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Finance and Economics => The Money Board => Economic News, the Global Economy and all Things Monetary => Topic started by: FreeLancer on May 30, 2011, 02:01:13 AM

Title: Bitcoin currency (merged topics)
Post by: FreeLancer on May 30, 2011, 02:01:13 AM
This digital currency supposedly is secure, inflation proof, and freaking out governments/banks because they can't control it.  Anyone looked into this?
Title: Re: Bitcoin currency (merged topics)
Post by: backwoods_engineer on May 30, 2011, 06:55:48 AM
I just started using it about a month ago.  It's quite difficult to buy BitCoin without either mailing cash to some company (e.g., Mt. Gox) or buying in to an offshore bank.

PayPal siezed one Bitcoin processor's funds.  He was exchanging dollars for BitCoin using PayPal.

I think very soon, Bitcoin is going to banned in multiple countries, including the US.   It's just too much freedom for the statists in our government.
Title: Re: Bitcoin currency (merged topics)
Post by: cliffyp on May 30, 2011, 10:35:38 AM
There is a weekly podcast put out by a George Mason professor of economics called EconTalk.  It's a good podcast, it's meant for everyday people.  He just interviewed one of the guys from Bitcoin a few weeks ago.  If you're unsure about Bitcoin or want to know more about it then check out the interview.  It's about an hour long:

http://www.econtalk.org/archives/2011/04/andresen_on_bit.html
Title: Re: Bitcoin currency (merged topics)
Post by: cliffyp on May 30, 2011, 10:43:54 AM
Oh ya, I forgot putting in my opinion.  I didn't know too much about BitCoin before listening to that podcast, but my gut reaction was negative.  One of the problems with fiat paper is that it can just be printed and printed without limit.  I figured a virtual currency would be even worse, at least there is a cost to paper and the time of the printing press. 

After listening to the podcast I'm interested in BitCoin and I hope it continues to develop.  There is a built in mechanism to hold inflation to a slow steady predictable rate and because BitCoin is open source there is a check against the system being gamed.  I don't think there should be one "official" currency.  Let's have free exchange and let the currencies compete in the market place.  I agree with Backwoods, BitCoin is going to come under some pressure if it continues to grow.  Way to much freedom in the hands of the people and not in the banking elite. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 31, 2011, 03:42:45 PM
True, there are some big hurdles facing Bitcoin, but the idea of an open-source P2P crypto-currency is very intriguing.  With enough momentum behind it, it seems like it could be hard to stamp out and I'll be interested to see how things develop.
Title: Re: Bitcoin currency (merged topics)
Post by: Artos on June 02, 2011, 02:58:16 PM
http://www.foxbusiness.com/on-air/stossel/blog/2011/06/02/digital-currency-libertarian-future-0

A new private currency called "Bitcoin" has hit the scene. It is a digital currency that my producer tells me is valauble partly because it's untracable: there is supposedly no way for the government, or anyone else, to see who owns or transfers Bitcoins.

Read more: http://www.foxbusiness.com/on-air/stossel/blog/2011/06/02/digital-currency-libertarian-future-0#ixzz1O9dlOZRG
Title: Re: Bitcoin currency (merged topics)
Post by: Bubafat on June 02, 2011, 08:54:05 PM
http://gizmodo.com/5807416/the-underground-website-where-you-can-buy-any-drug-imaginable
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on June 02, 2011, 09:46:53 PM
http://gizmodo.com/5807416/the-underground-website-where-you-can-buy-any-drug-imaginable

So people are putting their faith in the imperfect anonymity of Tor, and the shiny new alleged anonymity of Bitcoin, and then having their drugs delivered to their homes via the United States Postal Service.

Yeah, that sounds safe.

I worry that users of Bitcoin, Tor, PGP or GnuPG, e-gold, etc, seem to develop an attitude of invulnerability.  These privacy techniques are a defense against snoops, but they're only a defense, not perfect protection against all forms of intrusion.  And of course, as users get cocky and move into black-market stuff, this just draws more government attention and interference.
Title: Re: Bitcoin currency (merged topics)
Post by: dukejer on June 08, 2011, 09:08:19 AM
I like the idea of Bitcoin.  It is hard to make transactions with gold or silver unless you are in person or trust shipping gold or silver.  This makes gold and silver hard to make transactions over the Internet in a safe or timely manner.  The code and specifics of Bitcoin are completely open and maybe reviewed by anyone.   Bitcoin is not completely anonymous.  The government can use ISP logs, wire taps, warrants and other methods they currently employ to follow computer transactions.  Once they discover your public Bitcoin addresses they can track every transaction those Bitcoin addresses make, but they have to discover you Bitcoin addresses that you use.  You can create an unlimited number of Bitcoin addresses for yourself.  Every Bitcoin transaction is open and published to the Internet over the peer to peer network, (P2P).  That is part of what makes it safe.  The P2P network verifies every transaction to create a P2P trust and verifies the integrity of the transactions to help prevent fraudulent transactions and double spending of the same Bitcoin.

Here is a video from CBS speaking with one of the code developers of Bitcoin.

http://www.cbsnews.com/8301-504943_162-20069780-10391715.html

-Dukejer
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on June 19, 2011, 09:13:10 AM
I love bitcoin, that said, it's major flaw in my eyes is it's reliance on the internet... without the bitcoin network up and running it's not very useful, and it's value would be greatly diminished.  Certainly not something you can rely on in a survival situation, but I think it has great potential for just general transactions.  Try hiring someone in Moldova to do a little web development (which I've done).  Paypal doesn't support them, so you are stuck with either expensive bank wires or western union.  With bitcoin there is no middle man.

I've seen a lot of youtubers hating on bitcoin, saying only gold is real money because of it's "intrinsic" value.  Doesn't anyone ever ask what makes gold such a good currency?  It has a lot of the properties required to be money: stable supply, can't counterfeit it, not consumed industrially, easily divisible, recognizable.  Bitcoin has all these qualities too.

Politically, it's a wonderful currency, a true currency without a state, purely voluntary, completely non-fiat.
Title: Re: Bitcoin currency (merged topics)
Post by: backwoods_engineer on June 20, 2011, 08:53:50 AM
RED ALERT!

Those who have been trading Bitcoin at MtGox.com: the site has been compromised.  Please change your passwords if you used that password for other sites!
Title: Re: Bitcoin currency (merged topics)
Post by: ChrisFox on June 20, 2011, 11:56:54 AM
Just as with anything else on the internet, they got hit with a nasty Trojan over the weekend.

http://www.pcmag.com/article2/0,2817,2387194,00.asp (http://www.pcmag.com/article2/0,2817,2387194,00.asp)
Title: Re: Bitcoin currency (merged topics)
Post by: backwoods_engineer on June 20, 2011, 01:44:51 PM
Just as with anything else on the internet, they got hit with a nasty Trojan over the weekend.

http://www.pcmag.com/article2/0,2817,2387194,00.asp (http://www.pcmag.com/article2/0,2817,2387194,00.asp)

No, this is not what happened to MtGox.  This trojan attacks Bitcoin clients on individual computers, not Bitcoin traders like MtGox.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 20, 2011, 02:28:01 PM
It looks like Mt. Gox was a bit inept at cyber security, to put it mildly.  How many of you frantically searched for your info on the leaked database? 

Centralized exchange trading, like Mt. Gox, are the weak spot in the Bitcoin economy, they're too tempting for thieves, governmental or otherwise.  If someone can figure out a simple, secure, and decentralized method of exchange, this currency will really get some legs.
Title: Bitcoin Information
Post by: BigAl on March 01, 2012, 03:40:03 AM
Hi,

I've been mining/trading in Bitcoins (BTC) for almost a year, I will post more links for in depth information if anyone wishes or try to answer questions as they are posted.

The on-line forum is a good place to start:

https://bitcointalk.org/index.php

The general Frequently Asked Questions (FAQ):

http://bitcoin.org/

Best regards,

BigAl
Title: Re: Bitcoin currency (merged topics)
Post by: SurvivorStudent on April 14, 2012, 03:35:31 PM
It seems to me that the fact the transactions cannot be automatically reverse presents a problem and a market.
The problem is fraud since someone can "take the money and run" without any recourse on your part.
The market this presents is a possibility of an escrow service for transactions.
Does anyone have thoughts on this? How to we decrease the risk of fraud? how can we use an escrow service and still remain fair and anonymous?
Title: Re: Bitcoin currency (merged topics)
Post by: SurvivorStudent on April 14, 2012, 03:38:33 PM
I love bitcoin, that said, it's major flaw in my eyes is it's reliance on the internet... without the bitcoin network up and running it's not very useful, and it's value would be greatly diminished.  Certainly not something you can rely on in a survival situation, but I think it has great potential for just general transactions.  Try hiring someone in Moldova to do a little web development (which I've done).  Paypal doesn't support them, so you are stuck with either expensive bank wires or western union.  With bitcoin there is no middle man.
There are options out there for a physical transference of bitcoin (see https://www.casascius.com (https://www.casascius.com) ) but that of course presumes you trust the maker of the currency, much like all other money systems.

Oh, and I respectfully submit that Bitcoin is the very definition of Fiat, it isn't even printed on paper you can burn if you get cold.
Title: The "bitcoin" stands up to its first real test of economic usefulness ...in Iran
Post by: Oil Lady on December 05, 2012, 06:32:48 PM
Intersting development in Iran is now offering one "proof of concept" to the potential validity of the bitcoin.

It seems that due to US economic sanctions against Iran and against any trading with the Iranian Rial, there are now no dollars flowing through the Iranian economy. This has tanked the value of the Rial. But ... there are still plenty of web-connected Iranians who have their own persoanl stashes of bitcoins. And they are trading their bitcoins for US Dollars. Thus they are achieving a backdoor through the internet into the global economy (an economy still heavily dictated by the US Dollar).

http://www.businessweek.com/articles/2012-11-29/dollar-less-iranians-discover-virtual-currency#r=shared 

Quote
Dollar-Less Iranians Discover Virtual Currency
 
By Max Raskin on November 29, 2012

... Created in 2009 by a mysterious programmer named Satoshi Nakamoto, bitcoins behave a lot like any currency. Their value is determined by demand, and they can be used to buy stuff. Bitcoin transactions are encrypted and handled by a decentralized global network of tens of thousands of personal computers. Merchants around the world accept the currency, from a bakery in San Francisco to a dentist in Finland. Individuals who own bitcoins and wish to exchange them for physical currencies like euros or dollars can use exchange sites such as localbitcoins.com, a Finland-based site founded by Jeremias Kangas. “I believe that bitcoin is, or will be in the future, a very effective tool for individuals who want to avoid sanctions, currency restrictions, and high inflation in countries such as Iran,” Kangas wrote in an e-mail.

The advantage for Iranians is that bitcoins can be swapped for dollars that can then be kept outside the country. Another plus: Regulators can’t easily track the transactions, since bitcoins aren’t issued from a central server. Bitcoin users can conduct business on virtual private networks, which hide customers’ identities....


Title: Re: Bitcoin currency (merged topics)
Post by: nelson96 on January 06, 2013, 07:48:48 PM
John Stossel did a report on Bitcoins tonight.  I had never heard of them before.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 27, 2013, 09:25:05 PM
For those of you who have been curious about BitCoin, I thought I'd summarize my experience with this brave new digital currency and how I have been trading USD for BTC over the last year.

Since I started this thread, there was a very large BitCoin bubble where the value of a single BTC went to over $30 per BTC.  Around this time there were several well publicized hacking events which took the wind out of the price and it plummeted to less than $4.  Mt. Gox, the major online exchange, was hacked and almost went out of business and the future of the currency appeared doomed.  For the last half of 2011, I sat on the sidelines watching the price and monitoring the chatter surrounding its future.  I expected to see it disappear, but slowly the price began to pick up and it became clear to me that the underlying design of the currency is sound and that the publicized losses were due to poor online security precautions by users, rather than a flaw in the architecture of the currency.

January 2012, after seeing the prices slowly creeping up again, I jumped in and started exchanging dollars for bitcoin, via Mt Gox, for around $6 per coin.  It's a little complicated getting dollars into a Mt. Gox account, but my solution has been to use Dwolla (an online payment service that will do business with Mt. Gox, unlike PayPal) as the intermediate step between my bank and Mt. Gox. 

Really the only hiccup I've had has been related to the increasing security at Mt. Gox.  About half way through the year they gave away free Yubikeys for each account holder, which sounded great, especially since I was already using one for managing my online password security scheme and had not had any problems with the technology.  However, my Mt. Gox Yubikey is very tempermental when used and frequently would not be recognized, and thus threatened access to my Mt. Gox account, as well as a Blockchain account that I'd set up to use the same Yubikey.  After this, I gave up on the Mt. Gox Yubikey and am using Google Authenticator on my iPhone as a secondary password, instead.

Soon after this, Mt. Gox encouraged me to update my account to "Trusted" status by verifying my identity, which would allow me to transfer larger amounts of currency.  Although the amounts I'm trading didn't even get close to these limits, I decided I'd submit jpgs of my passport and a utility bill.  The next day they sent me an email and said that my account would not be updated to "Trusted" unless I submitted notarized physical copies of the documents I'd sent them online.  I figured, no big deal, I don't need the extra limits provided to "Trusted" members, so didn't do anything about it.

The problem was, a month or two later, when I tried to transfer some Bitcoin to a Blockchain wallet (which is highly encouraged, like a lot of things in life, you don't want all your coins in one place) but found that Mt. Gox was blocking any transfers out of my account.  Of course, they still let me put money into the account and do trades, but would not allow me to remove either dollars or bitcoin until I completed the verification process and obtained "Trusted" status.  Needless to say, I was a bit peeved, but no amount of online whining to Mt. Gox did any good, so I shelled out $70 for notarized copies and postage to Japan (Mt. Gox's physical address).  This did it, they've awarded me "Trusted" status, although it took almost a month from the time the notarized documents were mailed.

Last week, there was a brief spike up to $19 per bitcoin, then quickly retreated to $16, and now it is playing with $18.  I have no idea how this will all play out in the long run, but I will continue to build my holdings.  There is a maximum number of coins that will be minted and each coin is divisible to 8 decimal places, so who knows where the value of a BitCoin will be in 10 years, it could be defunct, or it could be worth $100,000.  I certainly am not putting all my eggs in this basket, just as I'm not putting it all into metals, either, but I think it's an interesting concept that holds a lot of promise. 
Title: Re: Bitcoin currency (merged topics)
Post by: nelson96 on January 27, 2013, 09:36:18 PM
Thanks for the updste FeeLancer, keep us up to date as time goes on.  You've done a lot more to make this work for you than I am willing to do, but I will keep watching in case it gets easier and more secure.
Title: Does anyone Bitcoin?
Post by: velacreations on February 11, 2013, 04:28:56 PM
I've been following bitcoin for a few years, and I have some money stored in them, but not a lot.

[part of post deleted at the request of the poster -- Mr. Bill]

Here's a chart comparing USD to gold and bitcoin to gold.  Notice how Gold has gotten more expensive to buy with USD, but cheaper to buy with BTC.

(https://docs.google.com/spreadsheet/oimg?key=0AoE8nAOEMIa7dExCSk5BX3E0TkVxTmtkYWlMdjJCU2c&oid=2&zx=ra7zrucdt4vq)

I've often thought bitcoin was a decent way to store money, untraceable, and easy to move without fees.
Title: Re: Does anyone Bitcoin?
Post by: nelson96 on February 11, 2013, 04:34:25 PM
FreeLancer has/does.  Here's another thread to check out . . .

http://thesurvivalpodcast.com/forum/index.php?topic=27624.msg457950#msg457950

[topics merged]
Title: Re: Bitcoin currency (merged topics)
Post by: velacreations on February 11, 2013, 04:44:15 PM
I've been playing with bitcoin for a while, too.  I can't say they are making me rich or anything, but I have definitely made money compared to the USD or gold.

I like to play games and gamble a bit, too.  I lose some, win some, and it's not central to my investment strategy or anything, but it's for entertainment.

Something I have been watching closely are sites like http://bitbears.com and http://bitcoingoldbar.com  They are like ponzi or chain schemes, but you can actually make money on them if you watch them and get in during a rush or when it is climbing.  I had made a bit on Bitbears, but not on the other one.  Both of those reset if they sit idle for a few days, so watch out, or at least, try and promote them, if you can.  I basically just watch to see others playing, and when the values are climbing, I get in and get out.

Aside from that, I am often thinking of BTC based businesses.  I think there is potential there.  One major obstacle I see is that you can't really go from a Credit Card to bitcoins.  I know the reasons behind this, but if someone figures that out, not only will it open up bitcoins to the masses, they will stand to make a lot of $$$.

Any other ideas for bitcoin businesses?
Title: Re: Does anyone Bitcoin?
Post by: Jeff NH on February 11, 2013, 07:34:02 PM
I've got some. I've bought silver with it, donated some bitcoins to charities with it a couple of times.  No interest in the gaming aspects of bitcoin.

Free State Now (A group associated with the free state project trying to accelerate sign-ups) recently started taking bitcoins. I've sent them some cash and will probably send them some bitcoin fairly soon.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 11, 2013, 08:48:19 PM
BTC has been steadily climbing for the last two weeks and hit a high today of $24.70 per coin.

I've purchased nothing with them, it's strictly speculative at this point, which is a bit out of character for me.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 21, 2013, 09:05:31 PM
BTC is near parity with an ounce of silver, it finally broke through $30 tonight. 

Who knows where it goes from here, it could shoot to $40 tomorrow, or fall to $4, or even $0.00004.
Title: Re: Bitcoin currency (merged topics)
Post by: velacreations on February 21, 2013, 10:06:22 PM
BTC is near parity with an ounce of silver, it finally broke through $30 tonight. 

Who knows where it goes from here, it could shoot to $40 tomorrow, or fall to $4, or even $0.00004.

actually, bitcoin passed silver a few days ago.Silver is $28.8 as I type this, Bitcoin is at $30.3
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 21, 2013, 11:14:10 PM
actually, bitcoin passed silver a few days ago.Silver is $28.8 as I type this, Bitcoin is at $30.3

Silver Eagles are still over $31, with rounds only about a dollar less.
Title: Re: Bitcoin currency (merged topics)
Post by: velacreations on February 21, 2013, 11:51:55 PM
Silver Eagles are still over $31, with rounds only about a dollar less.

well, btc incurs markups, too.  A lot of places charge 3% or more for exchanging dollars to btc, so that would make the price $31.42.

I really only go by spot prices because of that.  I've seen junk silver and generic going for close to 1 BTC in the past day or so in some places.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 22, 2013, 12:52:00 AM
well, btc incurs markups, too.  A lot of places charge 3% or more for exchanging dollars to btc, so that would make the price $31.42.

Wow, what places are charging those rates? 

Mt. Gox has only charged me between 0.5 - 0.6% for my trades.  Dwolla hasn't charged me anything for the transfer of USD from my bank to Mt. Gox.
Title: Re: Bitcoin currency (merged topics)
Post by: velacreations on February 22, 2013, 08:01:51 AM
bitinstant, I think. 

Virwox charges 11.5+%

BitPay is about 1%
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 05, 2013, 07:54:36 PM
Price just hit $43/btc today, it was $23 less than a month ago. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 12, 2013, 09:04:16 PM
While bitcoin has been on a roller coaster of volatility the last few weeks, the latest 23% sell off early this morning was precipitated by a glitch in the underlying software code, which caused a sell off at Mt. Gox and prompted them to temporarily suspend trading.  Previous panics had been attributed to tales of coins stolen due to poor internet security.  This was totally different.

Apparently, upgrades to the database engine in version 0.8 caused a bifurcation in the blockchain that could have led to potential double spending of the same coins, which is specifically something it was designed to avoid.  Given that it's a distributed system, with no centralized control point, there were some miners using v0.7 who were arriving at different values for newly minted coins than those who were evaluating the same blocks but using v0.8. 

I really have nothing more than a vague idea how this stuff works.  Don't they say not to invest in anything you don't understand?  This is the bleeding edge of a new technology, there's certainly risk to investing in this currency, so don't trade in any of your existing wealth if you would feel bad about loosing it forever down the rat hole of cyberspace. 

Amazingly, the price has already rebounded and is back above $45, within 10% of it's all-time high, and this seems to be due to the fact that the community is still small and nimble enough to get their fingers in the dike and avert disaster.  We will see where this goes from here.
Title: Re: Bitcoin currency (merged topics)
Post by: nelson96 on March 13, 2013, 10:55:10 AM
Thanks for the update FreeLancer, I have not invested in any bitcoin yet, and maybe never will, but it does interest me.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on March 13, 2013, 11:17:34 AM
I would also advise against any heavy investment because of the volatility, but I would highly suggest that everyone at least get a couple of bitcoins and join the community.  Maybe spend them once in awhile where you can, and see how it goes.  Supporting this can only lead to good things for the future of currencies, even if this particular one doesn't make it in the long run.

Does anyone have experience with mining?  I was looking into the new Butterfly Labs (http://"http://products.butterflylabs.com/") mining servers, and considering a purchase.  I don't think it's going to be something to make money from (my guess is you might be able to make back the purchase of the hardware within a year or two) but it's another cool way to support the community.
Title: Re: Bitcoin currency (merged topics)
Post by: Oil Lady on March 13, 2013, 11:59:30 AM
Here's a bitcoin thread I launched a few months ago which got mostly ignored.

http://thesurvivalpodcast.com/forum/index.php?topic=39393.msg442764#msg442764

Merge??



[Topics are now merged -- Mr. Bill]
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 13, 2013, 06:41:41 PM
Here's a bitcoin thread I launched a few months ago which got mostly ignored.

http://thesurvivalpodcast.com/forum/index.php?topic=39393.msg442764#msg442764

Merge??

There's no getting around it, this dubious bitcoin community is a motley assortment of techno-anarchists, pariah nations like Iran, seedy purveyors of vice and inequity, and a few mild-mannered guys like me.  But we're all giving the powers-that-be the finger, one bitcoin at a time!
Title: Re: The "bitcoin" stands up to its first real test of economic usefulness ...in Iran
Post by: Thox Spuddy on March 13, 2013, 06:59:41 PM
I have to tell you I'm struggling to understand how bitcoins work. I watch the instructional videos and I'm lost. This is a big thing that apparently is going unnoticed by many, note that the topic died upon posting. Can someone help out here? http://www.weusecoins.com/ (http://www.weusecoins.com/) This vid doesn't tell me how it works, how do you exchange dollars for bitcoins, and make purchases, and back to dollars?
Title: Re: The "bitcoin" stands up to its first real test of economic usefulness ...in Iran
Post by: nimzy88 on March 13, 2013, 08:26:20 PM
http://www.npr.org/blogs/money/2011/07/13/137795648/the-tuesday-podcast-bitcoin (http://www.npr.org/blogs/money/2011/07/13/137795648/the-tuesday-podcast-bitcoin)

This money planet podcast did a pretty great job a describing bit coins. I remember listening to it when it came out.

Not sure how it has changed over the last year or 2.
Title: Re: The "bitcoin" stands up to its first real test of economic usefulness ...in Iran
Post by: FreeLancer on March 13, 2013, 09:39:41 PM
I have to tell you I'm struggling to understand how bitcoins work. I watch the instructional videos and I'm lost. This is a big thing that apparently is going unnoticed by many, note that the topic died upon posting. Can someone help out here? http://www.weusecoins.com/ (http://www.weusecoins.com/) This vid doesn't tell me how it works, how do you exchange dollars for bitcoins, and make purchases, and back to dollars?

I like to think of bitcoins as being an encrypted tally sheet, or ledger, that is shared between everyone who owns a piece of the bitcoin pie.  A system of public and private keys anonymously verifies and protects ownership of your "coins" and the system is designed to carefully track the transfer of "coins" from one owner to another so there is no double spending or chargebacks.  There is no central authority that manages/controls everything and the software that manages this encrypted ledger is open source so that the chances that anyone has a backdoor into the piggy-bank is extremely low.

The main exchange for bitcoins is an internet site named Mt. Gox where you can trade with major currencies.  It's a little challenge getting dollars into Mt. Gox, but not that bad once you're set up.  The easiest way to get bitcoins would be to find someone who is willing to sell you coins in person, create a bitcoin wallet (which is just the name for the electronic tally sheet), and have them transfer directly into your account while you're face to face.

I've shared a little of my experience acquiring bitcoins on this thread:  http://thesurvivalpodcast.com/forum/index.php?topic=27624.0 (http://thesurvivalpodcast.com/forum/index.php?topic=27624.0)

I don't pretend to fully understand all the nuts and bolts of this experiment, but I do think it holds promise as a novel way to secure and transfer wealth without the intrusion of third parties (theft by taxes) and figure the best way to learn the system is to dive in and put some skin in the game.  But realize this is a speculative risk, don't bet the farm on it.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on March 15, 2013, 10:02:05 AM
Here's a bitcoin thread I launched a few months ago which got mostly ignored.

http://thesurvivalpodcast.com/forum/index.php?topic=39393.msg442764#msg442764

Merge??

"The topic or board you are looking for appears to be either missing or off limits to you."

I am not special enough to view that, apparently.  Probably why it was mostly ignored, too?
Title: Re: Bitcoin currency (merged topics)
Post by: nimzy88 on March 15, 2013, 10:58:45 AM
I posted this in the other bitcoin thread. Thought some people new to bitcoins would be interested. It also includes a history of how bitcoins started.

http://www.npr.org/blogs/money/2011/07/13/137795648/the-tuesday-podcast-bitcoin

This money planet podcast did a pretty great job a describing bit coins. I remember listening to it when it came out.

Not sure how it has changed over the last year or 2.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on March 15, 2013, 11:59:04 AM
"The topic or board you are looking for appears to be either missing or off limits to you."

I am not special enough to view that, apparently.  Probably why it was mostly ignored, too?

I merged that topic into this one, so it's all in this thread now.

Oil Lady's topic was originally posted in one of our political boards, which are available to most members after they've made a substantial number of forum posts.  More info on this policy: The Primary Role of The Survival Podcast Forums (http://thesurvivalpodcast.com/forum/index.php?topic=5940.0).
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on March 18, 2013, 11:22:05 AM
I merged that topic into this one, so it's all in this thread now.

Oil Lady's topic was originally posted in one of our political boards, which are available to most members after they've made a substantial number of forum posts.  More info on this policy: The Primary Role of The Survival Podcast Forums (http://thesurvivalpodcast.com/forum/index.php?topic=5940.0).

Thanks for the info.  I knew there was a minimum post count for a bunch of other boards, which I found after 10 posts, but I didn't realize there was another level of minimum posts.  Good to know!

I don't pretend to fully understand all the nuts and bolts of this experiment, but I do think it holds promise as a novel way to secure and transfer wealth without the intrusion of third parties (theft by taxes) and figure the best way to learn the system is to dive in and put some skin in the game.  But realize this is a speculative risk, don't bet the farm on it.

Well said!
Title: Re: Bitcoin currency (merged topics)
Post by: Thox Spuddy on March 18, 2013, 02:19:11 PM
On a scale of 1 to 10, is there prepper value in bitcoin useage? (1=low value)
Title: Re: Bitcoin currency (merged topics)
Post by: MTUCache on March 18, 2013, 02:41:55 PM
On a scale of 1 to 10, is there prepper value in bitcoin useage? (1=low value)
Gotta get a 2 or 3 from me, although I admittedly don't know as much as I'd like to about it. That's nothing against Bitcoins specifically, but more about what it is that you're preparing for and how that will impact your ability to use that asset when you need to.

In a prepper-mindset, you've got tangible assets, paper assets, and digital assets. The line between paper and digital is already completely wiped out.
I'm not one of those "bullets, beans and band-aids!" guys who only believe in what I can hold in my hand and use directly, but I'm also more than a little bit leery about something I can't physically touch and has the possibility of being hacked.

Truthfully, with the way financial transactions are handled today, and the reputations that most banks have been working hard to achieve over the last few years, it's not like Bitcoins should be looked at as any more risky than any other digital form of wealth. Just because it doesn't exist somewhere physically doesn't make it any less valuable than a paper bill or a physical item that you aren't allowed to touch or even see... 
Title: Re: Bitcoin currency (merged topics)
Post by: Thox Spuddy on March 18, 2013, 05:17:11 PM
I would wonder if in the event of a economic collapse if the bitcoin system makes a way to store reserves.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 18, 2013, 09:08:07 PM
On a scale of 1 to 10, is there prepper value in bitcoin useage? (1=low value)

The prepper value of bitcoin wealth is highly dependent on whose vision of the future turns out to be correct. 

If your version of SHTF tends towards a global meltdown of multiple support systems, then bitcoin will likely turn out to be a loss.  Although, if the grid comes back, your bitcoins will still be there, provided you safeguard your private keys, and if there's still a market for them, they will have value.  In this scenario, I would rate bitcoin wealth a value of 2 or 3.

My vision of the bad times ahead are not as apocalyptic as most, but do tend toward the dystopian.  I see technology advancing steadily, which will make tracking our every move much easier, and this increased surveillance by governments, in collusion with corporations, means our wealth is vulnerable to confiscation through either outright seizure, or via theft by taxation.  This is where I see value in a currency scheme like bitcoin.  It's off the books wealth that is relatively easy to secure and transfer, and it's for all practical purposes anonymous.  Memorize your private key and you have the ability to cross borders and have instant access to your bitcoin wealth.  No swallowing diamonds or secreting bullion in your shoes required.  Provided the grid stays up, which I believe to be the most likely scenario, I would rate bitcoin a 7 or 8.

At this moment 1 BTC = $52, down from it's all-time high today of $52.87.  Is this what it felt like when gold went parabolic from a few hundred dollars an ounce?
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on March 19, 2013, 01:13:44 PM
At this moment 1 BTC = $52, down from it's all-time high today of $52.87.  Is this what it felt like when gold went parabolic from a few hundred dollars an ounce?

Seriously, even for a supporter of Bitcoins, the fluctuations are kind of frustrating.  You'd be insane to try and 'day trade' them, but I still think they're a good idea for the long term.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 19, 2013, 01:32:37 PM
It is crazy to day trade and I'm just focusing on buying the big dips at this point and holding for the long term.  It went to $62 this morning and back down to $57.  I've got some open buy orders set to kick in at $35 and below, which seemed reasonable last week, but who knows if it will dip that low again.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on March 21, 2013, 10:29:37 AM
BitPay Integrates Bitcoin with Fulfillment by Amazon.com

http://www.cnbc.com/id/100527259

When this goes through, this could make the value of the bitcoin absolutely explode.  I'm frustrated at the $60+ price tag now, but it could be in the hundreds or thousands after this takes off.  That also makes mining an even more appealing option.  If I ever start mining, I'll post updates on how it goes.
Title: Re: Bitcoin currency (merged topics)
Post by: Thox Spuddy on March 21, 2013, 08:21:15 PM
Oh-oh!
Quote
US Begins Regulating BitCoin, Will Apply "Money Laundering" Rules To Virtual Transactions
http://www.zerohedge.com/news/2013-03-21/us-begins-regulating-bitcoin-will-consider-virtual-transactions-money-laundering (http://www.zerohedge.com/news/2013-03-21/us-begins-regulating-bitcoin-will-consider-virtual-transactions-money-laundering)
Title: Re: Bitcoin currency (merged topics)
Post by: Tyronedeblanco on March 21, 2013, 09:18:42 PM
Oh-oh!http://www.zerohedge.com/news/2013-03-21/us-begins-regulating-bitcoin-will-consider-virtual-transactions-money-laundering (http://www.zerohedge.com/news/2013-03-21/us-begins-regulating-bitcoin-will-consider-virtual-transactions-money-laundering)


This means bitcoin is credible / a threat now, right?
Title: Re: Bitcoin currency (merged topics)
Post by: Thox Spuddy on March 21, 2013, 09:29:37 PM
Apparently it has the potential for taking down the Fed. The war is on.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 21, 2013, 11:08:49 PM
The FinCen rules are a mixed bag.  On the one hand, it appears that they have no desire to go after individual users of BTC, those who are using it to barter for goods and services, or just accumulating them for the hell of it (like me).  But they will definitely be focusing attention on businesses, like Mt. Gox, which function at the intersection between government-backed currencies and BTC.  But that makes sense, it's relatively easy to monitor traditional business banking, just look at the squeeze the Fed can put on just about any banking entity in the world, even the Swiss.

Some are attributing the recent run up in the BTC market on this announcement, they see it as a legitimizing step which has provided boundary-lines that take away a great deal of the regulatory uncertainty surrounding adoption of the scheme.  Other supporters feel this is the kiss of death. 

I don't know how any of this is going to turn out, but it's probably time to start testing the process of converting back to dollars via Mt. Gox and Dwolla, just to see what hoops I'll need to jump through if I need to get serious about liquidation in the future.

1 BTC = $73.75 at this very moment.  I can't believe it was briefly below $37 just 10 days ago and it's really not in my nature to be this speculative with cold-hard cash.  Who knows where it will go from here, some (Max Keiser on Alex Jones ::)) are saying $100,000, or more.  But I wouldn't bet the farm on it.  Farms aren't likely to just disappear into the cyber-ether, like bitcoin could do tomorrow.
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on March 22, 2013, 03:25:32 PM
http://gma.yahoo.com/blogs/abc-blogs/man-lists-bungalow-bitcoins-115706957--abc-news-savings-and-investment.html

Taylor More is selling his family's bungalow with an asking price of $405,000 (that's Canadian dollars) or 5,521 Bitcoins. He would rather have the Bitcoins.

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 22, 2013, 07:56:27 PM
Taylor More is selling his family's bungalow with an asking price of $405,000 (that's Canadian dollars) or 5,521 Bitcoins. He would rather have the Bitcoins.

It will be interesting to see if he'll get any takers. 

One of the criticisms of BTC is that it is designed to be deflationary, there will only be 21 million coins minted in the scheme, with half of them already in circulation and the other half set to be minted at a much slower rate over the next 120 years, or so.  With a cap on the ability to produce new coins, if the existing coins become more desirable, their value will increase, which doesn't incentivize spending.  Some speculate that this deflationary design spells the ultimate failure of bitcoin.

Why would you buy a house with 5500 btc today, when the same house next year will likely sell for some fraction of that amount?  This is a very foreign concept for those of us used to seeing the purchasing power of our inflationary (government-backed) currencies decrease in a more, or less, predictable fashion.  Some say this makes BTC more like gold, a store of value which is hoarded more than it is spent, but time will have to be the judge of that.

The bitcoin price today has drifted down slightly, hovering around $70.  I guess everyone's taking some deep breaths and trying to figure out what the hell to do next.
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on March 27, 2013, 07:27:23 PM
http://www.forbes.com/sites/nowthisnews/2013/03/26/the-world-is-getting-a-bitcoin-atm/

Canadian entrepreneur Jeff Berwick will capitalize on Cyprus’ financial woes by installing the world’s first Bitcoin ATM on the island. Bitcoin — if you’ve missed it — is the decentralized web-based currency, without the backing of a bank or government.

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 28, 2013, 09:12:58 PM
Starting to see an upswing in articles from the MSM regarding bitcoin, which appears to be due to the Euro jitters surrounding the Cyprus issue.  Here's one from BusinessWeek (http://www.businessweek.com/articles/2013-03-28/bitcoin-may-be-the-global-economys-last-safe-haven) that I found interesting and does a good job of touching on the pertinent issues surrounding the concept.

1 BTC = $88 at this moment.   It went as high as $95 today, as well as plummeting briefly to $75.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on March 29, 2013, 10:56:39 AM
I've been following Bitcoin and am interested to see how it all plays out.

Way too speculative for me to invest any of my money into though.


After seeing what the DoJ did to the major internet gambling sites under the guise of "money laundering", I'm very skeptical when it comes to investing my money in anything that is 100% online.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 29, 2013, 11:31:44 AM
Mt. Gox and Dwolla were both hit hard by DDoS attacks last night, but are still up and functional this morning, with the price still hovering around $90. 

I'm testing the process of liquidating bitcoin through both of these services and so far no problems getting dollars into my bank account, in fact it's quicker, by a day or two, than getting dollars into Mt. Gox.  Dwolla charges a $0.25 flat fee for transfers in this direction, which may be why they process them quicker.

I'd like to try purchasing PMs online with bitcoin and would be interested hearing from others who have done this.
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on March 29, 2013, 09:00:09 PM
It's really bizarre to me how many gold & silver bugs hate bitcoin.  Lately, Chris Duane (who Jack has interviewed at least once) has made it his personal mission to smear bitcoin in a series of youtube posts and blogs.  I personally think people are getting too emotionally invested in their precious metals, and fear bitcoin because they see it as a competitor. 

If one truly understands gold and why it's been such an excellent medium of exchange, then one will naturally understand the usefulness of bitcoin  for many of the same reasons.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 29, 2013, 11:14:48 PM
I personally think people are getting too emotionally invested in their precious metals, and fear bitcoin because they see it as a competitor.

I agree, emotion tends to seriously cloud one's judgement.
Title: Re: Bitcoin currency (merged topics)
Post by: Thox Spuddy on March 30, 2013, 08:07:51 AM
 A good discussion on the bit coin is here: Chris Duane – BitCoin: Is It Real Or Is It Fiat?http://financialsurvivalnetwork.com/category/kerry-lutz-podcasts/ (http://financialsurvivalnetwork.com/category/kerry-lutz-podcasts/)
Title: Re: Bitcoin currency (merged topics)
Post by: Jeff NH on March 30, 2013, 12:40:57 PM

I'd like to try purchasing PMs online with bitcoin and would be interested hearing from others who have done this.

I've used dwolla to pay for silver rounds (no bitcoins in that transaction) and I've used bitcoin to buy shiresilver. I don't think I've ever purchased any bulk PM with bitcoin.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 02, 2013, 07:42:34 PM
I signed up for a coinabul.com account over the weekend, but haven't worked up the courage to pull the trigger on a precious metal purchase through their site.  A Gold Eagle is going for about 14.5 bitcoin per ounce now, while last week it was over 20 per ounce.  This is where the deflationary aspect of the currency makes people reluctant to buy anything with it, especially when the increase in buying power is as dramatic as it's been over the last month.

The price for one bitcoin is now at $118.  I've liquidated enough coin to get back my seed money and am just going to let the rest of the coins ride.  I need to step back for awhile and purge the emotion (fear/greed) out of my decision making process.
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on April 02, 2013, 07:50:51 PM
I signed up for a coinabul.com account over the weekend, but haven't worked up the courage to pull the trigger on a precious metal purchase through their site.  A Gold Eagle is going for about 14.5 bitcoin per ounce now, while last week it was over 20 per ounce.  This is where the deflationary aspect of the currency makes people reluctant to buy anything with it, especially when the increase in buying power is as dramatic as it's been over the last month.

The price for one bitcoin is now at $118.  I've liquidated enough coin to get back my seed money and am just going to let the rest of the coins ride.  I need to step back for awhile and purge the emotion (fear/greed) out of my decision making process.

I know the feeling.  If I sell everything now and it goes to $500 I'll be quite unhappy, on the other hand if I wake up tomorrow and it's $20 I'll be kicking myself as well.  Much like yourself, I think the only way to remain sane is to gradually sell portions of it into the rally so I don't wind up at either extreme.
Title: Re: Bitcoin currency (merged topics)
Post by: Jeff NH on April 04, 2013, 05:22:38 AM
The 'bitcoin bubble' is bad for bitcoin in the long term. It is meant to be a great/easy way to exchange value. I have some bitcoins - even have a couple of physical ones I bought a while ago somewhat as a novelty. I did not buy any of what I have as an investment or for speculation but rather to support the concept of bitcoin. I've used it to donate to a couple of charities and at the moment, I try to ignore the price. It is not worth the emotional investment of woulda/coulda.
Title: Re: Bitcoin currency (merged topics)
Post by: Otis on April 04, 2013, 06:43:57 AM
Forbes mentions Bitcoins in an article from yesterday 4/3/2013. 

http://www.forbes.com/sites/jonmatonis/2013/04/03/bitcoin-obliterates-the-state-theory-of-money/

Otis
Title: Re: Bitcoin currency (merged topics)
Post by: Mr -A- on April 04, 2013, 06:59:16 AM
This is getting pretty crazy with regular trades going for $140/btc...
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on April 04, 2013, 07:25:45 AM
Forbes mentions Bitcoins in an article from yesterday 4/3/2013. 

http://www.forbes.com/sites/jonmatonis/2013/04/03/bitcoin-obliterates-the-state-theory-of-money/

Otis

Nice article, thanks for posting!  I've never really been a big fan of Mr. Denninger.
Title: Re: Bitcoin currency (merged topics)
Post by: chickchoc on April 04, 2013, 11:36:26 AM
I just saw this on Yahoo news:  Bitcoin hacked

http://my.news.yahoo.com/bitcoin-hacked-price-stumbles-buying-103848677.html
Title: Re: Bitcoin currency (merged topics)
Post by: MTUCache on April 04, 2013, 11:49:29 AM
It's really bizarre to me how many gold & silver bugs hate bitcoin.  Lately, Chris Duane (who Jack has interviewed at least once) has made it his personal mission to smear bitcoin in a series of youtube posts and blogs.  I personally think people are getting too emotionally invested in their precious metals, and fear bitcoin because they see it as a competitor. 

If one truly understands gold and why it's been such an excellent medium of exchange, then one will naturally understand the usefulness of bitcoin  for many of the same reasons.
I'm relatively new to all of this type of economics, but I think the reason for the fear/mistrust of the Bitcoin by the PM bugs is probably because of how it highlights all of the fears they have in their own commodity without really offering a better alternative. It is susceptible to a lot of the same things that make people question the PM market (open to manipulation, plus it has other drawbacks on top of it (it's digital rather than tangible, and transactions are dependent on sites that are susceptible to hacking attacks or espionage).

Both PMs and Bitcoins are relatively difficult to do your commerce in, but one of them can be held in your hand while the other cannot. In most other aspects they're pretty comparable.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 04, 2013, 12:35:43 PM
I just saw this on Yahoo news:  Bitcoin hacked

http://my.news.yahoo.com/bitcoin-hacked-price-stumbles-buying-103848677.html

Saw this on another site, and it goes to show that for all the good things Bitcoin has going for it, there are still common problems that vex other currencies.  The fact that hackers can manipulate the price with their attacks is somewhat disconcerting. 
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on April 04, 2013, 01:36:44 PM
Saw this on another site, and it goes to show that for all the good things Bitcoin has going for it, there are still common problems that vex other currencies.  The fact that hackers can manipulate the price with their attacks is somewhat disconcerting.

It's kind of a misleading title/url.  Bitcoin wasn't hacked, an exchange got hit by a denial of service attack and couldn't transact.  Since it was mtgox, the biggest exchange, yeah, it did have a price impact.  I think the exchanges will continue to be a vulnerable point.
Title: Re: Bitcoin currency (merged topics)
Post by: raveneye on April 04, 2013, 01:39:04 PM
"Bitcoin Hacked" headlines are like the "Internet crashed" headlines from the 90's that came out every time an AOL mail server was unavailable for more than 20 minutes... Ignorant media reporting about technology they don't understand to an ignorant public that understands even less.

What happened yesterday was that the largest Bitcoin market, MtGox got hit with a Denial of Service attack.  A large number of virus-infected computers around the internet were all put to work attempting to access the website at the same time, and that prevented users from being able to log on and buy/sell on that one exchange.  As far as I can tell, noone lost their bitcoins, they just couldn't see their account.  It is similar to having Bank of America website go down for a few hours and the press reporting "Banks Crash".

When it comes to bitcoin, understand that you can either hold Bitcoin yourself, or hold it in a bank (like Instawallet, MtGox, or BTC-e).  If you have large amounts of Bitcoin and you worry about it the same way a Cyproit worries about his bank balance, then seriously consider installing the Bitcoin-Qt client, create a wallet, encrypt the wallet, transfer the coins into that wallet and even consider storing the wallet offline on a flashdrive or something that won't get lost if your computer crashes or is compromised.

A little background...
Bitcoins exist on the internet, but they can only be controlled by the keys in your wallet.  If your wallet is ever lost the bitcoins are lost forever, so back it up.
Your wallet has 100 unused keys.  As your create addresses and transactions, those keys get used up and new ones get added.  This means you should back the wallet up frequently if you do a lot with it.
Finally, if you store bitcoins at an exchange, bank, or mining pool, then they control the coins, and you are trusting them to be honest and keep them safe.  It is like keeping money in a bank in the Wild West.  It is possible for Jesse James to roll in, rob the bank, and leave you SOL.  There is no Bitcoin-FDIC.
Title: Re: Bitcoin currency (merged topics)
Post by: MTUCache on April 04, 2013, 02:05:32 PM
When it comes to bitcoin, understand that you can either hold Bitcoin yourself, or hold it in a bank (like Instawallet, MtGox, or BTC-e).  If you have large amounts of Bitcoin and you worry about it the same way a Cyproit worries about his bank balance, then seriously consider installing the Bitcoin-Qt client, create a wallet, encrypt the wallet, transfer the coins into that wallet and even consider storing the wallet offline on a flashdrive or something that won't get lost if your computer crashes or is compromised.

A little background...
Bitcoins exist on the internet, but they can only be controlled by the keys in your wallet.  If your wallet is ever lost the bitcoins are lost forever, so back it up.
Your wallet has 100 unused keys.  As your create addresses and transactions, those keys get used up and new ones get added.  This means you should back the wallet up frequently if you do a lot with it.
Finally, if you store bitcoins at an exchange, bank, or mining pool, then they control the coins, and you are trusting them to be honest and keep them safe.  It is like keeping money in a bank in the Wild West.  It is possible for Jesse James to roll in, rob the bank, and leave you SOL.  There is no Bitcoin-FDIC.
This is the part about Bitcoin that I don't personally have a good grasp on yet, and the part that is always going to make them "scary" for the uneducated masses... that fear of the unknown is tough to get past when you've spent your whole life assuming that things exist in some physical form (even if it's in a bank, or Fort Knox, and you can't really touch it).

The way most people are living right now they'd be in a much worse position financially if their identity got stolen rather than their bank's website getting hacked... but what does the attention get focused on? Neither. Heaven forbid your FB security settings aren't right and people can find pictures of your kids. Nevermind the fact that you're basically openly sharing all the personal data anyone would need to open up a few hundred grand in accounts with your employer, your government, random strangers, etc.  ::)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 04, 2013, 02:17:34 PM
What?!  No government sponsored bitcoin insurance? 
Title: Re: Bitcoin currency (merged topics)
Post by: Hootie on April 04, 2013, 02:38:07 PM
here are some charts that show the historic price of Bitcoin.

https://coinbase.com/charts (https://coinbase.com/charts)
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 04, 2013, 04:23:51 PM
All very true, and I (as should everyone else with the knowledge) should have corrected the idea that it was 'hacked' as soon as I saw it.  Instead I just used the more correct term of them having been 'attacked' instead of hacked, and didn't clarify.  If we all help to spread knowledge to make bitcoins (and everything surrounding them) more understandable, more people will get into it.

