcoins will be generated at roughly a constant speed of 25 bitcoins per ten minutes. Then for the next four years they will be generated at a constant speed of 12.5 bitcoins per ten minutes. So the short term rate is held constant, but the long term rate is decreasing. So he got it half right.

[TKeenan]

With regard to the constant rate of coin generation: The algorithm is meant to produce a rather constant coin generation rate over the short term. From November 2012 to about November 2016 bitcoins will be generated at roughly a constant speed of 25 bitcoins per ten minutes. Then for the next four years they will be generated at a constant speed of 12.5 bitcoins per ten minutes. So the short term rate is held constant, but the long term rate is decreasing. So he got it half right.

If you look at any system with a sufficiently powerful microscope (short enough time frame) all things are constant.  A formula 1 car is at a perfect standstill while going 220 miles per hour if you use the highest shutter speed of a modern DSLR. 

The rate is not constant - no matter how you slice it. 

Forget about the minutae - the big issue here is his argument in favor of a central banker.  What a crock.  That shows a profound lack of understanding for bitcoin.  Besides the fact that bitcoin volatility is due to many other factors not related to rate of supply creation. 

[Barek]

They should describe mining as "Verifying transactions and running random numbers through a complicated formula which requires intense computational power" Or something like that.

Got to agree with the OP on this one. The calculations are far from complicated. It's the same thing over and over again. The $8 block erupter does the same calculation 333 million times per second.

Imagine a sea of white marbles and in it somewhere a black marble. "Mining" is picking a marble at random and looking at it to see if it is black and then repeating that process over and over. Find the black marble and you can put all the transactions you want in it and add it to the (block)chain.

[Peter Lambert]

They should describe mining as "Verifying transactions and running random numbers through a complicated formula which requires intense computational power" Or something like that.

Got to agree with the OP on this one. The calculations are far from complicated. It's the same thing over and over again. The $8 block erupter does the same calculation 333 million times per second.

Imagine a sea of white marbles and in it somewhere a black marble. "Mining" is picking a marble at random and looking at it to see if it is black and then repeating that process over and over. Find the black marble and you can put all the transactions you want in it and add it to the (block)chain.

What I was trying to say is that it is a problem which makes the computer work hard, how do you describe that quickly without calling it a "difficult problem"?

[kireinaha]

More knee jerk reactions from bitcoin zealots. The first article is an opinion piece, and the writer thinks that bitcoin needs a central authority due to the wild volatility that we`ve all been witnessing for the past few weeks.. and years. From the standpoint of a currency, bitcoin is a disaster. Nobody is going to have faith in a form of currency that fluctuates 50% or more in a day. He has a point. I know that destroys one of the fundamental tenants of bitcoin, but it`s called reality, guys.

[Barek]

What I was trying to say is that it is a problem which makes the computer work hard, how do you describe that quickly without calling it a "difficult problem"?

Well, mining is fairly easy to explain. It is a lottery every 10 minutes where lottery tickets are distributed according to processing power of the participating computers. The issue with this is that people actually understand something and start to ask questions or outright doubt that it is that easy. However, if you tell them it is vastly complicated they just nod and accept it.

I get what you are saying and I understand why the press use it that way. It just makes it frustrating to try to explain details to people, who have made up their mind that it is something terribly complicated.

[Barek]

More knee jerk reactions from bitcoin zealots. The first article is an opinion piece, and the writer thinks that bitcoin needs a central authority due to the wild volatility that we`ve all been witnessing for the past few weeks.. and years. From the standpoint of a currency, bitcoin is a disaster. Nobody is going to have faith in a form of currency that fluctuates 50% or more in a day. He has a point. I know that destroys one of the fundamental tenants of bitcoin, but it`s called reality, guys.

How would you start a virtual currency? The goal is to get a portion of it to many people, so they can use it as a currency.

The wild swings you see is money being distributed. People buy and sell units. The trend is an increasing value per unit. If every person holds similar value of bitcoin, the number of participating people increases. People who buy their units early have a higher risk of loss incase the system turns out useless, but they also benefit from a rising value once they redistribute parts of their units. Overall, it's quite beautiful.

Relative price swings in the past have been much more drastic than today's. Expect the magnitude of swings to decrease as total market value increases.

[TKeenan]

What I was trying to say is that it is a problem which makes the computer work hard, how do you describe that quickly without calling it a "difficult problem"?

Well, mining is fairly easy to explain. It is a lottery every 10 minutes where lottery tickets are distributed according to processing power of the participating computers. The issue with this is that people actually understand something and start to ask questions or outright doubt that it is that easy. However, if you tell them it is vastly complicated they just nod and accept it.

I get what you are saying and I understand why the press use it that way. It just makes it frustrating to try to explain details to people, who have made up their mind that it is something terribly complicated.

Mining gets about 90% of the press' attention.  What is really interesting is not the mining.  The wonderfully cool part of bitcoin is the uncorruptable ledger.  An uncorruptable ledger which is maintained by a network of machines is what allows us to fire all bank managers necessary to maintain trust.  This is the sexy bit.  