This:
This is the part about Bitcoin that I don't personally have a good grasp on yet, and the part that is always going to make them "scary" for the uneducated masses... that fear of the unknown is tough to get past when you've spent your whole life assuming that things exist in some physical form (even if it's in a bank, or Fort Knox, and you can't really touch it).

is definitely true and is part of the problem.  The logical response is this:

"Bitcoin Hacked" headlines are like the "Internet crashed" headlines from the 90's that came out every time an AOL mail server was unavailable for more than 20 minutes... Ignorant media reporting about technology they don't understand to an ignorant public that understands even less.

What happened yesterday was that the largest Bitcoin market, MtGox got hit with a Denial of Service attack.  A large number of virus-infected computers around the internet were all put to work attempting to access the website at the same time, and that prevented users from being able to log on and buy/sell on that one exchange.  As far as I can tell, noone lost their bitcoins, they just couldn't see their account.  It is similar to having Bank of America website go down for a few hours and the press reporting "Banks Crash".

When it comes to bitcoin, understand that you can either hold Bitcoin yourself, or hold it in a bank (like Instawallet, MtGox, or BTC-e).  If you have large amounts of Bitcoin and you worry about it the same way a Cyproit worries about his bank balance, then seriously consider installing the Bitcoin-Qt client, create a wallet, encrypt the wallet, transfer the coins into that wallet and even consider storing the wallet offline on a flashdrive or something that won't get lost if your computer crashes or is compromised.

A little background...
Bitcoins exist on the internet, but they can only be controlled by the keys in your wallet.  If your wallet is ever lost the bitcoins are lost forever, so back it up.
Your wallet has 100 unused keys.  As your create addresses and transactions, those keys get used up and new ones get added.  This means you should back the wallet up frequently if you do a lot with it.
Finally, if you store bitcoins at an exchange, bank, or mining pool, then they control the coins, and you are trusting them to be honest and keep them safe.  It is like keeping money in a bank in the Wild West.  It is possible for Jesse James to roll in, rob the bank, and leave you SOL.  There is no Bitcoin-FDIC.

and while that is completely logical and 100% right on, the average person will have a hard time understanding.  Denial of Service, digital wallet, encrypting your wallet, backing it up offsite/on flash drive, lost digital wallet = forever lost bitcions - many of these things are separate concepts that someone interested in bitcoin needs to research and understand to feel truly comfortable. 

I think saying things like "Ignorant media reporting about technology they don't understand to an ignorant public that understands even less", even if true, isn't taking the whole of reality into consideration.  I've been into computers my whole life and that's what I went to school for and what I do for a living, but I can't possibly expect the public to understand some of these mid to higher level concepts offhand.  If you are interested in the idea of bitcoin, you should look into how it works, and how to protect your investment, but that's something most people won't know before hand.

Once enough people do that, it will catch on like wildfire and eventually people will use it and still have no real idea how it works, but they'll likely know the basics to keep themselves relatively safe.  Just like with our dollars, how many people really know how the fractional banking system actually works, and how the value of that dollar in their hand is derived?  Very few, but they know the methods to acquire it, spend it, and how to keep it relatively safe.

The good part is everything someone needs to know can be boiled down to a very understandable place, it's just a matter of finding the right resources.  The bitcoin website itself is pretty good, and anyone interested could start there and let Google take over after that.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on April 05, 2013, 07:53:06 AM

Once enough people do that, it will catch on like wildfire and eventually people will use it and still have no real idea how it works, but they'll likely know the basics to keep themselves relatively safe.  Just like with our dollars, how many people really know how the fractional banking system actually works, and how the value of that dollar in their hand is derived?  Very few, but they know the methods to acquire it, spend it, and how to keep it relatively safe.

The good part is everything someone needs to know can be boiled down to a very understandable place, it's just a matter of finding the right resources.  The bitcoin website itself is pretty good, and anyone interested could start there and let Google take over after that.

The problem with the Bitcoin is that it is not really backed by anything.

The U.S. dollar is backed by the U.S. government.

When you put (up to $100,000) in a FDIC insured and government approved bank, you have the guarantee of the government that they will back up that money should something happen to it.

The value of the Bitcoin is only as strong as the number of merchants who are willing to accept it.

If all merchants stopped accepting the Bitcoin tomorrow, it becomes worthless.

Seeing as how the DoJ is targeting Silk Road (one of the top Bitcoin marketplaces), a move by them to shut that site down could destroy the value of the Bitcoin tomorrow, especially if other more reputable Bitcoin accepting vendors get spooked and decide to no longer accept Bitcoins.



Then again, as someone who got some of my $ seized that was tied up in online poker... maybe I'm just irrationally overconcered with "what if's".


That is the thing that is pushing me away from investing in the Bitcoin at this point in time.
Title: Re: Bitcoin currency (merged topics)
Post by: MTUCache on April 05, 2013, 08:03:57 AM
Then again, as someone who got some of my $ seized that was tied up in online poker... maybe I'm just irrationally overconcered with "what if's".
I don't think you're being overly-concerned at all... this is a genuine concern.

Just as Jack and his guest mentioned on the podcast yesterday (Silver Circle episode), there's a point not too far in the future where our government is going to have to put capital controls in place to prevent the appearance of runaway inflation. One of the places where we've seen evidence of that first has been in electronic transactions. Not only are they openly encouraging electronic transactions because of how traceable they are (and how easily the banks can charge interest and fees on them), they're slowly discouraging and even removing other options people have. Bernanke saying that "silver is not money" was just the tip of the iceberg on this. What he's really getting at is that no other currency is going to be considered "money" in the US if the Fed has their way. It starts with very easy things to control and vilify (like off-shore poker and betting sites). It's not too far of a slide to move that into Bitcoins, off-shore banking investments, etc. If the Fed and IRS can't get their hands on it, they're going to do everything they can to make sure that you can't either...

If people are going to be concerned about the banks putting a levy on their deposits, or the government forcing allocations in their 401ks, they damn well better be prepared to lose whatever investments they have in an electronic, traceable non-US denominated account... and probably at a moment's notice.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 05, 2013, 08:38:07 AM
The problem with the Bitcoin is that it is not really backed by anything.

The U.S. dollar is backed by the U.S. government.

When you put (up to $100,000) in a FDIC insured and government approved bank, you have the guarantee of the government that they will back up that money should something happen to it.

The value of the Bitcoin is only as strong as the number of merchants who are willing to accept it.

If all merchants stopped accepting the Bitcoin tomorrow, it becomes worthless.

You've just described every other currency in existence.  Replace every instance of the word 'Bitcoin' with 'US Dollar' and you'd be 100% right on.  Currency only has value because people are willing to accept it.  The dollar has absolutely no backing other than good faith of a government.  Bitcoin has no backing other than the good faith of a bunch of people all over the world.  Even gold falls mostly into this category.  A vast majority of it's value is because people want it, not because it's particularly useful.  Some uses in jewelry and trace amounts in manufacturing could not come anywhere near it's current value if that's all it had to go on.

Each one has advantages and disadvantages, but to me the biggest advantage of Bitcoin is it's transparency.  No corrupt or incompetent government can ever destroy it's value.


Also, as far as "When you put (up to $100,000) in a FDIC insured and government approved bank, you have the guarantee of the government that they will back up that money should something happen to it."   We've recently seen what the central banks are willing to do, and we are pretty much guaranteed that even FDIC insurance is a complete joke the moment the government really needs that money.  Or, if a large portion of banks fail, how can the FDIC possibly insure them all?  If the 2008 recession put a massive strain on the FDIC, imagine what an actual crisis would do.  Where would we get the money to insure all those accounts?


Seeing as how the DoJ is targeting Silk Road (one of the top Bitcoin marketplaces), a move by them to shut that site down could destroy the value of the Bitcoin tomorrow, especially if other more reputable Bitcoin accepting vendors get spooked and decide to no longer accept Bitcoins.

Then again, as someone who got some of my $ seized that was tied up in online poker... maybe I'm just irrationally overconcered with "what if's".

That is the thing that is pushing me away from investing in the Bitcoin at this point in time.

Definitely valid concerns, for sure.  I have no doubt the US government will attack bitcoin and other similar currencies at some point.  Technically they already have, but how much further they will go remains to be seen.  I do have a lot of faith that technologically savvy backers of Bitcoin will create some work-arounds for people in bitcoin-oppressive countries  (just look at Pirate Bay and how long they've managed to flip the bird to everyone wanting t o shut them down).  It still worries me, though, and it's why I haven't invested very much in it.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on April 05, 2013, 08:50:54 AM
Definitely valid concerns, for sure.  I have no doubt the US government will attack bitcoin and other similar currencies at some point.  Technically they already have, but how much further they will go remains to be seen.  I do have a lot of faith that technologically savvy backers of Bitcoin will create some work-arounds for people in bitcoin-oppressive countries  (just look at Pirate Bay and how long they've managed to flip the bird to everyone wanting t o shut them down).  It still worries me, though, and it's why I haven't invested very much in it.

Look at how long the big poker sites were able to flip the bird to the USDoJ.

And then look what happened on 4/15/11, really without much warning at all.



Before you think I'm trying to say you're wrong and I'm right... that's not the case at all. I think that you make a lot of valid points. I'm just always trying to find out more information, that's all.  :)
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on April 05, 2013, 08:55:11 AM
Whenever someone asks or complains about what backs bitcoins, I always reply with what backs gold?  I rarely get the right answer.

I've developed a pet theory on the matter. 

When people start saying that gold has intrinsic value because it's used in jewelry and a few other things, it really gets my goat.  I've heard such pro-gold luminaries as Peter Schiff say this.

Why is gold valuable? Because it's used in jewelry.  Why is jewelry valuable?  Because it's made from gold.  The logic is completely circular.

First we have to separate the idea of industrial use from monetary use. I've found most Austrians have a real problem with this.  In fact, I'll take it a step further and say that things with a valuable industrial use (silver) are less valuable as money because industrial supply/demand for their industrial use disrupts the pricing mechanism.  If the government decreed tomorrow that everyone must install solar panels or face stiff tax penalties, then the value of silver would shoot up overnight.  Whatever we use as our ultimate unit of account needs to have a predictable supply for that intended purpose (use as money).

Gold makes an excellent money because it has almost ZERO industrial use.   

It's not rocket science.  A good medium of exchange has a known set of properties.  You can't make more of it, the quantity is generally stable and known, it's easily recognized, divided, transported, etc.  Historically we have found no better material for this than gold.  These properties are what backs gold, not the fact that it's used in esoteric electronics or jewelry.

Bitcoin happens to share many of these properties (but not all).
Title: Re: Bitcoin currency (merged topics)
Post by: MTUCache on April 05, 2013, 10:46:14 AM
Agree completely between the intrinsic value of gold.

One question I have for you Bitcoin users... how difficult would it be for somebody to "corner the market" on it and manipulate it's value based on scarcity?
 
If I'm looking at the correct sources, I'm only seeing a total expected production of Bitcoins somewhere in the neighborhood of 21 Million, with around 8 million currently in circulation. Regardless of whether the current value is inflated or not, this means that anybody with a spare $B(USD) could buy all the Bitcoins in existence (or at least all of them available for sale, which I assume would be a large proportion of them).

If the Fed decided to kill this they could do it almost overnight, simply by buying all the supply and sitting on it (and it wouldn't really impact their bottomline by that much, because they waste this much almost daily). Any other government would have this option as well (including the EU, China, etc). A large investor could pretty easily inflate the value of their own holdings by buying up a large portion of the remaining ones and then dumping at the peak (likely causing a crash when the market is saturated).

I dunno. Anything global and digital like this just feels like it has to be MASSIVE in order to avoid these types of manipulation. Small things on the internet either shrivel up quickly or explode... which is not good when you're trying to make a viable, transparent currency or commodity. If it's small enough to be contained by any small group it's going to get corrupted, bought out, stamped out, etc.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 05, 2013, 11:56:07 AM
Look at how long the big poker sites were able to flip the bird to the USDoJ.

And then look what happened on 4/15/11, really without much warning at all.

Before you think I'm trying to say you're wrong and I'm right... that's not the case at all. I think that you make a lot of valid points. I'm just always trying to find out more information, that's all.  :)

No, it's all good - I think it's been a very good discussion : )

But you are right, I don't think bitcoin is immune to government blocking.  I just know that it will be harder to do technologically than something like the poker sites or Pirate Bay.  The bitcoin network has tons of different nodes in just about every country, similar to a typical peer-to-peer set up, and completely lacks any central portal/site to access it.  The biggest current problem is the exchange sites are limited, and the big one (MtGox) has a majority of the traffic so it's definitely a weak point.

Agree completely between the intrinsic value of gold.

One question I have for you Bitcoin users... how difficult would it be for somebody to "corner the market" on it and manipulate it's value based on scarcity?
 
If I'm looking at the correct sources, I'm only seeing a total expected production of Bitcoins somewhere in the neighborhood of 21 Million, with around 8 million currently in circulation. Regardless of whether the current value is inflated or not, this means that anybody with a spare $B(USD) could buy all the Bitcoins in existence (or at least all of them available for sale, which I assume would be a large proportion of them).

If the Fed decided to kill this they could do it almost overnight, simply by buying all the supply and sitting on it (and it wouldn't really impact their bottomline by that much, because they waste this much almost daily). Any other government would have this option as well (including the EU, China, etc). A large investor could pretty easily inflate the value of their own holdings by buying up a large portion of the remaining ones and then dumping at the peak (likely causing a crash when the market is saturated).

I dunno. Anything global and digital like this just feels like it has to be MASSIVE in order to avoid these types of manipulation. Small things on the internet either shrivel up quickly or explode... which is not good when you're trying to make a viable, transparent currency or commodity. If it's small enough to be contained by any small group it's going to get corrupted, bought out, stamped out, etc.

I don't think there really is any defense against that.  I think, just like with the technological issues, the bigger bitcoin gets, the harder it will be to manipulate it or shut it down.    One advantage/disadvantage of bitcoin is that someone actually -could- buy up a majority of the supply, and it's possible we'd never know that 1 - it was one organization and 2- who it was.  It's entirely anonymous, so that creates some potential issues as well.

In the end, it's future is unknown, and it's price is swinging wildly.  Both of those factors will have to be mostly taken care of before it will get mainstream adoption.
Title: Re: Bitcoin currency (merged topics)
Post by: Hootie on April 05, 2013, 12:09:05 PM
here are some more resources on the "United States Department of Treasury Financial Crimes Enforcement Network"
FIN-2013-G001 (http://fincen.gov/statutes_regs/guidance/html/FIN-2013-G001.html)


According to Sercurity Now's Steve Gibson (http://www.grc.com/sn/sn-396.htm)
Quote
So for we end-users of Bitcoin, there is no longer any gray area at all. The United States Department of Treasury Financial Crimes Enforcement Network says we're doing nothing wrong.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on April 05, 2013, 01:13:56 PM

But you are right, I don't think bitcoin is immune to government blocking.  I just know that it will be harder to do technologically than something like the poker sites or Pirate Bay.  The bitcoin network has tons of different nodes in just about every country, similar to a typical peer-to-peer set up, and completely lacks any central portal/site to access it.  The biggest current problem is the exchange sites are limited, and the big one (MtGox) has a majority of the traffic so it's definitely a weak point.


I'm not that worried about BitCoin itself getting shut down.

Sure, there's always the possiblity that something crazy is going on behind the scenes. Then again, I mean any time I buy a gift card from a restaurant in town that just opened up, there's always the possiblity that the restaurant will shut its doors the next day. You'd think there would be warning signs in advance, but anythings technically possible.

What I'm saying is, to fear that Bitcoin itself will be shut down is kind of irrational. There are no signs of that happening.



What I'm more worried about would be many main/popular sites that currently accept Bitcoin getting shut down, seeing as how many of them are already on the DoJ's radar.

A lot of these sites that accept Bitcoins are either borderline illegal or outright illegal.


I guess what I'm saying is... if Amazon and EBay announced they were accepting Bitcoins, or if Bank of America said I could pay my mortgage payment with Bitcoins, I'd be much more on board.

Right now I don't trust the long term sustainability of sites like Hackers on a Plane (travel to hacking conferences by paying with Bitcoins) or Silk Road (buy illegal drugs with Bitcoins).

If those sites get shut down, I think it could spook more reputable sites from staying away from Bitcoins in general.

I could definitely be wrong though, wouldn't be the first time I was wrong about something to do with technology and investments.  :D
Title: Re: Bitcoin currency (merged topics)
Post by: raveneye on April 05, 2013, 02:24:14 PM
One question I have for you Bitcoin users... how difficult would it be for somebody to "corner the market" on it and manipulate it's value based on scarcity?

First of all, let's dispel this idea of "someone buying all the bitcoins".  The price right now is about $140.  If you took $14,000,000 to MtGox and clicked BUY, you would not end up with 100,000 BTC.  You are more likely to get less than 10K BTC and in the process drive the price up over $2,000 per.  The next 10K BTC would cost you far more.  If someone were to try to attack the BTC users by buying all their BTC, all they would end up doing is lining their pockets with billions of dollars, and drive the prices so high that people would just switch to spending mBTC  (0.001 BTC) or uBTC (0.000001 BTC) or satoshis (0.00000001 BTC).  Even if someone was able to secure 99.99% of all BTC, then there would still be 21,000,000,000,000 (that's 21 Trillion) satoshis still in circulation.

The far more real threat is price manipulation, as is currently being done with Gold and Silver in the futures markets.  Someone comes in, spends $1M slowly over a week, driving the price up from $140 to $150, then selling them all at the same time, crashing the market down to $100 instantly, then buying more in the $50-100 range as people panic sell, waiting until the price recovers, and repeating the process.  Big swings in price could have a huge psychological impact on the users and can scare them out of a market they don't fully trust to begin with.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 05, 2013, 02:59:30 PM
I guess what I'm saying is... if Amazon and EBay announced they were accepting Bitcoins, or if Bank of America said I could pay my mortgage payment with Bitcoins, I'd be much more on board.

I had posted on this earlier, but the link is now dead.  Here's a new one:

http://www.marketwatch.com/story/bitpay-integrates-bitcoin-with-fulfillment-by-amazoncom-2013-03-06

I think it's going to be a very long time (read: never) before Bank of America accepts bitcoins, though...
Title: Re: Bitcoin currency (merged topics)
Post by: nimzy88 on April 06, 2013, 04:56:39 AM
This was a concern by a few.  Bitcoin Hacked: Price Stumbles After Buying Frenzy

Quote
More than 80 percent of all bitcoin-USD trades and more than 70 percent of all bitcoin currency trades are done on Mt.Gox's servers, according to the company, making it a major target for anyone wanting to take down bitcoin trading, it said.

http://www.cnbc.com/id/100615508 (http://www.cnbc.com/id/100615508)

THoughts from those who use often? I am guessing profit taking is crossing many peoples minds who got in at $40 and maybe looking for a bit more clarity into the vulnerabilities of bitcoin sites.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 06, 2013, 12:27:54 PM
There's no getting around the fact that Mt Gox is the weak spot in the bitcoin economy, at least at this point in time.  But, until you can go to the Atm at the corner store, it's the only game in town and will be vulnerable to attack from criminals and governments, alike.

Mt Gox has been attacked alot in the last month and it does make logging in and executing market trades difficult, but, since almost all my trades are preset to trigger at prices I scheduled in advance, I have not been adversely affected.  Mt Gox is to be commended for handling the attacks as well as they have, but that doesn't mean they're invulnerable, especially from governmental intrusion, which is why I try not to keep many bitcoin or dollars in my account between trades.
Title: Re: Bitcoin currency (merged topics)
Post by: kiteflyer on April 06, 2013, 01:41:28 PM


 Here's a little tidbit for Bitcoin!

       kiteflyer


   US Begins Regulating BitCoin, Will Apply "Money Laundering" Rules To Virtual Transactions

    http://www.zerohedge.com/news/2013-03-21/us-begins-regulating-bitcoin-will-consider-virtual-transactions-money-laundering

    The WSJ reports that, "the U.S. is applying money-laundering rules to "virtual currencies," amid growing concern that new forms of cash bought on the Internet are being used to fund illicit activities. The move means that firms that issue or exchange the increasingly popular online cash will now be regulated in a similar manner as traditional money-order providers such as Western Union Co. They would have new bookkeeping requirements and mandatory reporting for transactions of more than $10,000. Moreover, firms that receive legal tender in exchange for online currencies or anyone conducting a transaction on someone else's behalf would be subject to new scrutiny, said proponents of Internet currencies.
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on April 06, 2013, 07:34:58 PM
There's no getting around the fact that Mt Gox is the weak spot in the bitcoin economy, at least at this point in time.  But, until you can go to the Atm at the corner store, it's the only game in town and will be vulnerable to attack from criminals and governments, alike.

There are a lot of other exchanges, the just don't all have the trustworthiness and reputation that mtgox does (and that does count for a lot).  Recently I just signed up at BTC-e which is based in Russia.  I don't really trust Russians all that much, and my wife trusts them even less (and she is one!).  But we are going to Russia this summer to visit the in-laws and I was going to see how/easy hard it was to withdraw/convert bitcoins to rubles once I'm over there.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 06, 2013, 08:35:29 PM
There are a lot of other exchanges, the just don't all have the trustworthiness and reputation that mtgox does (and that does count for a lot). 

In the end, this whole bitcoin economy comes down to trust.  Good luck with the Russians!
Title: Re: Bitcoin currency (merged topics)
Post by: Otis on April 08, 2013, 06:52:42 PM
Wow, BTC went up almost $50 from Friday.

Otis
Title: Re: Bitcoin currency (merged topics)
Post by: Bonnieblue2A on April 08, 2013, 08:14:15 PM
https://www.youtube.com/watch?v=yi2WgeJ73IE
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 09, 2013, 12:15:36 PM
Wow, BTC went up almost $50 from Friday.

Otis

And it's gone up another $40 since last night, to $238, $200 more than the price a month ago.
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on April 09, 2013, 01:07:27 PM
And it's gone up another $40 since last night, to $238, $200 more than the price a month ago.

The current market cap of bitcoin is still only 2.6 billion.  That is tiny for a currency (for some perspective, I think Apple's market cap is around 400 billion).  If bitcoin is "successful" and gains widespread adoption (and that's a big if), imagine bitcoin with a market cap at 100 billion (for a currency, i don't consider that unreasonable).  That would be a 38x increase above today's price (this should probably be adjusted for bitcoin inflation however).

Just speculating, I'm definitely not buying bitcoins at these prices (but I'm not selling the few I have either).



Title: Re: Bitcoin currency (merged topics)
Post by: BriGy86 on April 09, 2013, 03:31:26 PM
https://www.youtube.com/watch?v=yi2WgeJ73IE

Thanks!

Good listen.  I like the questions asked by the callers.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 09, 2013, 07:15:53 PM
The current market cap of bitcoin is still only 2.6 billion.  That is tiny for a currency (for some perspective, I think Apple's market cap is around 400 billion).  If bitcoin is "successful" and gains widespread adoption (and that's a big if), imagine bitcoin with a market cap at 100 billion (for a currency, i don't consider that unreasonable).  That would be a 38x increase above today's price (this should probably be adjusted for bitcoin inflation however).

I agree, a $100 billion market cap is a fairly conservative estimate with global adoption (but certainly not a sure thing).  Projecting 17 million bitcoin by 2018, the price per coin is close to $6,000. 

As near as I can tell, the total platinum produced to this point is 9,500 tons, valued at over $400 billion, and gold is absolutely enormous, at around 160,000 tons, or $8 trillion.  Bitcoin taking even a small share of this market doesn't seem too far out there.


Just speculating, I'm definitely not buying bitcoins at these prices (but I'm not selling the few I have either).

Me, too. 
Title: Re: Bitcoin currency (merged topics)
Post by: pokeshell on April 10, 2013, 01:06:39 AM
I had a huge conversation with a friend for bit coin back last November. I had a bunch, and I took $1000 plus another $2000 of my own and invested. We purchased some items, and he was out. We got a poster overseas that was legal, but very hard to find.

I bumped mine up to about $5k at $25ish, and kinda forgot about it. I have had bit coin for years due to some online gambling(small change). I'd play in US currency, let it rid the bit coin market durring the week, and re buy (I was profiting 25-30 bucks a week this way). I would usually make more from the bitcoin than the poker. I purchased bitcoin when it was at $.75. About 2 years ago, I was able to cash out bit coin in Canada at a casino. From what I have read, this is no longer the case.

I cashed out or moved back to currency, 3 good chunks the last month. Need to talk to my tax guy about that.

I think I learnd about it initially from selling online characters for video games.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 10, 2013, 06:40:34 PM
Pop!!  Woosh!!  Up to $266, then crashed to $105 due to DDOS attacks on Mt Gox and several other exchanges.  Mt Gox executed my preset lowball buys on the way down without any major mishaps, besides not sending out the email confirmations on those executed below $175.  Back up to $170 now.  Glad I'm not running a business/household with btc, it's just too damn volatile to be used as a currency, at this point, anyways.
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on April 10, 2013, 07:05:01 PM
Pop!!  Woosh!!  Up to $266, then crashed to $105 due to DDOS attacks on Mt Gox and several other exchanges.  Mt Gox executed my preset lowball buys on the way down without any major mishaps, besides not sending out the email confirmations on those executed below $175.  Back up to $170 now.  Glad I'm not running a business/household with btc, it's just too damn volatile to be used as a currency, at this point, anyways.

Yeah, the exchanges still seem way too fragile =( and things like this really shake peoples confidence in the entire system.  I put a small buy order in at $215 when it was still at $250+ which I considered lowball at the time.  Obviously it wasn't lowball enough!
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 10, 2013, 09:32:35 PM
I put a small buy order in at $215 when it was still at $250+ which I considered lowball at the time.  Obviously it wasn't lowball enough!

I'm keeping some buy orders set for $100 and below, anything is possible, especially when it's this easy for hackers to pull off a flash-crash. 
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 11, 2013, 12:50:22 PM
I thought I was somewhat well versed on this topic, but I have a question:

Why is there a panicked sell off every time MtGox has a major slow down?  Isn't it clear that time after time it's either major traffic they can't handle, or DDoS attacks?  What's causing people to do this?

Even worst case scenario, say MtGox goes under.  I get my bitcoins through another site, so I'm not sure about this, but aren't they just an exchange, or do they also hold bitcoins/wallets for people?  If they're just an exchange I don't get why everyone freaks out when they have a hiccup.  Yes, they are the biggest exchange that deals with 80% of the market, but I don't see how that would mean anywhere near the end for bitcoin.
Title: Re: Bitcoin currency (merged topics)
Post by: BriGy86 on April 11, 2013, 01:02:25 PM
I thought I was somewhat well versed on this topic, but I have a question:

Why is there a panicked sell off every time MtGox has a major slow down?  Isn't it clear that time after time it's either major traffic they can't handle, or DDoS attacks?  What's causing people to do this?

Even worst case scenario, say MtGox goes under.  I get my bitcoins through another site, so I'm not sure about this, but aren't they just an exchange, or do they also hold bitcoins/wallets for people?  If they're just an exchange I don't get why everyone freaks out when they have a hiccup.  Yes, they are the biggest exchange that deals with 80% of the market, but I don't see how that would mean anywhere near the end for bitcoin.

I think it has to do with Auto sell options.  Here you can see a flash crash in 2011. Check around the 7:40 min. mark. "I hope no one had any limit orders, because they just took all your coins."
https://www.youtube.com/watch?v=T1X6qQt9ONg

I don't even own any but from what I gather;

With the price going down. People had rules set to sell their bitcoins if it got to 30, 20, 10 etc. What ever they personally set.  If someone can initiate a market downturn they can essentially force others to sell their bitcoins as those auto sell/limit order rules are hit (if those people have the options set.)  Once that's done, There's a flood of bitcoins up for sale in the market and you can buy them on the cheap.

Maybe FreeLancer can elaborate on his "orders" he mentioned he had set.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 11, 2013, 02:17:14 PM
With the price going down. People had rules set to sell their bitcoins if it got to 30, 20, 10 etc. What ever they personally set.  If someone can initiate a market downturn they can essentially force others to sell their bitcoins as those auto sell/limit order rules are hit (if those people have the options set.)  Once that's done, There's a flood of bitcoins up for sale in the market and you can buy them on the cheap.

Maybe FreeLancer can elaborate on his "orders" he mentioned he had set.

Yes, I guess the technical term for the preset orders I've mentioned is a limit order, which merely means that you designate a price in advance that you wish to either buy or sell at, and how many shares (or bitcoin, in this case) you want to transact.  I have never actively traded anything else before, so it's all new territory for me, too.  I participate in the stock market through (mostly index) mutual funds, I don't actively trade individual stocks, because the data shows that even the experts have a hard time beating the averages, so I'm sure not going to try.

With BTC, my goal isn't to make money in the short-term by trying to time the ups and downs, but rather the accumulation of wealth, betting on the likelihood of the scheme's long-term success as a unique store of value.  Therefore, my limit orders are all set to buy a few more coins as the price falls during these flash-crash scenarios, not sell in a panic due to fear.  I'm comfortable with this strategy because I only use dollars I can afford to lose.  I got in when the value was in the single digits, I've already recouped my initial investment and put those dollars back into my traditional accounts, and anything from here is gravy, which helps to lessen the chance that fear and greed will cloud my judgement.

There is (probably) nothing wrong with the nuts and bolts of how bitcoin works, but there is weakness regarding how it's integrated into the existing economy.  The exchanges are a huge vulnerability, and Mt. Gox is a target due to being the biggest game in town.  I believe Mt. Gox to be trustworthy, based on my experience, and I think they are doing the best they can to adapt as this economy wildly expands, but there will be exploits by the hacker crowd to manipulate the price to their advantage.  That's part of being on the bleeding edge of a crypto/anarchist currency, there are no referees or do-overs.  It's the wild, wild west, so you've got to be aware of the risks. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 11, 2013, 02:31:38 PM
While I was typing the above, Mt. Gox suspended trading at $125 until 10pm eastern, hoping for a cool down.  The other exchanges are seeing the price fall into the $60 range.  It's a full-on panic.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 11, 2013, 02:41:10 PM
You both make a lot of sense.  So if I'm understanding this correctly, it can only take a small number of people to sell, which then triggers a bunch of auto sells that cascade into a crash?  And attackers or pure lag can cause that small number of people to panic and start the cascade?  Makes sense.  It's not ideal for a stable currency, of course, but this roller coaster has a while before it'll even out long term.


While I was typing the above, Mt. Gox suspended trading at $125 until 10pm eastern, hoping for a cool down.  The other exchanges are seeing the price fall into the $60 range.  It's a full-on panic.

Please keep your hands and feet inside the ride at all times...
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 11, 2013, 02:47:15 PM
Please keep your hands and feet inside the ride at all times...

....and those with heart conditions or motion sickness are advised to not board!
Title: Re: Bitcoin currency (merged topics)
Post by: BriGy86 on April 11, 2013, 02:55:16 PM
You both make a lot of sense.  So if I'm understanding this correctly, it can only take a small number of people to sell, which then triggers a bunch of auto sells that cascade into a crash?  And attackers or pure lag can cause that small number of people to panic and start the cascade?  Makes sense.  It's not ideal for a stable currency, of course, but this roller coaster has a while before it'll even out long term.


Please keep your hands and feet inside the ride at all times...

Another problem is too many coins in too few of hands.  people that got in early have more power to start this cascade than others.  And I believe there were a bunch bitcoins mined even before it went public.  (Million+ in the hands of maybe 10 people.)  I'm still looking for hard facts on that though.

The buy and sell options that FreeLance is talking about aren't all that different than stocks either.  I'm sure you could use those same options in stocks, and I'm sure people have gotten burned there too.  But Bitcoin is a smaller market.  And any larger than normal moves, have a compounding effect due to the size of the market in general.
Title: Re: Bitcoin currency (merged topics)
Post by: libertyzeal on April 11, 2013, 03:33:26 PM
While I was typing the above, Mt. Gox suspended trading at $125 until 10pm eastern, hoping for a cool down.  The other exchanges are seeing the price fall into the $60 range.  It's a full-on panic.

I'm trying to buy some BTC on a different exchange to take advantage of the panic, unfortunately funding exchanges in a pinch seems to be difficult.  =(
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on April 11, 2013, 03:41:57 PM
It is all fine and good to buy the bitcoins.. but on a practical side.. WHO do you do business with to use them?

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: BriGy86 on April 11, 2013, 04:00:20 PM
It is all fine and good to buy the bitcoins.. but on a practical side.. WHO do you do business with to use them?

Cedar

I assume its mainly online merchants.
https://www.spendbitcoins.com/places/
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 11, 2013, 05:36:24 PM
It is all fine and good to buy the bitcoins.. but on a practical side.. WHO do you do business with to use them?

I'm just a speculator, I won't be using them to buy anything until the price stabilizes and the economy surrounding it matures. 

Although, I would be comfortable doing face to face transactions with trusted parties and exchanging BTC via smartphone.  I'm actually doing this as an informal exchange for a small number of friends and family who want in on the action but don't want the hassle of buying coins online.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 11, 2013, 08:20:22 PM
Well....Mt. Gox opened 20 minutes ago and the price fell far enough that my buy orders at $100 and $70 have already executed.  One more left at $50 and then I'm out of dollars.
Title: Re: Bitcoin currency (merged topics)
Post by: pokeshell on April 12, 2013, 12:12:45 AM
It is all fine and good to buy the bitcoins.. but on a practical side.. WHO do you do business with to use them?

Cedar

For a long time it was "THE" way to fund your online poker accounts. I miss them days. Very easy fun money.
Title: Re: Bitcoin currency (merged topics)
Post by: BriGy86 on April 12, 2013, 10:34:09 AM
I've wondered this as well.  If your coins are stored on your computer and not in a central location, what happens when the software gets corrupt or the hard drive crashes.... and you haven't backed up your wallet?

Apparently this happens.

http://www.businessinsider.com/how-reformatting-a-hard-drive-cost-one-man-200000-2013-4

which leads me to another question.  The limit is 21,000,000, didn't this remove about 800 from that total pool>?
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on April 12, 2013, 10:40:54 AM
Another problem is too many coins in too few of hands.  people that got in early have more power to start this cascade than others.  And I believe there were a bunch bitcoins mined even before it went public.  (Million+ in the hands of maybe 10 people.)  I'm still looking for hard facts on that though.


This is a very good point.

The origins of the Bitcoin are very murky and it's impossible to know who is holding them and how many they have.


I thought this was an interesting story though:


http://dealbook.nytimes.com/2013/04/11/as-big-investors-emerge-bitcoin-gets-ready-for-its-close-up/
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 12, 2013, 12:01:33 PM
I've wondered this as well.  If your coins are stored on your computer and not in a central location, what happens when the software gets corrupt or the hard drive crashes.... and you haven't backed up your wallet?

Apparently this happens.

http://www.businessinsider.com/how-reformatting-a-hard-drive-cost-one-man-200000-2013-4

which leads me to another question.  The limit is 21,000,000, didn't this remove about 800 from that total pool>?

It's designed to be inflationary up until the last coin is mined.  At that point, it is designed to be deflationary, yes. 

If you're not comfortable with the concepts of basic encryption and backups, keep your bitcoins on a trusted site.  coinbase.com is one I recommend, but there are many.  I never did get an answer to the question:  does MtGox store wallets for people, or are they exchange-only?


Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 12, 2013, 12:53:35 PM
I never did get an answer to the question:  does MtGox store wallets for people, or are they exchange-only?

Mt. Gox holds both bitcoin and fiat currency for you in your account, which isn't exactly like a wallet.  I don't keep much of either stored there between trades, just in case something takes them down permanently or freezes transfers in and out.  But I'm probably being overly paranoid, I think they're trustworthy.

I've tried a couple of different bitcoin wallets on my local machine, but have since moved to the online wallet at blockchain.info.  It's so much smoother and it integrates perfectly with their smartphone app.  The way I look at it, this currency is only usable when the net is up and running, so storing my wallet in the cloud (so long as I safeguard my passwords) vs locally probably doesn't make much difference.  I know there are guys out there putting their wallets on encrypted thumb drives or machines that never touch the cloud, etc., but I'm not that paranoid, yet.  Maybe if I had millions, but not now.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 16, 2013, 02:06:16 AM
If anyone's curious just how volatile the BTC trading is at Mt. Gox, check out the real-time trading action at this site:  http://bitcoin.clarkmoody.com/ (http://bitcoin.clarkmoody.com/)

Bring your Dramamine or scopolamine patch, it's a wild ride.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 16, 2013, 08:00:43 AM
Mt. Gox holds both bitcoin and fiat currency for you in your account, which isn't exactly like a wallet.  I don't keep much of either stored there between trades, just in case something takes them down permanently or freezes transfers in and out.  But I'm probably being overly paranoid, I think they're trustworthy.

I've tried a couple of different bitcoin wallets on my local machine, but have since moved to the online wallet at blockchain.info.  It's so much smoother and it integrates perfectly with their smartphone app.  The way I look at it, this currency is only usable when the net is up and running, so storing my wallet in the cloud (so long as I safeguard my passwords) vs locally probably doesn't make much difference.  I know there are guys out there putting their wallets on encrypted thumb drives or machines that never touch the cloud, etc., but I'm not that paranoid, yet.  Maybe if I had millions, but not now.

I am also concerned about the possibility of the site getting shut down/transfers frozen, but my biggest concern is those sites being hacked.  My personal computer, while hopefully as secure as I can make it, isn't nearly as lucrative a target as any site that stores many peoples wallets.  Especially long term, if bitcoin becomes more and more popular, those sorts of attacks will become more common.  If a website is hacked and they get your credit card info, there are ways to protect yourself.  If they hack a website and get bitcoin wallets, your money is gone forever.

I don't plan to own that many bitcoins in the near future either, so it's probably not a big deal.  On the chance I do own a lot down the line, though, I figure it's good to practice now what I would be doing then.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 16, 2013, 03:33:47 PM
I am also concerned about the possibility of the site getting shut down/transfers frozen, but my biggest concern is those sites being hacked.  My personal computer, while hopefully as secure as I can make it, isn't nearly as lucrative a target as any site that stores many peoples wallets.  Especially long term, if bitcoin becomes more and more popular, those sorts of attacks will become more common.  If a website is hacked and they get your credit card info, there are ways to protect yourself.  If they hack a website and get bitcoin wallets, your money is gone forever.

I don't plan to own that many bitcoins in the near future either, so it's probably not a big deal.  On the chance I do own a lot down the line, though, I figure it's good to practice now what I would be doing then.

The blockchain.info site operates on the trust no one principle, they have no ability to spend the coins contained in any of their clients' wallets, so even if hackers gained control of the site they wouldn't be able to spend any coins, either.  If you forget your log on credentials, they can't help you, because they don't know what it is, they only know what the hash of those passwords looks like and have no ability to work backwards to determine the actual password.  The owner controls the keys and can import them into any other wallet client and gain immediate access to their coins, even if blockchain.info goes off line forever.  That's the beauty of the distributed bitcoin network.  Blockchain.info encourages their users to store encrypted versions of their keys, by whatever means necessary, for just that very possibility.  I believe it to be extremely safe, as well as convenient, and don't see it as a weak point in the system, unlike Mt. Gox.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 17, 2013, 05:06:30 PM
The blockchain.info site operates on the trust no one principle, they have no ability to spend the coins contained in any of their clients' wallets, so even if hackers gained control of the site they wouldn't be able to spend any coins, either.  If you forget your log on credentials, they can't help you, because they don't know what it is, they only know what the hash of those passwords looks like and have no ability to work backwards to determine the actual password.  The owner controls the keys and can import them into any other wallet client and gain immediate access to their coins, even if blockchain.info goes off line forever.  That's the beauty of the distributed bitcoin network.  Blockchain.info encourages their users to store encrypted versions of their keys, by whatever means necessary, for just that very possibility.  I believe it to be extremely safe, as well as convenient, and don't see it as a weak point in the system, unlike Mt. Gox.

Very cool, thanks for the info!
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 04, 2013, 08:16:01 PM
Here's an interesting Wired article from Dan Kaminisky (http://www.wired.com/opinion/2013/05/lets-cut-through-the-bitcoin-hype/), a noted security researcher.  Some interesting quotes:

Quote
A few years ago, I tried to break Bitcoin, and failed quite gloriously. The system and framework itself is preternaturally sound.

Quote
Of all the millions of dollars of purloined bitcoin that’s floating around out there, not one Satoshi of it has been spent. That’s because while most other stolen property becomes relatively indistinguishable from its legitimate brethren, everybody knows the identity of this particular stolen wealth, and can track it until the end of time.

Quote
Yes, bitcoin is like gold.....But bitcoin is arguably better than gold.  Gold doesn’t have a teleporter like bitcoin....

Quote
Governments probably can’t kill Bitcoin.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 15, 2013, 10:01:07 PM
Yesterday, Homeland Security served Dwolla with a "seizure warrant" for the account held by Mutum Sigillum, otherwise know as Mt. Gox, which is based in Tokyo and therefore out of US jurisdiction.  Dwolla is still operating and individual accounts are fully functional, but any pending transfers to Mt. Gox from account holder's bank accounts will get no further than Dwolla.  It will be interesting to see if any Mt. Gox account holders lose dollars in this mess.

The Mt. Gox USD/BTC prices over the last week or so have been weirdly stable, until this news broke, and then briefly dropped from $115 to $103, but is currently back up to $116. 

Other dollar portals into Mt. Gox exist (I only used Dwolla), but expect continued proxy attacks on the weak links in the bitcoin economy, especially those businesses who depend on the traditional banking systems.

I guess it speaks well of the underlying bitcoin architecture, that it appears to be resistant to direct attack, but there's no telling what lies on the road ahead, so don't invest anything you can't afford to lose forever.  I moved most of my remaining bitcoin off Mt. Gox, leaving just a few coin and dollars to mess around with, as I don't trust them to be able to stave off interference, government or otherwise, indefinitely.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on May 16, 2013, 07:58:47 AM
Thanks for the update.  After reading that news I wasn't sure what to make of it, but I think it's about damn time I move my bitcoins off coinbase and onto my own local wallet.

Is this a fluke case because of a lack of certain filings by Dwolla, or is this something broader?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 16, 2013, 09:46:44 AM
It's no fluke, Homeland doesn't care about Dwolla, they specifically targeted Mt. Gox, which is currently the de facto central hub in the decentralized bitcoin economy.  Interestingly, trading prices weathered this attack with barely a hiccup, but if the US can coerce Japan to close them down, it could be a very different story.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 25, 2013, 09:55:22 PM
For those interested in getting an ongoing education on bitcoin, I've been impressed with the relatively new podcast on bitcoins, Let's Talk Bitcoin! (http://letstalkbitcoin.com/)  The three hosts come from various backgrounds in technology, journalism, and the libertarian movement.  I believe the female host is based in New Hampshire and a big supporter of the Free State Project. The twice weekly shows feature interviews with the movers and shakers in the emerging bitcoin economy and is well worth a listen.

BrotherJohnF, who is also a major silver booster, puts out regular shows at The Bitcoin Channel (https://www.youtube.com/user/BitcoinChannel).  He's a bright guy who does an amazing amount of analysis, complete with real-time charts and graphs, and I always learn something new.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on September 11, 2013, 10:24:53 AM
"Does bitcoin need a standardized three-character symbol? Only if it has a future as a tradeable instrument with a physical spot market and a robust derivatives market. I argue that bitcoin does indeed have such a future."

http://www.financialsense.com/contributors/jon-matonis/talk-ticker-symbols-how-far-bitcoin-has-come



Keep in mind the author is rather biased, but despite that it is an interesting article.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on October 04, 2013, 08:45:09 AM
Well, Silk Road was shut down today and the alleged creator was arrested.



http://www.cnn.com/2013/10/04/world/americas/silk-road-ross-ulbricht/index.html?hpt=hp_c2

http://money.cnn.com/2013/10/02/technology/silk-road-shut-down/index.html?hpt=hp_c2
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 04, 2013, 07:31:11 PM
Well, Silk Road was shut down today and the alleged creator was arrested.

BTC price dived on the news but it didn't stay down for long. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 19, 2013, 12:03:34 PM
BTC is back up, way up.  Mt. Gox hit $195 earlier today, and the Bitstamp exchange went to $172.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on October 21, 2013, 02:33:44 PM
BTC is back up, way up.  Mt. Gox hit $195 earlier today, and the Bitstamp exchange went to $172.

Any general ideas on why?  I've been out of the loop on bitcoin related news, lately.  Ironic, considering I started listening to the Lets Talk Bitcoin podcast, but that's all older news at this point until I eventually catch up.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 21, 2013, 07:00:02 PM
It may be influenced by Baidu (chinese google) adopting it for online transactions. 

I suspect there may also be a new found faith in the security of the crypto-currency due to the fact that Ulbricht's 600,000 btc are not available to, or crackable by, the feds.  In the wake of the NSA leaks, the fact that his digital assets remain out of grasp of the government is kind of awesome.  Of course that faith could be shattered tomorrow and the price could plummet to single digits again.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 23, 2013, 07:44:30 PM
It's going parabolic again.  Hit a high of $231 today, that's up from $109 three weeks ago.

Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on October 24, 2013, 01:27:29 PM
Which probably means another large correction at some point, too.  Hold onto your seats, the roller coaster has begin again!
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 24, 2013, 08:34:21 PM
After selling on the way up, I kind of need a short-term dip.
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on November 07, 2013, 08:01:06 AM
Bitcoin hits all-time high of $309. So far, Bitcoin has been a high-margin and high-risk investment. Since the currency hit $123 on October 3, it has risen to about $309, nearly 3-fold. 

http://rt.com/business/bitcoin-boom-silk-road-364/

I am curious though. Several people in here say they have Bitcoin.. accordingt to the article, users of the new ‘Silk Road’ buy and sell cannabis, cocaine, heroin, firearms, and possibly order assassinations." Anyone order an assassination lately? Seriously though, do you guys hang onto Bitcoin or are you buying anything?

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 07, 2013, 09:42:24 AM
I have 95% of my bitcoin stashed for the long-haul.  The rest I play-trade with at Mt. Gox, and have never purchased anything with them, although I'd like to trade a few for gold sometime.
Title: Re: Bitcoin currency (merged topics)
Post by: Alan Georges on November 07, 2013, 05:48:45 PM
Big in-depth article about bitcoin in December's print issue of Reason.  Best intro I've seen.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on November 08, 2013, 02:41:28 PM
Seriously though, do you guys hang onto Bitcoin or are you buying anything?

I bought mine partially as a long term investment, but mostly just to support the movement.  I'd be much better at supporting the movement if I actually spent them, but I haven't done that yet in a mixture of laziness and fear of the price drastically increasing (which is exactly what has happened) and having to spend way more cash to replace my spent bitcoins.  It's really dumb on my part, since in theory I could just spend $100 every time I buy more bitcoins, and could buy the same stuff with it.  I don't know why, but it just feels wrong to be buying less than 1 bitcoin, though.

There's a lot of psychological mumbo jumbo that revolves around bitcoin, and sadly it affects me too, apparently.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 08, 2013, 05:54:27 PM
This Bitcoin thing is weird territory for me and I'm not quite sure what to do with the new-found electronic wealth.  It's not easy to spend or exchange, and if the value keeps going up it doesn't make sense to spend it anyways, especially when I have cash that's losing buying power by the day.

Today's Mt. Gox price is 80 times what I paid for my cheapest coins 20 months ago, and over 10 times the average cost of the coins I "hold" (I have to remind myself that they're just numbers on a shared electronic ledger).  Almost 13% of our paper net-worth, which has taken 20 years to accrue through saving and investing, is now represented by BTC.  Crazy-ass windfalls like this just don't happen to boring, dollar-cost averaging, guys like me.

I think I've decided that I'm not going to risk putting any more dollars into it at this point.  Since I took out the dollars I invested when it hit $100 this spring, I tell myself that I can't actually "lose" anything.  But I'm not sure that's what I'll be feeling when my Alt-BTC account in Quicken zeros itself out after the whole scheme tanks, and I'm kicking myself for not converting my windfall into something "tangible."

Maybe this type of attitude is why Bitcoin will ultimately fail.....or succeed.....I don't know, I'm just hanging on for the ride.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 18, 2013, 12:20:17 AM
Gox hit $600 minutes ago. 

Seems that the Chinese are behind this spike, so who knows how high a country of over a billion, looking to skirt draconian government currency controls, can drive this thing.

This link shows a graphic representation of global BTC trade. (http://www.businessinsider.com/bitcoin-map-2013-11)
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on November 18, 2013, 10:04:32 AM
As always, the speculating investors are partly fueling this thing too, but the underlying value is still constantly going up even after big corrections.

At this point I'm torn between wanting to sell my original investments worth, and let the rest ride... or letting it all ride... or even buying a little more.  I'm 100% ok with losing all of my original investment, so I doubt I'll choose option 1.  I also need to research more about storing the keys myself, but I keep pushing that off until I get a linux OS working again back home.  I refuse to hold any bitcoins on a windows machine, no matter the setup.

Title: Re: Bitcoin currency (merged topics)
Post by: The New Mike on November 18, 2013, 10:48:06 AM
What's so hard about setting up a working linux setup at home? Takes about an hour.  :)

Hell even the bitcoin QT wallet in most cases can be downloaded via a package manager.

I can't get any work done because I keep looking up for a second to check the price and gives me a heart attack every few minutes. So now i'm drinking calming tea hah.

This was actually the month where we were going to use a little of the savings we save each month and buy some. I bought 2, 3 weeks ago, had a bunch of shit with coinbase, ended up it going through, and I sold 1 at 450ish dollars which paid for both coins. (So i got a free bitcoin). But looking at these numbers, the volumes, the "fundamentals" etc etc etc etc etc etc, I'd like to buy but i can't. A fellow TSPer is trying to encourage me to use his Mtgox account to buy, but i'm not so sure. This price has to collapse at least a little bit. There is zero retraction on prices at all. If it dipped even JUST A LITTLE BIT, perhaps I'd be ok buying.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on November 18, 2013, 11:38:06 AM
What's so hard about setting up a working linux setup at home? Takes about an hour.  :)

Extremely difficult when you don't have the hardware to put it on : )  I'm waiting for the opportunity to grab a laptop to replace the one I had with dual boot windows/linux.


I can't get any work done because I keep looking up for a second to check the price and gives me a heart attack every few minutes. So now i'm drinking calming tea hah.

This was actually the month where we were going to use a little of the savings we save each month and buy some. I bought 2, 3 weeks ago, had a bunch of shit with coinbase, ended up it going through, and I sold 1 at 450ish dollars which paid for both coins. (So i got a free bitcoin). But looking at these numbers, the volumes, the "fundamentals" etc etc etc etc etc etc, I'd like to buy but i can't. A fellow TSPer is trying to encourage me to use his Mtgox account to buy, but i'm not so sure. This price has to collapse at least a little bit. There is zero retraction on prices at all. If it dipped even JUST A LITTLE BIT, perhaps I'd be ok buying.

I am pretty sure it'll dip down in some sort of correction, like it always has, but who knows?  It is very possible that this recent run will be 'the one' that all the bitcoin users say will eventually happen, where adoption of it just hits the breaking point and it skyrockets to a price of tens or hundreds of thousands per bitcoin.  Or, it could drop to zero just as fast. 

If you're sweating over the price of it, you probably shouldn't be investing in it.  Be prepared to lose it all.  Don't just tell yourself that, you need to actually believe it.
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on November 18, 2013, 05:52:05 PM
The Feds Embraced Bitcoin in the First-Ever Congressional Hearing on Virtual Currency
http://motherboard.vice.com/blog/the-feds-embraced-bitcoin-in-the-first-ever-congressional-hearing-on-virtual-currency

Homeland Security Calls Bitcoin an "Emerging Threat"
http://www.activistpost.com/2013/11/homeland-security-calls-bitcoin.html

It is sitting at $707 right now.

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on December 18, 2013, 09:57:46 AM
Bitcoin has fallen to less than half the value it recently traded for, following reports of fresh action by Beijing to restrict trade in the virtual currency. http://www.bbc.co.uk/news/technology-25428866
http://blogs.marketwatch.com/thetell/2013/12/18/bitcoin-spirals-down-as-china-exchange-halts-yuan-deposits/

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on December 18, 2013, 04:04:10 PM
On my last post, it was trading for around $600, and I was replying to someone who had been thinking about buying some when it was at $300 and wanted nothing to do with the high $600 price.  It never went below that, unlike what most of us figured, and skyrocketed to over $1200.  Now that it's somewhere around $550ish, it's down to less than half of what it was recently.  I am guessing lots of people were, and still are interested in it, and will be waiting a bit to see when it bottoms out, then will buy when it looks more reasonable.  What is "reasonable" is constantly changing, but it's all perception.  I am guessing the guy earlier who thought $600 was outrageous is reconsidering it's current $550 price as a lot more reasonable...

I guess the point is that everyone knows (or should know) it is a volatile commodity right now - like I said before, if you're trying to time the bitcoin market and make a quick buck... good luck.  Flip a coin, and those are probably your chances of success.  Everyone knew when it was over $1200 that it was in a bubble of sorts, and that it would come crashing down at some point.  We just didn't know how high it would go before that happened.  That's what it's done for a long time now - nobody should be surprised by that.  Despite the China news, it will continue to build, then correct, then build, then correct, just like any commodity that continually gains popularity - until it evens out into a mature market.  It will be a long time before it is in any way considered mature... so until then, hold onto your hats and enjoy the ride.

Buy for the long term, and buy to support the cause.  The learning experience, alone, will be worth it.
Title: Re: Bitcoin currency (merged topics)
Post by: TexDaddy on December 18, 2013, 05:39:56 PM
We bought one at $618, then got nervous and sold it at $1185. That was enough for me.
Title: Re: Bitcoin currency (merged topics)
Post by: mxitman on December 19, 2013, 12:02:29 AM
I agree with Jack and think it's way too volatile, unless you actually mine them and aren't paying cash or get them in trade I wouldn't put up that kind of coin when you could do the same and get some AU!
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on December 19, 2013, 07:19:19 AM
On my last post, it was trading for around $600, and I was replying to someone who had been thinking about buying some when it was at $300 and wanted nothing to do with the high $600 price.  It never went below that, unlike what most of us figured, and skyrocketed to over $1200.  Now that it's somewhere around $550ish, it's down to less than half of what it was recently.  I am guessing lots of people were, and still are interested in it, and will be waiting a bit to see when it bottoms out, then will buy when it looks more reasonable.  What is "reasonable" is constantly changing, but it's all perception.  I am guessing the guy earlier who thought $600 was outrageous is reconsidering it's current $550 price as a lot more reasonable...

I guess the point is that everyone knows (or should know) it is a volatile commodity right now - like I said before, if you're trying to time the bitcoin market and make a quick buck... good luck.  Flip a coin, and those are probably your chances of success.  Everyone knew when it was over $1200 that it was in a bubble of sorts, and that it would come crashing down at some point.  We just didn't know how high it would go before that happened.  That's what it's done for a long time now - nobody should be surprised by that.  Despite the China news, it will continue to build, then correct, then build, then correct, just like any commodity that continually gains popularity - until it evens out into a mature market.  It will be a long time before it is in any way considered mature... so until then, hold onto your hats and enjoy the ride.

Buy for the long term, and buy to support the cause.  The learning experience, alone, will be worth it.


Or, until world governments decide to really crack down on it and make it a crime to use Bitcoin anywhere (in a modern country).

And... then the value drops to almost nothing.


It's either going to turn into a commodity, or it's going to turn into a fad (like Beanie Babies, remember Beanie Babies!?)  :)
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on December 19, 2013, 07:34:18 AM
It's either going to turn into a commodity, or it's going to turn into a fad (like Beanie Babies, remember Beanie Babies!?)  :)

Someone does.
http://www.ebay.com/itm/like/380647311030?lpid=82

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on December 19, 2013, 10:57:49 AM

Or, until world governments decide to really crack down on it and make it a crime to use Bitcoin anywhere (in a modern country).

And... then the value drops to almost nothing.


It's either going to turn into a commodity, or it's going to turn into a fad (like Beanie Babies, remember Beanie Babies!?)  :)

Exactly right.  That's the coin flip on whether it'll go up or down (or more likely way up, or way down).
Title: Re: Bitcoin currency (merged topics)
Post by: Jesse2004 on December 19, 2013, 01:49:09 PM
Two interesting blog posts on bitcoins that you might like to read:

http://gonzalolira.blogspot.com/2013/12/a-calm-analysis-of-bitcoins-as-currency.html

http://gonzalolira.blogspot.com/2013/12/bitcoins-fully-compliant-currency.html

I don't agree 100%, but I think some good points / issues are raised.

Jesse
Title: Re: Bitcoin currency (merged topics)
Post by: Otis on December 19, 2013, 03:08:23 PM
Bitcoin is not going away.  In Bitcoin terms, this is like the year 1994, the year before Internet web browsing took off.  I believe it will be extremely valuable in the next several years.  Because of its P2P distributed technology, it is impossible to get rid of Bitcoin.  The Feds May one day try to crush it, but early indications are the Feds are fine with. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 19, 2013, 03:29:02 PM
I agree with Jack and think it's way too volatile, unless you actually mine them and aren't paying cash or get them in trade I wouldn't put up that kind of coin when you could do the same and get some AU!

Fractional bitcoin is simpler to buy than AU and BTC scales down to 0.00000001.  Many are now referring to it on the basis of a millibit, or $0.70 at current prices.

The volatility is scary as heck in both directions, but the technology has proved itself far beyond what many could ever have dreamed. A decentralized shared ledger documenting ownership is a potentially revolutionary concept that could rival internet protocol in its ability to shatter the status quo. But there will be many white-knuckle moments before we get to $40,000.
Title: Re: Bitcoin currency (merged topics)
Post by: Otis on December 19, 2013, 03:37:43 PM
Well said Freelancer. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 17, 2014, 07:40:43 PM
After listening to his last two podcasts, it sounds like Jack is a couple sips of Koolaid away from full membership in the bitcoin cult.  ;)
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on January 17, 2014, 07:57:29 PM
After listening to his last two podcasts, it sounds like Jack is a couple sips of Koolaid away from full membership in the bitcoin cult.  ;)
 
Rob Gray is moving towards doing something more with Bitcoin I think (saw a post of his on the AOCS website this week that made me think that).  The two of them are friends and jack was apparently heavily invested in his friend's Mulligan Mint business.  The fact that I am hearing the two of them talk about Bitcoin in the same week makes me wonder if they are prepping the battlefield, so to speak, for an announcement about a new venture.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 17, 2014, 10:19:15 PM
Rob Gray is moving towards doing something more with Bitcoin I think.......

Hmmm.....that doesn't sound good.  I hoped Jack would have learned his lesson by now.
Title: Re: Bitcoin currency (merged topics)
Post by: nimzy88 on January 22, 2014, 11:12:35 PM
Well looks like you can start saving your bitcoins up to come out here to Vegas for next years SHOT show. This was on multiple news stations yesterday. It looks like the front desk, maybe a few restaurants and gift shops are accepting the coins at 2 of the downtown hotels.

http://www.fox5vegas.com/story/24506810/vegas-casinos-now-accepting-cybercurrency-bitcoin
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 23, 2014, 02:06:20 PM
Well looks like you can start saving your bitcoins up to come out here to Vegas for next years SHOT show. This was on multiple news stations yesterday. It looks like the front desk, maybe a few restaurants and gift shops are accepting the coins at 2 of the downtown hotels.

Vice has a perverse tendency to adopt tech before it goes mainstream.  Bitcoins in Vegas won't just stay in Vegas.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 24, 2014, 03:17:06 AM
So both JP Morgan Chase and the US Treasury (http://rt.com/usa/chase-ceo-bitcoin-terrible-downfall-100/) are railing against the dangers posed by bitcoin this week. 

I wouldn't have thought that bitcoin's measly market cap could stimulate this level of fear mongering amongst the financial establishment.  Are they're really that worried about us losing our shirts in cryptocurrency saving and speculation, or are they worried about its continued growth spelling the beginning of the end of their control over money?
Title: Re: Bitcoin currency (merged topics)
Post by: rikkrack on January 24, 2014, 08:08:39 AM
Signed up today, reading what it is all about.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on January 24, 2014, 08:29:11 AM
So both JP Morgan Chase and the US Treasury (http://rt.com/usa/chase-ceo-bitcoin-terrible-downfall-100/) are railing against the dangers posed by bitcoin this week. 

I wouldn't have thought that bitcoin's measly market cap could stimulate this level of fear mongering amongst the financial establishment.  Are they're really that worried about us losing our shirts in cryptocurrency saving and speculation, or are they worried about its continued growth spelling the beginning of the end of their control over money?

“It’s a terrible store of value. It could be replicated over and over,”

I'd like to think the CEO of one of the biggest financial firms in the world isn't a complete idiot, and that there is some context I'm missing in that statement.  Replicated over and over?  Clearly he has no freakin clue how bitcoin works.

“And honestly, a lot of it – what I’ve read from you guys – a lot of it is being used for illicit purposes."

First off, whenever someone starts a sentence with 'And honestly', that's a pretty clear sign what's about to follow is complete BS.  Lo and behold - complete BS follows.  The list of legitimate businesses accepting bitcoin is absolutely staggering.  Just in very recent news we have overstock.com, tigerdirect.com, (both massive sites) and a UK public university accepting bitcoin.  There's over 20,000 businesses on bitpay, alone.

A fun game to play is the 'what CAN'T you buy with bitcoin' game.  Lately, it's getting almost impossible.  Amazon and eBay will be accepting them in the near future, and once that happens that will be the end of that game.

Is bitcoin used in illicit activities?  Of course, just like any anonymous form of exchange.  I promise you, though, that government-backed cash is used in infinitely more illicit activities than any cryptocurrency.  Although to be fair, many governments are trying to do away with cash, too...
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 24, 2014, 03:14:37 PM
These guys are just ludicrous.
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on February 07, 2014, 12:12:49 AM
The two main arguments against Bitcoin that i hear from people is

1) it has no inherent value

2) It can be used for illegal activities.

In regards to #1, I always have to laugh, especially when this came from my father in law who was a bond trader of all things!  But if you have any arguments against bitcoin you can x100 for the U.S. Dollar and any modern currency.  Any of the failings that Bitcoin or other currencies have, our currency does it worse, at least with Bitcoin there is a no shit cap on it, and the value is only determined by the market and what the conglomerate of users dictate to be vs the artificial  and total faith based value that the U.S. Dollar has.

For #2, what i always say is....well what did people buy Coke with in 2007? Cash.  99.9% of drugs in America are bought with U.S. Dollars, and guess what I have never heard of a drug bust based on "we tracked the serial numbers on his cash and knew right when he traded it for drugs".  The fact that people use money to buy drugs (whether bitcoin or Dollars) just belies the argument against regulation for this reason, and the fact that BILLIONS AND BILLIONS have been spent to keep peopel from using and getting drugs and it has failed, where there is a need there will be someone to fill it.  I also point out, "Ok so youre right bitcoin is bad because people can use it to buy illegal things, so heres a magic wand...BAM Bitcoin is gone, will drug use stop? will we even see a small dip in its production,  shipping and use? NO, so what the fuck are you talking about?"

The Fact that JP Morgan is worried about "illegal activities" surrounding a small percentage of crypto coin users is laughable given that they continue to manipulate markets steal money and generall fuck up the economy and lives of people everyday.  If this was a microcasm and JP Morgan was a person doing any of this they would be arrested, but if you sit on teh board of the Fed, Hey its fair play
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on February 07, 2014, 09:48:05 AM
The two main arguments against Bitcoin that i hear from people is

1) it has no inherent value

Agree with your whole post, but I wanted to touch on that specific argument.  Just the phrase 'inherent value' alone is so misused and wrong in the first place.  Nothing has an 'inherent value' - value is derived by perception, and perception alone.  'Inherent' implies every human on the earth would value it.  I could see the argument that food and water have inherent value, but almost nothing else would.  Gold and precious metals do not have inherent value, they are valued because most of the population of the earth finds at least some sort of worth in them - not because they are somehow inherently valuable to human life.

But let's evolve the argument - "Fine, neither gold nor bitcoins have 'inherent value', but even if people stopped valuing gold just because it's pretty and shiny, it still has actual industrial uses and can still be valued.  Bitcoins are just digital ones and zeroes, they are worthless without people wanting them."   

Also completely untrue, but to understand why you have to understand when someone says 'bitcoin' they can either be talking about 1) the digital coins/currency or 2) the protocol, aka the code that runs the software/network and makes bitcoin the currency possible.  The protocol itself is a couple thousand lines of code that have completely revolutionized the way we look at money, as well as 'collective trusted agreements'.  The code makes it possible for anyone in the world to send a unit of bitcoin anywhere else in the world instantly, anonymously, and with a very very small transaction fee.  It makes it possible to memorize your wallet, or write down a few strings of numbers on a piece of paper, then travel anywhere in the world and wherever you are, you'll have access to your currency.  Only a cryptocurrency like bitcoin can say that - and in that there is massive value.

On a more basic level, and even more valuable, it makes it possible for any two people in the world to use the bitcoin blockchain to come to an agreement and verify ANYTHING with complete trust, because once something is on the blockchain it is there forever - forever unchangeable (quick example - there is a dude in South America working on an application using the bitcoin protocol that would allow someone to put a document on the blockchain so you can later prove it existed in exactly that form any time in the future.  Usually this requires an official notary and can be complicated when dealing across nations borders - here it is instant and trustworthy).  At it's most basic level, bitcoin is simply a way for collective agreement on something.  That's why the currency works so well - everyone can agree that Bob has 3 bitcoins because it's permanently written in the records (blockchain) and millions of people have computers constantly verifying that information is accurate.  Using this, there will be hundreds of non-currency applications using the bitcoin protocol over the coming years.

Anyone who says all of that has "no value" simply has their head in the sand and is suffocating in their own ignorance.
Title: Re: Bitcoin currency (merged topics)
Post by: MTUCache on February 07, 2014, 01:54:07 PM
... there will be hundreds of non-currency applications using the bitcoin protocol over the coming years.

This, I feel at least, is the real crux of the issue that the typical layperson completely misses. Probably because it's so difficult to wrap your head around it when you're first figuring out how Bitcoin actually works (i.e., getting away from the centralized-mindset of where all this data is "stored" and who's in charge of managing it).

The computing power of the miners, who are verifying and "publishing" these blocks every ten minutes, is so vast and untapped. It won't take much longer before all of that computing power is being used to push through all the other non-money uses of this network. Business contracts, document archiving, real estate deeds, micro-loan agreements, warranties and guarantees on products or services, etc. It's tough to figure out exactly how that process works (at least, I definitely don't understand the details of it yet), but from what I've heard it's pretty well accepted that there are untapped capabilities in that area.

That revolutionizes transactions, that's when we start seeing companies and people really putting some substance behind their signatures and guarantees. There doesn't need to be "promises" anymore when the money for those goods or services always has a record of how/why you earned it. There are entire start-up businesses based in how to leverage this, and if even a handful of them work out we're going to see a dramatic revolution in banking worldwide. Things like Western Union, Visa, Mastercard, are suddenly equivalent to the Pony Express. Banks like Chase and Wells Fargo start looking a lot more ridiculous for charging these ungodly fees for something that other people do for free, from a phone, anywhere on the planet, and a lot more securely. Your example of a notary is a perfect example of how far this kind of decentralized trust-network could permeate our digital economy.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 08, 2014, 04:43:15 PM
We may be seeing the death of Mt. Gox, the largest exchange up till just a few months ago.

Gox froze bitcoin withdrawals early yesterday after mounting complaints by account holders unable to withdraw first fiat, then bitcoin.  Prices across all exchanges are down, with Mt. Gox leading the pack to the bottom.  I should have removed the small amount I was playing with, but now will have to ride out the storm.

And people were just starting to crow about how stable bitcoin prices have been lately.  Volatility is a given in this market, get used to it.  Cryptocurrency is the wild, wild, west.  There are no referees, no timeouts, and no do overs.
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on February 08, 2014, 08:57:01 PM
Agree with your whole post, but I wanted to touch on that specific argument.  Just the phrase 'inherent value' alone is so misused and wrong in the first place.  Nothing has an 'inherent value' - value is derived by perception, and perception alone.  'Inherent' implies every human on the earth would value it.  I could see the argument that food and water have inherent value, but almost nothing else would.  Gold and precious metals do not have inherent value, they are valued because most of the population of the earth finds at least some sort of worth in them - not because they are somehow inherently valuable to human life.

But let's evolve the argument - "Fine, neither gold nor bitcoins have 'inherent value', but even if people stopped valuing gold just because it's pretty and shiny, it still has actual industrial uses and can still be valued.  Bitcoins are just digital ones and zeroes, they are worthless without people wanting them."   

Also completely untrue, but to understand why you have to understand when someone says 'bitcoin' they can either be talking about 1) the digital coins/currency or 2) the protocol, aka the code that runs the software/network and makes bitcoin the currency possible.  The protocol itself is a couple thousand lines of code that have completely revolutionized the way we look at money, as well as 'collective trusted agreements'.  The code makes it possible for anyone in the world to send a unit of bitcoin anywhere else in the world instantly, anonymously, and with a very very small transaction fee.  It makes it possible to memorize your wallet, or write down a few strings of numbers on a piece of paper, then travel anywhere in the world and wherever you are, you'll have access to your currency.  Only a cryptocurrency like bitcoin can say that - and in that there is massive value.

On a more basic level, and even more valuable, it makes it possible for any two people in the world to use the bitcoin blockchain to come to an agreement and verify ANYTHING with complete trust, because once something is on the blockchain it is there forever - forever unchangeable (quick example - there is a dude in South America working on an application using the bitcoin protocol that would allow someone to put a document on the blockchain so you can later prove it existed in exactly that form any time in the future.  Usually this requires an official notary and can be complicated when dealing across nations borders - here it is instant and trustworthy).  At it's most basic level, bitcoin is simply a way for collective agreement on something.  That's why the currency works so well - everyone can agree that Bob has 3 bitcoins because it's permanently written in the records (blockchain) and millions of people have computers constantly verifying that information is accurate.  Using this, there will be hundreds of non-currency applications using the bitcoin protocol over the coming years.

Anyone who says all of that has "no value" simply has their head in the sand and is suffocating in their own ignorance.

You are correct, it is overused and I was guilty, what i meant and should have said was "tangible value"
Title: Re: Bitcoin currency (merged topics)
Post by: k2kidd on February 10, 2014, 03:39:10 AM
Russia cracks down on Bitcoin. 


Russian Central Bank warns against using Bitcoin
RT-Jan 29, 2014
Russia's top financial regulator is warning citizens against using virtual currencies, as they could be tied to gangs into money laundering and terrorist financing. ... against virtual currencies, which in their anonymity can be used as a ... Cracking down on “dubious” bank practices has been the number one ...
Title: Re: Bitcoin currency (merged topics)
Post by: MTUCache on February 10, 2014, 07:35:04 AM
Russia cracks down on Bitcoin. 


Russian Central Bank warns against using Bitcoin
RT-Jan 29, 2014
Russia's top financial regulator is warning citizens against using virtual currencies, as they could be tied to gangs into money laundering and terrorist financing. ... against virtual currencies, which in their anonymity can be used as a ... Cracking down on “dubious” bank practices has been the number one ...
Lol. Yes, I'm sure those Russian mafia guys are going all in on Bitcoin since they have such problems making money while using Euros and Dollars. Much like I'm sure the Bloods and Crips are conducting most of their drug trafficking in crypto-currency as well.  ::)
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on February 10, 2014, 01:28:50 PM
I'm actively getting setup with coinbase just to dip my toe into the Bitcoin game.

Has anyone setup recurring purchase?  e.g. dollar cost averaging?

I was thinking maybe buy $10USD with of BTC every Friday for example.  I don't really plan on this as a major investment, but like silver it's an alternative medium of exchange in case things ever got weird.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 10, 2014, 02:54:29 PM
Has anyone setup recurring purchase?  e.g. dollar cost averaging?

I haven't set up a recurrent purchase yet, but I hear many are happy with it.

Coinbase takes awhile to process transactions, something on the order of a week, based on my experience, so it's definitely not for day-traders wanting to move in and out in a hurry, but I think it's a good choice for people wanting a reliable entry into the market.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on February 10, 2014, 04:50:53 PM
By "transactions" you mean between USD and BTC?

Hopefully I can send a merchant or anyone else my bitcoins a little faster than that :)
Title: Re: Bitcoin currency (merged topics)
Post by: skas on February 10, 2014, 05:13:34 PM
By "transactions" you mean between USD and BTC?

Hopefully I can send a merchant or anyone else my bitcoins a little faster than that :)

FreeLancer meant a purchase from or a sale to coinbase to convert Federal Reserve Notes to BTC or vice versa.

BTC to BTC transactions happen considerably quicker (I'd measure it in seconds for the initial transaction, and then minutes for confirmations).
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 10, 2014, 06:30:00 PM
Yes, like skas said, I meant USD <=> BTC. 

USD is deducted from my linked bank account on about day 1-2 after the transaction date and BTC is then available in my coinbase account on day 5-7.  Maybe it's quicker if your account is granted some special status, but that's how it works for me.
Title: Re: Bitcoin currency (merged topics)
Post by: k2kidd on February 10, 2014, 06:49:00 PM
Jack said there was a video on YouTube of a guy breaking down bitcoin, I can't remember the episode though.  Helpful links for purchasing and learning about. 
Title: Re: Bitcoin currency (merged topics)
Post by: skas on February 10, 2014, 06:52:17 PM
Maybe it's quicker if your account is granted some special status, but that's how it works for me.

If you go through all their authentication/verification steps, you should be able to purchase more BTC, more quickly.

Additionally, sites like localbitcoins.com, and cashintocoins.com are generally quicker options if coinbase is too slow and you need it RFN.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 10, 2014, 07:39:52 PM
If you go through all their authentication/verification steps, you should be able to purchase more BTC, more quickly.

Additionally, sites like localbitcoins.com, and cashintocoins.com are generally quicker options if coinbase is too slow and you need it RFN.

Hopefully, it doesn't always take a week, but who knows?  These companies come and go in a fly-by-night manner, change their policies on a whim, and are notoriously difficult to reach for customer service. 

The conversion with fiat is the Achilles heel of cryptocurrency.  You've got to trust an ethereal entity on the internet to be ethical/competent/solvent long enough for you to complete your transactions, or you can take your chances with that guy you met on localbitcoins.com and hope he isn't undercover trying to nail your ass in a money laundering sting (like in Florida last week).
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on February 11, 2014, 12:15:04 PM
I'm now setup.  This morning I transfered $20USD into my coinbase.  The funds haven't shown up as of this post, but I'm confident it'll work.
I noticed that coinbase charges 1% + my bank changes a flat $0.15 per transfer into coinbase.

I want to make sure I really understand the various forms of wallet, including paper wallets before I goof up and lose any real money.
Title: Re: Bitcoin currency (merged topics)
Post by: Hootie on February 11, 2014, 01:00:25 PM
I'm now setup.  This morning I transfered $20USD into my coinbase.  The funds haven't shown up as of this post

let me know how it goes. I have a friend that wants to start using coinbase.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on February 11, 2014, 02:19:48 PM
let me know how it goes. I have a friend that wants to start using coinbase.

It's a very easy process, no need to wait.  Like FreeLancer said, the only real issue is the wait time between putting in your order and actually getting the bitcoins (same with selling them).  Just to note to everyone so there's no confusion, you put your orders in and are locked into that price.  So if the price swings wildly in that 5-7 days, it doesn't matter - your price is locked in at the time of purchase.

It sounds like Coinbase is getting really popular (not just on these forums, but in general).  As someone who has watched this scene for awhile now, this scares me.  It's always the bigger dogs that get hit the hardest by hackers and regulators.  I don't have a lot there, but I'm still going to be moving it to a home/paper wallet very soon.  I'm playing around with small transfers right now to make sure I'm 100% familiar before I offload from Coinbase.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 11, 2014, 02:40:48 PM
I want to make sure I really understand the various forms of wallet, including paper wallets before I goof up and lose any real money.

It's wise to be cautious and start slow.  But, honestly, I think goofing up somewhere along the line is pretty much par for the course.  All us early adopters are facing the risks that come with being on the bleeding edge of technology.

All the exchanges are under heavy attack in the last few days and are hunkering down, several are now not allowing bitcoin transfers out of accounts until things calm down.  Apparently the "malleability" issue brought up by Mt. Gox is the focus of these attacks.  Honestly, I don't understand the issue well enough to know how much of a factor it will be, but I doubt that it will be more than just a bump in the road. 

Society has never been down this road before and it's hard for us to know what we don't know about trusting ownership to a distributed ledger protected by cryptology.  There will be mistakes on the part of individuals, incompetence on the part of companies, and malice on the part of government, all of which makes this a risky arena in the short-term. 
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on February 11, 2014, 03:21:29 PM
I've actually met two of the coinbase founders a few years ago when I was interviewing for a position at google (did not get the job).  The names looked familiar on the "about" page and I checked my linkedIn and verified the same folks.  Seems like coinbase is an easy, convenient abstraction designed to onboard new folks.  It integrates easily with US banks, etc.  The downside being it's a central location/entity and not necessarily anonymous.

I can email someone without a wallet and it'll direct them to coinbase to setup a new account to receive payment.  In that regard it's Paypal using BTC.



Title: Re: Bitcoin currency (merged topics)
Post by: Thorgrim on February 12, 2014, 06:11:57 PM
Another option for those of you who want to buy small amounts of Bitcoin is: https://localbitcoins.com/

You can look people up in your area and buy for cash in person.

I have mined most of my coins but the ones I did buy I used this service because it is much more private.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 13, 2014, 06:55:07 PM
BTC continues the downward slide, with the CoinDesk index dropping below $600 and the doomed Mt. Gox closing in on $400. 

Silk Road 2.0 has announced that all of their customer's 4500 coins were stolen and are blaming the transaction malleability issue for their being hacked, which is causing more panic about a fatal flaw in the cryptocurrency. 

Who knows, is it time to buy, or get out before losing everything?
Title: Re: Bitcoin currency (merged topics)
Post by: skas on February 13, 2014, 07:50:54 PM
The transaction malleability story SR/2 is positing is pure garbage.  You can't steal BTC from someone else's wallet with TM.  This was an inside job, and the people screaming that the BTC sky is falling are akin to people looking at a bank robbery and saying "ha! money is stupid!" (not saying you're guilty of this, FreeLancer).

I'm not going all in anytime soon, as I think it has much more correcting to do (I still think BTC should be closer to $2-300/BTC). I wouldn't even go all in at that point, but I'd probably buy a coin or two and let them sit.  I'm interested in BTC (and sadly [due to the name and source] Doge) because of the IDEA. All money I've put into it has been money I've been willing to lose, and I don't see it as an investment vehicle.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 13, 2014, 10:17:00 PM
The transaction malleability story SR/2 is positing is pure garbage. 

Agreed.  Anyone buying drugs from them should have had a clue that they were dealing with either a government honeypot or a criminal con game (actually I guess those are both kind of the same thing, except the government hides behind the veneer of law).

As for Mt. Gox and their fear mongering, they could be pulling this malleability crap out of their ass in an attempt to drive the price down and scoop up coin for cheap, but they're more likely just incompetents who got in over their heads.

I've had some play-money profits sitting at MtG for a few months now (I jumped the gun and seriously misjudged the crest of the last surge), which I was thinking I'd use to buy the Litecoins they keep saying they will start trading.  With all this new drama, I expect to never get any of it back.  Fortunately, I can still sleep with the thought of losing it, unlike that poor guy who flew to Japan and still couldn't get them to give him his money.  But if their price goes below $250 I've got some limit orders scheduled to trip, on the possibility that they might stay afloat long enough to transfer those coins off the exchange.  Otherwise, I'm just holding steady.

Long-term, my rational mind continues to see this as a minor bump in the road.  But it's still scary to see any amount of wealth gyrate around like this, I can't imagine what the guys who bought in at $1200 must be feeling.  It's hard for reason to get the upper hand over the emotions of fear and greed.
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on February 14, 2014, 02:19:43 AM
I still don't understand Bitcoin, and while I may have missed the boat on some "can't miss" opportunities over the years, my tendency not to invest (or test the waters, gamble, speculate, or whatever you call it) in things I don't understand has served me well. I will continue to sit on the sideline and just learn for now.
 
I can't imagine a future that does not have some sort of e-currency in it (SHTF scenarios withstanding of course).  There will be something.  But many of us remember the .com bubble in the 90's: there was a lot of turbulence and turnover as the winners and losers got sorted out.  I suspect there is more of that to come in the e-currency world before a standard finally emerges.
 
In the meantime, those of you who bought lifetime MSB memberships with Bitcoin a couple weeks ago may have got the deal of the century!
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on February 14, 2014, 08:13:23 AM
As for Mt. Gox and their fear mongering, ....  they're more likely just incompetents who got in over their heads.

This.

I just see this as a buy-at-a-discount opportunity.  I -do- think the recent high price over the past months was inflated in good part due to speculation, but I also see the underlying demand continuing to rise a hell of a lot faster than coins are being minted.

I don't know how much further it will fall, but I am confident it will eventually bounce way back up.  This is not the first time we've seen this story.
Title: Re: Bitcoin currency (merged topics)
Post by: archer on February 14, 2014, 10:09:37 AM
The anonymous online marketplace Silk Road 2 says it has been hacked resulting in the loss of all its customers' bitcoins.

An administrator for the site said hackers had manipulated computer code enabling them to withdraw $2.7m (£1.6m) worth of the virtual currency.

It follows similar attacks on two exchanges that trade in bitcoins earlier in the week.

Silk Road 2 is known for selling drugs and other illegal items.

http://www.bbc.co.uk/news/technology-26187725




Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 14, 2014, 10:23:24 AM
I still don't understand Bitcoin, and while I may have missed the boat on some "can't miss" opportunities over the years, my tendency not to invest (or test the waters, gamble, speculate, or whatever you call it) in things I don't understand has served me well.

Bitcoin is very much an out of character investment for me, I'm not a gambler, but here I am.

I don't know how much further it will fall, but I am confident it will eventually bounce way back up.  This is not the first time we've seen this story.

True. We have seen this several times now.

The anonymous online marketplace Silk Road 2 says it has been hacked resulting in the loss of all its customers' bitcoins.

FUD - Fear, Uncertainty, and Doubt

SR 2 is most likely an FBI honeypot.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on February 14, 2014, 01:36:02 PM
The anonymous online marketplace Silk Road 2 says it has been hacked resulting in the loss of all its customers' bitcoins.

An administrator for the site said hackers had manipulated computer code enabling them to withdraw $2.7m (£1.6m) worth of the virtual currency.

It follows similar attacks on two exchanges that trade in bitcoins earlier in the week.

Silk Road 2 is known for selling drugs and other illegal items.

http://www.bbc.co.uk/news/technology-26187725

I don't understand this one.  So, you have bitcoins, and you want drugs, so you go to silk road 2.  Why the hell would you ever let a site like that hold onto your money?!  I admit I have no idea how they work, but I just assumed it was a place that coordinated trade between sellers and buyers for a small percentage/finders fee.  Who the hell leaves money on a site like that, and why?!  This is definitely a case of being too stupid to deserve any safety with your currency.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on February 14, 2014, 04:22:16 PM
Yeah, if you could download drugs or prostitutes it might make sense to use a software crypto currency.

Given that you still need to take physical possession of drugs, it doesn't seem unreasonably inconvenient to pay with physical money of some sort.

(not that I have experience dealing drugs)
Title: Re: Bitcoin currency (merged topics)
Post by: Hootie on February 16, 2014, 12:34:06 AM
wonder if there is anyway to create a bit coin account, where I don't have to link it to centralized manager (coinbase, bit wallet)?


I still don't understand Bitcoin
I like this video. It is short and explains the basics. http://youtu.be/Um63OQz3bjo (http://youtu.be/Um63OQz3bjo)
My geekier friends usual find this video better http://www.youtube.com/watch?v=mrlgw5KpkXM (http://www.youtube.com/watch?v=mrlgw5KpkXM)



Thanks to all of you who mentioned https://localbitcoins.com/ (https://localbitcoins.com/) and cashintocoins.com (http://cashintocoins.com). I never even considered that a Local Buy/Sell of bitcoins was going on.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 16, 2014, 01:44:55 AM
My geekier friends usual find this video better http://www.youtube.com/watch?v=mrlgw5KpkXM (http://www.youtube.com/watch?v=mrlgw5KpkXM)

This Steve Gibson explanation back in 2011 is what convinced me that BTC had serious potential. 

wonder if there is anyway to create a bit coin account, where I don't have to link it to centralized manager (coinbase, bit wallet)?

Control of the private key matched to a specific public key on the blockchain (which is a distributed peer-to-peer electronic ledger, not a centralized entity) is the only requirement for proving ownership of bitcoins. 

You must communicate with the blockchain in order to establish the public/private key pair for your address(es) and also to perform transactions.  This can be done by running a wallet application on your own web-connected computer, using an online wallet or exchange (which are frequently centralized, but not necessarily, as in the case of the blockchain.info wallet), or even just using a program like bitaddress that generates valid keys for you to commit to memory, write down, or print for offline storage.  There's pros and cons with each method and most use multiple different methods, depending on their desire for security vs. convenience.
Title: Re: Bitcoin currency (merged topics)
Post by: Jeff NH on February 16, 2014, 03:50:09 PM
wonder if there is anyway to create a bit coin account, where I don't have to link it to centralized manager (coinbase, bit wallet)?


Yes. Download the standard bitcoin client, or the multibit client and manage your own wallet. I only use coinbase to 'get' the bitcoins but I immediately move them to my own wallet. Once you are full verified, you can buy on coinbase and have instant access to the bitcoins with no wait.

Personally, I use blockchain.info for (most) of my wallet needs. It is not a centralized manager per se and if you set it up right, blockchain.info could go away tomorrow and you still have access to all of your coins.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 16, 2014, 04:06:56 PM
Personally, I use blockchain.info for (most) of my wallet needs. It is not a centralized manager per se and if you set it up right, blockchain.info could go away tomorrow and you still have access to all of your coins.

I'm a big fan.  I believe blockchain.info has had their heart in the right place from day one and have more faith in their operations than just about anyone else, due to the fact that they are one of the few open-source bitcoin sites that have been designed with the ability to safeguard your wallet even if they totally go offline forever.  Almost everyone else's systems are built on a proprietary and centralized system that puts you at more risk of theft, fraud, or government seizure.

Here's a good interview with Roger Ver (http://www.coindesk.com/roger-ver-blockchain-past-present-future/), the majority owner whose gained the moniker "Bitcoin Jesus", which I think it provides some good insights into the philosophy of the company.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on February 17, 2014, 08:23:34 AM
Anyone have experience with the bitcoin software Armory?  I have only been using it for a little bit, but it seems pretty solid.  They also claim the way their software is written, just about anyone could duplicate it's core easily enough to access your bitcoins, should the company somehow vanish from existence (and every copy of the software also somehow vanished from existence).

It seems like a very easy and secure way to control your own wallet.
Title: Re: Bitcoin currency (merged topics)
Post by: Thorgrim on February 17, 2014, 10:39:39 AM
I believe that this latest incident at Gox is the second time they have been hacked. The first time it happened it sent BTC from $30 back to $2. So either they are supremely incompetent or something else is going on.

I have a theory that Gox is somehow government run or controlled. Not based on a huge amount of evidence just speculation on my part.

There have been persistent rumors that Litecoin will at some point be added to Mt.Gox yet it never happens. Pretty sure I even read something about it happening right on their own website. The owner of Mt.Gox and the creator of Litecoin are brothers and it is very easy to simply add another coin to an exchange once you have a working trading engine and account system. So the question is why haven't they done it yet? Other exchanges like Cryptsy add news coins almost weekly.

Another suspicious thing and a reason I never considered using Mt.Gox was that the BTC price on Gox has been consistently higher then all other exchanges for months. Usually about $100 or so higher, around 10%. One would think that would be a perfect opportunity for arbitrage which would then close that gap.

The only thing I can come up with is that they don't actually want to add Litecoin to Gox because if you add it and everyone's money goes missing it would do huge damage to the reputation of the number two coin.

If Gox isn't somehow part of a government operation then how come they aren't closed down, charges pending now that peoples money have gone missing twice? There were many complaints that people could not withdraw money from Gox in a timely manner or at all and that customer service was terrible.

Just my thoughts. Governments and Banks are threatened by cryptocurrency and one way they can fight against them is to destroy their reputation which is what has happened with this Silkroad 2 and Mt.Gox fiasco.

Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 17, 2014, 02:51:52 PM
Anyone have experience with the bitcoin software Armory? 

Haven't used it, but it seems to have a really good reputation.  The only downside is it supposedly hogs a ton of resources on your machine, but I keep hearing that a more svelte update is in the works, which I would like to try.

Another suspicious thing and a reason I never considered using Mt.Gox was that the BTC price on Gox has been consistently higher then all other exchanges for months. Usually about $100 or so higher, around 10%. One would think that would be a perfect opportunity for arbitrage which would then close that gap.

I don't know that it's suspicious, but the fact that the gap never closed points to the problems Gox had getting dollars off the exchange for their customers, people would pay more for the bitcoin and take those instead.  I agree, in a smooth market where fiat and BTC flowed without any friction, arbitrage would have quickly closed that gap. 

If Gox isn't somehow part of a government operation then how come they aren't closed down, charges pending now that peoples money have gone missing twice? There were many complaints that people could not withdraw money from Gox in a timely manner or at all and that customer service was terrible.

I don't know what Japan's attitude is toward bitcoin or Mt. Gox, but that's the jurisdiction that will have to settle any legal matters.  The US has gone after them hard, they seized $5 million held in their US-based Dwolla account, which I think could be argued to have been the beginning of the latest crisis for Gox.  That's a significant amount of money to lose when you need to be growing your business.  I believe they were forced to start making some tough choices at that point and have progressively backed themselves into a corner since then. 

I am skeptical they will survive, but it sounds like blockchain.info is heavily involved with assisting in correcting their transaction malleability issue and getting them back online, which seems like a positive sign to me.  I don't think you'd see a transparent organization like that helping a crooked member of the bitcoin flock.  Gox might be able to squeeze out another recovery after all.
Title: Re: Bitcoin currency (merged topics)
Post by: Thorgrim on February 17, 2014, 09:04:14 PM
Honestly I hope not. Gox needs to die. It is bad for BTC and crypto's in general. There are several other large exchanges now and many small ones. A couple years ago that wasn't the case.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 24, 2014, 11:32:30 PM
Honestly I hope not. Gox needs to die. It is bad for BTC and crypto's in general.

You may have your wish......Gox is offline with no explanation at this time.  It has not been good news at the other exchanges and BTC is falling off a cliff.

Maybe we'll know something by morning, but since it's Gox they'll probably just continue to keep us in the dark.  I'm seeing chatter about wagers on how long Karpeles can expect to stay alive if customers don't get their coins.  Harsh crowd, these crypto-anarchists.
Title: Re: Bitcoin currency (merged topics)
Post by: skas on February 25, 2014, 08:19:34 AM
I honestly don't think Karpeles needs to worry about the crypto-anarchists that lost BTC.  They'll write it off as the cost of progress towards anarchy (that's how I'm treating the entire current wave of crypto).

Karpeles needs to be worried about the big time investors and various others that allegedly funneled quite a bit of money into Gox that may or may not have gotten their expected profit.  I've seen it suggested that the Yakuza was funneling funds through Gox.  If they didn't get their payout? Yeah, I'd not want to be Karpeles...
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on February 25, 2014, 09:24:38 AM
This whole debacle has given me much more confidence in bitcoin than I ever had before.  MtGox can go away forever, and the community will shrug it off.  This is very much a temporary downturn, but in the end the entire BTC network is much stronger.  This 'bug' that MtGox complained about did muck things up a bit, but first off  1)  it's not a bug, it's an interesting feature that allows for a lot of flexibility, 2) it was well known for some time now, and Gox had plenty of time and warning to fix it and 3) it is very fascinating to see the community come together to help the payment processors, exchanges, etc to make sure the way they process bitcoins doesn't leave them vulnerable to this quirk.

They all have come out much stronger in the end, and it's shown just how responsive and cooperative the whole community is (especially the experts).  If you're up for a gamble, now is probably a great time to buy.  The price is waaaay down, and it's an over reaction to what amounts to absolutely nothing in the end, except maybe for some pissed off people who have money/BTC in Gox who are legitimately concerned.
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on February 25, 2014, 04:09:37 PM
My local TV station ran a story on Bitcoin tonight.  The story was mostly favorable, though they did give the "some people maintain it's value is purely psychological based on the belief someone will pay more for it than they do" disclaimer.
 