But everyone wants to talk about the complex math - which of course is nonsense.  SHA256 is not complex math.

[Peter Lambert]

What I was trying to say is that it is a problem which makes the computer work hard, how do you describe that quickly without calling it a "difficult problem"?

Well, mining is fairly easy to explain. It is a lottery every 10 minutes where lottery tickets are distributed according to processing power of the participating computers. The issue with this is that people actually understand something and start to ask questions or outright doubt that it is that easy. However, if you tell them it is vastly complicated they just nod and accept it.

I get what you are saying and I understand why the press use it that way. It just makes it frustrating to try to explain details to people, who have made up their mind that it is something terribly complicated.

Describing it that way lacks some of the scale to the amount of processing power needed. It is also confusing how mining is reported in units like GHs, which is completely different but looks similar to the usual unit for processor speed, GHz.

[Barek]

Mining gets about 90% of the press' attention.  What is really interesting is not the mining.  The wonderfully cool part of bitcoin is the uncorruptable ledger.  An uncorruptable ledger which is maintained by a network of machines is what allows us to fire all bank managers necessary to maintain trust.  This is the sexy bit.  

But everyone wants to talk about the complex math - which of course is nonsense.  SHA256 is not complex math.

Agreed. It seems to have gotten better though lately.

Then again, the question where Bitcoin comes from is an understandable one. Calling it mining might have been a bad idea. Instead, saying a with time decreasing number of Bitcoins are given away every 10 minutes in a lottery, would have made the whole process much less interesting (but actually more accurate) and would have shifted focus to more relevant topics.

Describing it that way lacks some of the scale to the amount of processing power needed. It is also confusing how mining is reported in units like GHs, which is completely different but looks similar to the usual unit for processor speed, GHz.

More processing power = more tickets. If you want to explain the GH, you can say a Hash is a ticket. I think people are smart enough to figure out what GHs stands for and seeing that as 10^9 tickets per second is just fine to understand how the block reward is awarded.

[Mike Christ]

Can we TP this guy's house?  We all know he was paid to write this article, nobody is this stupid.

[Peter Lambert]

Then again, the question where Bitcoin comes from is an understandable one. Calling it mining might have been a bad idea. Instead, saying a with time decreasing number of Bitcoins are given away every 10 minutes in a lottery, would have made the whole process much less interesting (but actually more accurate) and would have shifted focus to more relevant topics.

Instead of calling it mining, call it "transaction processing", that is a more descriptive term for what the work actually goes toward.

[TKeenan]

Mining gets about 90% of the press' attention.  What is really interesting is not the mining.  The wonderfully cool part of bitcoin is the uncorruptable ledger.  An uncorruptable ledger which is maintained by a network of machines is what allows us to fire all bank managers necessary to maintain trust.  This is the sexy bit.  

But everyone wants to talk about the complex math - which of course is nonsense.  SHA256 is not complex math.

Agreed. It seems to have gotten better though lately.

Then again, the question where Bitcoin comes from is an understandable one.

I totally disagree with this.  Who cares where it comes from.  Who cares what rate it comes.  This does not effect bitcoin in any appreciable way.  It was all about a fair distribution.  But even if it was all given away randomly in one day - the remarkable function of bitcoin is the uncorruptable ledger.  The means of distribution is boring and dumb.  Who the fuck cares about 'mining' - that is just dumb.  Of course, it was a cleaver way to get thousands of guys to set up a node.  So that part is a little bit interesting.  But otherwise, mining which gets all the press attention - is simply a distraction to the remarkable part of bitcoin - the blockchain.  

[kireinaha]

More knee jerk reactions from bitcoin zealots. The first article is an opinion piece, and the writer thinks that bitcoin needs a central authority due to the wild volatility that we`ve all been witnessing for the past few weeks.. and years. From the standpoint of a currency, bitcoin is a disaster. Nobody is going to have faith in a form of currency that fluctuates 50% or more in a day. He has a point. I know that destroys one of the fundamental tenants of bitcoin, but it`s called reality, guys.

How would you start a virtual currency? The goal is to get a portion of it to many people, so they can use it as a currency.

The wild swings you see is money being distributed. People buy and sell units. The trend is an increasing value per unit. If every person holds similar value of bitcoin, the number of participating people increases. People who buy their units early have a higher risk of loss incase the system turns out useless, but they also benefit from a rising value once they redistribute parts of their units. Overall, it's quite beautiful.

Relative price swings in the past have been much more drastic than today's. Expect the magnitude of swings to decrease as total market value increases.

To begin with, Satoshi and the other early adopter `whales` should ease up on their enormous cache of coins. Satoshi, with his million coins, could act as a pseudo central authority until bitcoin gains some degree of stability. But that`s unlikely to happen, because just like the Winkevoss twins and others, he`s in this to make money, obviously.