However, based on the old adage that when the shoe shine boy starts giving stock advice it's time to get out of the market, stories promoting something by people who don't seem to know what they are talking about make me nervous.
 
While some may be inclined to take this as an opportunity to gamble with their money and buy, as mentioned before, it may also be prudent to sell on any near term bounces if you have accumulated significant capital gains and your Bitcoin investment is a larger portion of your portfolio than you want, now.
Title: Re: Bitcoin currency (merged topics)
Post by: Gulo gulo on February 25, 2014, 08:46:20 PM
Npr's "marketplace" program had a blurb today about mtgox. It swung real quick from "this is why bit coin is bad" to "when are we gonna get some regulation on this?". So here comes the damning of bit coin.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 25, 2014, 08:57:44 PM
The amount of coins stolen off the Gox exchange is absolutely staggering, 744,400 bitcoins.  Andreas Antonopoulos is stating that it wasn't an inside job (ie fraud) and that the losses started months ago.  Eric Voorhees, a bitcoin startup guy, is admitting to losing over 500 coins, which also just blows my mind why he would leave that amount sitting around on any exchange.

And there's talk of maybe trying to figure out a way to get them functional again.  I don't see how the rest of the movers and shakers in bitcoin can go along with that.  Gox's supreme incompetence should not be rewarded with a bailout, even though I wouldn't mind getting back those coins I picked up cheap last week.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on February 26, 2014, 11:03:37 AM
This is long, but an excellent interview I found on Reddit today:

http://www.youtube.com/watch?feature=player_embedded&v=wzwWIDIVSTo (http://www.youtube.com/watch?feature=player_embedded&v=wzwWIDIVSTo)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 27, 2014, 07:49:02 PM
I'm beginning to sense some doubt that bitcoin will rapidly bounce back post Gox.  It's becoming clear that the movers and shakers in the community are beyond stunned and deeply embarrassed that one of their own (admittedly troubled, but still a big player in the bitcoin economy) could have gone this far off the rails right under their noses. 

While the underlying bitcoin protocol appears sound, since it functions in an open-source environment that keeps it honest, the closed, black-box, approach to managing dollars and coins on many exchanges raises serious trust issues.  It's really looking like we took this revolutionary new-world currency solution that we could trust and, not knowing any better, used it to implement an old-world banking system at many of these online exchanges/wallets, only without any of the traditional centralized banking oversight mechanisms that have been required to keep those legacy businesses honest.

There are technological solutions that can provide asset verification and proof of solvency, but it may take some time to fully implement these new procedures.  A decentralized technological solution would certainly be preferable to forming a regulatory body to audit bitcoin business, but this debacle has left the door wide open for proponents of regulation to sweep in and try to grab control while thousands of people are bemoaning the loss of their Goxed life savings. 

So, I'm thinking that things could be rocky for awhile until we can get the next generation of bitcoin businesses, with newly implemented safeguards and audit capabilities, fully online.
Title: Re: Bitcoin currency (merged topics)
Post by: SnoHam13 on February 28, 2014, 07:12:31 AM
picked this up on Drudge Report this am

http://abcnews.go.com/Technology/wireStory/japan-minister-calls-bitcoin-collapse-expected-22713601

Mt Gox [how ever ya say it] has filed for bankruptcy due to this mess

SnoHam13
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on February 28, 2014, 12:42:10 PM
I'm beginning to sense some doubt that bitcoin will rapidly bounce back post Gox.  It's becoming clear that the movers and shakers in the community are beyond stunned and deeply embarrassed that one of their own (admittedly troubled, but still a big player in the bitcoin economy) could have gone this far off the rails right under their noses. 

I would agree, but only because of the word 'rapidly' in there.  There is simply too much room for innovation here for there not to be a big bounce back... but "when?" is the question.  The only people who should be concerned about it bouncing back rapidly are the speculators, and quite frankly - who gives a damn about them?

The underlying protocol, network, and community have too much momentum for this current setback to be anything more than a bump in the road.  I'm not saying there couldn't be some serious fall-off-a-cliff-to-death from unknown future events, but I don't see the current bump being anywhere near that. 

There definitely is a lot of room for improvement, and there are going to be plenty of big bumps in the road as we figure out the happy medium between the open source decentralized system, and it's connectivity to the legacy banking system.  There's also the happy medium between security and convenience, because right now it's out of most peoples comfort and knowledge to securely hold their own bitcoins, so they need to rely on these exchanges and wallet services which clearly is not a good idea for large amounts.  All things to be worked out in time.
Title: Re: Bitcoin currency (merged topics)
Post by: BurlintonRoad on February 28, 2014, 12:53:02 PM
I am trying to learn more about bitcoin.

Is making a blockchain wallet a solid protection against someone stealing your money as long as you guard the information well?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 28, 2014, 01:41:12 PM
I am trying to learn more about bitcoin.

Is making a blockchain wallet a solid protection against someone stealing your money as long as you guard the information well?

If you mean an online wallet at blockchain.info, I would say yes, provided you use strong passwords and two-factor authentication, and your computer does not have malware that can eavesdrop on your online communications.

I have more faith in this company than most because they have no ability to recover your keys, because they don't know them. If they don't know them they can't be forced to turn them over to the government or other thieves, and they can't go rogue and run off with them themselves. But if you lose the passwords, your screwed.  It's the security vs convenience trade off, you lose convenience when increasing security.
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on March 03, 2014, 09:07:59 PM
I dont know how exactly it could be done on the bitcoin protocol but if a big time multi billionare type could somehow build a crypto currency on a verified holding of gold and silver I think that would be unstoppable.  The coins would be backed by specie at 10%, 50%, etc and could be traded in for the metals upon demand say after a 2-3 year period to get the coin itself started without people buying in at the beginning at trading in immediately. 

What thinks the forumsphere?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 03, 2014, 10:32:05 PM
What thinks the forumsphere?

NoFiatCoin (http://www.nofiatcoin.com/) has launched a similar concept.  I don't know much about it, or what the long-term viability is likely to be.
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on March 03, 2014, 10:56:47 PM
will have to look at this more in depth, first cursory look shows a very interesting concept.  viability, if it does what it says it does, seems like it makes sense, however viability doesnt always match up with fundamentals unfortunately.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on March 04, 2014, 07:40:23 AM
I dont know how exactly it could be done on the bitcoin protocol but if a big time multi billionare type could somehow build a crypto currency on a verified holding of gold and silver I think that would be unstoppable.  The coins would be backed by specie at 10%, 50%, etc and could be traded in for the metals upon demand say after a 2-3 year period to get the coin itself started without people buying in at the beginning at trading in immediately. 

What thinks the forumsphere?

These types of ideas always come down to the central management.  Even if the billionaire/company managing this remains 100% legit and trusted, it can still be shut down with one visit from the gov.  There is no redundancy like bitcoin has with its peer to peer decentralized system.
Title: Re: Bitcoin currency (merged topics)
Post by: EagleSteel on March 04, 2014, 01:10:59 PM
I dont know how exactly it could be done on the bitcoin protocol but if a big time multi billionare type could somehow build a crypto currency on a verified holding of gold and silver I think that would be unstoppable.  The coins would be backed by specie at 10%, 50%, etc and could be traded in for the metals upon demand say after a 2-3 year period to get the coin itself started without people buying in at the beginning at trading in immediately. 

What thinks the forumsphere?

If you attach physical PM's to a crypto currency you allow two things that we have in the old system. 1. Manipulation and 2. Capital Controls.
Title: Re: Bitcoin currency (merged topics)
Post by: Alan Georges on March 05, 2014, 05:14:43 PM
As a side note:
http://www.foxnews.com/tech/2014/03/05/bitcoin-firm-ceo-found-dead-in-suspected-suicide/

Yet another banker suicide (or possibly just "suicide"), this time a bitcoin banker.  Make what you will of it.
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on March 05, 2014, 07:05:34 PM
Yet another banker suicide (or possibly just "suicide"), this time a bitcoin banker.  Make what you will of it.

I saw that story, too.  I read little into it for now.  There was no indication that her suicide was tied to her work, and not even proof it was a suicide. Maybe she was overexposed in Bitcoin and took a beating with money she couldn't afford to gamble.  But for now, I wouldn't connect it too closely to Bitcoin.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 31, 2014, 01:29:06 PM
Bitcoin is definitely facing some challenges and the price reflects the uncertainty about the technology. Several major technological changes need to be implemented successfully in order for it to be more widely accepted and allow for further price appreciation.

First off, there needs to be a decentralized method of trusting one's holdings at exchanges and other deposit institutions outside of your wallet. Second, there must be a seamless method of record keeping for tax compliance purposes, so the average guy doesn't have to go thru the nightmare of calculating capital gains on every purchase. And third, strong wallet security is too cumbersome, and until the technology can be perfected to optimize convenience while maintaining strong security in a way that the average person can manage, widespread adoption won't happen. Nothing frightens away potential users more than the specter of loss to thieves, con artists, and the tax man.

I don't think these changes are impossible and a lot of venture capital is being spent on the solutions right now, but they won't be implemented successfully for awhile, so I see prices continuing to go mostly sideways until at least late in the year. 

Of course, there's always the chance bitcoin could totally fail or succumb to a superior crypto currency, so I'm not recommending betting the farm on it, but I think more likely than not it will survive and thrive.  But it may always remain as more of a niche financial instrument, kind of like a digital form of gold, where mainly large institutions, wealthy individuals, and assorted cranks and others working on legal edge hold them.
Title: Re: Bitcoin currency (merged topics)
Post by: BurlintonRoad on April 01, 2014, 11:12:24 PM
I would have to agree. 

I think it could be close to breaking through but first a lot of it needs to be simplified for the regular guy who struggles with each new technology. 

One problem is there is a lot of conflicting information out there right now.  There has been a smear campaign and frankly I do not know how sheeple fall for narrow thinking all of the time but they do.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 02, 2014, 07:26:02 AM
Also agreed.  And it may seem counter intuitive because of that, but I am planning to dive in head first into mining and getting a 600 GH/s mining rig.  It's true that all the small guys are getting pushed out, but I still think there is a lot of potential for serious miners.  The immediate future does not look all that bright (nor particularly dark either) but I think the long run has the sky as the limit.  I will be making a small investment, and it would be nice to make a little money, but in the end it's about supporting the network. 

How often in your life do you get to directly help in the making of something that has the potential to drastically change the world for the better?
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on April 03, 2014, 12:17:24 AM
A few points. I myself am a huge believer in crypto curencies, however I never bet the farm on anything nor would I advise that. I have more than the average person invested in it via mining equipmentn etc. However if I lost it all I would be hurt but not dead or even severely injured. I also don't bet the farm on metals or anything. Diversify!      Also as jack said there is a huge open market for a company to develop software that could easily account for tax purposes all the "property" transactions conducted on exchanges. Remember we are barely two years into this being accepted at a large level, there is much to be done to make it more seamless, that's where the market comes in.  The "uncertainty" of exchanges is the beautiful tapestry of libertarian/anarchist ideals woven into the system. Ultimately YOU are responsible so keep YOUR money safe. Done buy bitcoins and leave them all sitting in an exchange develop cold/paper wallets for secure storage learn about encryption of your files and pick random passwords. In the end we can only blame ourselves, learn and move on.  I spotted mt gox as a bad spot to hold money years ago, they never presented themselves as good stewards of my capital.   This is all about being your own bank, your own mediator and keeping responsibility within the individual and not within a central bank
Title: Re: Bitcoin currency (merged topics)
Post by: EagleSteel on April 03, 2014, 08:48:55 AM
Bitcoin and Litecoin ......well most cryptocurrenies have taken it on the kisser over the last week. I blame yesterday's dive on myself. I bought over 100 Litecoin's at $13 and then it went straight down! lol
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 17, 2014, 12:05:24 AM
Let's Talk Bitcoin, Episode 101-The Why of Bitcoin (http://letstalkbitcoin.com/e101-the-why-of-bitcoin/) is really worth a listen.

This episode features two deep thinkers in the cryptocurrency space, Andreas Antonopoulos and Chris Ellis, waxing philosophical on ideas of money and currency, intrinsic value, centralized systems of trust, the constancy of change, and the massive disruption that bitcoin poses for the status quo.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on April 17, 2014, 11:37:38 AM
Let's Talk Bitcoin, Episode 101-The Why of Bitcoin (http://letstalkbitcoin.com/e101-the-why-of-bitcoin/) is really worth a listen.

This episode features two deep thinkers in the cryptocurrency space, Andreas Antonopoulos and Chris Ellis, waxing philosophical on ideas of money and currency, intrinsic value, centralized systems of trust, the constancy of change, and the massive disruption that bitcoin poses for the status quo.

I look forward to it - I just finished episode 100 yesterday.  Thanks again for turning me on to that podcast!
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 22, 2014, 12:34:15 PM
Today is the four year anniversary of Bitcoin Pizza Day, when a programmer paid 10,000 Bitcoin for two Papa Johns Pizzas.  At the time that amount was valued at about $25, today it would be worth over $5 million.
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on May 27, 2014, 09:31:55 PM
Bet that papa johns wish they had held onto it or maybe they cashed out at 1100 a coin and got out of the pizza biz!


Bitcoin has jumped $100 in the last month and I was able to make a decent profit on a few coins as well as I am currently investing in dogecoin which is at a 4 month low. It's interesting to see all other alrcoins take a dive while bit coin slumps which is inverse to what we have seen so far. The reason I am long doge is due to its community.  Doge is actually used for transactions at a much higher rate than any other coin by relative volume traded.  It was over .0000028 just a few months back. In march it dipped below 100 but recovered into the 130's and now is 1/3 that.  I see a resurgence of doge on the horizon and am putting a few bit coins into that bet.  If I play it right I can double or triple my investment.  Time will tell. However just like stocks or gold. Don't invest what you can't lose. I am using profits made from mining (mined millions of doge and sold near its peak) and earlier good trafes on coins such as dark coin and zeta coin among others. 

If your reading this in late 2014 you'll know if I was right!
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on May 31, 2014, 11:13:44 PM
Bit coin now up to 650!! $200 dollar jump since April

Doge is now down to .00000056 and litecoin at .017 (from stable price around .25)

I feel like this is like if silver was down to $12 an ounce, a steal!


Scripts are being hit harder now as people are dumping on the way down but a floor will soon be reached. I think dogecoin is at that floor and I'm dumping a bit coin into them (a $497 bit coin). 


As long as PayPal doesn't renege on their promise to allow bit coin transactions in their payment network every coin will recover and be open for transaction purchases (they won't jump like bit coin will since they will have to be converted to bit coin first and a lot of traditional brick and mortar won't want another step).  In the end it will be good times ahead for all the coin markets that have a decent following already IMHO.
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on June 05, 2014, 11:16:03 PM
dishnetwork has announced they will start accepting bitcoin as payment.  Its going more mainstream by the week, also EBAY CEO has announced that paypal will soon have to start accepting digital currencies, Ebay wants a piece of that pie, just like jack said.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 06, 2014, 03:11:14 AM
The IRS has issued a statement that, at least for 2014, tax payers holding bitcoin are not required to complete FinCEN Form 114, which is required for those holding more than $10k in a foreign bank.  They left the door open to change future policy as they continue to refine their policy on cryptocurrency.  One more regulatory issue to keep an eye on.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 07, 2014, 03:33:48 AM
A Yukon gold mine is being advertised for $2 million in Bitcoin. Reportedly the mine does $1 million a year in sales and the equipment is worth another million.  Kind of makes you wonder....
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on June 07, 2014, 08:16:03 AM
They either see a huge swing in bitcoin coming or they have tapped all the pay dirt on that mine!

I would like to see their financial reporting and the result of about 100 test holes across that property!
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on June 11, 2014, 12:02:55 AM
Thought I would chime in with info on a new and intriguing coin that is relatively new, DarkCoin.

Bitcoin came with the promise of anonymity, which it delivers if people are very careful, however it is not guaranteed and for 90% of users it can probably be traced in some way.

For instance if your address is 12345678 and you send 1 BTC to overstock.com to buy a couch, then your name is forever now attached to that address and any and all transactions that come from that address are now "12345678 JIM SMITH" if someone wanted to start recording these sorts of things, this is just using overstock.com as an example but this applies to anyone you send a coin to, if ever any one of them recorded any of your information all the transactions for that address are now attached to you! If you use coinbase, forget about it, that should be obvious to you.  Some people get around this by creating a new address in the bitcoin client everytime they do a transaction, however most people dont because it takes time, etc.

With Darkcoin they get around that by using the time tested technique of 'washing' the coin with others, just like money laundering in the movies.

Basically this is how it works

whenever you want to send a Darkcoin to someone, whether 1 or 10000000 you send them in 100 Darkcoin increments, but that i mean it has to be in increments of 100.

If you want to send 1 you will send 100 to the pool, if you want to send 250 you will send 300 to the pool.

The pool then combines them with other peoples transactions and sends the intended recipient your coins from a random pool address, not your address.

So to illustrate this lets say you want to send me 5 darkcoins.


You will type in my address and send me the 5 darkcoins, 100 will be deducted from your wallet and sent to the pool

The pool will then combine your 100 darkcoins with other users transactions.

5 Darkcoins will then be sent to me, and 95 will be sent back to you, so you will not be losing 95, they just send them back. 

The address that will appear in my transaction log will not be yours but a random address drawn from the pool.


This adds a degree of anonymity to the transaction that bitcoin fails to do, which is a plus.

A downside is there is NO WAY for me to say "i never got them" and you to know if i did or not, the transaction log wont show that, thats the price you pay for anonymity.


I dont think darkcoin will ever be mainstream like bitcoin or litecoin will ever be, but it has a purpose and a specific niche of transactions that want that; the market provides!


I think its great, and have a few squirreled away in case it takes off, which it has to a certain degree already.


What do you think?


Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 11, 2014, 07:15:56 PM
I'm in favor of all the experimentation going on, whether it's altcoins or side chains, it's all good.

But personally I'm just sitting on the sidelines holding BTC, watching to see how this cryptocurrency thing plays out.
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on June 13, 2014, 04:44:23 PM
Was just booking a trip on Expedia.com. They take bitcoin!

*just saw post in money board announcing this. I am Officially Johnny come lately*
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on July 01, 2014, 01:35:57 PM
Newegg.com, a nearly $3 billion a year company, is the latest company to accept bitcoins.  I order many, many thousands of dollars of stuff there every year, but it's mostly through the company credit card.  Still, I will be using this for any personal purchases, for sure. 

http://www.coindesk.com/online-retail-giant-newegg-now-accepts-bitcoin/
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 04, 2014, 10:19:05 PM
The US Marshals recently auctioned off several thousand bitcoin that was part of the Silk Road seizure and in the process leaked the email addresses of those participating in the auction. We are literally talking about a CC: vs. BCC: level mistake on the part of a .gov moron, which allowed someone to go on a sophisticated phishing expedition and net 100 BTC from the arbitrage fund Bitcoins Reserve.

http://www.coindesk.com/phishing-scam-targets-us-marshals-service-bitcoin-auction-list/ (http://www.coindesk.com/phishing-scam-targets-us-marshals-service-bitcoin-auction-list/)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 27, 2014, 05:37:53 PM
Here's more on the Yukon gold mine on sale for bitcoin, it's an actual interview with the owner, who thinks that gold is less attractive than bitcoin due to geopolitical pressures.

http://www.coindesk.com/timothy-coles-2-million-gold-mine-bitcoin/ (http://www.coindesk.com/timothy-coles-2-million-gold-mine-bitcoin/)

Quote
The people that have the bitcoin are the ones that can drive the price up, or drive it down, depending on what ups. Whereas gold, the people that have the gold are really at the mercy of politicians, financial institutions, London fixes that we really know nothing about. People that have gold really have no control over the direction that goes.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on July 28, 2014, 09:42:03 AM
Very interesting
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 23, 2014, 12:05:16 PM
PayPal announces bitcoin partnerships.  This could be big.....

http://www.coindesk.com/paypal-announces-first-partnerships-bitcoin-space/ (http://www.coindesk.com/paypal-announces-first-partnerships-bitcoin-space/)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 03, 2014, 02:07:42 PM
PayPal announces bitcoin partnerships.  This could be big.....

.....just not in the short term, apparently. Price hit its lowest point since the spike in December.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 05, 2014, 07:27:53 PM
And the slide continues, the price went below $300 today.

Nobody seems to have an explanation, either.
Title: Re: Bitcoin currency (merged topics)
Post by: skas on October 05, 2014, 10:51:46 PM
Eh, looks like some early adopters getting out (speculation on my part) and some heavy manipulation.  I haven't looked in a few hours, but it looked like someone had a roughly 7 million dollar sell wall in place at $300/btc, and that wall is still holding.
Title: Re: Bitcoin currency (merged topics)
Post by: Max on October 06, 2014, 11:51:55 AM
And the slide continues, the price went below $300 today.

Nobody seems to have an explanation, either.

The USD is still showing strong. The USD index is sitting at 86.12. When Bitcoin was at it's high the USD index was below 80. I think there is some true correlation between the USD and Bitcoin movements. I don't think there is any major manipulation in the Bitcoin market besides Hit stories in the news. Now Gold and Silver on the other hand are manipulated like mad and there is no correlation between USD & precious metals movements. Once the system breaks PM’s will skyrocket and Crypto’s may as well. Very interesting times we live in.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on October 06, 2014, 12:14:59 PM
The USD is still showing strong. The USD index is sitting at 86.12. When Bitcoin was at it's high the USD index was below 80. I think there is some true correlation between the USD and Bitcoin movements. I don't think there is any major manipulation in the Bitcoin market besides Hit stories in the news. Now Gold and Silver on the other hand are manipulated like mad and there is no correlation between USD & precious metals movements. Once the system breaks PM’s will skyrocket and Crypto’s may as well. Very interesting times we live in.

I don't think the USD has anything to do with this recent slide in the price of bitcoins.  This was a massive sell off of 35,000 BTC, apparently, and it's simple supply/demand.  Flood the market, and prices will drop.

It seems like a very big holder just said 'F it' and got out.  Or it might be manipulation, but that's much less likely.  It was clearly someone willing to sell their entire collection (or a huge chunk) for anything above $300.  You can see it in real time, once the 35,000 is sold off, the price finally comes back up over $300 after constant selling at that price stops.

Any time a large holding gets distributed among many smaller accounts, like happened here, I'm ok with it.  The fewer people with gigantic holdings, the less manipulation is possible.

In other news:  Bitcoin is on sale, folks!   

Or it might drop to $0 tomorrow - who knows?!
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 28, 2014, 10:07:59 PM
Let's Talk Bitcoin, Episode 101-The Why of Bitcoin (http://letstalkbitcoin.com/e101-the-why-of-bitcoin/) is really worth a listen.

This episode features two deep thinkers in the cryptocurrency space, Andreas Antonopoulos and Chris Ellis, waxing philosophical on ideas of money and currency, intrinsic value, centralized systems of trust, the constancy of change, and the massive disruption that bitcoin poses for the status quo.

Here's another great philosophical episode with these two guys:  http://letstalkbitcoin.com/blog/post/lets-talk-bitcoin-165-the-shadow-of-history (http://letstalkbitcoin.com/blog/post/lets-talk-bitcoin-165-the-shadow-of-history)
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on December 01, 2014, 07:51:35 AM
Here's another great philosophical episode with these two guys:  http://letstalkbitcoin.com/blog/post/lets-talk-bitcoin-165-the-shadow-of-history (http://letstalkbitcoin.com/blog/post/lets-talk-bitcoin-165-the-shadow-of-history)

That was definitely another good one, yep!
Title: Bitcoin
Post by: bigbear on January 14, 2015, 02:33:26 PM
Is down 22% today... 
http://www.cnbc.com/id/102337172#.

And down 32% in the last 2 days...
http://www.bloomberg.com/news/2015-01-14/bitcoin-s-2-day-plunge-threatens-mainstream-adoption.html

Title: Re: Bitcoin
Post by: Cedar on January 14, 2015, 02:37:46 PM
Even the Ruble Is a Better Investment Than Bitcoin These Days
http://www.slate.com/blogs/moneybox/2015/01/14/bitcoin_crashing_even_the_ruble_is_a_better_investment.html

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 14, 2015, 03:04:53 PM
(http://s3.amazonaws.com/dk-production/images/25658/large/bubble_main.jpg?1364495604)

2013: Enthusiasm

2014: Capitulation

2015: Despair
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on January 14, 2015, 05:01:21 PM
2014: Capitulation
2015: Despair

OMG I NEED SLEEP.. I just got back in from setting traps with the trapper, and I read that as decapitation. Might be apt maybe?

Cedar

Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 14, 2015, 05:30:17 PM
Might be apt maybe?

Only time will tell....

Although, I'm sure it feels that way for anyone who went all in at $1200.
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on January 14, 2015, 06:36:06 PM
So what is a bitcoin going for now?
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on January 14, 2015, 06:38:41 PM
So what is a bitcoin going for now?

This is real time I think
http://www.coindesk.com/price/

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 14, 2015, 06:48:27 PM
Went to $160 last night, playing with $200 now.
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on January 15, 2015, 05:41:51 AM
This is a good thing. I think the 150 to 200 level is the stable area for bitcoin for the near future.  it is still being thought of as a commodity so its still behaving like one in a way. 
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on January 15, 2015, 05:50:31 AM
Ah, so Bitcoin is tied to oil...

I'd like to see it actually used as a currency. I use it when possible but it's not that often. One would think a low price would push sellers toward it.

The real breakthrough is the Blockchain which gets no press at all.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 31, 2015, 02:57:03 AM
Not really sure where best to put this, but, for anyone not keeping up with the Silk Road case, Ross Ulbricht gets life in prison for his role as the Dread Pirate Roberts and facilitating online drug sales using bitcoin.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on May 31, 2015, 05:59:30 AM
Not really sure where best to put this, but, for anyone not keeping up with the Silk Road case, Ross Ulbricht gets life in prison for his role as the Dread Pirate Roberts and facilitating online drug sales using bitcoin.

Yeah, life in prison for creating a website. God help the Etsy folk if some of their sellers don't pay sales tax...

Silk Road was the poster child of why Bitcoin is evil. We were supposed to believe that all sorts of weapons, hitmen, drugs, and all sorts of nasty folks were acting nefariously fueled by magic electronic money. In reality it was kind of nothing special. I perused it once and other than laughing at sales of black tar heroin (hey maybe we could blame the inventor of that stuff, Bayer) it was a yawn. But Ulbricht is guilty of the greatest crime in history: he chose to ignore the state.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 31, 2015, 04:17:20 PM
Bet DPR wishes he'd pled out. Dude didn't have a clue he was in way over his head.

Here's a good article: http://arstechnica.com/tech-policy/2015/05/sunk-how-ross-ulbricht-ended-up-in-prison-for-life/ (http://arstechnica.com/tech-policy/2015/05/sunk-how-ross-ulbricht-ended-up-in-prison-for-life/)
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on May 31, 2015, 05:38:12 PM
I think he was hoping for a privacy advocate who snuck in under the radar and would hold out in the jury. I wouldn't have don't had I been there

However he had to know that the government was going to pull out all the stops, push every charge they could and make an example of him. 

Truth is he is correct. He did make drug purchasing safer and more reliable.

Drugs should be safe. People used to be shot and killed over buying booze and being robbed when trying to buy it in back alleys with trucks, etc.   

However he lost his credibility with my libertarian sensibilities and philosophy when he ordered multiple deaths, thought they had been carried out and ordered more.   

He should be guilty of conspiracy to commit murder. But that's it.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 01, 2015, 04:22:58 AM
He should be guilty of conspiracy to commit murder. But that's it.

Well, that part of the saga will be tried in Baltimore in a few months. Even if he gets off on appeal for his current sentence, he won't beat the murder for hire.  He's screwed.  Totally screwed.
Title: Re: Bitcoin currency (merged topics)
Post by: R_Morgan on June 01, 2015, 05:47:15 AM
Well, that part of the saga will be tried in Baltimore in a few months. Even if he gets off on appeal for his current sentence, he won't beat the murder for hire.  He's screwed.  Totally screwed.

I feel for the families that had sons, etc od on the drugs they bought there, however the fact that silk road existed was not the cause for them to start using it was merely a new avenue for them to buy their drugs. If silk road had not been there the outcome would have likely been the same and would they have preferred them to have had to drive into nasty parts of town and knock on doors of run down houses or go to their mailbox? 

Drug addicition is a horrible thing, but a website doesn't cause it, many factors and choices in their lives prior to it led to their od. As a father I understand, I would be lashing out at whatever I could find. I never fault the bereaved over bad judgements such as sandy hook. I never fault those parents for calling for gun control, I fault the pushers using them for their own benefit.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on June 01, 2015, 08:06:39 AM
This is probably the most stark example of the difference in legal classes.  He was a small fish going against the stream, creating a place for people to buy and sell anything online:  Life in prison.  Meanwhile, a huge bank (and likely many more in the future) is found to have been working directly with one of the biggest drug cartels in the world (you know, the kind that actually murders scores of people every week):  slapped on the wrist with a relatively small fine.

http://www.huffingtonpost.com/avinash-tharoor/banks-cartel-money-laundering_b_4619464.html

Quote
Bank of America, Western Union, and JP Morgan, are among the institutions allegedly involved in the drug trade. Meanwhile, HSBC has admitted its laundering role, and evaded criminal prosecution by paying a fine of almost $2 billion. The lack of imprisonment of any bankers involved is indicative of the hypocritical nature of the drug war; an individual selling a few grams of drugs can face decades in prison, while a group of people that tacitly allow -- and profit from -- the trade of tons, escape incarceration.



Well, that part of the saga will be tried in Baltimore in a few months. Even if he gets off on appeal for his current sentence, he won't beat the murder for hire.  He's screwed.  Totally screwed.

Yep, I think Ulbritcht is a POS who deserves prison for life, but certainly not for the reasons he was sent there.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 06, 2015, 02:29:47 PM
$275/BTC

Been awhile since we've seen this steep a climb.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 08, 2015, 01:42:12 PM
For all the brain wallet fans out there, it's not as safe as you think.

http://www.wired.com/2015/07/brainflayer-password-cracker-steals-bitcoins-brain/ (http://www.wired.com/2015/07/brainflayer-password-cracker-steals-bitcoins-brain/)


Quote
Reddit user “thonbrocket,” describes how they had used a phrase from an obscure poem in Afrikaans as a passphrase, and was shocked to find that it was guessed.


Random beats "clever" every time.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 21, 2015, 12:55:32 AM
Another great Antonopoulos talk:  https://youtu.be/_0mykANOMGQ (https://youtu.be/_0mykANOMGQ)

In bitcoin land, Roger Ver may be Jesus, but Andreas Antonopoulos is the Apostle Paul.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on July 21, 2015, 09:56:28 AM
Another great Antonopoulos talk:  https://youtu.be/_0mykANOMGQ (https://youtu.be/_0mykANOMGQ)

In bitcoin land, Roger Ver may be Jesus, but Andreas Antonopoulos is the Apostle Paul.

Andreas is like the best ambassador of the cause. He's done Rogan a few times as well.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 31, 2015, 11:47:33 PM
Japan has arrested Mark Karpeles in connection with the bitcoin losses at Mt Gox:  http://www.bbc.com/news/world-asia-33745611 (http://www.bbc.com/news/world-asia-33745611)
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on August 19, 2015, 07:30:13 AM
Lyn Ulbricht (mother of Ross Ulbricht the convicted owner of Silk Road) on the Freedom Feens.  Interesting if biased discussion.

http://www.freedomfeens.com/2015/08/15/interview-with-lyn-ulbricht-mother-of-silk-road-hero-ross-ulbricht-freedom-feens-radio/
Title: Re: Bitcoin currency (merged topics)
Post by: bigbear on September 02, 2015, 02:08:19 PM
http://www.technologyreview.com/news/540921/the-looming-problem-that-could-kill-bitcoin/

Transaction volume... or lack thereof.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 03, 2015, 12:25:38 PM
Bitcoin has blown past $300 and now $400 in the last few days. China's exchanges have the highest volumes, leading some to speculate that the population there is utilizing it as a way to avoid capital controls and currency devaluation brought on by their economic downturn. But, who really knows?  It's been almost exactly two years since the $1200 price spike.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on November 04, 2015, 12:31:23 PM
I used to have a bitcoin price monitor app on my phone that would alert me with any change greater than 3% (up or down).  I hadn't had it on for a few months, but just today decided to see where things were at.  Over 100% increase since my last check, most of that in the last 2 days.  Weird timing on my part.

And now I'm getting multiple alerts every hour, which means swings of 3% or more.  I still don't worry about the price, but it's a passing interest at this point.  Might turn that app off for now, though...

The only reason I could foresee bitcoin not doing very well long term is goverment regulation.  If all the states step up and follow New Yorks example, it will be the death of bitcoin innovation, entrepreneurs, and usage in the US.


Title: Re: Bitcoin currency (merged topics)
Post by: Wild Colonial Boy on December 09, 2015, 05:33:02 AM
Bitcoin: Sydney home of suspected founder Craig Steven Wright raided by Australian Federal Police over Australian Tax Office warrant.

http://www.abc.net.au/news/2015-12-09/bitcoin-suspected-founder-craig-wright-home-raided-by-afp/7014254

Well I always thought that the mysterious founder of Bitcoin was a Japanese American, Dorian Nakamoto....now it seems Bitcoins roots may be linked to Australia....perhaps a collaboration between the Silicon Valley and Kangaroo Valley??
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 09, 2015, 08:03:32 AM
Bitcoin: Sydney home of suspected founder Craig Steven Wright raided by Australian Federal Police over Australian Tax Office warrant.

http://www.abc.net.au/news/2015-12-09/bitcoin-suspected-founder-craig-wright-home-raided-by-afp/7014254

Well I always thought that the mysterious founder of Bitcoin was a Japanese American, Dorian Nakamoto....now it seems Bitcoins roots may be linked to Australia....perhaps a collaboration between the Silicon Valley and Kangaroo Valley??

Definitely unexpected. Very interesting.
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on December 09, 2015, 09:20:02 AM
Well I always thought that the mysterious founder of Bitcoin was a Japanese American, Dorian Nakamoto..

Newsweek got that story about as wrong as you possibly can, and screwed with that poor guys life more than anyone deserves.

Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on January 18, 2016, 02:31:53 PM
Longtime Bitcoin developer Mike Hearn drops out of the project entirely, stating that Bitcoin has failed.  Long, detailed blog post:

The resolution of the Bitcoin experiment (https://medium.com/@octskyward/the-resolution-of-the-bitcoin-experiment-dabb30201f7#.l0mwa4biu)

Quote
...Why has Bitcoin failed? It has failed because the community has failed. What was meant to be a new, decentralised form of money that lacked “systemically important institutions” and “too big to fail” has become something even worse: a system completely controlled by just a handful of people. Worse still, the network is on the brink of technical collapse. The mechanisms that should have prevented this outcome have broken down, and as a result there’s no longer much reason to think Bitcoin can actually be better than the existing financial system.

Think about it. If you had never heard about Bitcoin before, would you care about a payments network that:

    Couldn’t move your existing money
    Had wildly unpredictable fees that were high and rising fast
    Allowed buyers to take back payments they’d made after walking out of shops, by simply pressing a button (if you aren’t aware of this “feature” that’s because Bitcoin was only just changed to allow it)
    Is suffering large backlogs and flaky payments
    … which is controlled by China
    … and in which the companies and people building it were in open civil war?

I’m going to hazard a guess that the answer is no. ...
Title: Re: Bitcoin currency (merged topics)
Post by: Prodigy on January 18, 2016, 03:15:52 PM
Longtime Bitcoin developer Mike Hearn drops out of the project entirely, stating that Bitcoin has failed.  Long, detailed blog post:

The resolution of the Bitcoin experiment (https://medium.com/@octskyward/the-resolution-of-the-bitcoin-experiment-dabb30201f7#.l0mwa4biu)


And then none other than Satoshi himself rode in on a white horse, took back control over Bitcoin, and saved it from certain doom...

*cough*

Anyway, I kind of wish I'd been paying more attention but ever since the big debate about block sizes started I saw more and more infighting and gradually drifted away.  It's now been months since I've done any readin of bitcoin related news.  This was an interesting, if somewhat depressing, post.  Thanks for posting it Mr. Bill - it has inspired me to dive back into the pool and see what's going on.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 18, 2016, 03:17:36 PM
Longtime Bitcoin developer Mike Hearn drops out of the project entirely, stating that Bitcoin has failed.  Long, detailed blog post:

The resolution of the Bitcoin experiment (https://medium.com/@octskyward/the-resolution-of-the-bitcoin-experiment-dabb30201f7#.l0mwa4biu)

The prevailing theory is that this was a tantrum thrown over the block size debate, a ragequit.  But who knows?  Some even accuse him of being in cahoots with big finance to kill Bitcoin before they roll out their own blockchain technology.  He got one thing right, though, it is an experiment.
Title: Re: Bitcoin currency (merged topics)
Post by: Max on January 20, 2016, 08:36:52 AM
The prevailing theory is that this was a tantrum thrown over the block size debate, a ragequit.  But who knows?  Some even accuse him of being in cahoots with big finance to kill Bitcoin before they roll out their own blockchain technology.  He got one thing right, though, it is an experiment.

With the way the markets are heading I don't see Bitcoin dying. Some people might see Bitcoin and virtual currencies as life boats from the mass devaluing of currencies around the world. Time will tell but I for one don't think these virtual currencies have even remotely hit their high water mark.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on January 20, 2016, 11:58:46 AM
With the way the markets are heading I don't see Bitcoin dying. Some people might see Bitcoin and virtual currencies as life boats from the mass devaluing of currencies around the world. Time will tell but I for one don't think these virtual currencies have even remotely hit their high water mark.

I agree, however, the real gamble to me is... will Bitcoin be "THE" virtual currency? Or, will something else take it's place?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 20, 2016, 02:08:52 PM
I agree, however, the real gamble to me is... will Bitcoin be "THE" virtual currency? Or, will something else take it's place?

Who knows?  It's all a big gamble, but at some point the ecosystem becomes large enough that it makes sense to fine tune what everyone is using, rather than reinventing the wheel. Look at internet protocols, there's all kinds of things that would be done differently knowing what we know now. But it works well enough and since we are all dependent on it, we tweek it as best we can to get it to do what we want it to.

It's going on 5 years since I started this thread and Bitcoin is still kicking, despite plenty of reports of impending doom. Prediction is hard, especially about the future.
Title: Re: Bitcoin currency (merged topics)
Post by: Max on January 20, 2016, 02:29:45 PM
I agree, however, the real gamble to me is... will Bitcoin be "THE" virtual currency? Or, will something else take it's place?

That is the question. I tend to go bounce around. For example I have been buying and selling Name Coin on BTC-E. For the last two months it's been bouncing between $0.50 and $0.35. Some might say, "it's only 15 cents, so what" but you have to look at the percentage of the move which typically is between 20% and 30%. I'm coming close to doubling my holdings. I only have $1,200 invested in this so if I screw up it's not going to ruin me. Plus it's kinda fun to trade and the fees are next to nothing.
Title: Can we get a crypto currency thread going I would love to contribute
Post by: livingfreedom on April 27, 2016, 04:43:50 AM
Hello my name is Brandon,

I have been a long time listener to the show. I am absolutely obsessed with cryptography, encryption and crypto currencies like Bitcoin. I believe bitcoin is the most disruptive tech to come along since the birth of the internet. What most people don't realize is that bitcoin is just the beginning, just the tip of the iceberg. Bitcoin has triggered an avalanche of innovation that is coming like a tsunami. We need to learn and play with these new animals so that we can understand the future of commerce and money. Not saying to go invest, but I am saying to buy a little and understand it. I believe that the only way I could really "get" crypto was to get some in my hands and play with it. I have been doing tons of research, trial and error and the like with many of these new protocols. I started a podcast where I am going to be doing a lot of talking about these things. I would love to talk with others about their experiences with and curiosities about these things in this community which I respect so much!
Title: Re: Bitcoin currency (merged topics)
Post by: bigbear on April 28, 2016, 11:56:56 AM
http://finance.yahoo.com/news/larry-summers-joins-barry-silbert-bitcoin-investment-firm-digital-currency-group-as-senior-advisor-161613775.html

Larry Summers is now advising a bitcoin company.  That's a pretty weighty name...
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 29, 2016, 04:17:23 PM
For unclear reasons, the bitcoin price is sharply up since Friday, briefly touching $550, and higher, on some exchanges.  A year ago it was less than $200.  With this recent price rise, the total value of all bitcoin is now over $8 billion.
Title: What is Bitcoin and how does it work?
Post by: richze90 on June 05, 2016, 10:37:37 AM
Hey everyone, I started listening to TSP in March and listen to the show daily.  I love the different perspectives and the balanced non-alarmist approach to building a sustainable lifestyle.  On recent shows I have noticed some interest in Bitcoin as a show topic and even a question asking Jack what Bitcoin wallet he uses.  I feel I can lend some of my experience with Bitcoin to other listeners who are interested in getting started.   

I started using Bitcoin (and other cryptocurrencies) in 2013 after discovering it while researching the Cyprus financial crisis in March of that same year.  At first I was skeptical and thought it was some cheesy digital token that some company controlled.  However, after digging deeper and reading Satoshi Nakamoto’s (Bitcoin creator) whitepaper I understood that Bitcoin was revolutionary because there was no central authority to control or expand the money supply and it had all the benefits of Gold and Silver plus the ability to take your money anywhere on Earth without it being subject to confiscation.  While this was exciting by itself it also presented a way to reduce my participation in the corrupt financial system and help build a parallel financial system that is resistant to deflationary shocks.

I receive part of my income in Bitcoin and I use it as a way for me to store wealth outside the financial system, buy stuff online to include PM purchases, and even help others buy bitcoin locally with cash.  I consider myself a Bitcoin expert and advocate, but I realize I do not know everything.  If you have heard something contrary to what I post, please call me out so we can discuss and make sure the information I post is completely accurate.  What I will discuss in my upcoming posts are ways to use Bitcoin safely and securely.  Bitcoin is still a risky asset as there could be some bug in the Bitcoin codebase that could cause confidence in the ledger to be lost!  Just like any investment it should be part of a portfolio that has balanced risk. 

Now that this is out of the way let's get started.  My goal is to create simple easy to understand posts that will allow folks to get started with Bitcoin.  Bitcoin deep down is a very complex and will do my best to keep these posts at a level that make sense for everyone. 

What is Bitcoin and how does it work?

I feel it is a good idea that everyone understands how something works before diving in if only at a basic level.  So before I create a post on how to create a wallet lets go over how Bitcoin works. 

Bitcoin is a peer to peer network that is used to exchange digital value without a company/government consent.  Bitcoins are not actually sent over the internet, instead transactions are recorded on a public ledger.  This public ledger consists of “blocks” that are created on average every 10 minutes and are recorded permanently to the “blockchain” (Take a look at https://insight.bitpay.com/).  As such this public ledger means all transactions are pseudonymous and not entirely private.  The moment your random Bitcoin address is linked to your identity anonymity is lost!   

Who creates these blocks?  Bitcoin miners do!  Miners are collectively the payment processing engine for Bitcoin.  The miners are computers with specialized processors that listen to the Bitcoin network and record a list of all valid transactions that were made since the last block.  As they gather the transactions they are also solving a mathematical puzzle.  The first miner to solve the puzzle wins the block reward (currently 25 bitcoins) and publishes the block with all of the transactions they gathered for all other miners to see.  All miners on the network then validate that the puzzle was solved correctly and then they start to mine the next block and repeat this process. 

The transactions that miners are listening for are created by Bitcoin wallets.  A Bitcoin wallet will typically generate and save a “private key”.  A private key is just 52 characters randomly generated by the wallet (it can even be created offline by rolling a die many times).  This private key gives the wallet holder control of the corresponding address (this key should be kept in a safe place and not shown to anyone).  With this private key, the wallet software generates the corresponding Bitcoin address (this is the public address that you can show everyone) and scan the Blockchain to determine how many bitcoins belong to that address.  When someone sends bitcoins to another address the wallet will use the private key that it has stored to send out a signed message to the network indicating the quantity and address that the bitcoins have been transferred to. 

Hopefully that was simple and straightforward as I intended.  Let me know if there are any questions or if you want anymore details into certain functionality.  In my next post I will give an overview of the different wallet types and tell you what I use to store my Bitcoin. 
Title: Re: Bitcoin currency (merged topics)
Post by: WarrenPuckett on June 14, 2016, 10:47:31 AM
Can't the government just block the websites and bring down Bitcoin that way?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 15, 2016, 10:44:27 PM
Flirting with $740 in the last couple hours.  Brexit, China, halving of the mining reward, flying pigs......who knows why?


Can't the government just block the websites and bring down Bitcoin that way?

That's the beauty of the widely distributed peer-to-peer blockchain concept, it doesn't require the centralized points of failure necessary with previous digital currencies, which makes it difficult to bring down.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on July 05, 2016, 10:17:47 AM
My 12 year old requested I start paying him for his chores in bitcoin.  I've sent him 2x $5USD payments, and already it's made over 10%.

At first he thought it was just some cool-geek thing, but now he's asking me about fundamentals of finance, exchange rates, dollar cost averaging and other things the average bear never learns in high school.  Even if the valuation crashes, he's learning tons more than me paying him in greenbacks.
Title: Re: Bitcoin currency (merged topics)
Post by: Mastoo on September 02, 2016, 09:20:54 PM
I used my first bitcoin ATM today. It was impressive. Cash goes in, and the wallet on my phone dings to tell me the bitcoin has arrived.
Title: Re: Bitcoin currency (merged topics)
Post by: jerseyboy on September 19, 2016, 05:47:43 PM
I used my first bitcoin ATM today. It was impressive. Cash goes in, and the wallet on my phone dings to tell me the bitcoin has arrived.

I just looked at

https://coinatmradar.com/

And the few I looked at charged between 8% and 14% to buy bitcoin and 5% to sell bitcoin.

I guess when you pull $20 out of an ATM and they charge you $2 it is the same thing.

Jerseyboy
Title: Re: Bitcoin currency (merged topics)
Post by: Mastoo on September 20, 2016, 06:10:59 AM
The one I used was 8%. My experience has been that most people "selling" bitcoin for cash are looking to profit 5-10%.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 18, 2016, 03:40:25 PM
You knew this was coming:  http://www.coindesk.com/irs-seeking-data-coinbases-bitcoin-customers/ (http://www.coindesk.com/irs-seeking-data-coinbases-bitcoin-customers/)

The IRS is asking Coinbase for their customer data. Which they have, because Coinbase is a registered California-based financial services company that is bound by federal Know Your Customer regulations.


Don't launder your off-shore assets through Coinbase and expect to get away with it.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 22, 2016, 04:53:23 PM
Coinbase's statement:  https://blog.coinbase.com/2016/11/18/protecting-customer-privacy/ (https://blog.coinbase.com/2016/11/18/protecting-customer-privacy/)

Quote
Our customers may be aware that the U.S. government filed a civil petition yesterday in federal court seeking disclosure of all Coinbase U.S. customers' records over a three year period. The government has not alleged any wrongdoing on the part of Coinbase and its petition is predicated on sweeping statements that taxpayers may use virtual currency to evade taxes.

Although Coinbase's general practice is to cooperate with properly targeted law enforcement inquiries, we are extremely concerned with the indiscriminate breadth of the government's request. Our customers’ privacy rights are important to us and our legal team is in the process of examining the government's petition. In its current form, we will oppose the government’s petition in court. We will continue to keep our customers informed on developments in this matter.


Time will tell......
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 29, 2016, 12:41:08 AM
Very interesting story out of Venezuela, a country wrecked by socialist economic policies:  http://reason.com/archives/2016/11/28/the-secret-dangerous-world-of (http://reason.com/archives/2016/11/28/the-secret-dangerous-world-of)

In a nutshell: 

Electricity is nearly free, which makes the cost of bitcoin mining extremely favorable.

Bitcoin allows people to buy food and supplies and can be easily transferred to and from other countries.

The secret police hunt down miners, who are both stealing electricity and flouting the country's capital controls.  They then ask for bribes to avoid arrest and/or confiscate the mining rigs for their own mining operations.

Title: Re: Bitcoin currency (merged topics)
Post by: Alan Georges on November 29, 2016, 06:03:40 AM
In a nutshell: 

Electricity is nearly free, which makes the cost of bitcoin mining extremely favorable.

Bitcoin allows people to buy food and supplies and can be easily transferred to and from other countries.

The secret police hunt down miners, who are both stealing electricity and flouting the country's capital controls.  They then ask for bribes to avoid arrest and/or confiscate the mining rigs for their own mining operations.
It is funny how socialist countries frequently claim that they're "building the future."  Seems to be actually happening in Venezuela, just not the future they thought they were building.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 20, 2016, 10:08:10 PM
BTC successfully punched thru $800 today.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 21, 2016, 10:07:36 PM
Geez, it's already playing with $850, things may just decide to go nucking futs all over again, like three years ago.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 22, 2016, 10:49:32 PM
We've hit $900.  BTC might surpass the all-time high of around $1200 before the year is out.

That last high was back in November 2013, when there were 12 million bitcoins.  Today we have 16 million and the limit of 21 million will not be reached until the year 2140. Current market capitalization is around $14.5 billion. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 23, 2016, 12:39:27 AM
Nearly 99% of the trading volume is in CNY (Chinese Yuan), 0.67% in USD.
Title: Re: Bitcoin currency (merged topics)
Post by: FrugalFannie on December 23, 2016, 09:37:00 AM
I was a bit surprised this morning when I checked the price. Wonder how high it will go and at what price it will sustain.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 24, 2016, 06:32:16 PM
Looks like $900-ish is the resting point for now.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 01, 2017, 03:19:12 PM
1000 USD/BTC

Market Cap $16 billion   

Bitcoin outperformed all other assets in 2016.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 06, 2017, 01:25:01 PM
The bubble popped yesterday with the price a whisker away from an all-time high somewhere above $1150-ish, now it's below $900 and maybe going lower.  Currently the market is driven almost entirely by Chinese looking to move yuan out of country without running afoul of the stiff currency controls. It appears the government of China has been looking more closely at Bitcoin, issued some statements, opened some investigations of local exchanges, and now people are spooked.

Given the stiff penalties for fraud and the recent crackdown on crooked government officials, this latest rumbling from the government likely generated a sudden realization that Bitcoin isn't anywhere near as anonymous as they hoped.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on January 06, 2017, 02:06:16 PM
Bitcoin outperformed all other assets in 2016.

In terms of USD you mean?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 06, 2017, 03:29:11 PM
In terms of USD you mean?

I think that was the assumption of the articles I read. But there's not much consensus and it looks like more recent articles are pushing back on that claim. Some articles list it as a top, or the top, performing, asset, asset class, commodity, or even currency, in terms of USD.  So who knows? 

Bitcoin doesn't really fit well into any of those molds and it's still very tiny.  It had a good year, though, and it certainly isn't dead. Out of the myriad cryptocurrencies out there, BTC has nine times the market cap when compared to all the other altcoins (litecoin, ethereum, ripple, monero, dogecoin, etc) combined.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on January 06, 2017, 04:31:25 PM
I think that was the assumption of the articles I read. But there's not much consensus and it looks like more recent articles are pushing back on that claim. Some articles list it as a top, or the top, performing, asset, asset class, commodity, or even currency, in terms of USD.  So who knows? 

Bitcoin doesn't really fit well into any of those molds and it's still very tiny.  It had a good year, though, and it certainly isn't dead. Out of the myriad cryptocurrencies out there, BTC has nine times the market cap when compared to all the other altcoins (litecoin, ethereum, ripple, monero, dogecoin, etc) combined.

As the father of a 12 year old who prefers I pay his allowance in BTC (via coinbase), I tell everyone to think of BTC like a foreign currency.  If you ignore the digital aspects, that's really all it is.

There are certainly professional financial experts who do FX trades for a living.  My company has a group of them, as we earn revenue globally and a bunch of smart dudes figure out how many euros, dollars, pesos, yen, etc. to keep in what amount.  There are tax implications and many factors. 

My prediction with BTC going forward, it will not see strong gains without at least some global currency weakening. 
Meaning if it races to $2000USD, it's because a bunch of fiat currency is being dumped.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 06, 2017, 06:44:52 PM
I guess I see it more as a hybrid. It's similar to fiat currency, except for the fiat part, which reverses inflation potential over the long haul. The fact that each coin or block in the chain represents a huge expenditure of computational power and electricity (ie. the mining component of the distributed network), a process that is essentially irreversible, gives it more of a precious metal flavor.  Except that it's different from gold because enormous value can be transferred, with minimal friction, anywhere the network is accessible, plus it also leaves an audit trail and can't be melted down to disguise its origins as easily (although it can be laundered effectively by moving it through other altcoins).

I'm surprised that the rise of the other altcoins haven't effectively diluted bitcoin since 2013.  Ethereum seems to be the only competitor worth taking a risk on, although it's had a rocky course since its launch over a year ago and it doesn't look like it will be supplanting bitcoin anytime soon.  In the end, I guess nothing carries any intrinsic worth without the shared delusion of its value spreading to a critical mass of individuals who desire to own it.  Doesn't matter if it's gold, silver, greenbacks, or numbers on a brokerage screen or central bank.  Bitcoin carries the advantage in the cryptocurrency space by virtue being first and having a history of weathering the most setbacks over the last 8 years.  But it still can't compete with the shared delusion surrounding gold's history, and maybe it never will.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 06, 2017, 07:25:06 PM
Interesting article from WIRED:  Bitcoin Will Never Be a Currency - It's Something Way Weirder (https://www.wired.com/2017/01/bitcoin-will-never-currency-something-way-weirder/)
Title: Re: Bitcoin currency (merged topics)
Post by: FrugalFannie on January 06, 2017, 08:42:42 PM
I remember when it popped at $1200 a few years back. We cashed out some of what we had at the time. Of course our total investment in it was $2 via a game my husband played and won a "few" BTC in return. So we have held on to the rest of it. It's all gravy. We have sold some things for BTC and used BTC to buy a few things. But mostly we are just holding onto it at this point.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 06, 2017, 09:34:30 PM
It's been 4 years since I sold to get my initial investment back, which I wish I hadn't done, and 3 since my last purchase (to open a Coinbase account). I guess that means I value the upside windfall over the downside loss. I am buying ethereum now that Coinbase is handling it, as the upside seems favorable to me right now, plus it has the potential to be much more versatile than the other clone coins out there.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 10, 2017, 06:13:09 PM
Novel use for the blockchain:  Julian Assange Just Read Out a Bitcoin Block Hash to Prove He Was Alive (http://www.coindesk.com/julian-assange-just-read-bitcoin-block-hash-prove-alive/)

Quote
Wikileaks founder Julian Assange used data from the blockchain as a "proof of life" during a Reddit ask-me-anything session today.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 24, 2017, 01:08:59 PM
Bitcoin prices are back in the ~$1200 range again.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on March 10, 2017, 05:28:27 AM
SEC considers allowing a "Bicoin ETF".

http://www.marketwatch.com/story/what-the-sec-needs-to-do-to-approve-the-bitcoin-etf-2017-03-08?siteid=yhoof2&yptr=yahoo

Bicoin users (like me) will not be happy about this because it shows what Bitcoin is and isn't. It is a forex investment, not a currency. And if allowed by the SEC it will be the easiest arbitrage with cash on the planet for investors.

FWIW, I doubt it will pass.
Title: Re: Bitcoin currency (merged topics)
Post by: FrugalFannie on March 11, 2017, 03:24:09 PM
SEC considers allowing a "Bicoin ETF".

http://www.marketwatch.com/story/what-the-sec-needs-to-do-to-approve-the-bitcoin-etf-2017-03-08?siteid=yhoof2&yptr=yahoo

Bicoin users (like me) will not be happy about this because it shows what Bitcoin is and isn't. It is a forex investment, not a currency. And if allowed by the SEC it will be the easiest arbitrage with cash on the planet for investors.

FWIW, I doubt it will pass.

It did not pass. https://www.nytimes.com/2017/03/10/business/dealbook/winkelvoss-brothers-bid-to-create-a-bitcoin-etf-is-rejected.html
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 16, 2017, 03:13:33 PM
From Andreas Antonopoulos:  https://youtu.be/tX4mWFWwnBg (https://youtu.be/tX4mWFWwnBg)


Quote
This is a fantastic opportunity for Americans to learn some German; the first word they should look up is 'Schadenfreude,' as their hopes and dreams of "draining the swamp" are crushed by a completely sold-out establishment politician. I've spent the last six months telling people all around the world that Trump was going to win and no one would believe me. Was this a failure of politics or economics? The U.S. political system failed because the economy failed. Bitcoin is providing an honest market solution; the reason it's being used as an exit is because it offers the real market value for your currency exchange when the other markets have been artificially shut off.[/quote]
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 27, 2017, 03:31:35 PM
CoinDesk's Bitcoin Index price crossed $1335, which is well into record territory.  Coinbase's price is actually a bit higher, around $1360, currently. 

There's been a fairly large spread of almost $100 between exchanges over the last week or so, with both Poloniex and Bitfinex trading higher than their peers, ostensibly due to banking issues that are limiting the ability of those exchanges to transfer fiat currency in and out of their customer's accounts.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 30, 2017, 04:11:28 PM
Excellent overview by Andreas Antonopoulos, who is widely considered the most objective and trustworthy authority in the cryptocurrency space. 

The Stories We Tell About Money (https://youtu.be/ONvg9SbauMg)

Quote
In this talk, Andreas recounts the history of Bitcoin and what it represents, building upon all the stories we've been told over the centuries about what "money" is, how we perceive its value, and why the old answers have changed as we adjust to this new world of digital peer-to-peer currencies. He also discusses global threats to economic stability and trust in the financial system, including demonetisation and wealth destruction through inflation.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 03, 2017, 03:08:01 PM
BTC successfully punched thru $800 today.


1000 USD/BTC

Market Cap $16 billion   

Bitcoin outperformed all other assets in 2016.


Bitcoin prices are back in the ~$1200 range again.


Trading has solidly surpassed $1500/BTC in the last 24 hours at most exchanges. Some are trading over $1600 and a few are below $1400. I don't recall spreads this wide, except for right before Mt Gox went bust.  The market cap for all crypto currencies is over $41 billion, with BTC making up almost $25 billion of that total.
Title: Re: Bitcoin currency (merged topics)
Post by: EpsilonActual on May 10, 2017, 06:21:06 AM
I purchased my first bitcoin last night through Coinbase. Current value of a bitcoin sits at $1761.53
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 10, 2017, 10:10:49 AM
Good move!  Coinbase is an excellent place to start purchasing and storing cryptocurrency.

Consider buying some Ethereum or Litecoin, too.  That's what I'm adding to my holdings at this point. Litecoin started selling on Coinbase last week and rumor has it that others will follow.  The market capitalization for all cryptocurrency increased by more than $25 billion in the last couple months, and the altcoins benefited from the majority of that.  The total cryptocurrency market is worth over $52 billion and Bitcoin now makes up just a little more than half of that amount.

While I think everyone should own some cryptocoin, please don't trade more cash for it than you are prepared to lose forever. It's still the Wild West and violent volatility will continue to be the rule for years to come.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 18, 2017, 08:16:55 PM
Today's prices exceeded $1900/BTC, with a market cap of more than $31 billion.  The spread between the various exchanges has narrowed considerably from two weeks ago.

The total cryptocurrency market cap now exceeds $64 billion.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 21, 2017, 02:08:12 PM
Bitcoin has been trading above $2000, twice what it started the year at, for more than 24 hours, bringing its market cap to $33.5 billion.

Ethereum has second place in the market cap race, at almost $14 billion, with a price around $150. It was going for $7 at the beginning of the year.

The market cap for all crypto currency is now above $73 billion.  Gold's market cap is more than $7 trillion.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on May 23, 2017, 10:58:45 AM
I agree, however, the real gamble to me is... will Bitcoin be "THE" virtual currency? Or, will something else take it's place?

^^man, this guy had no idea what he was talking about  8)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 23, 2017, 07:10:53 PM
The cryptocurrency craziness just doesn't want to stop.  Current prices are above $2300, almost double what it was a month ago.


Wences Casares, CEO of bitcoin wallet Xapo and member of PayPal’s board of directors spoke at a conference today and predicted a price of $1 million within 5-10 years.  Seems like crazy-talk to me (especially since the closest anybody else has been willing to predict is half that), but fortunately he tempered that exuberance with:

“The biggest mistake [would] be to buy more bitcoin than you can afford to lose. The biggest mistake is [also] not to own any bitcoin. Put 1% of your net worth in Bitcoin and forget about it for 10 years”

For his prediction to be true, the 20 million bitcoins that will exist in 2027 would have a market capitalization of $20 trillion!  That's three times what gold is now.
Title: Re: Bitcoin currency (merged topics)
Post by: bigbear on May 24, 2017, 12:16:47 PM
Consider buying some Ethereum or Litecoin, too.  That's what I'm adding to my holdings at this point.

Ethereum has second place in the market cap race, at almost $14 billion, with a price around $150. It was going for $7 at the beginning of the year.

I was just going to ask your thoughts on Ethereum!  I stumbled across it today.  This is an older article, but it speaks to the structural differences between Bitcoin and Ethereum (non-profit and more open usage). 
https://www.thebalance.com/what-s-the-deal-with-ethereum-3939137

Cryptocurrency shows little to no sign of stopping.  And it's easy to imagine reasons why it could continue its trajectory...  But I got curious about one angle:  Sovereign Wealth Funds.

If sovereign wealth funds (the investment accounts of a nation) were to buy into cryptocurrency, that would be a big move and signal.  Norway itself has $900 billion in sovereign funds.  If they dropped 10% into bitcoin, imagine the jump.  It would also signal a distrust of central banks, by the gov't themselves. 

So I tried to find out if any sovereign wealth funds have invested in any cryptocurrency.  And only found some speculation for Norway earlier in 2017.
http://bitcoinist.com/norway-wealth-fund-reinvest-bitcoin/

Does anyone know anything about sovereign fund investments in crypto?


Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 24, 2017, 06:50:04 PM
I think Ethereum probably has the most potential of the current altcoins.  It's significantly different from bitcoin technologically and that allows it to be tailored to do things that bitcoin currently can't (and may never be updated to) do.  It suffered a crisis with the DAO attack and appears to have weathered the controversial hardfork that was implemented in order to restore what was stolen by the hack. 

Track record matters in the blockchain game, and there's lots of crapcoins and scamcoins seeking to lure you in, these are the sketchy penny stocks of the crypto market.  How a currency handles the inevitable attacks by bad actors (both internal and external) demonstrates the weak points and pitfalls in the underlying technology.  Bitcoin, being the first on the scene and having weathered the most negative press (Mt Gox, Silk Road, etc.), leads the way in terms of track record and confidence, although there's no guarantee it couldn't be supplanted by one of the upstarts.

As far as the sovereign wealth funds.  Who knows?  There's piles of money sitting in traditional financial vehicles right now.  If it does move onto the blockchain, my guess is that it will be done cautiously over a period of time.  Large piles of money aren't typically accumulated by rash behavior.


Current prices:

BTC  ~ $2600    $42.4 billion cap    50% of the entire crypto market
ETH  ~ $190      $17.4 billion cap
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 25, 2017, 04:18:10 PM
Coinbase has had trouble keeping up with the enormous volume of transactions this week and was offline at several points.

http://fortune.com/2017/05/25/coinbase-outage-bitcoin/ (http://fortune.com/2017/05/25/coinbase-outage-bitcoin/)


Illustrates one of the risks involved with participation in a nascent financial technology.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 27, 2017, 01:29:29 PM
Huge correction the last two days. Bitcoin is down around $2000, with a market cap of $34 billion.

Total crypto market cap fell from a high of $91 billion to $69 billion.
Title: Re: Bitcoin currency (merged topics)
Post by: chad on May 27, 2017, 01:54:13 PM
Any reason or speculation on why the drop?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 27, 2017, 02:06:09 PM
My guess is it's probably profit taking.  With such a huge run up in prices there's bound to be a significant number of speculators looking to take some earnings off the table. 
Title: Re: Bitcoin currency (merged topics)
Post by: chad on May 27, 2017, 02:12:35 PM
My guess is it's probably profit taking.  With such a huge run up in prices there's bound to be a significant number of speculators looking to take some earnings off the table.

Makes sense. Interesting at least I'll be keeping an eye on bitcoin more.
Title: Re: Bitcoin currency (merged topics)
Post by: bigbear on May 30, 2017, 10:52:19 AM
As far as the sovereign wealth funds.  Who knows?  There's piles of money sitting in traditional financial vehicles right now.  If it does move onto the blockchain, my guess is that it will be done cautiously over a period of time.  Large piles of money aren't typically accumulated by rash behavior.


Current prices:

BTC  ~ $2600    $42.4 billion cap    50% of the entire crypto market
ETH  ~ $190      $17.4 billion cap

Large piles of money moved cautiously is still done in larger than normal increments.  But I get your point...

I believe one of the articles I linked to had Bitcoin with a 70% market share.  Interesting to see that they're about 50% now.  I believe Ether was around 15% vs. the 20% or so now.

Do you see the market share shifting as a good thing for crypto as a whole?  Or a bad thing?  Or just a thing as the market figures out which currency/technology is better?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 30, 2017, 12:18:54 PM
I think bitcoin's loss of market share is probably to be expected (although that doesn't necessarily mean it becomes less valuable in the process) with so many crypto coins competing to improve on the original concept.  Bitcoin might be supplanted by other cryptocurrency, but I don't see how anything, short of an extinction level event, kills the entire concept of storing and transferring value over a decentralized global network.

I'm still struggling with how to position my holdings going forward to best deal with these uncertainties.  While I believe crypto isn't going away, the traditional fiat system will not disappear either, at least for the next twenty years or more.  So what is the best way to straddle both worlds in the meantime, and how should one allocate their net worth between them?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on May 31, 2017, 01:37:30 PM
I'm seriously considering starting a process of dollar cost averaging out of my bitcoin holdings, at least until I get closer to a more conservative level of net worth.  I'm a believer, but not to the point of risking that many eggs in the cryptocurrency basket. 

I got this way around the end of 2013, too, during the last big bubble.  Since it popped, it hasn't been difficult for me to just continue holding them over the last few years.  But now these recent price increases are starting to gnaw at me again and I think it may be time to consider emptying the basket a bit to spread the risk around. 

Haven't quite settled on how fast to draw down, if I actually decide to go that route, but I'm trying to not let alternating greed and fear get the upper hand in the decision making process.  Easier said than done.
Title: Re: Bitcoin currency (merged topics)
Post by: bigbear on June 01, 2017, 08:54:20 AM
It's a tricky concept...  I think I agree that it's a sustainable currency.  So I'm past the confidence hold up.  But I've still got 2 hold ups:

1.  It's valuated in the US$.  Which shows the US$ is the standard bearer still.  As you said, it's tough to say (with any type of confidence) that will change anytime soon.  This hold up is relatively small for me compared to the next one.
2.  Crypto has a technological element to it as well.  And because of that is susceptible to the "next big thing" as far as valuation goes.  Look at almost any industry and you see huge shifts in the companies that dominate based on technology and manage  Retail went from homemade, local mom/pop general stores, magazine retailers, K-Mart/Wal-Mart, Amazon.
It looks like is already happening with Bitcoin and Ether.  What's next?  What's the life expectancy of crypto technology?

On the flip-side, there have been significant changes with fiscal, monetary, and financial "tools" within the fiat world over the past 50-60 years as well (from deficit spending, national debt forgiveness, taxation games, helicopter money, glass-steagall, fractional reserves, CDO, pension-type assumptions, central lending rate manipulation, etc., etc....).  A big assumption is that the way crypto works now would limit many (all?) of those "tools."  Could that change?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 05, 2017, 09:10:10 PM
BTC  ~ $2600    $42.4 billion cap    50% of the entire crypto market
ETH  ~ $190      $17.4 billion cap


Currently:
 
     ~ $2900/BTC     $47 billion     47%
     ~ $249/ETH     $23 billion
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 07, 2017, 12:51:36 AM
Finally made up my mind and initiated a test run of an automatic sell/deposit program, which I hope to ramp up over the next few months, as I become comfortable that all the cogs in the process are functioning satisfactorily.  I'm aiming for a withdrawal rate that would pay out the entire current value of my bitcoin holdings over the next 10 years, and plan to continue those monthly withdrawals until the value of my cryptocurrency holdings are back down around 10% of net worth.  I will continue to hold ethereum but probably won't add significantly to what I already have.  If coinbase offers additional altcoins I may consider adding them to my holdings.

If the bitcoin experiment crashes and burns, at least I'll have cashed out some portion of the current windfall and spread the financial risk around to other asset classes.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 01, 2017, 10:50:12 PM
Today a festering disagreement over future upgrades to bitcoin culminated in a fork of the blockchain into two separate currencies.  The bulk of the miners and exchanges are sticking with the original Bitcoin (BTC) blockchain and making some upgrades, while a more radical splinter group has formed the new Bitcoin Cash (BCH) blockchain.

The weird thing after a fork like this, if your BTC was in a wallet where you controlled the private keys, is that BTC recorded in the blockchain ledger prior to the split now also represents an equal amount of BCH in the new chain.  So, if yesterday you had 10 BTC in a paper wallet, or a web wallet like blockchain.info (but not Coinbase), today you now also control 10 BCH worth $4,300, in addition to the original 10 BTC worth $27,000.
Title: Re: Bitcoin currency (merged topics)
Post by: bigbear on August 02, 2017, 07:44:03 AM
I wonder how many are cashing out on the glitch and reinvest later?  Is there legal recourse for the wallet companies?  What would have happened had that account balance gone the other direction as dramatically?  What if that was the only currency (i.e. functioned as someone's checking account)?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 02, 2017, 12:52:43 PM
Probably a fair number are looking at cashing in their BCH windfall before it tanks, but there may also be a long term future for the new currency, either as a viable alt coin or perhaps even supplanting BTC.  Who knows?

It's the wild west out there in the cryptocurrency economy.  You can't count on .gov for redress of grievances and any losses incurred fall squarely on your own shoulders. 

Turns out, being your own bank is a big responsibility.  If you use weak passwords, reuse the same password for multiple accounts, aren't familiar with 2FA, and don't understand PGP encryption practices for verifying downloaded files, you should really rectify those deficiencies before jumping into the cryptocurrency space.  Even then you could still lose everything.  Plenty of super smart people have outsmarted themselves and lost control of their private keys, so it can happen to anyone.

Ironically, the best strategy for securing a totally digital asset is to generate a set of keys on a clean offline operating system, print several copies of this cold storage wallet to old fashioned paper, laminate them to prevent water damage, and store them in a secure metallic container, the same way you would with an equivalent amount of gold or cash.  We've got thousands of years of cultural experience in regards to securing physical assets, but only a couple decades when it comes to digital assets.  Better to go with the one you know.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 03, 2017, 08:31:33 PM
Coinbase just reversed their decision to not support the BCH fork.

Quote
In the case of bitcoin cash, we made clear to our customers that we did not feel we could safely support it on the day it was launched. For customers who wanted immediate access to their bitcoin cash, we advised them to withdraw their bitcoin from the Coinbase platform. However, there are several points we want to make clear for our customers:


Both bitcoin and bitcoin cash remain safely stored on Coinbase.

Customers with balances of bitcoin at the time of the fork now have an equal quantity of bitcoin cash stored by Coinbase.

We operate by the general principle that our customers should benefit to the greatest extent possible from hard forks or other unexpected events.

Over the last several days, we’ve examined all of the relevant issues and have decided to work on adding support for bitcoin cash for Coinbase customers. We made this decision based on factors such as the security of the network, customer demand, trading volumes, and regulatory considerations.

We are planning to have support for bitcoin cash by January 1, 2018, assuming no additional risks emerge during that time.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 04, 2017, 11:54:22 PM
     ~ $2900/BTC     $47 billion     47%
     ~ $249/ETH     $23 billion


BTC is solidly back in record territory again, after blasting through $3100 tonight, bringing its market cap to $51.7 billion, which is over 48% of the total cryptocurrency market.

The nascent BCH has been falling, almost hitting $200 today, but back up a little now.  Still, it's ranked 4th out of the all the cryptocurrencies, behind ethereum and ripple, with a market cap of $4.5 billion. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 06, 2017, 04:50:37 PM
Finally made up my mind and initiated a test run of an automatic sell/deposit program, which I hope to ramp up over the next few months, as I become comfortable that all the cogs in the process are functioning satisfactorily. 

So Coinbase emails me today:  "Unfortunately, one of your recurring payments could not be completed as scheduled.  Please verify your ID, and your recurring payments will resume."  Turns out they want to know what I use Coinbase for, the source of my funds, my occupation, and my employer. 

     Use:  selection limited to investing, trading, trading on another platform, online purchases, online payments, business
     Source:  limited to occupation, investments, inheritance, mining
     Occupation:  huge selection list
     Employer:  free text

Given that they've been operating as a regulated US financial institution from the beginning, I suspected I'd have to deal with additional "Know Your Customer" scrutiny eventually, but we're not talking large dollar amounts here.  Coinbase has a history of abruptly closing or freezing accounts they thought were suspicious.  Yet another reason why it is so important to maintain control of your private keys for the bulk of your holdings.

The bank will be harassing me next.  Then the IRS. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 12, 2017, 08:29:24 PM
Bitcoin has surpassed $4000.

Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 19, 2017, 04:03:29 PM
Against most predictions, the new BCH fork has sharply risen in value recently, going from $200 dollars a week ago to as high as $900.  Bitcoin during this same time frame has fluctuated between $3800 and $4500.

If you are still holding pre-fork BTC, the combined worth of your BTC plus the equal number of BCH is now around $5000. 

On New Year's Day that BTC was worth $1000 and the market cap of all cryptocurrencies was around $20 billion.  Today the total market cap is over $144 billion, with the top three (BTC, ETH, BCH) comprising 75% of the total.
Title: Re: Bitcoin currency (merged topics)
Post by: FrugalFannie on August 21, 2017, 11:32:51 AM
Against most predictions, the new BCH fork has sharply risen in value recently, going from $200 dollars a week ago to as high as $900.  Bitcoin during this same time frame has fluctuated between $3800 and $4500.

If you are still holding pre-fork BTC, the combined worth of your BTC plus the equal number of BCH is now around $5000. 

On New Year's Day that BTC was worth $1000 and the market cap of all cryptocurrencies was around $20 billion.  Today the total market cap is over $144 billion, with the top three (BTC, ETH, BCH) comprising 75% of the total.

SO are you trying to tell me that "somewhere" I own BCH? Where would I find this to cash it in if I desired?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 21, 2017, 01:16:22 PM
Depends on what wallet system your BTC were in prior to August 1. 
Title: Re: Bitcoin currency (merged topics)
Post by: FrugalFannie on August 21, 2017, 03:20:19 PM
Depends on what wallet system your BTC were in prior to August 1.

I use an app called Block Chain.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 21, 2017, 04:28:54 PM
Assuming that's the Blockchain.info wallet, you could use their 12 word pass phrase to convert them into a bitcoin cash wallet run by BTC.com. They just released this functionality a few days ago and state that it is stable and working for Blockchain.info and Mycelium wallets backed up with a 12 word pass phrase.

I literally just learned about it last night, still not sure I trust it enough to try it, especially since the site is owned by a Chinese mining pool. One must be wary of sites offering to process your preforked BTC into BCH because many are undoubtably scams designed to steal your $4000 bitcoins and leave you with nothing.

Coinbase has already promised to convert all their customers automatically sometime later this year. Blockchain.info hasn't yet indicated it would offer a similar service.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 24, 2017, 11:40:14 PM
Turns out, being your own bank is a big responsibility.  If you use weak passwords, reuse the same password for multiple accounts, aren't familiar with 2FA, and don't understand PGP encryption practices for verifying downloaded files, you should really rectify those deficiencies before jumping into the cryptocurrency space.  Even then you could still lose everything.  Plenty of super smart people have outsmarted themselves and lost control of their private keys, so it can happen to anyone.

I just found Crypto Dad's YouTube channel:  https://www.youtube.com/channel/UC68x_TIzqCtF69fYl2_kl3w/feed (https://www.youtube.com/channel/UC68x_TIzqCtF69fYl2_kl3w/feed)

This guy's got the right mix of smarts and paranoia when it comes to cryptocurrency, yet also a willingness to explain these complex topics to the rest of us.  I've watched three of his videos and there's valuable info for all levels here.  These are the critical skills we must become proficient in to survive and thrive in the era of digital asset ownership. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 26, 2017, 02:28:18 PM
Blockchain.info will support Bitcoin Cash. 

August 22 blog post:

Quote
Within the next 8 weeks, we’ll be rolling out limited support for BCH via the settings panel in your Blockchain Wallet. Users with balances of bitcoin in their Blockchain Wallet on August 1st will be able to access an equal balance, as of August 1st, of bitcoin cash.

While no immediate action is necessary, rest assured that your funds are secure. Blockchain wallets are non-custodial and you hold the private keys, meaning you always have full, exclusive access to your funds — which are always accessible with your recovery phrase.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 01, 2017, 05:16:29 AM
I have to confess... I'm 100% out of Bitcoin and have been since earlier this year. I support the technology and decoupling money from government is a great thing but there are some problems.

Bitcoin is suffering from long lag times. That means those of us who are trying to use it as money can't. If we can't the core users are speculators driving up the price rather than (my term) forexers looking for a new currency.

I'll also add that if Bitcoin was a stock it would be hammered from all sides for losing MARKET SHARE to the numerous upstart coins. As Etherium, Dash, Ripple, and others gain ground the water is getting muddy.

I'm long the tech, especially long term but in the here and now I definitely smell tulips.
Title: Re: Bitcoin currency (merged topics)
Post by: bigbear on September 01, 2017, 06:51:52 AM
I have to confess... I'm 100% out of Bitcoin and have been since earlier this year. I support the technology and decoupling money from government is a great thing but there are some problems.

Bitcoin is suffering from long lag times. That means those of us who are trying to use it as money can't. If we can't the core users are speculators driving up the price rather than (my term) forexers looking for a new currency.

I'll also add that if Bitcoin was a stock it would be hammered from all sides for losing MARKET SHARE to the numerous upstart coins. As Etherium, Dash, Ripple, and others gain ground the water is getting muddy.

I'm long the tech, especially long term but in the here and now I definitely smell tulips.

Thanks for stopping by.  I guess this is my biggest fear.  Love the theory and idea, but in practice it seems a tech race so the foundation shifts. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 02, 2017, 02:36:08 PM
Pretty good overview on cryptocurrency from today's PBS NewsHour:  Major companies try Bitcoin technology (https://youtu.be/T3ZbYIJv4ok)


I'm long the tech, especially long term but in the here and now I definitely smell tulips.

What will you need to see before you're willing to jump back into crypto?
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 03, 2017, 04:55:42 PM
What will you need to see before you're willing to jump back into crypto?

Actual use as currency. Processing times and costs are creeping up which was the original claim to fame. New coins are popping up daily. Virtually all exchanges are for cash, not real transactions. It's speculation. By definition it is not working as designed in the original white paper. And I believe a lot of Bitcoin speculators are actually the people who historically buy gold. It's a buy-hold-hope forex fund, not a currency.

Would you take your salary in Bitcoin? Your mortgage? Auto loan? Bitcoin (cryptos generally) just don't have the long term stability of a dollar, pound, Euro, yuan, etc. When I see that stuff, it will be stable. But the ability for speculation will have been leveraged out.

Also please bear in mind I am differentiating between Coins and Blockchain technology which I believe will usher in massive new opportunities.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 04, 2017, 01:29:43 PM
But when was cryptocurrency ever not highly speculative?  Insane volatility and risk have been the only certainties in this space from the very beginning. 
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 04, 2017, 02:36:23 PM
But when was cryptocurrency ever not highly speculative?  Insane volatility and risk have been the only certainties in this space from the very beginning. 

True. But "currency" implies stability. How can you spend and save without knowing the underlying value? If an apple cost $1 today and $0.10 tomorrow the dollar has problems. The meteoric rise of Bitcoin and lack of using it means speculative holding. And with no actual underlying value to protect it such as gold or a massive global military force.

Joe Kennedy once wisely opined that he knew to pull out of the stock market in 1929 after his shoe shine boy asked for investment advice. When I look around now I see people who couldn't explain basic stock lingo dumping money into Bitcion to strike it rich I feel the same.

Investment bubble, not currency. Once it has a crash I'll look in again.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 04, 2017, 05:42:03 PM
I'll also add that from an Austrian economic perspective the speculative bubble of Crypto has emerged during a historically low interest rate. Those of us who prefer the Austrian School believe this is the time of the greatest mistakes. Tighter purse strings (higher interest rates) will deter this kind of speculation. Or pop the bubble.

Bitcoin has seen a big bump due to the velocity of money. A recession and high interest rate could see a lot of users exit. Remember, my argument is that it is a speculative forex trade, not a currency.

Then again, I've been wrong before....
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 04, 2017, 05:59:17 PM
And with no actual underlying value to protect it such as gold or a massive global military force.

I'm not convinced of that.  Bitcoin's ultimate value is the decentralized immutability of the transaction information recorded in the blockchain ledger.  That process cumulatively represents the enormous amount of time and energy required to mine each individual block of transactions.  No physical placeholder, centralized governing authority, and/or threat of physical violence is required to enforce the transaction rules.  That's a totally novel concept in the history of civilization. 

The real genius behind bitcoin is its proof-of-work consensus algorithm (ie. the competitive mining process used for transaction accounting) outlined in Satoshi's white paper.  The fact that Satoshi referred to it as "coin" or "currency" probably has the least relevancy to what bitcoin actually represents.  It's far weirder and more powerful than either of those traditional terms imply.

Of course that doesn't rule out future bubbles.  We've been through several already in less than a decade, and I'm sure there will be more.

(https://farm5.staticflickr.com/4429/36197418714_d59d955cc8_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on September 04, 2017, 06:30:13 PM
Joe Kennedy once wisely opined that he knew to pull out of the stock market in 1929 after his shoe shine boy asked for investment advice. When I look around now I see people who couldn't explain basic stock lingo dumping money into Bitcion to strike it rich I feel the same.

1980, gold hit its high.  I remember it well, because my wife and I were shopping for wedding rings. :facepalm:

The jewelry counters at department stores were teeming with... well, people who appeared to be very unsophisitcated financially, and the stores didn't even have price tags on the jewelry.  They just had letter or color codes, and the prices were shown on a chart and adjusted as gold's price went up and down (or mostly up and up for much of the year).  All jewelry, even the junkiest workmanship, was selling at a substantial multiple of its melt price.

We saw the same thing just before the dotcom stock crash, and just before the housing market crash.

A few days ago I saw some guy on Facebook asking how to buy bitcoin, and it was clear he didn't even know what it is, but he got a little advice from random people and bought some within a few hours.

I can't guarantee there's going to be a crash soon (or ever), but this does have the feel of a bubble, and the main function of a bubble is to suck wealth from the wallets of the uninformed masses.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 04, 2017, 08:06:20 PM
Why does "mining" Bitcoin have any value? Solving complex computer algorithms is actually a meaningless event. If you mine bauxite, you actually have bauxite. Mining Bitcoin you have... nothing.

A currency only works because something is behind it. That could be a commodity like gold or a vast military force. If there was a competition to solve calculus problems I'd do really well. I'd fail if it was based on baseball trivia. Why would we assign currency value to it?

I like crypto in the long term but if you bet on a stock that had no underlying value, lost market share continually, and had no cost to entry to competitors you'd be a fool. I'll let it stabilize before I get back in.

I love the Bitcoin chart. If you google image search tulip mania it looks kinda similar.

I could be wrong......... I've been buying gold mining stocks of late.
Title: Re: Bitcoin currency (merged topics)
Post by: Alan Georges on September 04, 2017, 08:57:23 PM
Why does "mining" Bitcoin have any value? Solving complex computer algorithms is actually a meaningless event. If you mine bauxite, you actually have bauxite. Mining Bitcoin you have... nothing.
With bitcoin, what you have is proof that you burned compute cycles.  Yeah, I know, that's kind of weird.  It's like if you mined, I dunno, dark matter and put it in a bottle.  Nobody can see it, but yeah, it's there alright, and I can prove that my dark matter mining machine went through the proper mining procedures to gather this much dark matter.  Or at least, somebody's dark matter mining machine did the work and I later traded them something of value for that jar of dark matter.  Like I said, weird.  But it's not precisely nothing.

Bitcoin (and similar schemes) has another thing going for it that no preceding electronic money system ever had, its developer(s) solved the scarcity problem.  No previous e-curency scheme has had this one locked down.  Even when it comes to "real" money, dollars and euros can be waved into existence without limit, but in an analogy to physical mining, there'll only ever be a certain amount of bitcoin.

Quote
A currency only works because something is behind it. That could be a commodity like gold or a vast military force. If there was a competition to solve calculus problems I'd do really well. I'd fail if it was based on baseball trivia. Why would we assign currency value to it?
Because we can trust that somebody burned compute cycles on it, and that the market'll never be flooded with wheelbarrows of freshly-printed bitcoin notes. 

David, I know this sounds like I'm some kind of bitcoin proponent, and really I'm not.  I don't own any, and never have.  Frankly I don't understand it well enough to put any worthwhile amounts of money into it.  I just think that it's interesting that this shadowy person or group of people have put together something that's in many ways more open and honest than "respectable" central bank currency.

And yeah, it looks awfully bubble-ly to me too.  Gold mining stocks are probably less risky.  At least you have something you can point to and say "See, I own x% of that mine over there."
Title: Re: Bitcoin currency (merged topics)
Post by: mountainmoma on September 04, 2017, 09:03:56 PM
I am not and have not bought any for a couple reasons, but the first reason was that I have no interest is paying the people who "mined" the original bitcoins ! This has no value to me. Yes, I understand they spent time on it. I spend time on alot of things too, and no-one throw money at me for it.  Second reason is it has fluctuating value and is treated by people as an investment. It seems like, if its value held still, that it could be an interesting way to move money over borders. Right now it definitely looks like an investment vehicle in bubble mode.
Title: Re: Bitcoin currency (merged topics)
Post by: Alan Georges on September 04, 2017, 09:15:52 PM
... It seems like, if its value held still, that it could be an interesting way to move money over borders.
There was an episode about bitcoin last month on In The Rabbit Hole where the guest brought up this very thing.  Moving to Canada about seven years ago, it took a week-plus to transfer his bank accounts over, with $75 wire transfer fees at every turn.  He joked that he could've loaded gold bars into a conestoga wagon and gotten it there faster.  Then a couple of years ago when he moved back, he moved it through bitcoin and it was all done at internet speed.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 04, 2017, 10:09:04 PM
Alan Georges gets it.

It's like teleporting gold.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 05, 2017, 07:18:13 AM
I have owned Bitcoin. But not currently. I was a proponent early on but the problems are becoming evident.

I can prove that time and effort went into printing the dollars in my billfold. I mean they took the effort to serialize each one and they have shiny reflective numbers so there must be inherent value there, right?

Solving algorithms isn't providing any value. If I could prove I had dug a hole and then filled it in I'd be a fool to expect to be payed for my labor. Proof of labor is meaningless without value creation.

It's like teleporting gold.

I don't see how. Put it this way... For at least 100 years an ounce of gold has bought a fine suit for a man (sorry ladies but this is math I know). It's actually a cliche in wealthy circles. Gold has held stable among a basket of commodities. Are we really at a point where algorithms are commodities? A silver quarter from 1960 still buys a gallon of gas. Bitcoin could double or halve in an hour. The comparison to metals doesn't quite work for me.

Now I will concede that the blockchain does have massive value as a distributed ledger. And I'm sympathetic to decoupling currency from the government seeing how they have managed it. But I still see a speculative bubble.

Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 05, 2017, 02:30:51 PM
Put this into perspective...

There are as of right now 12 cryptocurriencies with over $1 billion in market cap. 97 have market caps over $1 million. The top 3, Bitcoin, Bitcoin Cash, and Etherium have a combined market cap of $110 billion.

Does Ripple deserve an $8 billion market cap? Are these coins really providing so much value that we need over 600 of them? Is Zcash really better than Monodo? Does it give you pause that even the programmers couldn't agree on how Bitcoin should run and it had to be forked? Same with Etherium? Bitcoin is really worth twice that of Ford Motor Company?

If you step back and start looking at the valuations here this looks like a bubble. I hope I'm wrong because a lot of good people will lose a lot of money if I'm right. But the math doesn't lie.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 05, 2017, 02:37:54 PM
There is a method to the apparent madness of the mindless hashing required by the proof-of-work algorithm.

The value in the proof-of-work algorithm comes from the prohibitively high cost in time, hashing power, and electricity that would have to be spent in order for a bad actor to attempt to change transactions already recorded in the blockchain.  Every ten minutes a new block of transactions is added to the chain and with that time pressure it makes more economic sense for a bad actor to spend his resources competing for the legitimate mining reward for finding the next block rather than trying to change the previously recorded transactions in the chain to his advantage.  This is how the traditional problems of double spending and counterfeiting is prevented.

That's the genius of using the blockchain's proof-of-work in a distributed network where nobody can ever really trust anyone else, and yet allows for the information and transactions recorded in it to be trusted without utilizing a central authority.  Since 2008 Bitcoin has used this method of adding blocks of transactions to the chain every 10 minutes without fail, despite the efforts of the world's best minds to break it.  The technology works and has value.  The question is how much value and how long before something better comes along? 
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 06, 2017, 10:22:17 AM
I would not have expected to discover that Roger Ver agrees with many of my arguments. He is on the latest Vin Armani show and complained that Bitcoin has increased transaction cost and transaction time to the point that it may no longer be a viable currency. He predicts that the breakout success will not be Bitcoin adding that if it is prohibitive to use in a business it will rapidly fail as an investment.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 06, 2017, 01:41:00 PM
Well, Ver managed to hardfork Bitcoin Cash to increase transaction volume, so we'll see how his vision pans out. If you owned bitcoin prior to August you now also have an equal amount of Ver's nascent currency, too, so you can participate at no added cost.

I honestly never saw the use case of buying coffee with bitcoin as being especially compelling from a personal perspective.  It always seemed better suited to larger transactions where the added security of the bitcoin blockchain was worth the added time and hassle involved with the confirmation process.  Think situations where you would wire money between financial institutions or selling a kilo of gold with assay fees.  Bitcoin transactions create much less friction per dollar value transferred and is effectively instant compared to those traditional methods.

There will be other coins that are better suited to buying coffee. This was anticipated early on and was the impetus behind Litecoin, the first altcoin launch back in 2011, which has a 2.5 minute block creation time compared to bitcoin's 10.

But who knows, it could all disappear overnight. Crypto is an experiment, not an investment plan. Never risk more than you can afford to lose forever.  And don't bother if you're not willing to learn how to keep digital assets a secret. That's the biggest risk, in my opinion, losing control of the private keys that are the only way to prove you own the assets recorded on the blockchain. That's what keeps me up at night. Many days I think it would almost be better for my sanity if it all crashed to zero tomorrow and I could just go back to relying on the government backed banking system to keep my wealth safe and sound.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 06, 2017, 01:56:34 PM
Seems to be the motivation of the Bitcoin programmers. At $8 per transaction you're better off pulling out Visa until you get to the $300-$400 range (depends on the contract).

Perhaps the idea is to mirror gold. While we all recognize gold can be currency it's way too pricey for common use. I tend to side with Ver. If Bitcoin can't dominate market share and get costs down to marginal, what's the point? High cost long transactions have been handled by Western Union for years. And losing market share on purpose isn't usually a good strategy.

From what I've learned I'm more bullish on Etherium and Dash. But I'm a mediocre programmer at best and altcoins aren't a business I really understand. So I don't gamble in them. And I hate to be dismissive but Bitcoin and Bitcoin dollar has that same feel as "New Coke". If the development team can't agree what to do it's usually a red flag.

I hope I'm wrong. I'd love to see the dollar supplanted by a free market currency. I doubt we're there yet.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 06, 2017, 05:59:14 PM
Ver's not a developer, he's more of an activist investor who wound up in the minority on the block size debate so decided to go with Bitcoin Cash anyway.

Not that there's anything wrong with that, and it's almost expected in the anarchocapitalist world of cryptocurrency.  Nobody's ever had to figure out how to govern the software upgrades to the consensus algorithm of a distributed payment system that has no central leadership.  It behaves more like a biological system adapting to evolutionary pressure.  So it's brand new territory that doesn't correlate with what we've learned to expect from our existing financial systems. 

I rely on Andreas Antonopoulos for enlightenment in this space.  Everyone else winds up selling out at some point, their objectivity goes to hell, and they start pumping scam coins and spreading fud.  He has managed to avoid those enticements and really has dedicated himself to educating average people about crypto when he could easily be fleecing the flock like the majority of the talking heads out there.  He is adamant that none of these coins should be treated as an investment.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 06, 2017, 07:52:13 PM
Ver's not a developer, he's more of an activist investor who wound up in the minority on the block size debate so decided to go with Bitcoin Cash anyway.

Never said otherwise.

I actually follow Antonopoulos as well. As fate would have it he was security officer for a few years at Blockchain.info which was partially bankrolled in its infancy by Ver and (wrote it somewhere around here) my preferred Bitcoin exchange. It's Tor based and you keep your private keys. Not as user friendly as Coinbase but much more secure.

It's not that I don't understand the tech, I held Bitcoin for a while. I even did my best to use them. I'm just applying the metrics I would to any other investment or forex position.If the Yuan fluctuated 20% overnight I wouldn't buy it either.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 06, 2017, 08:36:38 PM
Yeah, I don't have any complaints about blockchain.info's web wallet, but it's always a bit disconcerting when Andreas recommends against using a web wallet, yet won't say a word either positive or negative about blockchain.info since he parted ways.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on September 09, 2017, 05:37:49 PM
http://deadcoins.com/

"Curated list of cryptocurrencies forgotten by this world."  Currently contains 592 dead cryptocurrencies.
Title: Re: Bitcoin currency (merged topics)
Post by: Alan Georges on September 09, 2017, 06:19:17 PM
http://deadcoins.com/

"Curated list of cryptocurrencies forgotten by this world."  Currently contains 592 dead cryptocurrencies.
What?!?!  Coinye (https://en.wikipedia.org/wiki/Coinye) is kaput?!?
I suspect Taylor Swift had a hand in this.   :tinfoily:

And Cthulhucoin?  It's not dead; it's waiting, dreaming, in R'lyeh.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 09, 2017, 06:29:04 PM
And Crapcoin, too?  Say it ain't so.....
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 10, 2017, 07:02:06 AM
http://deadcoins.com/

"Curated list of cryptocurrencies forgotten by this world."  Currently contains 592 dead cryptocurrencies.

With a combined market cap loss of $1,246,937 not counting scams and the $28 million lost in Speedcoin. But then these coins lacked the one thing Bicoin, Bitcoin Cash, Etherium, Dash, and the American Dollar all have... our confidence.

Any other industry this would be a massive red flag. I don't understand why currency is so unique.
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on September 12, 2017, 07:45:59 AM
From today's news:
Hackers linked to North Korea are ramping up attempts to steal bitcoin in order to bring in money for Kim Jong Un's regime, a top cybersecurity firm says. Bitcoin and other forms of virtual money -- known as cryptocurrencies -- appeal to North Korea as the U.S. pursues international sanctions aimed at further isolating the country, according to a new report from FireEye.

"Sanctions against North Korea are likely to fuel their cybercrime activity," said Bryce Boland, Singapore-based chief technology officer with FireEye. "Attacks on cryptocurrency exchanges can be a great vehicle to obtain what is ultimately hard currency."

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on September 29, 2017, 05:10:33 AM
Fidelity CEO is open that they're into crypto.

https://www.yahoo.com/finance/news/fidelity-ceo-abigail-johnson-says-173509444.html

Interesting that the article calls out Jamie Dimon for being bearish while JP Morgan is buying.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 08, 2017, 08:14:48 PM
I finally got around to configuring my network to allow incoming connections with the Bitcoin Core software running on an old laptop, which allows it to function as a full node on the bitcoin network.

https://bitcoin.org/en/full-node#what-is-a-full-node (https://bitcoin.org/en/full-node#what-is-a-full-node)
Quote
A full node is a program that fully validates transactions and blocks. Almost all full nodes also help the network by accepting transactions and blocks from other full nodes, validating those transactions and blocks, and then relaying them to further full nodes.

Most full nodes also serve lightweight clients by allowing them to transmit their transactions to the network and by notifying them when a transaction affects their wallet. If not enough nodes perform this function, clients won’t be able to connect through the peer-to-peer network—they’ll have to use centralized services instead.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 12, 2017, 06:26:44 AM
New high of $5200.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 20, 2017, 02:13:39 PM
Bitcoin just blew through the $6000/btc and $100 billion market cap levels.  The entire cryptocurrency market is valued at $175 billion.

BTC started this year at $1000.


Blockchain.info wallets now handle bitcoin cash and all BTC held prior to the split have been converted automatically to BCH.
Title: Re: Bitcoin currency (merged topics)
Post by: Ice Age Farmer on October 20, 2017, 09:55:50 PM
Disclaimer:  I used to mine, and still own, some Bitcoin.

That said, I don't trust this crypto'currency' any further than I can throw it.  Which I can't.  Because I can't hold it.  I think Puerto Rico has demonstrated pretty effectively that you can't use it in any sort of emergency/grid-down situation.

Also, buyer beware these ICOs; as time goes on, we see more and more of them languishing or being outright scams:

http://www.zerohedge.com/news/2017-10-19/worlds-largest-ico-imploding-after-just-3-months

But, just my 0.0004BTC...
Title: Re: Bitcoin currency (merged topics)
Post by: HanaHH on October 21, 2017, 02:34:45 AM
Also think that Bitcoin is going to banned in hole world
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 21, 2017, 10:26:39 AM
Looking at this chart, it appears that bitcoins recent rise is coming at the expense of the other currencies.  The overall crypto market is down $2 billion since yesterday, while bitcoin has added over $2.5 billion to its market cap.

(https://farm5.staticflickr.com/4494/37802127792_f72c50178c_o.png)
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on October 21, 2017, 09:11:45 PM
If Bitcoin is the new gold, why hasn't gold gained alongside Bitcoin?

Yes, the cryptos are eating each other.

But what do they really offer? Stocks offer gains and dividends. Metals offer a store of wealth. Bitcoin is a currency that takes 30 minutes to close a sale.

I could be wrong. And those who held the Bitcoin I sold were correct... for now. I can't tell you when this will collapse.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on October 23, 2017, 08:32:41 AM
Saudi Prince Alwaleed spoke on CNBC this morning.

Re Bitcoin: "Enron in the Making."
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 23, 2017, 10:11:59 AM
He went on to say, “it doesn’t make sense. This thing is not regulated, it’s not under control, and not under the supervision of any central bank.”

That’s what decentralized means, your highness. It’s a feature, not a bug.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on October 24, 2017, 03:35:39 PM
He went on to say, “it doesn’t make sense. This thing is not regulated, it’s not under control, and not under the supervision of any central bank.”

That’s what decentralized means, your highness. It’s a feature, not a bug.

But he has a point. All global currencies but metals and Bitcoin have a military to back them up. Metals have intrinsic value. Bitcoin is fiat without the muscle. The only thing propping up global currency is the might of the issuing country. Think petrodollar. While I love the decentralization of money, he offers a very good argument.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 24, 2017, 08:57:30 PM
Bitcoin is a unique experiment, both technologically and economically, and as such could fail spectacularly at any time.  It's also, at least in part, a reaction to the financial crisis of 2008, which saw governments and central bankers bailing out financial institutions while tax payers got screwed.  A prime goal of bitcoin has been to establish whether or not it was possible to distribute a public ledger for the purpose of storing and trading value over a global network without central governance. 

So, yes, Prince Al-Waleed is exactly correct, bitcoin does not have intrinsic value (whatever that is) like gold, and no military backing nor central bankers like fiat.  But that's also the whole point of the bitcoin experiment.

I'm not an anarchist.  And many libertarians probably wouldn't claim me.  I don't see the state, its fiat, nor its threat of violence at the end of a gun going away anytime soon.  So I'm still heavily committed to traditional USD denominated assets.  But bitcoin offers a glimpse into the future.  The first bitcoin block was mined in January 2009 and new blocks have been added roughly every 10 minutes since then, solely driven by market forces and a consensus algorithm coded in software.  It's weathered hacking attempts, thefts, price bubbles, failed exchanges, government censorship, software upgrades, and copycat competitors over the better part of a decade.  That's quite an impressive achievement, especially for something with no central governing authority.

I think the underlying blockchain technology is sound and has enormous potential.  That particular Pandora's box will not be closed, short of an extinction level event.  But it's still uncharted territory and bitcoin could all go to zero tomorrow in favor of a superior technology.  As such, any participation in the bitcoin market should be treated as highly speculative.  Extremely speculative.

Don't risk what you can't afford to lose forever.  I risked very little back in 2012/2013, less than 1% of what I was worth back then.  That investment has grown 10,000%, which on paper represents far more of my net worth than I'm really comfortable with long term, so I'm in the process of selling monthly at a rate of about 5% per year and I seriously doubt I will ever risk USD for additional BTC purchases.  That's where my comfort level is right now, and I'm OK with waking up tomorrow, or 10 years from now, and finding it's all vaporized into the ether.  I suppose many would sell it all right now to avoid losing those gains, but that would have tremendous tax implications, plus the risk of banking scrutiny for money laundering, and so I decided to at least start the process slowly and see how it goes.  Plus, all I know is HODLING when it comes to investing, anyways, so this was the middle path I thought would work best for me.

WARNING:  Just because I have personal exposure to bitcoin does not mean I'm comfortable with anybody else reading this thread and putting hard earned USD into BTC, which is currently trading between $5-6k, and then waking up tomorrow and finding it's all gone.  I'm really not comfortable with that at all.  And I think if you read this thread from the beginning you will see that I've been pretty consistent about the speculative nature of investing in this space.  You're on your own.  I'm on my own.  We each are free to suffer the consequences of our own decisions.
Title: Re: Bitcoin currency (merged topics)
Post by: bigbear on October 25, 2017, 09:25:42 AM
Thanks FreeLancer for your contributions to this thread.  I've learned quite a bit about bitcoin and blockchain reading through this thread and searching different topics in the thread. 

Crypto-currency definitely has an ideological appeal.  And maybe that ideology is the 'intrinsic value' that gives it market value...? 
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on October 25, 2017, 11:25:00 AM
I actually have a very similar story. I began in 2010-2011 and likewise put a small amount of money in. I traded it (I'll put some trading info below if anyone is interested). I, however am an anarchist and came to it from that angle. I want a decentralized currency and I think governments should be punished for what they have done to theirs. I actually tried to do as much as I could in Bitcoin.

Trouble is, nobody really spends Bitcoin. Even other people with my political stance don't really do it. Even at libertarian conventions where silver and gold are common Bitcoin just doesn't trade hands all that much. It got me worried.

When the time to resolve transactions finally got too great to ever pretend that this was a currency, I sold. And in 2016 I made a lot of money in Bitcoin. I'm not joking when I say it was the trade of my life. I will never get such a return again.

But I also look at the people hyping Bitcoin. They don't have any experience currency trading. Most lack an understanding of economics. Many can't program. While I would never consider myself a coder, I speak C++. I would parse new coins based on their business model and source code. I felt alone.

I'm bullish in the long run. I think Blockchain is already improving our lives with things like food safety and the tech will grow. I think there will be a crypto in the future that works. I don't know how it will but I doubt we've seen the right one yet. Clearly they all have issues. And I track the coin based businesses like Swarm City which I think have great potential. This is disruptive technology.

If nothing else, Bitcoin at least got people thinking about the evils of central banking. That's good. And I enjoy the debate. Both sides have compelling arguments.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 26, 2017, 12:52:57 AM
Crypto-currency definitely has an ideological appeal.  And maybe that ideology is the 'intrinsic value' that gives it market value...?

I think that anarchist/libertarian/cypherpunk ideology was a critical force that bootstrapped BTC from nothing in its early years, but my impression is that the ideological enthusiasm began to fade away about the time Satoshi disappeared from the project and hit a low point with the Mt Gox implosion and the takedown of Silk Road.  This latest bitcoin price surge seems driven more by tech and finance entrepreneurial types, rather that ideologues, plus there's just more hype in the media this time around.  Just look at all the YouTube shills for every crapcoin and ICO you can imagine.

Honestly, at least in the US, bitcoin is a technological solution to a problem we don't really have at the moment.  We've got banks and credit cards and the ability to move money between accounts without much expense.  That's not true of most of the world and some of those places will wind up using bitcoin to solve real life problems before we do.  It didn't take Venezuelans long to figure out the arbitrage opportunity in using government provided electricity to mine bitcoins that could be converted to Amazon.com gift cards they could buy food with to keep from starving to death.  At this point I don't think we've seen the killer application for cryptocurrency or blockchain technology in the developed world, it might be another decade before that's found and who knows if bitcoin will be the technology that powers it by then. 

It's like the internet in the early 90's, where it's really hard to tell what the technology will ultimately be useful for and how it will disrupt the status quo.  How many years did it take before your mom had an email account or was brave enough to try buying anything online?  How many people thought AOL and Yahoo would be relevant players 20 years later?  Plenty of predictions back then turned out to be wildly off mark, in both directions, because it's hard to predict the future.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 29, 2017, 10:35:38 PM
Another impending bitcoin hard fork, known as SegWit2x, is fast approaching in the next few weeks.  It's looking like it may be the most contentious one we've seen yet, with many afraid that the fork implementation is recklessly exposing current bitcoin holders to potential losses through something called a replay attack, or even outright theft.  These risks are more likely to occur with wallets that many bitcoin holders are using, especially those that do not utilize a full node server for monitoring the validity of transactions submitted to the blockchain. 

A full node wallet, like that found in the Bitcoin Core wallet (the current iteration of the original software that bitcoin was built on from the beginning), is somewhat cumbersome because it requires that a current up-to-date copy of every single bitcoin transaction since 2009 be maintained on your computer and synchronized with all the other nodes in the bitcoin ecosystem.  This requires about 200GB of storage and days to weeks of downloading to get a full synchronized copy of the entire blockchain, which is why most people use the more vulnerable lightweight wallets.

The Bitcoin Core developers (the guys who know the most about how bitcoin works) are warning bitcoin holders to move their holdings from Blockchain.info, Coinbase, Bitpay, and Xapo to the latest version of their Bitcoin Core software, which is currently 0.15.0.1.  For those not able or willing to go to the effort of downloading the entire blockchain, they suggest using services like GreenAddress, Electrum, or TREZOR, but to not spend any coin from those services until well after the outcome of the fork is known, in order to avoid losing bitcoin to unscrupulous and/or incompetent actors. 

This could have been avoided if the SegWit2x faction had the decency to program their software change to not allow replay attacks, but that is something they have not committed to, which is why this could be a very contentious split, with overtones of an attempted hostile takeover by a small group within the bitcoin ecosystem.

It's time to hunker down and keep your coins close until this all shakes out.  But be careful, move slow, stick with the technology that you know the best.  This is not the time to be clever and outsmart yourself by trying something new and untested.

Warning from the Core Developers at Bitcoin.org:  Beware of Bitcoin's possible incompatibility with some major services (https://bitcoin.org/en/alert/2017-10-09-segwit2x-safety)
Quote
A subsection of the Bitcoin economy including prominent businesses such as Coinbase, Xapo, and BitPay have signed an agreement to adopt and implement a contentious hard fork of Bitcoin sometime in November. A hard fork is a backwards incompatible change to the Bitcoin network. This hard fork is not supported by the majority of the Bitcoin users and developers and is therefore a contentious hard fork. By adopting this hard fork, we believe the supporters of this agreement are shifting their users to an alternative currency (an altcoin) which is incompatible with Bitcoin.

The signatories of this agreement wrongly believe that the currency created by adopting this contentious hard fork will eventually become Bitcoin. Therefore storing any BTC on services such as Coinbase, Bitpay and Xapo is strongly not recommended. By storing BTC on these services, you could find that after the hard fork, your BTC has been renamed to something else or replaced entirely with the new altcoin. The best way to ensure that your BTC is protected is to download the latest version of Bitcoin Core and transfer out any BTC stored on services that are a signatory to this agreement. We have listed the businesses supporting this contentious hard fork at the bottom of this document.

For users who aren’t prepared to install Bitcoin Core and go through the lengthy set up process, we recommend a wallet such as GreenAddress, Electrum or TREZOR. Avoid using web wallets like blockchain.info. However users should only use these wallets to store their coins and never perform transactions until well after the hard fork. Any transactions you make on the Bitcoin blockchain can also be replicated and “replayed” on the altcoin chain. If the coins on the contentious hard fork have any value, there will be methods you can use to “split” your coins and have access to them. Pay extra attention to major Bitcoin communication channels and media shortly after the fork so you stay informed.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 02, 2017, 01:15:56 AM
BTC is around $7,000 with a market cap $117 billion.  The 12 month low was $700.

If you add in Bitcoin Cash's $540 price, 10 bitcoins that were worth $7,000 a year ago are now worth more than $75,000.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 02, 2017, 10:14:58 PM
(https://farm5.staticflickr.com/4458/38129444341_85cef2e413_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 03, 2017, 08:01:49 PM
CNBC:  Largest US bitcoin exchange added 100,000 customers in one day after futures announcement (https://www.cnbc.com/2017/11/03/coinbase-adds-100000-users-after-cme-announces-bitcoin-futures-plans.html)

Quote
Investors rushed to open new accounts for buying and selling bitcoin after news that the world's largest futures exchange plans to launch futures for the digital currency this year.

About 100,000 new users joined Coinbase a day after the Tuesday announcement, according to public data compiled by Alistair Milne, co-founder and chief investment officer of Altana Digital Currency Fund.

Coinbase is the largest bitcoin exchange in the U.S. and one of the most popular ways to buy and sell digital currencies bitcoin, ethereum and litecoin. The company now has 11.9 million users, according to its website.


Forbes:  How High Can Bitcoin Go? (https://www.forbes.com/sites/investor/2017/11/03/how-high-can-bitcoin-go/#d9cd12b109c4)

Quote
Firstly this is a game of round numbers. Round numbers shouldn’t have any effect on prices but in practice they do. Approximation is a good skill to have in markets and people are draw to them as targets. So let’s get the obvious target for Bitcoin out of the way:

$10,000.

This is an extremely high probability.

Quote
What people often forget about Bitcoin and cryptocurrency is that the market cap of the whole sector is currently just about $200 billion, the equivalent of one decent NASDAQ company. If you think Bitcoin is a hula-hoop, then it is currently expensive, but if like me you see blockchain as the next big thing, the current levels are trivial.

The next level for me is $50,000 a Bitcoin. This makes Bitcoin a trillion dollar asset. This is a real thing.
Yet with perhaps 300 trillion dollars of equities and bonds out there on earth, it’s still not exactly creating a revolution.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on November 07, 2017, 02:17:45 PM
Motherboard, 11/7/17: Someone ‘Accidentally’ Locked Away $300M Worth of Other People's Ethereum Funds (https://motherboard.vice.com/en_us/article/ywbqmg/parity-multi-signature-wallet-vulnerability-300-million-hard-fork)

Quote
On Tuesday, a single user permanently locked down dozens of digital wallets containing nearly $300 million dollars worth of ether, the unit of exchange on the Ethereum platform, allegedly by accident. ...

 The affected wallets—known as "multisignature" wallets because they require multiple people to sign off before funds are moved, making them popular with companies—were all created with Parity, a popular program for digital wallets. Parity multisignature wallets experienced a bug in July that allowed a hacker to steal $32 million in funds before the Ethereum community scrambled to band together to hack back and secure the rest of the vulnerable ether.

According to a blog post released by Parity on Tuesday, the code that fixed the July bug contained another vulnerability. That vulnerability allowed a user known as "devops199" on GitHub, a site for developers to collaborate on open source code, to allegedly accidentally trigger a function that turned the contract governing Parity multisignature wallets into a regular wallet address and made him or her the owner. Devops199 then killed this wallet contract, or, as Parity put it, "suicided" it. This made all multisignature wallets tied to that contract instantly useless, their funds locked away with no way to access them. ...
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 07, 2017, 04:20:17 PM
Ethereum’s programmability, supposedly its strength, has so far been its biggest weakness from the beginning.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 07, 2017, 10:38:42 PM
US News & World Report:  What's the Best Bitcoin Wallet? (https://money.usnews.com/investing/investing-101/articles/2017-11-06/best-bitcoin-wallet-of-2018) 
Quote
#5 Coinbase, #4 Blockchain.info, #3 Electrum, #2 Leger or Trezor, #1 Paper wallet.


I'm pretty much in agreement, but currently I think I prefer the Electrum software wallet in cold storage mode over the Trezor or Ledger, mostly because I just recently started playing with hardware wallets and feel like I can understand and better control how my keys are being stored and accessed with Electrum.

Electrum really does a lot of things very well, and it works on Windows, macOS, Linux, and Android, and can be used with a hardware wallet, as well.  I've used it on several Macs, as well as in the Tails Linux distribution (I personally wouldn't trust Windows with significant amounts of bitcoin).  It provides the ability to generate and store wallet keys on an airgapped computer that you never allow online ever again and export a master public key to a second online computer to generate a watch-only wallet.  This second computer will interface with the network for transactions, but when you need to send a bitcoin transaction that requires a signature with the private keys it will save an unsigned copy of the transaction to a file that can be opened by the airgapped computer, which signs and save the transaction file to be transferred back to the online machine for broadcasting to the network.  It sounds complicated but Electrum makes it easy to do.  A couple youtube vids and you're good to go.

The other nice thing about having an airgapped computer is the fact that it makes the perfect platform for generating secure paper wallets using the bitaddress.org webpage, too.  Get an old basic printer that doesn't have any wireless connectivity to print out the paper wallet address and keys and you're good to go.

Remember, whatever method you choose, you must start slow and experiment with small amounts before committing significant amounts of coin.  Make sure you can reliably perform all the steps necessary to get your coins back out of the wallet after you've put them in there.  And practice the steps a few times over a few days so it really sinks in.  Otherwise, you might wind up outsmarting yourself in the process of trying to keep your coins safe.  It's like burying gold out in the back forty, you need to take some steps to make sure you can find it again when you really need it. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 08, 2017, 12:26:09 AM
Wired:  ‘I Forgot My PIN’: An Epic Tale of Losing $30,000 in Bitcoin (https://www.wired.com/story/i-forgot-my-pin-an-epic-tale-of-losing-dollar30000-in-bitcoin/)

This freaky little story popped up in my feed literally hours before I was planning on major cold storage changes.  Spooked me into double checking everything for another three days before I finally pulled the trigger on the transfers, and that was in addition to the week I'd already spent prepping and testing all the computers and drives involved in the new scheme.


I heard a similar story on a podcast in early 2014, where a young couple related how they'd put their entire 1,000 bitcoins into an encrypted paper wallet but then lost the encryption key a month later.  That was briefly worth a $1 million back then, it's $7.4 mil now.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 08, 2017, 05:37:20 AM
Wired:  ‘I Forgot My PIN’: An Epic Tale of Losing $30,000 in Bitcoin (https://www.wired.com/story/i-forgot-my-pin-an-epic-tale-of-losing-dollar30000-in-bitcoin/)

This freaky little story popped up in my feed literally hours before I was planning on major cold storage changes.  Spooked me into double checking everything for another three days before I finally pulled the trigger on the transfers, and that was in addition to the week I'd already spent prepping and testing all the computers and drives involved in the new scheme.


I heard a similar story on a podcast in early 2014, where a young couple related how they'd put their entire 1,000 bitcoins into an encrypted paper wallet but then lost the encryption key a month later.  That was briefly worth a $1 million back then, it's $7.4 mil now.

Not a rare story, it's happened to at least two friends of mine. The trader in me is curious what the actual float of Bitcoin is. We may never know.

Roger Ver was on Tom Woods' podcast to discuss crypto. Interesting discussion.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on November 08, 2017, 02:25:02 PM
Wired:  ‘I Forgot My PIN’: An Epic Tale of Losing $30,000 in Bitcoin (https://www.wired.com/story/i-forgot-my-pin-an-epic-tale-of-losing-dollar30000-in-bitcoin/)

This freaky little story popped up in my feed literally hours before I was planning on major cold storage changes.  Spooked me into double checking everything for another three days before I finally pulled the trigger on the transfers, and that was in addition to the week I'd already spent prepping and testing all the computers and drives involved in the new scheme.


I heard a similar story on a podcast in early 2014, where a young couple related how they'd put their entire 1,000 bitcoins into an encrypted paper wallet but then lost the encryption key a month later.  That was briefly worth a $1 million back then, it's $7.4 mil now.

I had something similar happen.

Hard drive that had my Bitcoin account on it fried... I had my account information and password written down on a piece of paper, my 3 year old (at the time) decided to doodle all over it.


It was a fraction of a single coin (something like .72), and at the time was a few hundred bucks.

Now, I guess it's a few thousand :(
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 09, 2017, 01:57:54 AM
Another impending bitcoin hard fork, known as SegWit2x, is fast approaching in the next few weeks. 

The planned for next week SegWit2x fork has been called off, possibly permanently, reportedly due to a lack of consensus among the businesses backing the block size change, as well as backlash from bitcoin users.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 11, 2017, 09:50:55 PM
The last few days have been interesting.  BTC ran up above $7800 immediately following the cancellation of SegWit2x, but soon went into free fall and is currently down to $6000.  Meanwhile, BCH (Bitcoin Cash, which forked from BTC in August) has run up to $1800.  As luck would have it, I traded most of my BCH in for BTC a week ago, in preparation for the fork.  I have a few BCH tied up in Coinbase, but I don't think they're going to be available until January.

(https://farm5.staticflickr.com/4542/38349695241_eb82b1a8d6_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: Speaker0311 on November 12, 2017, 06:40:43 AM
I would keep a close eye on dash.
When they roll out the "evolution" wallet they will be a serious contender for the crown, I think.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 14, 2017, 02:58:06 PM
SO just to be clear, Bitcoin and Bitcoin Cash run the same fundamental software, mine the same, and operate almost identically except that Bitcoin takes hours to resolve and costs upward of $40 while Bitcoin Cash costs nothing and resolves immediately? I'm no genius but I think I know who wins this currency war. Bitcoin shot itself in the foot not doing its last fork.

For what good my handicapping is since I don't do crypto right now, Bitcoin looks like its going the way of the dodo, Etherium scares me, and I have a hard time deciding who looks better between Dash and Bitcoin Cash. But if Bitcoin craters as I expect it has the possibility to poison the entire well.

Last, I'll just reiterate that those "investing" in coins should be very careful. These have the potential to be up 70% in a day or two and fall just as fast. And with no underlying value (even a badly run company has capital and book value) the possibility of vanishing overnight is massive. You're holding a penny stock, not a blue chip.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 14, 2017, 07:32:27 PM
SO just to be clear, Bitcoin and Bitcoin Cash run the same fundamental software, mine the same, and operate almost identically except that Bitcoin takes hours to resolve and costs upward of $40 while Bitcoin Cash costs nothing and resolves immediately? I'm no genius but I think I know who wins this currency war. Bitcoin shot itself in the foot not doing its last fork.

This last weekend's Bitcoin Cash craziness, coming on the heels of the SegWit2x cancellation, marks the beginning of a civil war.  Powerful actors with serious money to throw around, like Roger Ver and the industry NYA signatories, have launched a concerted attack against Bitcoin.  It's a battle between those who want to force changes that favor transaction volume (the buy your cup of coffee side) on the blockchain and those who want to preserve decentralization and censorship resistance (the be your own bank side) of the original concept. 

I'm coming down on the store of value, digital gold, be your own bank side, and as such $40 dollar transaction fees (although I've never paid anywhere near that much) and one hour times to reach 6 confirmations doesn't seem unreasonable to me.  The fact that transferring $10,000, $100,000, or $100 million costs the same $5-10 fee makes me think that Bitcoin will ultimately be used to store and transfer large amounts of purchasing power anywhere on the planet, regardless of borders, banking laws, or which blockchain Bitcoin Jesus throws his reputation behind. 

Since building new blockchains over the last couple years (Ethereum, Dash, etc.) has so far failed to gain sufficient dominance over BTC, the new strategy appears to be hard forking (Bitcoin Cash, Bitcoin Gold, maybe SegWit2x eventually) the original blockchain.  Who knows how it will work out, but 2018 will be the year of the hard forks.  There's already a web page for a Bitcoin Cash+.


But if Bitcoin craters as I expect it has the possibility to poison the entire well.

True.


Last, I'll just reiterate that those "investing" in coins should be very careful. These have the potential to be up 70% in a day or two and fall just as fast. And with no underlying value (even a badly run company has capital and book value) the possibility of vanishing overnight is massive. You're holding a penny stock, not a blue chip.

Also true.


You're holding a penny stock, not a blue chip.

Maybe.  Civilization hasn't been down this particular road before, so it's difficult to distinguish whether it's a bubble or a technological adoption curve at this point.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 14, 2017, 08:01:38 PM
You have the choice of a checking account that charges $10 per check and one that charges $0.001. It's not even really a choice.

I'm so confused over this "store of wealth" claim. Historically stores of wealth are precious metals, bonds, and CDs precisely because they don't change in value that much. Pre-Fed the Us dollar was a store of wealth. That's one of the purposes of a currency to begin with. It's why we need crypto. Modern currencies aren't stores of wealth.

Even if I accepted the notion that Bitcoin BTC is the new gold, it's still a fool's errand. Guys like me will trade 6 figures for $5 to the miners but the miners of BCH are getting a quarter penny off a candybar sold in India. If crypto actually takes off, who has better positioned themselves?

Bitcoin originally positioned itself as the ultimate frictionless currency. Crosses borders, low transaction cost, decentralized. Doesn't feel that way anymore. Seems like it has abandoned its core values.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 14, 2017, 09:12:08 PM
You have the choice of a checking account that charges $10 per check and one that charges $0.001. It's not even really a choice.

Depends on how much value is placed on transaction immutability, resistance to censorship, and degree of decentralization, qualities that don't come free.  And how much would a checking account actually cost if it wasn't run on the back of a fractional reserve banking system?


I'm so confused over this "store of wealth" claim. Historically stores of wealth are precious metals, bonds, and CDs precisely because they don't change in value that much.

When was the last time a de novo currency/asset/store of wealth (and designed to ultimately be deflationary, no less) arrived on the scene?


Bitcoin originally positioned itself as the ultimate frictionless currency. Crosses borders, low transaction cost, decentralized. Doesn't feel that way anymore. Seems like it has abandoned its core values.

Like I said, it looks like we're entering into a cryptocurrency civil war over these very questions.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 15, 2017, 06:00:02 AM
Let me put it another way... For you BTC holders, would you have bought in when you did if transaction costs were as high as they are now and took as long to resolve? In 2011/2012 when I got in I would never have accepted these costs. They'd completely violate the claim of currency. No way I'd have accepted a "currency" that can't buy a candy bar.

I have fully come to understand that BTC is a store of wealth strictly because it is worth money and hard to trade but no other store of wealth has ever acted that way. Well, maybe tulips. I just don't understand why being non-usable is an asset. I'll admit I have an Austrian bias (like Mises) but even if I grant that the Blockchain is the biggest invention of the past decade why would you use it to power a currency with a goal of no turnover? We got decentralized accounting and then limited it? That was the whole point, wasn't it?

BTC can't live up to its own white paper.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 15, 2017, 08:17:58 AM
BTC was far from frictionless when I was acquiring my current holdings through Gox and then transferring it to a Bitcoin-QT wallet. That was all a pain in the ass. Coinbase is easy.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 20, 2017, 10:28:36 AM
BTC has been at record levels above $8000 for the last 24 hours, currently at $8250 with a market cap of $138 billion.  It was ten days ago when the price dropped down below $5500 and Bitcoin Cash was being hailed as the new king.  Who knows which direction the roller coaster is going next, some are predicting $10,000 per bitcoin before the end of the year. 

Unexpected article from Bloomberg about preppers and cryptocurrency:  https://www.bloomberg.com/news/articles/2017-11-20/can-bitcoin-survive-an-apocalypse (https://www.bloomberg.com/news/articles/2017-11-20/can-bitcoin-survive-an-apocalypse)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 23, 2017, 12:38:11 AM
Just look at all the YouTube shills for every crapcoin and ICO you can imagine.

Today a bunch of these guys are reporting that they were simultaneously hacked within the same 24 hour period:  https://youtu.be/nv-uV_Ny-I4 (https://youtu.be/nv-uV_Ny-I4)

The exploit hinged on socially engineering cellphone providers into transferring the target's numbers to cloned phones, from which the attackers could then request a Gmail password reset via SMS, thus commandeering the target's email, YouTube channel, Google Drive, and Chrome browser settings with any saved passwords for online accounts.  Depending on the degree of compartmentalization of passwords and second factor authentication, some of these guys lost serious money.  It sounds like these guys share private numbers and emails between themselves, so breaking into one phone might yield valuable personal information that could be linked to another victim.  If you're running an Android phone and store all kinds of information in it that's linked to a Gmail account, that's a potential single point of failure for your entire digital life.  Not good.


Trevon James is claiming he had 111 BTC ($900k) stolen from his Exodus wallet:  https://youtu.be/VwIAAw5iTIA (https://youtu.be/VwIAAw5iTIA)

This is BTC he's been accruing from his involvement in Bitconnect (widely suspected to be nothing more than a pyramid/ponzi scheme), which he's been pumping hard on his channel.  Like a lot of these guys, he has a habit of over-screen-sharing his online trading and desktop wallet balances on his videos. 

The Exodus wallet, like many others, is a hierarchical deterministic wallet that's backed up by a 12-word passphrase, which is known as a seed and is randomly generated for you to record to a piece of paper for safe keeping (not electronically!) when you create the wallet.  If, for whatever reason, such as a loss of the computer or a hard drive failure, all the addresses and private key pairs can be regenerated from the seed after installing Exodus software on a new machine.  Exodus is relatively new and has the benefit of allowing people to store multiple different cryptocurrencies on a local machine where you control the private keys.  It also links to shapeshift.io and allows you to exchange one type of currency for another within the wallet software itself.  I've used it and I like it, but I wouldn't concentrate my holdings in it, either.  Same can be said for pretty much every other type of wallet out there.  You can't keep everything in one basket and any single wallet needs to be designed to minimize the chances of it being breached through a single point of failure.

Some other YouTubers are reporting that Trevon stored his Exodus backup seed in his Google Drive, so once he lost control of his Gmail account it was game over.  All the thief had to do was restore an Exodus wallet using Trevon's 12-word seed and then transfer all the BTC out to his own wallet. 

Maintaining absolute control over one's private keys is job number one when you own crypto.  There is no legal recourse, no do-overs, no insurance policies.  You're on your own. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 26, 2017, 12:12:25 AM
BTC is now over $9000, which pushes the market capitalization to $151 billion.

Total crypto market is $284 billion.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 26, 2017, 05:51:27 PM
There are now 15 cryptocoins with market caps greater than $1 billion. 

Since Bitcoin Cash and Bitcoin Gold are both forks of Bitcoin, a single Bitcoin valued at $2800 on July 31 could now be converted into $11,481.  The combined market cap of these three currencies is $192 billion.

(https://farm5.staticflickr.com/4543/26890156369_247633b34e_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 28, 2017, 04:13:06 PM
Kinda sorta hit $10,000 today..........although Coinbase and Coindesk prices are still lagging behind.

(https://farm5.staticflickr.com/4542/37822205355_800e4097f9_b.jpg)

(https://farm5.staticflickr.com/4530/37822433175_8b688d010a_b.jpg)

(https://farm5.staticflickr.com/4558/37992626754_d6b4e99729_b.jpg)

(https://qzprod.files.wordpress.com/2017/11/bitcoin_price_milestones_close_price_marker_chartbuilder-11.png?w=1280)

.......and about 2 days to $10,000.


Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 29, 2017, 07:03:10 AM
And less than a day to $11,000.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 29, 2017, 07:15:06 AM
It's a little hard to trade in something whose 'support' line is vertical.

Roger Ver on Dave Rubin's show was maybe worth a listen if you are a crypto beginner. Full disclosure, I 100% agree with Ver (which makes me nervous) and I am chewing a pencil this morning considering buying Bitcoin Cash. It might be the best upside.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 29, 2017, 10:31:59 AM
Bitcoin ain’t for trading. It’s for hodling.

And you best hodl on tight, because it’s guaranteed to be a wild ass ride that could obliterate every penny you put in to it.

And don’t let anything Ver says be the deciding factor in going with B Cash.  He’s been behaving badly of late and I’m wary of anyone’s judgement when they can’t control their emotions.  And don’t call it B Cash, he goes ape shit when you say that.  He ain’t Jesus anymore, not since he let all his millions go to his head.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 29, 2017, 12:01:08 PM
I agree with his central argument that making a currency costlier to use is generally not a good thing. I'm in a place where I wouldn't even call Bitcoin a currency anymore. Even its fans call it a "store of wealth" showing they have no clue about finance as wealth storage is meant to protect downside, not grow on the upside.

All that said, I wouldn't be shocked to see $20k. It's just a confidence game. Once we hold $10k it has to shoot to the next level. Nobody's selling.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 29, 2017, 12:33:50 PM
Until the IRS decides to treat crypto as a currency for tax purposes, it’s going to function like the asset they say it is, at least for those with large amounts.  Tracking capital gains is cumbersome for those of us who want to stay on the right side of the law.

Bitcoin Jesus renounced his citizenship so he doesn’t have to worry about the tax man, unlike the rest of us.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on November 29, 2017, 02:25:19 PM
Until the IRS decides to treat crypto as a currency for tax purposes, it’s going to function like the asset they say it is, at least for those with large amounts.  Tracking capital gains is cumbersome for those of us who want to stay on the right side of the law.

Bitcoin Jesus renounced his citizenship so he doesn’t have to worry about the tax man, unlike the rest of us.

For easier math, if I bought BTC @ $10K each, and sell @ $20K each - how does one calculate the CAP gains?  Do I pay my income tax rate on the profit, or if instead I prove I held it for N years (long enough to be considered long term by IRS), do I pay that?  Or maybe option C - I tell no one, and cash out of BTC into some offshore haven?

Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 29, 2017, 02:46:24 PM
Explains it pretty well. It's sticky depending on what you actually did with your crypto.

https://www.fool.com/investing/2017/09/25/are-bitcoin-profits-taxable.aspx

It's pretty much what I did. Pain in the ass because you have to generate the documents yourself. Made my tax attorney laugh which worried me. Not that I did it wrong but because I require her to be a soulless mercenary for my money.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 29, 2017, 03:54:16 PM
I paid taxes on my 2013 sales and used a program that calculated the short and long term cap gains from an imported file of Mt Gox transactions. I had to step my CPA through it and he did a little research on his own before he’d sign off on it.

This year all the gains are long term and I’m just going to use an average cost basis of $44 per coin.  That’s to the IRS’s favor, so they better not hassle me over it.

The big conundrum now is if/how/what to report to the IRS in terms of new coin ownership resulting from a bitcoin hard fork. Personally I don’t think it should be reportable until it’s sold, but some say it is.  If so, how do you determine the cost basis, the price on the date of the fork, or the date you actually were able to redeem them?
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 29, 2017, 04:20:09 PM
I paid taxes on my 2013 sales and used a program that calculated the short and long term cap gains from an imported file of Mt Gox transactions. I had to step my CPA through it and he did a little research on his own before he’d sign off on it.

This year all the gains are long term and I’m just going to use an average cost basis of $44 per coin.  That’s to the IRS’s favor, so they better not hassle me over it.

The big conundrum now is if/how/what to report to the IRS in terms of new coin ownership resulting from a bitcoin hard fork. Personally I don’t think it should be reportable until it’s sold, but some say it is.  If so, how do you determine the cost basis, the price on the date of the fork, or the date you actually were able to redeem them?

It's not reportable until sold. You still hold the asset. What I would do is calculate the spread at the fork. If you get 1 new coin for every 2 old coin the cost basis is 66% old coin and 33% new coin applied retroactively to the original purchase.

This is no different than the accounting I did when I sold Kraft after being an Altria shareholder. After the divest I just calculated what percentage Kraft represented that day and applied to my original purchase.

Bear in mind your "cost basis" is a goofy thing. You can (with stocks) claim that you paid the highest price it reached on the day you bought. That can be some funky wiggle room and I don't know if it holds true for crypto.

There is another accounting method where you pay gains annually but almost nobody uses it as the complication offsets any savings and the IRS will question why you're not reporting full sale (ask me how I know).

My bottom line is that I wouldn't sell without a cost basis or you look like a fraud. So selling a spinoff coin while keeping the documents on the original coin looks shady. If you do my rough percentage math it looks better and it's a little more honest. It seems screwy because you claim you bought something that doesn't exist but it's the best accounting you can do. Sorry for the added math and IRS worksheets.

Hope it helps but consult a tax professional, not a super-nerd daytrader with a CPA for a father. My taxes are a hot mess even though I try to be as honest as possible. It requires advice from dad and an attorney. You probably feel my pain here.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on November 29, 2017, 04:32:00 PM
Theoretically if instead of cashing out of BTC and into USD, you bought hard goods or services using BTC, is there anything to legally report to the IRS?

Legally that's barter, right?
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 29, 2017, 04:50:37 PM
Theoretically if instead of cashing out of BTC and into USD, you bought hard goods or services using BTC, is there anything to legally report to the IRS?

Legally that's barter, right?

That's where it gets really messy. You would still need to claim capital gains. Technically barter is taxed. If you literally trade produce with the neighbor it should be taxed as income. Sometimes people do. As an example if I build you a deck and you give me several rifles in trade it might be worth it to report. Most often it's a small enough dollar amount that people don't report and the IRS wouldn't care.

This is the gray area of tax code. If I bought a couple Bitcoin for $1 and then used them to buy a car, I'd damn sure claim it. I would live in dread of an audit. I'm not really wworried about swapping produce with a neighbor.

My advice with the IRS... Be as honest as possible. When I got audited they owed me money. I do the best I can and then try to overpay by $50. They know I'm a lousy target. But $50 to avoid an audit seems like a bargain. Once you go through the process of sending registered mail and copying secure documents... it's a mess.

Goes without saying this is not financial advice.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 29, 2017, 08:45:20 PM
After doing a little digging around, it looks like there's a fair degree of consensus that all Bitcoin Cash (BCH) generated from the fork is considered income for owners of Bitcoin (BTC) private keys, as of August 1, and this income is reportable in 2017, whether you actually take control of the new BCH, to sell it or trade it, or not.

https://www.forbes.com/sites/greatspeculations/2017/08/04/how-to-report-bitcoin-cash-and-avoid-irs-trouble/#65759e173066 (https://www.forbes.com/sites/greatspeculations/2017/08/04/how-to-report-bitcoin-cash-and-avoid-irs-trouble/#65759e173066)

https://bitcoin.tax/blog/how-to-tax-bitcoin-cash-bch/ (https://bitcoin.tax/blog/how-to-tax-bitcoin-cash-bch/)


Forbes is using an August 1 price of $266 and Bitcoin.tax is using $277 as the initial BCH basis. 

So, for example, 10 BTC held in private keys you controlled on July 31 generates 10 BCH on August 1 with a value of $2770 that must be reported as income in 2017, even if you don't do anything with it in 2017.  Even if you don't know how to actually use your BTC keys to gain control of your newfound BCH wealth, you still owe the tax man.

If you sell for USD or exchange the new BCH for another crypto this year, then capital gains applies.  So, 10 BCH, valued at $5770, exchanged for 1.3 BTC on August 18 produces $3000 of short-term gain, which is taxable as regular income. 

It looks like any BTC held at Coinbase on August 1 won't produce any reportable BCH income in 2017, because Coinbase isn't making those BCH available to account holders until January 1.  But holdings at Blockchain.info on August 1 is reportable because account holders retain control over their private keys (even if they don't know it), plus they made it possible to hit a button and transfer out BCH holdings last month.

It's really weird to be paying taxes on something you had no control over acquiring.  And what about the poor suckers who got scammed into thinking they were redeeming BCH but had their BCT and BCH both stolen in the process?

And then there's the more recent Bitcoin Gold fork, too.  It forked weeks before you could even take control of it and there's still hardly anybody exchanging it.



Crap, this little development isn't going to do anything good for my marginal tax bracket, but I don't see any legal way out of it.  The blockchain is immutable, its transactions are searchable, and with enough motivation its addresses can be linked back to meat space.

Gotta pay to play if you ever plan on converting substantial amounts of crypto into fiat.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 30, 2017, 01:51:17 PM
The opposing view on crypto from rawdogletard:  https://youtu.be/7Dmt5e7mrvo (https://youtu.be/7Dmt5e7mrvo)

He's entertaining.......
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 30, 2017, 02:22:18 PM
After doing a little digging around, it looks like there's a fair degree of consensus that all Bitcoin Cash (BCH) generated from the fork is considered income for owners of Bitcoin (BTC) private keys, as of August 1, and this income is reportable in 2017, whether you actually take control of the new BCH, to sell it or trade it, or not.

https://www.forbes.com/sites/greatspeculations/2017/08/04/how-to-report-bitcoin-cash-and-avoid-irs-trouble/#65759e173066 (https://www.forbes.com/sites/greatspeculations/2017/08/04/how-to-report-bitcoin-cash-and-avoid-irs-trouble/#65759e173066)

https://bitcoin.tax/blog/how-to-tax-bitcoin-cash-bch/ (https://bitcoin.tax/blog/how-to-tax-bitcoin-cash-bch/)


Forbes is using an August 1 price of $266 and Bitcoin.tax is using $277 as the initial BCH basis. 

So, for example, 10 BTC held in private keys you controlled on July 31 generates 10 BCH on August 1 with a value of $2770 that must be reported as income in 2017, even if you don't do anything with it in 2017.  Even if you don't know how to actually use your BTC keys to gain control of your newfound BCH wealth, you still owe the tax man.

If you sell for USD or exchange the new BCH for another crypto this year, then capital gains applies.  So, 10 BCH, valued at $5770, exchanged for 1.3 BTC on August 18 produces $3000 of short-term gain, which is taxable as regular income. 

It looks like any BTC held at Coinbase on August 1 won't produce any reportable BCH income in 2017, because Coinbase isn't making those BCH available to account holders until January 1.  But holdings at Blockchain.info on August 1 is reportable because account holders retain control over their private keys (even if they don't know it), plus they made it possible to hit a button and transfer out BCH holdings last month.

It's really weird to be paying taxes on something you had no control over acquiring.  And what about the poor suckers who got scammed into thinking they were redeeming BCH but had their BCT and BCH both stolen in the process?

And then there's the more recent Bitcoin Gold fork, too.  It forked weeks before you could even take control of it and there's still hardly anybody exchanging it.



Crap, this little development isn't going to do anything good for my marginal tax bracket, but I don't see any legal way out of it.  The blockchain is immutable, its transactions are searchable, and with enough motivation its addresses can be linked back to meat space.

Gotta pay to play if you ever plan on converting substantial amounts of crypto into fiat.

I believe it because I trust Forbes but that in no way makes any sense. You would think it would be handled the same as a stock split or a divestiture. If you pay the tax on it as income, why would you then pay capital gains afterward? It's taxed income presumably sitting in the bank... And the .gov doesn't count crypto as a currency so how is it income?

I appreciate the correction (my assumption was wrong but I do feel it to be better accounting) but this makes me more confused than ever. These are the endless tax speed bumps that drive me crazy. Why I'm sure I've committed a felony somewhere.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 30, 2017, 03:30:18 PM
I agree it makes zero sense.

Another consequence of this tax regulation is the fact that by declaring the BCH as income you've automatically signaled to the IRS exactly how much BTC you held at the time of the fork.  For the 99% of bitcoin holders who weren't going to ever pay taxes on it anyways, it probably doesn't matter.  But it will matter for the rest of us.

And this isn't just a BTC problem, either.  BCH already is facing 3 planned hardforks less then a year into its existence.  Just about any blockchain can be forked and these negative tax consequences forced on the holders of the parent chain who opposed the fork.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on November 30, 2017, 03:34:36 PM
  My dad called me an idiot when I paid about $9 each for my supply of bitcoin.....I might sell it ,or trade it for gold soon.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 30, 2017, 04:07:05 PM
  My dad called me an idiot when I paid about $9 each for my supply of bitcoin.....

Been there.  Wife, parents, in laws, coworkers, cousins, friends.  Ponzi, pyramid, multilevel, tulip mania.  I've heard 'em all.


....I might sell it ,or trade it for gold soon.

Keep at least one. 

Everyone needs some skin in the game.  It's the best way to learn. 
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 30, 2017, 04:20:18 PM
I got told all kinds of crazy stuff. But I was a true believer that having a global currency with low costs was a guaranteed success. Bitcoin was going to bury Western Union. The opportunities for a frictionless currency were abound.

If it still was that way today I'd still have it. As it stands Bitcoin is clunkier than gold. It's lost its original value proposition and (in my mind) violated its own white paper. It was the solution for a metal currency (hence they called it a coin) but now it's not as good as metal.

It's a currency that can't be used as a currency and a store of wealth that's the best speculative investment. Like always us Austrians can't tell when...

Even the core belief of Bitcoin... that it is limited in production is a lie. They've already proven they can just fork off and create more. If the core developers own the currency why not inflate? Why are we limited to Bitcoin Cash? Why not Bitcoin Supra or Bitcoin Plus?
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on November 30, 2017, 05:11:40 PM
Keep at least one. 

Everyone needs some skin in the game.  It's the best way to learn.

The people I know who wouldn't be upset about losing $9K on a speculative bet, also don't need the money.  If/when people bought it at 3 digits or lower, sure.  The ROI is like a lotto ticket.  You spend beer money on the chance to live the dream.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on November 30, 2017, 05:13:58 PM
What's the consensus of dollar-cost-averaging with BTC?

We do it with our 401K contributions.
I do it with ammo and some other items I stock at home.

I suppose the difference being I am quite certain in the future I'll need USD, ammo, and toilet paper.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 30, 2017, 06:35:31 PM
Even the core belief of Bitcoin... that it is limited in production is a lie. They've already proven they can just fork off and create more. If the core developers own the currency why not inflate? Why are we limited to Bitcoin Cash? Why not Bitcoin Supra or Bitcoin Plus?

I don't know about that, the core devs are highly resistant to inflating the supply of BTC, just as they are with centralization of the infrastructure. 

This is not true of the forks and altcoins, though, which are much more susceptible to the whims of their creators and majority stake holders (usually one and the same).  If Vitalik wants more ETH he can make it happen, or if a bunch of investors are locked out of their funds because someone fat-fingered a line of code in a digital contract, he can fork it so they get their money back.  And I bet if Ver thinks the world needs more BCH he can make that happen, too. 

For better or worse, there's no single entity with significant control over BTC, that whitepaper concept is still very much intact.


The people I know who wouldn't be upset about losing $9K on a speculative bet, also don't need the money.  If/when people bought it at 3 digits or lower, sure.  The ROI is like a lotto ticket.  You spend beer money on the chance to live the dream.

That's a tough one, alright.  It's a much more straight forward choice of keeping a BTC that was purchased at $9 than shelling out $9k to get your first one.  I think the best way to look at it, if you see BTC as worth speculating on, is to change your wallet and exchange settings to display the value in millibits (mBTC) and manipulate the psychological value we attach to whole (and round) numbers to our favor.  If its value continues to grow, we'll all be talking in milliBTC, microBTC, or Satoshi units, anyways.


What's the consensus of dollar-cost-averaging with BTC?

It seems like the last time I researched it, there were some studies that found a statistical advantage with investing an entire year's worth of retirement savings in January, because the market is more likely to go up than down, plus you get the full benefit of dividend reinvestment.  I don't know that there's any consensus on that, though.  But even if there were, as a psychological tool that helps motivate regular investment, I think dollar-cost-averaging has enormous value.  And in terms of BTC, Coinbase makes it easy to set up a monthly buy, say 10 mBTC per month, which would be $100 today, but could be $40 next month, or $70 the one after that. 

We've been through 80% drops before, there's no guarantee it won't happen again.  It might go to zero or, as some hedge fund guys have been saying lately, it might hit $40 per mBTC by the end of 2018.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on November 30, 2017, 07:45:05 PM
I don't know about that, the core devs are highly resistant to inflating the supply of BTC, just as they are with centralization of the infrastructure. 

This is not true of the forks and altcoins, though, which are much more susceptible to the whims of their creators and majority stake holders (usually one and the same).  If Vitalik wants more ETH he can make it happen, or if a bunch of investors are locked out of their funds because someone fat-fingered a line of code in a digital contract, he can fork it so they get their money back.  And I bet if Ver thinks the world needs more BCH he can make that happen, too. 


Well I don't want the dollar inflated so it's kinda the same thing. Bitcoin can literally double its currency overnight and not lose market cap? There's no investment we would let behave like this (other than internet stocks in the 90s).
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 30, 2017, 10:24:31 PM
I guess that the creation of BCH via hostile hardforking could be seen as equivalent to doubling the supply of BTC, sort of.  And that could be a fatal flaw for BTC, but I don’t think it’s really clear what the long term effects of forking will be yet. So far it strikes me as a better way of launching a new altcoin, but it could also be the mechanism for producing a superior technology, too.  Anything is possible, but I wouldn’t bet against BTC at this point.

Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 01, 2017, 02:41:59 PM
From The Atlantic:  Bitcoin Is a Delusion That Could Conquer the World:  The cryptocurrency’s current price is completely unreal. Then again, so is money. (https://www.theatlantic.com/business/archive/2017/11/bitcoin-delusion-conquer-world/547187/)

Quote
A bar of gold. A disk of iron. A chain of beads. A card of plastic. A slip of cotton-linen paper. These things are worthless. One cannot eat them, or drink them, or use them as a blanket. But they are valuable, too. Their value comes from the simplest thing. People believe they are money, and so they are.

If every currency is a consensual delusion, then bitcoin, a digital cryptocurrency that changes hands over the internet, feels more like a consensual hallucination on psychedelic drugs. The concept of bitcoin was born in a detailed white paper published in late 2008 by a pseudonymous “Satoshi Nakamoto.” By 2013, one bitcoin was worth $12. As of this writing, it’s worth more than $10,000. Its value has doubled in the last two months alone. For any currency’s value to increase by 100 percent in eight weeks is, to use a technical term, bonkers. If the Japanese yen or American dollar did the same, their economies would plunge into an infernal deflationary spiral.

Throughout history, currency has taken one of two forms: physical assets, like gold or beads, and fiat currency, like government-backed paper and coins. Bitcoin and its brethren introduce a third category: digital currencies that run on a combination of game theory, economics, and cryptography—thus, cryptocurrencies. If all money is the sharing of an illusion, bitcoin wants to build a better way to share it.

Like many people, I’ve long regarded bitcoin’s rise with both wonder and confusion.  To help me make sense of it, I started calling cryptocurrency experts and academics to ask, is bitcoin just a dumb bubble, like 17th-century tulip bulbs? An investment hedge, like gold? A currency, like dollars? The answers I got weren’t satisfyingly unanimous. I heard “all of the above” and “none of the above” and “nobody knows for sure, yet.”
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 01, 2017, 03:06:22 PM
When I bought Bitcoin...

It was the leanest way to transfer money. That's failed by high costs.

It was limited in its production. That's failed via forking.

It was a currency. That's failed because now it's a "store of wealth".

The entire value of Bitcoin was its liquidity. It was the fastest and easiest way to transfer funds globally. We literally talked about how we could transfer money to rural communities and it acted seamlessly reducing transfer costs. That was the value.

I'm buying gold miners like crazy. I am nervous that I look like Scion Capital. I can't tell you when this will erupt but I know it will.

This is not financial advice. I am a stark raving lunatic. People who would believe me have missed the greatest economic opportunity of our time.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 01, 2017, 04:51:42 PM
Well, it would be nice to see my PM & Mining fund claw back that 50% loss.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 01, 2017, 05:38:44 PM
Well, it would be nice to see my PM & Mining fund claw back that 50% loss.

It will. I don't know the fund specifically (I don't like funds) but once the Bitcoin bubble pops people will remember there is real gold. And I think there is a reverse bubble in metals because of the over-contracted paper gold, silver, etc.

None of this makes me happy. Believe it or not my wife still teases me that "Bitcoin can save the world". I was a true believer. I thought this was the decoupling of government and money. Now it's just a shitty speculative bubble. It's the only "currency" that you can't really use. Der Traum ist aus.

I hate being this guy. I wanted this to work. But its value, based on its liquidity, is gone. It's hard to shoot the rabid dog but what choice do you have? The Bitcoin people don't see le fin du monde.

I do not think I am being hyperbolic using the German for 'the dream is over' or the French for 'the end of the world'. When this collapses billions of currency units will disappear. Is that a good thing for the central bankers? Goddam right. I'd be stunned if they weren't working against crypto.

The Bitcoin people have done everything in their power to make it not a currency.

I pray I'm wrong.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on December 01, 2017, 05:46:45 PM
  I just had a broker do the deal to trade my BTC for gold at market value as I held my $10 each BTC long enough.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 01, 2017, 06:32:36 PM
I will continue hodling.

Mostly.  My automatic sell program at 5% per year will continue, which currently returns my initial investment every month.  I’ve got a lot to lose, on paper, when this all goes up in flames, but that’s a risk I’m willing to take. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 02, 2017, 12:19:33 AM
Anybody used BTC for purchases at APMEX or JM Bullion, or any other PM dealers?
Title: Re: Bitcoin currency (merged topics)
Post by: Speaker0311 on December 02, 2017, 03:54:07 AM
A fork does not in any way create Bitcoin, it is not a stock split. It creates a new coin which must stand on its own.

Long transaction times and high fees do hurt BTC, however companies like VISA have created work arounds such as the SHIFT card which gives you instant transactions and zero transaction fees.

Even with that I'm still betting other cryptos will overtake BTC. People don't have to be loyal to a national currency anymore. This is a real free market and people will use what works best.

I'm betting John Macafee is right about the price, and metals while nice to have have lost their shine. Its too difficult to do business in them and transportation is a nightmare.
Title: Re: Bitcoin currency (merged topics)
Post by: tipafo on December 02, 2017, 09:39:42 AM
Funny, one's perspective. Just some musings from someone not so savvy or brave.

I'm continually kicking myself for not buying in when I knew of bitcoin at $2.  A "mere" $200 "investment" would now be to me a small fortune. Taxes, fees, and disillusions be damned.

I would gladly pay what I might have to pay on lotto winnings to have won the lotto.

I finally bought in last week. All of $30 +fee. Naturally, too late to catch the 4k to 9k jump. But then, I'm a fool many ways around.

I'll keep buying in now, maybe up to $1k this year, but won't likely sell unless there is such a massive jump in value that the gains outweigh any consequences to selling into "hard" currency. Like it "could have been" now.

I may or may not use bitcoin as intended. Maybe not ever. Maybe later when the rules and regulations have settled into something reasonable.

Bitcoin, Etherium, next-coin, USDebtCoin, whatever, digital currency is here and now and the future.

If I had bought in then, or even at the fork, and had lost faith or perceived opportunity value in "bitcoin", I would liquidate smartly and quickly, pay the piper and tip the doorman as I thankfully take my winnings and exit the house, to look elsewhere for normal market gains.

But, then, I have no significant wealth to set against the consequences of trading unapproved digi-bits for approved digi-bits, nor even a reasonable understanding of normal economic systems.

Ah, well.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 02, 2017, 12:29:26 PM
Long transaction times and high fees do hurt BTC, however companies like VISA have created work arounds such as the SHIFT card which gives you instant transactions and zero transaction fees.

And the Lightning Network has essentially infinite transaction scaling potential and will allow for decentralized exchange of BTC and other alt coins without the need to process transactions on the underlying blockchains.  They’re also saying it will be possible to earn dividends on BTC held on Lightning nodes, too. 
Title: Re: Bitcoin currency (merged topics)
Post by: Speaker0311 on December 02, 2017, 05:26:40 PM
I like the idea behind the lightning network, but until I see it in operation I'm skeptical. And if DASH gets the evolution wallet out first I don't think it will matter.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 06, 2017, 06:03:34 AM
$13,000


(https://farm5.staticflickr.com/4522/27096315879_27ebf74b9a_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 06, 2017, 08:01:39 AM
Here's a weird little thought...

Right now M2 is $13747.3 billion. Market Cap of Bitcoin is 218.5 billion. That's a difference of roughly 63. That's one dollar of Bitcoin floating around for every 63 greenbacks. If Bitcoin doubles again (hey why not?) 1/32. At $52,000 per coin there's an extra dollar for every 16 greenbacks...

What I'm getting at is if Bitcoin makes a charge to $500,000 or the like, the inflation will be devastating. It will literally empty our bank accounts. And most of us that do Bitcoin hold only a little there. We'd be wiped out as well. Forget about the poor as milk doubles.

If Bitcoin is successful, it could ruin the global economy as only a few lucky people actually hold it but it will chase up commodities.

What I'm getting at... Do we have to own Bitcoin as a global hedge against Bitcoin?
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on December 06, 2017, 08:16:16 AM
  I learned long ago that money only has value when you let it go.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 06, 2017, 08:24:57 AM
If successful, bitcoin will disrupt the current economic system. 

$59,000/BTC represents a $1 trillion market cap, which isn't as far-fetched as it seemed a couple years ago.  Wouldn't take all that much institutional money flowing in to get to that level.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 06, 2017, 03:53:12 PM
Now at $14,000, a gain of more than $2000 in less than 24 hours.

BTC is back above 60% market dominance as many other coins fell.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 06, 2017, 04:00:24 PM
Maybe a little levity...

https://www.reddit.com/r/btc/comments/6cz4i2/the_problem_with_bitcoiners_with_apologies_to_emo/
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 06, 2017, 04:40:11 PM
There’s truth in there, it’s been a really fractious year. 
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 07, 2017, 07:23:47 AM
(https://farm5.staticflickr.com/4533/25021468668_6b7a55a451_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 07, 2017, 08:20:11 AM
CoinMarketCap finally got to $16k, not sure why Coinbase is ahead of it today, almost the exact opposite of how it's been the last couple days.

(https://farm5.staticflickr.com/4544/38863532832_78e271c2c1_b.jpg)

(https://farm5.staticflickr.com/4538/38893790321_abff4f79e3_b.jpg)



Greater than 2000% appreciation in one year, with a trend line pointing straight up?  What could go wrong?
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 07, 2017, 11:24:35 AM
Uncanny that it's spiking up today, a mere three days before it will be listed on the CBOE and the big boys can short it and its listing on the CMT on the 18.

A lot will be tested in the next two weeks. I might dust off the daytrading gloves come Monday.

Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on December 07, 2017, 11:48:16 AM
Uncanny that it's spiking up today, a mere three days before it will be listed on the CBOE and the big boys can short it and its listing on the CMT on the 18.

A lot will be tested in the next two weeks. I might dust off the daytrading gloves come Monday.

I presume you are familiar with the term "flash crash".  Where high frequency algorithms get triggered into a downward spiral.

If you had a stop loss on BTC, wouldn't the same risk apply as with equities on an exchange?

e.g. your order to sell is triggered @ $50, but it falls to $10 before the order is filled
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 07, 2017, 12:06:43 PM
It's worse than that. Bitcoin's (BTC) only value proposition is that it will continue to go up. It's cost to mine is only valuable to a Marxist who believes in the labor theory of value. And a "store of wealth" by definition can't go down in value over time. If it ever did stabilize no one would be willing to pay the high transaction fees to get in.

So Bitcoin only has value if it moves up. We haven't tested what happens when it has a bad month... What happens with a day or two with no transactions or very low volume.

Note that other cryptos (including Bitcoin Cash) still offer the value as use as a currency. I'm very dubious that BTC is the one with a futures market. Shorting it is the only way to make money if it collapses (unlike legit currency trading). There is a growing conspiracy among some of my Bitcoin friends that the developers will be the first to short it as they have made it a coin that doesn't work.

Bitcoin should never have gotten listed. This stinks to high heaven.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on December 07, 2017, 12:51:55 PM
How much energy does Bitcoin mining consume?

ArsTechnica, 12/6/17: Bitcoin’s insane energy consumption, explained (https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-energy-consumption-explained/)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 07, 2017, 01:38:34 PM
https://www.bitsonline.com/antonopoulos-responds-donations-goodwill/ (https://www.bitsonline.com/antonopoulos-responds-donations-goodwill/)

Roger Ver took to Twitter questioning why Andreas Antonopolous tells audiences he's not a BTC millionaire.  Andreas responded with all the personal reasons why and now he's being overwhelmed with contributions. 

This is the latest episode of Ver behaving badly, this year something broke inside him.



Andreas' explanation of why he's not a BTC millionaire (re-posted to r/bitcoin):  https://www.reddit.com/r/Bitcoin/comments/7hylea/andreas_antonopoulos_posted_this_response_to_a/ (https://www.reddit.com/r/Bitcoin/comments/7hylea/andreas_antonopoulos_posted_this_response_to_a/)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 07, 2017, 05:32:05 PM
(https://farm5.staticflickr.com/4556/27126219729_10525870f2_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 08, 2017, 05:41:41 AM
That is, if Coinbase is actually working. The website tweeted 20 hours ago that users are experiencing delays and having trouble logging in to their accounts due to high traffic.

To be fair, a perfect "store of wealth" is a currency you can't buy anything with, can't afford to transact in, can't use due to lag times, and can't even be accessed by the owner. That's why I store my gold in an undisclosed Latvian garage whose owner doesn't have a phone or email account.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 08, 2017, 01:58:10 PM
It’s like those carved money stones that fell out of canoes and yet continued to be transferred back and forth between island tribes while laying at the bottom of the sea.

Coinbase is a worrisome central point of failure in what’s supposed to be a decentralized system, it’s like Gox was 4 years ago.  Store your coins in a wallet you fully control. If you don’t have the private keys you don’t actually own the bitcoin.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on December 08, 2017, 02:19:21 PM
Coinbase is a worrisome central point of failure in what’s supposed to be a decentralized system, it’s like Gox was 4 years ago.  Store your coins in a wallet you fully control. If you don’t have the private keys you don’t actually own the bitcoin.

Like David said about his gold in that Latvian garage, with 30 minutes notice he probably can't exchange that gold for a gallon of milk.

Coinbase has an interesting role here.  It allows e-commerce retailers (like my own employer) to accept BTC at their online retail point of sale, but then immediately exchange into USD.
I admit I was a little dismayed they did not plan on holding BTC just as any other foreign currency. Technically it's a stand-in for PayPal or a number of third party redirect payment providers.

As more merchants accept BTC, the proposition for holding BTC becomes more desirable, and Coinbase facilitates that.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 08, 2017, 05:49:29 PM
Coinbase just emailed this out to users:

Quote
We at Coinbase couldn’t be more excited by the explosion of interest in digital currencies. The last few weeks has seen an unprecedented increase in the price of digital currencies. More people are engaging with our platform than ever and that bodes well for the future of the digital currency. At the same time, it does create extreme volatility and stress on our systems. We take this very seriously and wanted to share some important thoughts.

We’re continuing to invest heavily to scale our platform

Over the course of this year we have invested significant resources to increase trading capacity on our platform and maintain availability of our service. We have increased the size of our support team by 640% and launched phone support in September. We have also invested heavily in our infrastructure and have increased the number of transactions we are processing during peak hours by over 40x.

There may be downtime which can impact your ability to trade

Despite the sizable and ongoing increases in our technical infrastructure and engineering staff, we wanted to remind customers that access to Coinbase services may become degraded or unavailable during times of significant volatility or volume. This could result in the inability to buy or sell for periods of time. Despite ongoing increases in our support capacity, our customer support response times may be delayed, especially for requests that do not involve immediate risks to customer account security. You can read more in our Coinbase User Agreement.

Be an educated investor

We also wanted to remind customers of some of the risks associated with trading digital currency. Digital currencies are volatile and the prices can go up and down. Due to the rapidly changing price of digital currencies, some customers may not have sell limits that are sufficient relative to the value of total digital currency they are storing on Coinbase. Sell limits are one of the many measures Coinbase takes to protect client accounts and assets.

As a proactive measure, we encourage customers to check the following items on their accounts:


Ensure your email address is properly receiving all communications and notifications from Coinbase. To learn more about ensuring email delivery, please refer to this support article.

Ensure your two-factor authentication is updated and functional. If you have recently switched mobile devices, your two-factor authentication needs to be properly migrated to the new device. In addition, please migrate from SMS two factor to Google Authenticator to enhance the security on your account, if you have not already done so. To learn more about two-factor authentication, please refer to this FAQ.

Familiarize yourself with your buy and sell limits. They can be found here.

Complete any pending identity verifications. During times of significant volatility, ID verification may become degraded or unavailable. To learn more about identity verification on Coinbase, please refer to this FAQ.

Expect payments to take the maximum number of days indicated when making a deposit or withdrawal.
Stay up to date

We will continue to update customers for our website, our status page, in our apps, via email, on our blog and on Twitter.

We will keep you informed

We are committed to safety, security and transparency. We are working tirelessly to provide the best service and support but we can’t promise perfection during the periods of extraordinary demand. We will continue to do our best to keep our customers informed.

Thank you,

The Coinbase Team


A lot of public BTC personalities are increasingly vocal about their criticism of Coinbase for not rolling out SegWit addresses by now (which would decrease transaction fees), their enthusiastic support of the now cancelled SegWit2x fork, and their continued flat-footedness in dealing with surges in the market.  Many are urging a boycott of Coinbase, but it's a tough call because they're the easiest entry point for new cryptocurrency users at this point and there's no better alternatives yet. 

Coinbase needs to get their act together if they don't want to wind up as a footnote, especially if Square steps things up with their plans for entering the bitcoin exchange space.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 08, 2017, 06:20:49 PM
https://www.bitsonline.com/antonopoulos-responds-donations-goodwill/ (https://www.bitsonline.com/antonopoulos-responds-donations-goodwill/)

Roger Ver took to Twitter questioning why Andreas Antonopolous tells audiences he's not a BTC millionaire.  Andreas responded with all the personal reasons why and now he's being overwhelmed with contributions. 


Quartz:  A bitcoin booster got $1.5 million after being “bitshamed” for being poor (https://qz.com/1151233/andreas-antonopoulos-got-1-5-million-in-bitcoin-donations-after-roger-ver-bitshamed-him/)

Amazing!  Good for him.  Nobody deserves this more than Andreas. 
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 08, 2017, 09:52:36 PM
The Coinbase problem is stemming from having too many customers. It seems that the hordes need a "store of wealth" which seems odd because the latest numbers suggest the savings rate is down to almost 3%.

If you've ever wondered what it looks like when the "smart money" is selling and the "dumb money" is buying you have a front seat.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 10, 2017, 04:22:11 PM
It's D-Day. The futures markets are open. For the first time you can make money if Bitcoin loses value. That is if your broker allows access (most don't).

For me personally, this is the absolute failure of Bitcoin. The idea that Goldman Sachs now has a way to control it smacks in the face of the idea of decentralized. The whole point was to screw the banks and their predatory schemes after all.

When this all falls apart and decent people lose their shirts while the big banks cover shorts we will clamor for regulation. So in taking the worst crypto public and killing it easily the rest will be besmirched.

This is hard for me, I loved the dream of a decentralized currency. But this has been so mismanaged it's almost impossible to believe it.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 10, 2017, 04:33:41 PM
When this all falls apart and decent people lose their shirts while the big banks cover shorts we will clamor for regulation. So in taking the worst crypto public and killing it easily the rest will be besmirched.

How long do you predict it will take to fall apart?
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 10, 2017, 04:58:36 PM
How long do you predict it will take to fall apart?

This is the curse of Austrian Economics. It's impossible to time. The market can stay irrational longer than the investor can stay solvent in a short. That's the rub.

The next few weeks will be telling. I think the major brokerages are afraid due to liquidity concerns (rightly so and never a good sign).

I don't understand this move. The claim that Bitcoin is limited to 21m is now off the table. I can print as much paper Bitcoin as I want and the futures contracts resolve in dollars, not even the Bitcoin itself (unlike gold). Further, it only hurts the price. If every gold contract came due tomorrow it would skyrocket because there is more paper gold than real gold. Why would a Bitcoin owner want this downward pressure?

Bitcoin owners: the development team is at least not looking out for your best interest. Now that it's listed they may be criminally liable for their decisions. I would consider the act of listing it as a violation of the prospectus (white paper). If Bitcoin is growing why does it need futures contracts? So glad we graduated from the guppy tank to the shark tank.

****My Opinion***** I don't think this is an accident. This is an organized strategy to kill a viable non-state money. Of course the big banks want to crush it. For some reason the development team wants to crush it. The .gov obviously wants to crush it. It's working in tandem. I suspect the bubble pops and the development team end up in the pokey.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 10, 2017, 05:53:19 PM
Weeks, months, years, decades....what’s your timeframe till BTC failure is obvious to everyone?
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 10, 2017, 07:42:02 PM
Weeks, months, years, decades....what’s your timeframe till BTC failure is obvious to everyone?

From my perspective it's already obvious. There is no claim to a currency that can't be used based on a Marxist theory of value that now trades in futures.

I'm Austrian (both economically and ethnically  ;)) I can't guess when, I can only guess why.

Goes without saying this is not advice and I am not an advisor. I assume the same of every post and poster.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 10, 2017, 11:08:46 PM
Bitcoin owners: the development team is at least not looking out for your best interest. Now that it's listed they may be criminally liable for their decisions. I would consider the act of listing it as a violation of the prospectus (white paper). If Bitcoin is growing why does it need futures contracts? So glad we graduated from the guppy tank to the shark tank.

Who says the devs were for it?  It sounds to me like Wall Street wanted in on bitcoin, not the other way around.

Criminally liable?  How?  Who?  It’s a distributed system with no central authority. 


There is no claim to a currency that can't be used based on a Marxist theory of value that now trades in futures.

Marxist?
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 11, 2017, 05:24:20 AM
Unfortunately, without a value claim as a usable currency, the value claim that "it took electricity to mine" is a Marxist labor theory of value proposition.

On Wall Street we have something called "fiduciary duty". In other words, it is a crime to act in a way that hurts shareholders. It's the highest form of legal responsibility.

Criminally liable?  How?  Who?  It’s a distributed system with no central authority. 

Don't you feel a little like the the "decentralized" claim has come off its wheels? We have factions and development teams and now if they break their fiduciary duty, they damn sure can be held liable. But I'm sure the .gov wouldn't want to scuttle Bitcoin and jail the programmers. That would be mean.

I'm getting a little  :tinfoily: but it's an end I can see.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on December 11, 2017, 06:55:02 AM
  I sold my BTC a week ago,I trust my instincts and ,had my surgery failed,the vapor of my BTC would have been lost in the wind.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 11, 2017, 12:41:39 PM
Don't you feel a little like the the "decentralized" claim has come off its wheels? We have factions and development teams and now if they break their fiduciary duty, they damn sure can be held liable.

No I don’t.

It’s not Silk Road, there’s no Ross to throw in jail.  Satoshi’s gone, the early devs have moved on.  Nobody’s in charge. 


B Cash, ethereum, and every other altcoin can’t say that.  There’s fraud and malfeasance aplenty there, and lots of people to pin it on, too. 


  I sold my BTC a week ago,I trust my instincts and ,had my surgery failed,the vapor of my BTC would have been lost in the wind.

Bummer, I was hoping you’d keep up your membership in the 21 million club.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on December 11, 2017, 01:49:16 PM
I'm legitimately confused when it comes to Bitcoin's exponential growth. I've been digging into it and here is the information I've gathered:



1) It's been reported that about 1,000 users own/control almost 40% of all Bitcoin's.

https://www.bloomberg.com/news/articles/2017-12-08/the-bitcoin-whales-1-000-people-who-own-40-percent-of-the-market

2) It's also been reported that anywhere from 20-30% of Bitcoin's are dead/unrecoverable or more commonly referred too as "float". (I owned about one coin that would qualify as float... the computer the wallet/ID was stored on was fried and can't be accessed anymore)

http://fortune.com/2017/11/25/lost-bitcoins/


3) Additionally, there are still about 4.5-5,000,000 coins that have yet to have been mined.

https://themerkle.com/80-of-all-bitcoins-will-have-been-mined-in-a-year-from-now/



---

Essentially... one could make the argument that these ridiculously high prices and growth may be sustainable (not necessarily the exponential growth... as I think you're starting to see "commoners" priced out, which was the jet fuel propelling everything), as long as the "whales" all play nicely amongst one another and continue to swoop in and buy the dips as they occur.

One could also make that argument that all it would take to send the entire market crumbling would be for a small percentage of the whales to no longer buy the dip, and no longer sell in small quantities but rather unload large quantities of their holdings all at once.



It's going to be interesting to see how it all plays out. Personally, I'll be watching from the sideline.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on December 11, 2017, 01:52:02 PM

Bummer, I was hoping you’d keep up your membership in the 21 million club.

Wouldn't it be more like the 13,000,000 club?

5 million coins haven't been mined yet, and anywhere from 2.5-4 million have been lost forever.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 11, 2017, 01:56:48 PM
Wouldn't it be more like the 13,000,000 club?

5 million coins haven't been mined yet, and anywhere from 2.5-4 million have been lost forever.

All true.  But it’s still called the 21 million club if you want to google it.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on December 11, 2017, 01:59:52 PM
All true.  But it’s still called the 21 million club if you want to google it.

I just wanted it to sound even more exclusive  8)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 11, 2017, 02:24:43 PM
I suspect the number of non-fractional owners worldwide, who still control their keys, is less than 5 million.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on December 11, 2017, 03:10:38 PM
I suspect the number of non-fractional owners worldwide, who still control their keys, is less than 5 million.

It certainly seems that way... and that's why I'm not necessarily on board the, "this is tulips in the Netherlands in 1600s, GET OUT NOW!!! AHHHH!" train of doom and gloom.

If the whales are fully committed to playing the long game with Bitcoin, this could go on for quite some time due to the ability to divide Bitcoin into such tiny fractions.

The number of users/vendors looking to do business in full coins is doing to dwindle (if it hasn't already), but the number of users who just want to buy .000001 or less coins is pretty much infinite.



It also seems that the majority of the "whales" have two things common:

1) They are invested in not just becoming rich, but also in seeing Bitcoin become universally accepted.

2) They have very deep pockets which gives them unprecedented ability to manipulate the market... which isn't anywhere near as fluid/open/organic as it appears on paper due to the things I pointed out in my earlier post.


While I'm not in any way suggesting these whales are being altruistic (I'm sure every one of them has already hedged their initial investment and regardless of what happens will walk away a winner), I also don't think that they are your typical "rational" investors who are going to pump and dump.

A rational investor would have flipped their $11,000,000 investment that is now worth over a billion dollars by now. They would have done it long ago if their end game was just to become filthy rich. The fact that the Winklevoss' and Nakamoto's of the world aren't dumping leads me to believe that they are trying to go out of their way to see Bitcoin succeed in what most of us would view as an irrational way.

If the entities that own 75% or so of the industry are all on board to continuing the charade... it's possible to see sustained "growth" for years to come.

It's also possible that one of the early adopters decides to dump everything and buy their own island(s), and Bitcoin plummets tomorrow. If that was going to happen though... one could argue it would have happened a few weeks ago when the exponential increases were being reported almost hourly ($10000 to 12000 to 17000 in a span of days/hours, instead of weeks/year). The fact that it didn't plummet at that point moves it out of the "beanie baby/tulips in Netherland" territory and into something different.

What that ultimately is? I'm not sure, and I don't think anyone else does either.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 11, 2017, 03:14:33 PM
I can’t disagree with any of that.
Title: Re: Bitcoin currency (merged topics)
Post by: LVWood on December 13, 2017, 12:41:02 PM
Well it's official.
Bitcoin is now the biggest bubble in world history.

(http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/11/30/bitcoin%20bubble%20biggest%20ever.jpg)

http://www.zerohedge.com/news/2017-12-12/its-official-bitcoin-surpasses-tulip-mania-now-biggest-bubble-world-history
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on December 13, 2017, 12:46:39 PM
  WOW,even bigger than the bubbles in my tub....glad I sold out now as it will fall real soon ,and real hard !
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 13, 2017, 01:02:49 PM
If I was a broker at a major investing house and I knew that I could swing this market with a trading volume of only $3 billion dollars I would do everything in my power to bid it up prior to it going public and then buy the shorts only to sell the original position.

Allowing a futures market was a big mistake. One major player could trigger a mass sell-off. The trading houses might be playing chicken right now.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on December 13, 2017, 01:22:18 PM
If I was a broker at a major investing house and I knew that I could swing this market with a trading volume of only $3 billion dollars I would do everything in my power to bid it up prior to it going public and then buy the shorts only to sell the original position.

Allowing a futures market was a big mistake. One major player could trigger a mass sell-off. The trading houses might be playing chicken right now.

I'm legitimately confused by the, "allowing a futures market" statement.

To my knowledge (I'm sure I'm getting something wrong, please clarify for me)... Bitcoin doesn't have an owner who is giving a yes/no on futures trading by these exchanges. The exchanges are essentially just accepting bets around an existing entity/technology, much like a lot of offshore online casinos accept wagers and set up wagering lines around something like The Oscars.

The Academy isn't giving the green light for Oscars wagers... they are taking place because offshore books think they can make a profit off of them.



I agree that it's foolish on the part of the CME to allow wagers on Bitcoin futures... but, these wagers are going to be made with dollars, not Bitcoins.

Bitcoin really has no exposure at all, all the (massive) exposure is in the derivatives market... though it is definitely possible that someone who owns a considerable amount of Bitcoin could create a massive conflict of interest by purchasing shorts at favorable rates and then dumping a boatload of coins before their futures contract is up.

That's not really Bitcoin's problem though, is it? It's these exchanges problem.


I guess what I'm saying is... I agree with you in that this is almost certainly going to end in catastrophic fashion, but I don't understand how or what anyone "representing" Bitcoin (is there such a person?) could have done anything to prevent futures being traded around Bitcoin?
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 13, 2017, 01:40:18 PM
Totally agree, this is a wonderful ploy by the investment houses. The CBOE and CME should have never made the choice.

Look what futures markets have done to metals. We have far more paper gold and silver than actual. You may not be able to print a Bitcoin but you sure can write a new contract that resolves in dollars.

The banks even wrote that this is a mistake to do. There's not enough data to begin writing a futures contract.
http://money.cnn.com/2017/12/07/investing/banks-bitcoin-futures-trading-cftc/index.html
Explains it pretty well.

Why would a Bitcoin holder want me to trade the futures anyway? He'd much rather I buy the coin and raise price and volume.

In other words, I am blaming the boards. Really blaming the bought-off regulators who should have known better. With volume levels so low and hype so high it's a big target for foul play.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 13, 2017, 01:53:20 PM
I don’t think Wall Street really understands that BTC is owned by koolaide drinking hodlers who’ve been through a couple Bitcoin bubbles already.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on December 13, 2017, 02:12:59 PM
Totally agree, this is a wonderful ploy by the investment houses. The CBOE and CME should have never made the choice.

Look what futures markets have done to metals. We have far more paper gold and silver than actual. You may not be able to print a Bitcoin but you sure can write a new contract that resolves in dollars.

The banks even wrote that this is a mistake to do. There's not enough data to begin writing a futures contract.
http://money.cnn.com/2017/12/07/investing/banks-bitcoin-futures-trading-cftc/index.html
Explains it pretty well.

Why would a Bitcoin holder want me to trade the futures anyway? He'd much rather I buy the coin and raise price and volume.

In other words, I am blaming the boards. Really blaming the bought-off regulators who should have known better. With volume levels so low and hype so high it's a big target for foul play.

Gotcha, I was trying to make sure I understood.

We're 100% on the same page. CME is crazy for even proposing this, and the regulators who monitor CME and who signed off on this are out of their collective minds.



I've just been reading a lot of articles about how futures trading is going to "destroy Bitcoin", and they all confuse me.

Bitcoin itself isn't in play when it comes to the futures market... regardless of if Bitcoin plummets to $25/coin in 6 months, or skyrockets to $100,000/coin in 6 months... there is still going to be 21,000,000 of them in existence and available for purchase (minus the unmined coins and inaccessible float). Bitcoin itself isn't going anywhere, what is really at stake is the derivatives market and these brokerages/exchanges that are ponying up all this currency on these positions which are sitting ducks for manipulation.

Manipulation in which direction? That's the $64,000 question. If I knew that, I'd bet on it myself  ;) I don't, so I'll just enjoy watching potential financial Armageddon on the sideline.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 13, 2017, 02:17:32 PM
I don’t think Wall Street really understands that BTC is owned by koolaide drinking hodlers who’ve been through a couple Bitcoin bubbles already.

I try to stay away from the unproductive slurs. I don't think Wall Street has any grip of crypto at all. One of the things that scares me the most is the gulf between people who understand economics and the people who understand tech. Very few people understand both and both groups are making mistakes.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 13, 2017, 08:47:13 PM
Gotcha, I was trying to make sure I understood.

We're 100% on the same page. CME is crazy for even proposing this, and the regulators who monitor CME and who signed off on this are out of their collective minds.



I've just been reading a lot of articles about how futures trading is going to "destroy Bitcoin", and they all confuse me.

Bitcoin itself isn't in play when it comes to the futures market... regardless of if Bitcoin plummets to $25/coin in 6 months, or skyrockets to $100,000/coin in 6 months... there is still going to be 21,000,000 of them in existence and available for purchase (minus the unmined coins and inaccessible float). Bitcoin itself isn't going anywhere, what is really at stake is the derivatives market and these brokerages/exchanges that are ponying up all this currency on these positions which are sitting ducks for manipulation.

Manipulation in which direction? That's the $64,000 question. If I knew that, I'd bet on it myself  ;) I don't, so I'll just enjoy watching potential financial Armageddon on the sideline.

You're right but also wrong. The underlying Bitcoin will always be there but it's unsure if it's going to $100k or $0 tomorrow. There are arguments for both. But if it does either, the margin call will bankrupt the trading houses.

Interactive Brokers will only allow long trades! How is that possible?
http://www.zerohedge.com/news/2017-12-11/interactive-brokers-allows-long-only-bitcoin-futures-trading-50-margin

If I can only buy calls, where is the put? There's no bookie on planet earth that only takes one side. Of course we saw what Interactive's CEO Peterffy said about the underlying risk in Bitcoin...

https://www.cnbc.com/2017/11/15/thomas-peterffy-keep-bitcoin-away-from-the-real-economy.html

And the scary thing is that he's rich enough and smart enough to sink it by himself. He pioneered high speed trading. And I agree with him. You don't want this level of volatility in a futures market. The regulators dropped the ball. But why does he constantly call this a bubble yet only allow customers to go long?

With the news that Steam will no longer take Bitcoin, Bitcoin went up. That's crazy.

There's something going on here. For this thing to spike so high right before its open in futures... Maybe not a coincidence. I can't imagine a better Wall Street dream. They have a product that can't be used, can't be forged, doesn't even exist, and they get to gamble on where they think it will go. Somebody knows what they are doing. I wish I knew if it was being pushed up or down.

Anybody else wondering if it's the weapon to bankrupt your investing competitors?

I'm doing my best to figure it out but it's real hard to get data on these houses. If I see something, I'll post it.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on December 14, 2017, 02:49:49 AM
I think that BTC and other crypto mediums are simply today's PET ROCK and while a form may survive...isn't this the 'easily manipulated and controled' form of exchange that we all have been warned to avoid?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 14, 2017, 02:56:52 AM
...isn't this the 'easily manipulated and controled' form of exchange that we all have been warned to avoid?

No, I think you’re confusing BTC with USD.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on December 14, 2017, 04:00:08 AM
No, I think you’re confusing BTC with USD.

 :)
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on December 14, 2017, 10:10:36 AM
Last night and this morning I listened to Jack's crypto currency episode.  I don't regularly listen to every new show, but will spot download topics of interest.

There was one huge thing I took from everything I learned:

Crypto currency infrastructure will be where the steady growth lies.


This was true during the 1849 California gold rush.  Levi Strauss made more selling denim overalls than anyone mining for gold.

I also think of what Apple/iTunes did for mp3 and digital music.  I had mp3s in the late 1990s, but it was for computer geeks. The technology was mostly there, but apple wrapped it up into a simple attractive package, so even the simplest of users could use it.

Someone will do similar for crypto and become a billionaire.

Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 14, 2017, 05:19:46 PM
Pieces are coming together. 40% of Bitcoin is Japanese buyers.

https://www.reuters.com/article/us-markets-bitcoin-japan/behind-bitcoin-boom-japanese-retail-investors-pile-in-idUSKBN1E70IT

Japan is arguably the largest country for forex trading because the Yen has a negative interest rate. These are short term, get rich quick traders. I should point out that Japanese banks offer some of the highest leverage. And wouldn't you know they let "investors" leverage Bitcoin.

https://www.forbes.com/sites/petercohan/2017/12/11/how-15x-leverage-at-tokyo-bitcoin-exchange-could-spread-contagion/#784374a2b3eb

So the futures quants in NYC are looking at this and realizing almost half of the Bitcoin rally is leveraged Japanese accounts. And they know the dirty little secret. Leveraged accounts can't afford to lose money.

It turns out the rally isn't the true believers but an Asian forex trade. I think we've done some damage coming up with the "hoddlers" slur. They're not driving the market at all.

Lots of moving pieces here. I'm trying my best to put it together. When I get something, I will share it post haste.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 14, 2017, 05:41:33 PM
I think we've done some damage coming up with the "hoddlers" slur.

It's not a slur, Hodlers wear it with pride.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on December 14, 2017, 08:31:33 PM
It's not a joke to me. I intentionally avoid slurs in the economic realm.

I try to provide the most up to date data and I get glib from a mod.

I'm done. Do your own math.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 14, 2017, 10:05:12 PM
(https://steemitimages.com/DQmRqSzuFyqASS4prAGpAjrzNaHMkGUn6VtT7afHf5cA4L6/1630567_1.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on December 15, 2017, 10:35:00 AM
You know what is surprisingly complex, is setting up automatic dollar-cost-averaging for anything other than BTC.

I have coinbase setup to take $50 each payday, but they only have options to buy BTC on recurring.  Last I checked there's not an integrated "shapeshift"  in coinbase either.
So I've started using jaxx for my main wallets, and coinbase is just the integration to my USD bank account(s).

In Jaxx I can swap between almost any alt-coin out there. 

My current strategy is to gradually accumulate LiteCoin and Dash.  I was discussing with a co-worker who recently moved to the US from Serbia on a work visa.  He is younger, but having lived through multiple Balkan conflicts, and schizophrenic foreign policies - he is a fascinating contrarian investor to talk with.

He is way more bullish on crypto than I am, but he is also practical.  He said BTC is like gold.  You don't buy dinner or pay your bills with it. It sits in the safe until you need to make a major purchase.  So to him the slow mining and high fees are tolerable in that context.  It's like liquidating a gold bar or old time paper stock certificate. 

We both agree whichever consumer level coin gets widely adopted will be a sound investment long term.  Maybe it'll take a national fastfood chain or other retailer, but already the legal cannibis shops up here are beginning to integrate with DSH.  If the pot shops can make DSH work, Amazon and Wal-Mart eventually could too.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 15, 2017, 01:15:03 PM
He said BTC is like gold.  You don't buy dinner or pay your bills with it. It sits in the safe until you need to make a major purchase.  So to him the slow mining and high fees are tolerable in that context.  It's like liquidating a gold bar or old time paper stock certificate. 

Exactly.  BTC’s for hoarding. 
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on December 15, 2017, 01:45:39 PM
Exactly.  BTC’s for hoarding.

Personally I think the term "accumulate"  is more appropriate.  Similar as you would with a bluechip stock.  But even stock holders of old school industrial giants should have an exit strategy.  The lack of this among many of the BTC "horders"  detracts from their credibility in some circles.

Given it took me over 24 hours to "shapeshift"  about $50USD worth of BTC into DSH, I'm only using BTC when I must.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 15, 2017, 02:12:29 PM
But even stock holders of old school industrial giants should have an exit strategy.  The lack of this among many of the BTC "horders"  detracts from their credibility in some circles.

Pretty much all circles, really.  A recent survey showed an average target sell price of just under $200k/bitcoin.  Even for a bitcoin maximalist like myself, that’s absolutely mind blowing.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on December 15, 2017, 02:19:31 PM
(https://scontent.fsnc1-1.fna.fbcdn.net/v/t1.0-9/25348765_2249491391743106_5314109229325521344_n.jpg?oh=1165fe286d3e8bc0b7d5e1097e8652ea&oe=5AC4AC68)
Title: Re: Bitcoin currency (merged topics)
Post by: Alan Georges on December 15, 2017, 07:32:24 PM
Pretty much all circles, really.  A recent survey showed an average target sell price of just under $200k/bitcoin.  Even for a bitcoin maximalist like myself, that’s absolutely mind blowing.

A screaming mad economist takes a look at the question:
http://captaincapitalism.blogspot.com/2017/12/a-literal-economic-intepretation-of.html (http://captaincapitalism.blogspot.com/2017/12/a-literal-economic-intepretation-of.html)
TLDR version:
(total # of $US)/(total # of bitcoins) = $186k per bitcoin

Of course that completely neglects all kinds of market drivers, but it does put some kind of quantitative perspective on it.  Maybe another way to look at it is there's likely only about 10x upside left to bitcoin.  Normally a 10x upside is pretty good, but there's also a pretty steep downside possible too.

I'm definitely not an expert here!  I'll just say that any investments with potential down sides that are more conveniently expressed on a log scale are too hot for me.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 16, 2017, 12:03:19 PM
The BTC price rose overnight and is currently trading above one pound of gold.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on December 19, 2017, 10:40:16 AM
I've probably wasted a day of my life research crypto mining hardware, it's costs, throughput and capabilities.

A decent calculator is available online;
https://www.cryptocompare.com/mining/calculator/dash?HashingPower=22&HashingUnit=GH%2Fs&PowerConsumption=81&CostPerkWh=.082

There are MANY problems with getting into mining, and I mean real mining that produces > $100USD monthly. Not spending $0.25 of electricity so you iPad poops out $0.05 in crypto.

1) purpose built miners, of all types (CPU, GPU, ASIC) are sold out every where
2) Entry level units with moderate throughput and efficiency cost $1000-1500 and often will pay for themselves within 9 months given present valuations
3) More expensive units are much more efficient (output vs consumed watts), but take a few years to break even in some cases
4) certain blockchain algorithms demand more exotic hardware (CPUs are cheaper and more common than GPUs)
5) some processor architectures benefit from a 220VAC power supply for peak efficiency


Based on all that, I feel DSH is perhaps the smartest kid in summer school here.
But even if I could find a Miner for sale on amazon, I'm not confident the valuation would not decrease before the miner paid for itself.
You also have the broader problem of paying yourself in the thing you're producing.  If you grow tons of tomatoes, you probably need to convert some to cash to pay the rent.

Great, you mined 5 coins!

Do you exit into USD, preserving the bulk of the value (ignore inflation for now), but exposing yourself to capital gains taxes?
What's the point of tooling up to "beat the house" if all you can ever do with your winnings is place larger bets?

I've heard mining compared to being a land lord, where the property owner starts with a single unit, saves profits, invests in a second unit, etc.
Soon the property owner is buying whole apartment complexes, has a good CPA and does crafty, but legal, tricks to leverage tax rules.

While the re-investment portion may be possible with crypto, there needs to be some smart business acumen to bridge back to the fiat/gov world.
Anyone who's followed Robert Kiyosaki, will know what I mean.




Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 19, 2017, 01:47:39 PM
Mining has always seemed to me like a much bigger risk than just buying the crypto from someone else and riding the appreciation wave.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 19, 2017, 07:16:00 PM
Coinbase just released BCH equivalent to the amount of BTC held on August 1, but the price is crazy high and sales are disabled.
Title: Re: Bitcoin currency (merged topics)
Post by: LVWood on December 19, 2017, 08:15:11 PM
SEC Halts Crypto Stock

Quote
U.S. regulators temporarily suspended trading in an obscure digital currency company due to concerns that its stock is being manipulated after the shares surged more than 17,000 percent in less than three months, making paper billionaires out of top executives.

https://www.bloomberg.com/news/articles/2017-12-19/sec-halts-crypto-over-manipulation-concerns-after-2-700-jump
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on December 19, 2017, 08:54:52 PM
Coinbase just released BCH equivalent to the amount of BTC held on August 1, but the price is crazy high and sales are disabled.

My son was doing cartwheels when I came through the door tonight.  Apparently a few months of his allowance in BTC had turned into a few hundred in BCH.  Well that has since fallen to 1/4 that amount, and unable to sell we just watched helplessly.  To a 13 year old, he just witness a new Xbox being thrown into the ocean.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on December 19, 2017, 09:08:54 PM
SEC Halts Crypto Stock

https://www.bloomberg.com/news/articles/2017-12-19/sec-halts-crypto-over-manipulation-concerns-after-2-700-jump

Quote
... The company is the product of a reverse merger with a sports bra company.

 :jaw-drop:
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 19, 2017, 09:19:32 PM
My son was doing cartwheels when I came through the door tonight.  Apparently a few months of his allowance in BTC had turned into a few hundred in BCH.  Well that has since fallen to 1/4 that amount, and unable to sell we just watched helplessly.  To a 13 year old, he just witness a new Xbox being thrown into the ocean.

Yeah, with the price at $8500, I was maniacally pounding on my mouse like a crack addicted monkey.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on December 19, 2017, 11:21:44 PM
Interesting article from Jimmy Song, a relatively new public bitcoin personality I've started following:  Bring on the FUD: 2017 Was The Year Bitcoin Became Anti-Fragile (https://www.coindesk.com/bring-fud-2017-year-bitcoin-became-anti-fragile/)

I've watched this presentation where he goes into more depth on the anti-fragility of bitcoin:  https://youtu.be/PkiuIyOY0bs (https://youtu.be/PkiuIyOY0bs)

I don't disagree with any of his points, but I don't know how well it corresponds with Taleb's conception, although a quick google search reveals recent positive comments from him about BTC.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on December 20, 2017, 09:22:26 AM
Am I the only one worried about tax implications?  I'm not a CPA or tax professional, but I know enough to postpone large capital gains of equities until the new year. 

Do BTC and other alt-coin holders do similar?
Can we expect a huge dump of BTC/BCH next month (Jan 2018)?
Does anyone have the stones to create a stop-loss?

Holding this stuff after making 10x gains is moronic.  Sell when able and go buy an asset with that money like a real capitalist.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on December 20, 2017, 11:38:48 AM
Am I the only one worried about tax implications?  I'm not a CPA or tax professional, but I know enough to postpone large capital gains of equities until the new year. 

Do BTC and other alt-coin holders do similar?
Can we expect a huge dump of BTC/BCH next month (Jan 2018)?
Does anyone have the stones to create a stop-loss?

Holding this stuff after making 10x gains is moronic.  Sell when able and go buy an asset with that money like a real capitalist.

This is why I traded my BTC to physical gold .
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on December 28, 2017, 07:50:10 PM
A manager of the Exmo Bitcoin exchange has been kidnapped in Ukraine. According to Russian and Ukrainian media reports Pavel Lerner, 40, was kidnapped while leaving his office in Kiev's Obolon district on 26 December.

The reports said he was dragged into a black Mercedes-Benz by men wearing balaclavas.
Police in Kiev confirmed to the BBC that a man had been kidnapped on the day in question, but would not confirm his identity.
https://www.bbc.com/news/business-42505261

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: bigbear on December 29, 2017, 06:50:12 AM
Does anyone have the stones to create a stop-loss?

Sounds like the ideal time to limit how much you could lose off the current price.  Which is exactly what a stop-loss does.  Seems like there's a lot of price flux, so unless you want to monitor the price every second a stop-loss is a good way to limit the downside risk.
Title: Re: Bitcoin currency (merged topics)
Post by: osubuckeye4 on December 29, 2017, 07:03:22 AM

Holding this stuff after making 10x gains is moronic.  Sell when able and go buy an asset with that money like a real capitalist.

The strategy a lot of my friends who are in on crypto's are utilizing is this:

- Invest a very small portion of their overall retirement portfolio (5% or less)
- If/when price doubles, take out the initial investment and pop it back into traditional investments
- Sit back and enjoy the ride with the remainder of the investment...


The ones who are fully in on cryptos will set up benchmarks and withdraw funds once those benchmarks are hit. They'll then take those earnings and invest them in emerging coins (Ripple was one popular option a few of my friends were discussing... I know that it has doubled in price in a short timeframe).



I'm personally not in on crypto's at the moment because the wife and I are saving every penny for a new home (going to wait till the real estate market here in Illinois crashes as a result of tax reform... we have anywhere from 9-18 months to sock away as much as possible), but after we get everything all set up, we'll most likely start to dip our toes in crypto at that time.

My hope is that the DoJ and SEC will have stuck their noses in a little further and legitimatized the exchanges a bit more by that point. Right now, I'd be terrified that my wallet was going to get breeched as I slept, and the lack of FDIC insurance makes that a potentially devastating loss.

For me (and I'm certainly not speaking for anyone else)... I don't want to take 5% of my retirement portfolio and put it into what is essentially a casino right now. I'd rather take the money and put it into savings for the down payment on a home in what should, hopefully, be a buyers market in the next 18 months as a result of tax reform putting the squeeze on existing homeowners who are going to be taxed out of dwellings.
Title: Re: Bitcoin currency (merged topics)
Post by: Jeff NH on December 31, 2017, 05:52:34 PM

My hope is that the DoJ and SEC will have stuck their noses in a little further and legitimatized the exchanges a bit more by that point. Right now, I'd be terrified that my wallet was going to get breeched as I slept, and the lack of FDIC insurance makes that a potentially devastating loss.

For me (and I'm certainly not speaking for anyone else)... I don't want to take 5% of my retirement portfolio and put it into what is essentially a casino right now. I'd rather take the money and put it into savings for the down payment on a home in what should, hopefully, be a buyers market in the next 18 months as a result of tax reform putting the squeeze on existing homeowners who are going to be taxed out of dwellings.

So your hope is more government with a little more government sprinkled on top. Please stay out of crypt-currency. The whole point by the way is that you should not be holding money in exchanges. If you want the safety of violence backed currency - stick with debtcoin.

Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on December 31, 2017, 07:13:55 PM
A manager of the Exmo Bitcoin exchange has been kidnapped in Ukraine. According to Russian and Ukrainian media reports Pavel Lerner, 40, was kidnapped while leaving his office in Kiev's Obolon district on 26 December.

The reports said he was dragged into a black Mercedes-Benz by men wearing balaclavas.
Police in Kiev confirmed to the BBC that a man had been kidnapped on the day in question, but would not confirm his identity.
https://www.bbc.com/news/business-42505261

Cedar


Kidnapped Exmo Bitcoin exchange manager Pavel Lerner was freed by his abductors in Ukraine on Friday.
Exmo confirmed that their employee is safe and "there was no physical harm inflicted on him".
Mr Lerner, 40, a leading analyst at the cryptocurrency company, was kidnapped on 26 December while leaving his office in Kiev's Obolon district.
http://www.bbc.com/news/business-42518235

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 16, 2018, 03:53:10 PM
Big dive in prices across the board.  Bitcoin is approaching a 50% drop from its all-time high.

(https://farm5.staticflickr.com/4627/38833939005_ac98940247_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: redrider on January 17, 2018, 07:46:34 AM
Big dive in prices across the board.  Bitcoin is approaching a 50% drop from its all-time high.
Any theory as to why?

Thanks,

rr
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 17, 2018, 08:16:45 AM
Government regulation issues in China and Korea.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on January 17, 2018, 10:42:52 AM
I have not seen posts about people buying up crypto on the cheap.

Why not?

If ammo was 1/2 off, most of us would take out a second mortgage...
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 17, 2018, 10:55:04 AM
Probably for the same reasons they don’t buy the stock market when it goes on sale during a crash. 
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on January 17, 2018, 11:38:18 AM
Probably for the same reasons they don’t buy the stock market when it goes on sale during a crash.

I guess I'm weird that way.  I keep 10%+ cash in my of my brokerage accounts for this scenario.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 17, 2018, 01:37:30 PM
You buying this dip?
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on January 17, 2018, 02:24:46 PM
I have not seen posts about people buying up crypto on the cheap.

Why not?

If ammo was 1/2 off, most of us would take out a second mortgage...

Because it looks like a head and shoulders top and no trader worth his salt chases one of those. And the market is driven by Japanese forex traders who have nothing to go on but the chart (Bitcoin has no fundamentals like a P/E, dividend, or even a usable metric beyond market cap) so ugly charts matter. It also feels troubling that Bitcoin has value because it is going up and it is going up because it has value.

https://en.wikipedia.org/wiki/Head_and_shoulders_(chart_pattern)

The bigger question is if the investment banks who allowed users to buy calls actually kept the puts on their own books. It will be interesting when quarterly data comes out on the banks (maybe next quarter).

Very interesting that to the believers Bitcoin is an unshakeable "store of wealth" but to the traders it's a high volatility forex version of three card monte. I worry one of those two is correct.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on January 17, 2018, 05:32:42 PM
You buying this dip?


No, but I started contributing to a Roth IRA through my employer in addition to the 401K matching.
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on January 17, 2018, 07:19:04 PM
Is there any truth in the concern that the amount of electricity used in maintaining the block chain and mining is unsustainable?  I have heard several people reference this issue in the last few weeks and can’t tell if they are just talking to have an opportunity to say “I told you so” if a crash occurs or if the underlying technology in Bitcoin requires an unsustainable amount of electricity.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 17, 2018, 08:11:25 PM
Forbes article from today:  Bitcoin Mining Uses As Much Power As Ireland. Here's Why That's Not A Problem (https://www.forbes.com/sites/christopherhelman/2018/01/16/bitcoin-mining-uses-as-much-power-as-ireland-and-why-thats-not-a-problem/#8e1bbea45893)

Quote
Analysts Michael Weinstein, Khanh Nguyen and their team at Credit Suisse took a look at the issue, and in a research note out today they conclude that fears of cryptocurrencies overwhelming the power grid are overblown. Start by comparing bitcoin’s 20,000 gigawatt hours per year with the 4.3 million Gwh used in the U.S. last year and 6 million by China. The analysts figured that if the price of bitcoin rose to $50,000, miners would find it economic to boost their efforts such that they would consume more than 350,000 Gwh, still less than 2% of world power capacity. The team also calculated the bitcoin price that would be needed to incentivize miners to gobble up all the world’s generation capacity: $1.1 million per coin.

Quote
In the long run, says Credit Suisse, the breakthrough far more likely to rile world energy markets is the electric vehicle. If, by 2040, EVs grab a third of new-car market share, the world could require more than 280 gigawatts of additional power generation capacity — or somewhere in the vicinity of 2.4 million Gwh. But again, that’s figuring on current technology. After 25 years of improvements, lithium ion batteries are going to keep getting better.

Technology has a way of outwitting the unbelievers. Just a few months ago Jamie Dimon, CEO of JPMorgan, called bitcoin “stupid” and a “fraud.” Last week he said he regretted those comments, saying, “The blockchain is real.”
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on January 18, 2018, 04:11:31 AM
Thanks for the article.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on January 18, 2018, 08:39:58 PM
Enjoy the dip as you sue the members of this board. People like me are very careful when we talk finance recommendations but those who have lost 50% in crypto over a couple weeks can easily find posts that they are literally buying electric gold. You have a paper trail of people telling you to invest in snake oil. Enjoy the lawsuit.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on January 18, 2018, 09:04:27 PM
...Enjoy the lawsuit.

This might be a good time to remind everyone of this snippet from our Terms of Use and Policies:

7) The SURVIVAL PODCAST FORUM does not provide financial advice. The discussions that take place of this forum as well as on the SURVIVAL PODCAST show are opinion only. What is provided is suggestions for guidance, not specific advice and should not be construed any differently.  Seek the help of a professional for "proper" advice.
The Ownership nor the Management will not be held accountable for any action you might take after visiting this website.

We assume that everyone here is intelligent enough to know the value of free advice provided by random anonymous Internet-users.
Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on January 18, 2018, 10:06:30 PM
Enjoy the dip as you sue the members of this board.

Nice... Threatening members...via false proxy.

Cedar
Title: Re: Bitcoin currency (merged topics)
Post by: redrider on January 19, 2018, 07:36:33 AM
We assume that everyone here is intelligent enough to know the value of free advice provided by random anonymous Internet-users.
Whut?

I live my life following advice from random anonymous internet users.

Dudn't everybody?

rr
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on January 19, 2018, 08:32:34 AM
Don't think I'm immune.

At the very least I exited Bitcoin prior to the IRS issuing guidance on how to report it. In a very real (and very legal) sense I have incorrect tax returns. So even though I did my best and likely paid the correct rate I'm not in compliance technically.

Add on to that that not every country has the same fiduciary laws and some of the things I have posted could be construed as borderline criminal in some places globally. Not a good thing for an avid international traveler like myself. In fact I already have plans for international travel and I'm looking into legality of things I have said about finance after being tipped off to be careful by a member of my mastermind group.

Even if you're stateside there is no guarantee of safety. It only takes one idiot like a Jeff Sessions to believe that by being into Bitcoin you are somehow involved in financial crimes or money laundering. And they've been going hard into Coinbase (not a safe place to store currency).

Last, on the extreme end and a healthy dose of tinfoil, there is a conspiracy here. Or maybe it was just an accident that Asian countries announced crackdowns immediately after the big banks sold calls and kept all the puts internally. Now that the banks have made millions selling worthless futures contracts and the fix is in the government will swoop in to provide "regulation" for the foolish people who bought up contracts worth slightly less than a fart in the wind. What happens when Bitcoin gets its very own Mueller? Frankly looking back I could be accused of 'pump and dump'.

I rwalize this is fringe stuff. But the government want this tech squashed. It's not beyond me to believe the banksters would make millions on their futures selling only to turn around and claim that the little guy miners were defrauding them about the true value of Bitcoin. I'm surprised there hasn't been a class action against the development team already.

I might not be well spoken at all times and a little glib but there are a lot of landmines around.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on January 19, 2018, 08:33:37 AM
Nice... Threatening members...via false proxy.

Cedar

I didn't know you followed the crypto currencies Cedar.
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on January 19, 2018, 04:58:15 PM
What is the “thing” that gives Bitcoin its value?  Is it a straight fiat currency, or does fiat currency derive its value from the backing of a government?  Is bitcoin valuable because it is transferable into a fiat currency like the usd (a fiat currency backed by a fiat currency)? To go back to my question of a couple days ago is Bitcoin valued because of the willingness of groups to pay the electric bill to maintain the blockchain in exchange for getting Bitcoins kicked out to them from time to time?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 19, 2018, 07:03:00 PM
What is the “thing” that gives Bitcoin its value?  Is it a straight fiat currency, or does fiat currency derive its value from the backing of a government?  Is bitcoin valuable because it is transferable into a fiat currency like the usd (a fiat currency backed by a fiat currency)? To go back to my question of a couple days ago is Bitcoin valued because of the willingness of groups to pay the electric bill to maintain the blockchain in exchange for getting Bitcoins kicked out to them from time to time?

This is a 50 minute talk from Andreas Antonopolous:  https://youtu.be/ONvg9SbauMg (https://youtu.be/ONvg9SbauMg)

It covers a lot of ground, with the "value" question addressed in the last half.

In the beginning... 00:00
Digital scarcity 00:41
Peer-to-peer network 01:34
Solving the double-spending problem 01:59
Cash, peer-to-peer without intermediaries 04:10
People paying companies to maybe pay people 04:34
The un-banked and the under-banked 05:28
Bitcoin - digital money as cash 06:08
What is cryptocurrency? 07:16
Independent self-verification 08:42
Why the Internet is special - global free flow of information 10:24
Why Bitcoin is special - global free flow of money 12:24
The bizarre aspects of traditional banking 13:34
Adjusting to this new world 15:36
Governments attempting to control Bitcoin 16:48
"Who's in charge?" - system of trust without hierarchy 18:18
People who see Bitcoin's strengths as flaws 20:20
Multi-signature schemes for consumer protection 21:19
Our misunderstanding of the most ancient technology 23:20
What gives money value? Stories we tell, promises we trust 26:30
The shared hallucination of paper money 29:48
False promises and the myth of "zero-value" currencies 31:22
Gresham's Law in India 34:02
The characteristics of good money & currency 35:13
Difficulties of barter at a large scale 36:49
Ancient tokens of values 38:13
Scarcity vs. inflationary supply, debt & devaluation 39:11
Bitcoin vs. traditional money as a store of value 41:52
"How much is a bitcoin worth?" 43:05
Digital gold 43:47
"Fake money" resolved by the market 44:21
Closing summary & remarks 45:17

Title: Re: Bitcoin currency (merged topics)
Post by: Cedar on January 19, 2018, 07:29:38 PM
I didn't know you followed the crypto currencies Cedar.

Sometimes. I don't know alot about it, but have posted in the past. Mostly come to read about it though.

Cedar

Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on January 19, 2018, 09:18:31 PM
Thanks Freelancer, I’ll give it a listen this weekend.
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on January 21, 2018, 03:01:06 PM
Mr. Antonopoulas is very confident about the future of Bitcoin.  He sounds almost messianic.  Nothing wrong with that, and maybe he is right.  His enthusiasm appears to be getting compensated with donated Bitcoins, so his money is where his mouth is.
 
I have not heard him address another aspect of working with Bitcoin that makes me remain a skeptic: by not being a government currency, it does not have to be used.
 
Government currency seems to have a built in advantage by being the system a country uses to collect taxes.  Being a citizen of the USA comes with a built in liability of having to pay taxes.  And the government can protect its currency by requiring me to use its currency to pay my taxes.  On the flip side, if I want to receive welfare from the government, it can require me to receive it in its currency as well.  As long as the major economic powers of the world refuse to accept Bitcoin for payment of government obligations, or offer to allow people to receive government payments in the form of Bitcoin, it is going to be second fiddle to government fiat currencies, isn’t it?
 
Antonopolous seems to think governments will eventually accept Bitcoin, but I’m not clear on how they will come to the conclusion that using Bitcoin helps them manage their economies.  I see a town in Switzerland is allowing Bitcoin for tax payements, and you can buy citizenship in Vanuatu with Bitcoin, but I don’t consider those to be the kind of national econimic powerhouses that need to come on board.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 21, 2018, 04:48:21 PM
Mr. Antonopoulas is very confident about the future of Bitcoin.  He sounds almost messianic.  Nothing wrong with that, and maybe he is right.  His enthusiasm appears to be getting compensated with donated Bitcoins, so his money is where his mouth is. 

Yes, I think he stands apart from the rest of the shills in the cryptocurrency space by focusing on evangelism, rather than making a quick fortune.  And, while he's an enthusiastic believer that this technology will revolutionize the way the world stores and transfers value, he is also quite frank about the extremely high risks associated with investing in crypto and keeping it secure in the present time.


Antonopolous seems to think governments will eventually accept Bitcoin, but I’m not clear on how they will come to the conclusion that using Bitcoin helps them manage their economies. 

I agree, that's just one of the big unknowns, and I am not risking my entire life and fortune on crypto like Andreas has. 
Title: Re: Bitcoin currency (merged topics)
Post by: redrider on January 22, 2018, 12:00:44 PM
Thanks so much for the index, Freelancer!

I would have passed this video by if you hadn't posted the index.

rr
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on January 22, 2018, 12:19:43 PM

I agree, that's just one of the big unknowns, and I am not risking my entire life and fortune on crypto like Andreas has.

I bet he has a LOT MORE than his original investment now though.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on January 22, 2018, 01:34:42 PM
No, look a month or two back on this thread, Andreas has been upfront about how he was forced to sell most of his BTC between 2014 and 2016 to pay debt and support his family.  For as much as he’s done, he doesn’t have much to show for it. He’s kind of like a wandering missionary monk who’s taken a vow of poverty. 
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on January 22, 2018, 01:40:26 PM
Well ,it did help his economy. I sold at $1500 a coin and while I could have done better,I still did quite well. I have still some in the newest launching of crypto and if one or two take off,I will be happy again.Kind of like calling the lottery an investment.
Title: Re: Bitcoin currency (merged topics)
Post by: Applejack on January 27, 2018, 05:53:26 PM
Reading up on bitcoin and the post here as well. I am still not sold on this. More will have to come out about it before I even think about buying in on this.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on January 30, 2018, 02:59:26 PM
Facebook bans ads that promote cryptocurrency or ICOs:

New Ads Policy: Improving Integrity and Security of Financial Product and Services Ads (https://www.facebook.com/business/news/new-ads-policy-improving-integrity-and-security-of-financial-product-and-services-ads)

Quote
...We’ve created a new policy that prohibits ads that promote financial products and services that are frequently associated with misleading or deceptive promotional practices, such as binary options, initial coin offerings and cryptocurrency.

Quote
29. Prohibited Financial Products and Services

Policy

Ads must not promote financial products and services that are frequently associated with misleading or deceptive promotional practices, such as binary options, initial coin offerings, or cryptocurrency. ...

Examples

“Start binary options trading now and receive a 10-risk free trades bonus!”
“Click here to learn more about our no-risk cryptocurrency that enables instant payments to anyone in the world.”
“New ICO! Buy tokens at a 15% discount NOW!”
“Use your retirement funds to buy Bitcoin!”

We want people to continue to discover and learn about new products and services through Facebook ads without fear of scams or deception. That said, there are many companies who are advertising binary options, ICOs and cryptocurrencies that are not currently operating in good faith.

This policy is intentionally broad while we work to better detect deceptive and misleading advertising practices, and enforcement will begin to ramp up across our platforms including Facebook, Audience Network and Instagram. We will revisit this policy and how we enforce it as our signals improve. ...
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on January 30, 2018, 03:06:29 PM
CFTC sent subpoenas to cryptocurrency exchange Bitfinex and cryptocurrency issuer Tether in early December:

Bloomberg Technology, 1/30/18: U.S. Regulators Subpoena Crypto Exchange Bitfinex, Tether (https://www.bloomberg.com/news/articles/2018-01-30/crypto-exchange-bitfinex-tether-said-to-get-subpoenaed-by-cftc)

Quote
...Tether’s coins have become a popular substitute for dollars on cryptocurrency exchanges worldwide, with about $2.3 billion of the tokens outstanding as of Tuesday. While Tether has said all of its coins are backed by U.S. dollars held in reserve, the company has yet to provide conclusive evidence of its holdings to the public or have its accounts audited. Skeptics have questioned whether the money is really there. ...
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 01, 2018, 11:58:14 PM
We've been through 80% drops before, there's no guarantee it won't happen again.

Bitcoin has fallen almost $12k (60% drop) from it's all-time high near $20k in mid-December.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on February 05, 2018, 07:19:44 PM
I'm so sorry. You can follow this thread and quite literally watch me lose my mind as this whole shit show falls apart.

Had I been clearer I could have prevented more people from losing money.

Not advice. Hodl on. Best of luck.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on February 06, 2018, 04:49:57 AM
I'm so sorry. You can follow this thread and quite literally watch me lose my mind as this whole shit show falls apart.

Had I been clearer I could have prevented more people from losing money.

Not advice. Hodl on. Best of luck.

I thought you were clear,too many just didn't heed your warning.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on February 07, 2018, 09:09:08 AM
I'm so sorry. You can follow this thread and quite literally watch me lose my mind as this whole shit show falls apart.

Had I been clearer I could have prevented more people from losing money.

Not advice. Hodl on. Best of luck.

I started with less than $100.  I bought various coins, in a few different kinds of wallets.  I learned how to move in and out of USD, as well as shape shifting from one crypto currency to another.  Even before this "crash" I think I spent 15-20% on mining fees just repeatedly moving the "money" around.  In contrast to a brokerage account, the fees for trading crypto are outrageous.

What's worse is I have mini wallets with literal pocket change that I cannot transfer or sell due to the mining fees eclipsing the equity value.  So my $12USD in Jaxx is stuck there for now

This was all educational and thank God I didn't add more zeroes to this silly game.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 07, 2018, 10:47:57 AM

What's worse is I have mini wallets with literal pocket change that I cannot transfer or sell due to the mining fees eclipsing the equity value.  So my $12USD in Jaxx is stuck there for now


Coinbase has run into the same problem, a couple million dollars of bitcoin dust trapped in individual change addresses that costs more to consolidate than it’s worth.

Crypto is an experiment, (un)fortunately, where everyone is stuck learning on the fly. 
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on February 07, 2018, 05:23:18 PM
Just one guy's opinion.  This guy is Steve Strongin, head of Global Investment Research at Goldman Sachs:

Fortune, 2/7/18: Goldman Sachs: Today's Cryptocurrencies Will Go to Zero, But Stronger Digital Currencies May Still Emerge (http://fortune.com/2018/02/07/bitcoin-price-usd-prediction-goldman-sachs-cryptocurrency/)

Quote
...“So, are any of today’s cryptocurrencies going to be an Amazon or a Google, or will they end up like many of the now-defunct search engines? Just because we are in a speculative bubble does not mean current prices can’t increase for a handful of survivors,” he said. “At the same time, it probably does mean that most, if not all, will never see their recent peaks again.”...
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on February 07, 2018, 05:47:17 PM
Coinbase has run into the same problem, a couple million dollars of bitcoin dust trapped in individual change addresses that costs more to consolidate than it’s worth.

Crypto is an experiment, (un)fortunately, where everyone is stuck learning on the fly.

But if all of the MISFIT accounts were donated to a charity then their owners could do good and get a tax deduction???????
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on February 07, 2018, 06:38:11 PM
But if all of the MISFIT accounts were donated to a charity then their owners could do good and get a tax deduction???????

https://bitinfocharts.com/comparison/bitcoin-transactionfees.html

Looks like the average transaction currently costs US$4.59 (down from its high of $54.90 on 12/21/17).  So there's no way to donate tiny accounts to charity without spending more than the value donated.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on February 07, 2018, 06:46:46 PM
Courthouse News, 2/6/18: SEC Chief Promises Action on Unregulated Coin Offerings (https://www.courthousenews.com/sec-chief-promises-action-on-unregulated-coin-offerings/)

Quote
...The Securities and Exchange Commission does not have jurisdiction over cryptocurrency trading markets, but the agency considers initial coin offerings as the functional equivalent of initial public offering, SEC Chairman Jay Clayton emphasized this morning.

“ICOs that are securities offerings, we should regulate them like we regulate securities offerings, end of story,” Clayton said, testifying before the Senate Banking, Housing and Urban Affairs Committee. ...
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on February 07, 2018, 07:09:52 PM
But if all of the MISFIT accounts were donated to a charity then their owners could do good and get a tax deduction???????


It’s like having a safe full of 50 million tiny envelopes, each of which contains 3 or 4 nickels and dimes, and the only way to spend or transfer the coins is to put a first class stamp on each envelope and mail them to the new owners.

If Coinbase has been paying attention they could have fixed the way their wallets process transactions so that these bits of change didn’t get stuck in limbo as mining fees increased.  It’s like they expected the free ride on mining fees to last forever.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on February 07, 2018, 08:08:00 PM
Courthouse News, 2/6/18: SEC Chief Promises Action on Unregulated Coin Offerings (https://www.courthousenews.com/sec-chief-promises-action-on-unregulated-coin-offerings/)

This will be a lot of tinfoil so please tread lightly. If you don't understand what I'm saying please don't get offended.

Turning altcoins from ICOs to IPOs will end them. IPOs are strictly regulated and only "qualified" people (as in you have a few million) can participate. The ground floor is gone.

****IF**** I was at the SEC, I'd have much more interesting questions:

Why did the development team do everything possible to squander Bitcoin?

How come the banks only allowed call options at the literal top? This would be like your bookie telling you you can only wager on one team in the game. He only does it if he knows a fix is in. When it was initially reported it was presented as though the banks only allowed upside gambling because they knew it would go up. In reality they hoped to sell futures contracts that didn't pan out and resulted in them keeping the commission (exactly what happened).

Did the major banks know when or influence countries to outlaw or restricy crypto? When? Did this effect their (I assume fraudulent) futures pricing?

Were there trading patterns? In other words, is this a market that could have been "blind shorted"?

I'd even want to look into the idea of "holding". [This requires explanation. No one "holds" an investment. If I doubled your IRA you'd likely spread the new money across your portfolio. Hence you are either buying or selling. There is no hold. Asked if you were bullish or bearish there is no bunnyish.  A lot of people got hurt by believing you hold (never sell).]

In short, I believe we have just witnessed a financial crime. Somehow the banks sold calls (not puts) at the top. So the only people to capitalize on the decline were the bankers while their clients got a haircut. The true believers got hosed in their religion of holding and the development team saw its biggest gains by violating the white paper. To cap it off we can blame the start of the fall on government crackdowns. And the new solution is a government crackdown.

In 20 years the pulitzer will go to the young man/woman who picks through all this stuff and finds the corruption. I guarantee it's there. The SEC would be driving hard if the feds didn't want Bitcoin to die. Hell, they might have helped somehow.

Crypto will work. But not by being clunky. The Bitcoin team set us back years.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on March 17, 2018, 02:32:24 PM
Plattsburgh NY bans commercial cryptocurrency mining:

Local Law P-3 of 2018 (http://www.cityofplattsburgh.com/CivicAlerts.aspx?AID=229)

Quote
...the Common Council of the City of Plattsburgh hereby declares an eighteen (18) month moratorium, on all applications or proceedings for applications, for the issuance of approvals or permits for the commercial cryptocurrency mining operations in the City of Plattsburgh. ...

It is the purpose of this Local Law to allow the City of Plattsburgh the opportunity to consider zoning and land use laws and municipal lighting department regulations before commercial cryptocurrency mining operations results in irreversible change to the character and direction of the City.

Further, it is the purpose of this Local Law to allow the City of Plattsburgh time to address through planning and legislation, the promotion of the protection, order, conduct, safety health and well-being of the residents of the City which are presented as heightened risks associated with commercial cryptocurrency mining operations.

It is the purpose of this Local Law to facilitate the adoption of land use and zoning and/or municipal lighting department regulations to protect and enhance the City’s natural, historic, cultural and electrical resources. ...

Background in this article from Motherboard:

This City Just Passed the First Bitcoin Mining Ban in the US (https://motherboard.vice.com/en_us/article/8xk4qv/bitcoin-ban-plattsburgh-coinmint-mining)

Quote
...According to [Mayor] Read, Plattsburgh has the “cheapest electricity in the world” due to a hydroelectric dam on the St. Lawrence river and residents pay only 4.5 cents per kilowatt-hour. (For the sake of comparison, the US average is a little over 10 cents per kilowatt-hour). Industrial enterprises—including Bitcoin mines—in Plattsburgh pay even less: Just 2 cents per kilowatt-hour. ...

The problem is that Plattsburgh only has an allotment of 104 megawatts of power per month. The biggest Bitcoin mining operation in Plattsburgh, operated by a Puerto Rican company called Coinmint, used roughly 10 percent of the city’s total power budget in January and February.

In January, Plattsburgh went over its power allotment and was forced to purchase electricity on the open market for far higher prices. This cost was distributed among the city’s residents, some of whom ended up paying between $100 and $200 more for their electricity than usual. ...
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on March 17, 2018, 02:55:50 PM
BTC transaction fees are way down, so now is a good opportunity to move long term holdings between wallets. Last night I payed a midrange fee (as determined by the Electrum wallet) of 65 cents per transaction and could have payed a quarter of that if I’d been willing to wait longer.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on March 19, 2018, 02:35:31 PM
What's being stored in the blockchain besides transaction data?

Financial Cryptography and Data Security, 22nd International Conference, 2/26/18-3/2/18:
A Quantitative Analysis of the Impact of Arbitrary Blockchain Content on Bitcoin (https://fc18.ifca.ai/preproceedings/6.pdf) (18-page PDF)

Quote
Abstract. Blockchains primarily enable credible accounting of digital events, e.g., money transfers in cryptocurrencies. However, beyond this original purpose, blockchains also irrevocably record arbitrary data, ranging from short messages to pictures. This does not come without risk for users as each participant has to locally replicate the complete blockchain, particularly including potentially harmful content. We provide the first systematic  analysis  of  the  benefits  and  threats  of  arbitrary  blockchain content. Our analysis shows that certain content, e.g., illegal pornography,  can  render  the  mere  possession  of  a  blockchain  illegal.  Based  on these insights, we conduct a thorough quantitative and qualitative analysis of unintended content on Bitcoin’s blockchain. Although most data originates from benign extensions to Bitcoin’s protocol, our analysis reveals more than 1600 files on the blockchain, over 99 % of which are texts or images. Among these files there is clearly objectionable content such as links to child pornography, which is distributed to all Bitcoin participants. With our analysis, we thus highlight the importance for future blockchain designs to address the possibility of unintended data insertion and protect blockchain users accordingly.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on March 27, 2018, 10:57:32 AM
Monero transactions are traceable.

Wired, 3/27/18: The Dark Web’s Favorite Currency Is Less Untraceable Than It Seems (http://The Dark Web’s Favorite Currency Is Less Untraceable Than It Seems)

Quote
...Despite Bitcoin's widespread use on the dark web and for other illicit applications like ransomware, scofflaws have become increasingly aware that if they're not ultra-careful in how they use it, the Bitcoin blockchain can help identify them... As a result, the online underground has increasingly switched to Monero.

But researchers now point to two distinct cracks in Monero's untraceability, one of which was fixed in its early 2017 revamp, and one that still lingers today, even as Monero coders have taken steps to fix it. Both problems relate to how Monero hides the source of a payment, essentially by mixing the coin someone spends with a sampling of other coins used as decoys known as "mixins."

The researchers first note that simple tricks allow an observer to identify some of the decoy mixins used to cover for a real coin being spent. ...

The researchers also found a second problem in Monero's untraceability system tied to the timing of transactions. In any mix of one real coin and a set of fake coins bundled up in a transaction, the real one is very likely to have been the most recent coin to have moved prior to that transaction. Before a recent change from Monero's developers, that timing analysis correctly identified the real coin more than 90 percent of the time...

...for Monero users who spent coins before its privacy improvements, indelible fingerprints could lead to their front door. And that points to a more fundamental problem for cryptocurrencies offering privacy: Any security flaw discovered in the future might apply retroactively, allowing observers to dig up old skeletons buried in the currency's blockchain. ...
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on April 01, 2018, 01:28:28 PM
From today's EFFector, the newsletter of the Electronic Frontier Foundation:

Quote
Report: By 2020, More Than 30% of World’s Electricity Consumption Will Be Spent Explaining Bitcoin

Scientists have released a new study claiming that if current trends continue, nearly a third of the world’s power will be used to explain how Bitcoin works by 2020. According to experts, the amount of energy required to download tweets, articles, and instant messages which describe what “the blockchain” is and how “decentralized” currencies are “the future” will soon eclipse the total amount of power used by the country of Denmark. The authors note that the average Uber driver now spends three minutes per ride explaining how the coin is “totally anonymous” and encouraging riders to install Coinbase or a similar app.

Furthermore, they warn that “alt-coins” like Ethereum and Filecoin are even more inscrutable, and explanations of them promise to waste even more time and energy in the future.


NSA Stock Rating Up 1000% After Rename to National Blockchain Agency

In a surprising turn, the NSA has announced a name change to include the word “blockchain,” which has sent the usually secretive spy agency’s stock soaring. An NSA spokesperson, wishing to remain anonymous, also stated that as a part of this rebranding the agency will now store all information it has collected about every American on the blockchain. “Since the storage is on the blockchain, it will be totally anonymous.”


National Basketball Association Sues National Blockchain Agency

The NBA has filed a trademark infringement suit against the National Blockchain Agency (previously known as the NSA). Sources within the NBA say the move was precipitated by the organization’s plans to rename itself the National Blockchain Association.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 22, 2018, 08:45:08 PM
Wikileaks Claims Coinbase Has Shut Down Its Online Store's Bitcoin Account (http://fortune.com/2018/04/22/wikileaks-coinbase-shut-down-bitcoin/)

It's not clear if Coinbase froze Wikileaks deposited funds (crypto and/or fiat), but it's a good reminder of what happens if they suspect you're violating U.S. government financial regulations. 

The only way to hang on to crypto is to maintain absolute control of your private keys.

It's a good idea to pay your capital gains taxes, too. 
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on April 24, 2018, 09:55:39 AM
I had a great uncle who allegedly buried some amount of gold decades back.  Unfortunately he went senile in his old age and relatives couldn't extract the correct location before he passed away.

While we can shake our heads at that foolishness, it's really not different than a paper wallet getting lost.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on April 24, 2018, 08:30:17 PM
Bitcoin has done the unthinkable... ended Bitcoin. With the release of the lightning network...

https://www.coindesk.com/information/what-is-the-lightning-network/

It seems on its face good. A and B go to a movie. A spends $30 on tickets and B spends $12 on concessions. Instead of 4 market moves lightning gives the theater $42 and A $8. Saves on the transfer cost of Bitcoin. Brilliant. The lightning network resolves it in a more efficient Blockchain move.

Lightning lets you pass money back and forth until you want to resolve it on the Blockchain. It's a cool way to pass a few bucks between friends and settle up with Blockchain at the end of the day.

But you don't need to settle. Suppose I had a few million in Bitcoin and used it on the lightning network. I, not the minors, collect on exchange. I am incentivized to keep funds forever in lightning without resolution in the Blockchain. In other words, I am a lightning intermediary. I am a Bitcoin BANK. And I never need to get back to the Blockchain. The currency is guaranteed just like the gold dollar in 1974. And you'll use me as an intermediary because I'm cheaper than legit Blockchain.

To any trader we immediately scream "derivatives market".

Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 30, 2018, 10:29:15 AM
This author argues that the only use case for gold these days is as a means for nation states to pay for wars when nobody accepts their paper anymore.  Individuals are better off with crypto.

https://www.forbes.com/sites/investor/2018/04/30/bitcoin-is-the-new-flight-capital/#6ecf80d37320 (https://www.forbes.com/sites/investor/2018/04/30/bitcoin-is-the-new-flight-capital/#6ecf80d37320)

Quote
Today you’d stash it in Bitcoin and be safe in the knowledge that you could fly away on holiday somewhere safe for a few months and your stash would be as safe as the place your hid you private keys.


This is a blow to gold so that for now when a war breaks out or a conflict starts to brew, don’t expect gold to spike like the old days. Now Etherium, Bitcoin, Ripple, Litecoin and a myriad of crypto will get the attention that gold once enjoyed.
Title: Re: Bitcoin currency (merged topics)
Post by: Smurf Hunter on April 30, 2018, 10:39:02 AM
This author argues that the only use case for gold these days is as a means for nation states to pay for wars when nobody accepts their paper anymore.  Individuals are better off with crypto.


Let's unpack that statement a bit...

That implies that parties are accepting gold in exchange for munitions and other war time materials.  If gold was crap, arms dealers wouldn't accept it.
More specifically, this is the pattern of "rogue" actors who are out of favor with the global financial system and it's allies.  If France or Germany wants to buy fighter jets or missiles, Lockheed Martin will likely accept Euros or a bank FX of the same into USD.

It's when rebel armies, "failed" nation states or "terrorists" want to arm up that gold comes into play. 

What has me wondering, is logistically crypto has advantages over gold, so why are any "bad guys" still using gold?
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on April 30, 2018, 07:04:12 PM
  Crypto can fail as can the machine that supports it.
Gold is universally recognized as a value...even aliens come to earth to mine  and extract our gold.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on April 30, 2018, 07:13:11 PM
Quote
However, there is no shaking gold’s investment audience. It’s the same old types since when I was a small child, grisly old guys awaiting Armageddon and a global comeuppance.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on May 01, 2018, 08:27:05 AM


Not to mention the $343 an oz price I paid for my gold and the current value that just screams how badly inflated our US Dollar has come in just a few years. Gold is a stabilizing metal...and far more portable than silver and yet more dependable than a bunch of ones and zeros that change value on the whims of the market...GOLD is an anchor to value and not a path to profit.
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on June 13, 2018, 07:44:16 PM
Bloomberg, 6/13/18: Tether Used to Manipulate Price of Bitcoin During 2017 Peak: New Study (https://www.bloomberg.com/news/articles/2018-06-13/professor-who-rang-vix-alarm-says-tether-used-to-boost-bitcoin)

Quote
Tether, one of the most-traded cryptocurrencies, shows a pattern of being spent on Bitcoin at pivotal moments, helping to drive the world’s first digital asset to a record price in December, according to research by a University of Texas professor known for flagging suspicious activity in the VIX benchmark. ...

The analysis showed a pattern of Bitcoin price support, Griffin said. First, Tethers are created by the parent company Tether Ltd., often in large chunks such as 200 million. Almost all new coins then move to Bitfinex, he said. When Bitcoin prices drop soon after the issuance, Tethers at Bitfinex and other exchanges are used to buy Bitcoin “in a coordinated way that drives the price,” Griffin said in an interview.

“I’ve looked at a lot of markets,” he said. “If there’s fraud or manipulation in a market it can leave tracks in the data. The tracks in the data here are very consistent with a manipulation hypothesis.”...

He zeroed in on 87 of the largest purchases of Bitcoin with Tether from March 2017 to March 2018. In the cases examined, new Tether had been issued within the prior three days, and Bitcoin’s price had fallen in the prior hour. What followed were increases in Bitcoin’s price -- and those gains added up.

Even though the 87 examples account for less than 1 percent of the time period examined, they amounted to about 50 percent of Bitcoin’s compounded return over that year. ...

Bitcoin purchases with Tether “strongly increase just below multiples of 500. This pattern is only present in periods following printing of Tether and not observed by other exchanges,” he wrote in the paper. To other investors, it gives the impression of a “price floor,” providing a signal for them to buy as well.

“If it was random behavior you wouldn’t see it cluster around the thresholds,” he said in the interview. “It indicates it’s a conscious strategy to provide price support.”...

The paper:
Is Bitcoin Really Un-Tethered? (https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3195066)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 14, 2018, 05:24:18 PM
Excellent Andreas Antonopoulos post-bubble talk:  https://youtu.be/6xIq0FdmsIA (https://youtu.be/6xIq0FdmsIA)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 25, 2018, 02:15:09 AM
It’s a few months old but $5900 is close to where the price fell this weekend, so the numbers and perspective are still useful.

(https://cdn.howmuch.net/articles/bitcoin-horrific-crashes-865c.png)
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on June 25, 2018, 06:49:10 AM
I read recently that somewhere around $5000 is the point where Bitcoin becomes unprofitable for minors to keep maintaining the block chain.  If the price is being supported by fewer and fewer people buying up the excess, and I don’t know that’s what’s happening, is there a chance the block chain itself could be in danger soon because people start turning off their machines?
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 25, 2018, 08:34:57 AM
There are all kinds of dangers, known and unknown, but mining difficulty adjusts as needed to average ten minutes between each new block on the chain, thus predictably producing 6 blocks of transactions every hour.  This process lowers the amount of electricity consumed by the hashing rigs used by the remaining miners as others stop competing for the rewards of finding new blocks. So if $5000 is unprofitable this week, it doesn’t mean it won’t be profitable to mine at $3000 next month as the difficulty decreases.
Title: Re: Bitcoin currency (merged topics)
Post by: CharlesH on June 25, 2018, 10:31:29 AM
Very cool information.  Thanks!
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on June 28, 2018, 07:17:33 PM
3 Tips to relieve anxiety during the BTC bear market:  https://youtu.be/EPmgwfLiroE (https://youtu.be/EPmgwfLiroE)


In my opinion, Jimmy Song is a close second, after Andreas Antonopoulos, as a trusted voice in this space.  Both have the technical skills to understand the underlying code and explain to a layperson, but most importantly, they're honest about the risks involved.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 05, 2018, 02:21:56 AM
6 Million Bitcoin is Lost or Stolen, Should the Real Value of BTC Higher? (https://www.ccn.com/6-million-bitcoin-is-lost-or-stolen-should-the-real-value-of-btc-higher/)

So, instead of 17 million bitcoin, there's only 11 million available for trade now, and the maximum limit of 21 million bitcoin by the year 2140 will really be only 15 million. 

Such is the harsh reality of a truly decentralized ledger of account, there's no central authority who can refund coins.  It's not like ethereum, where Vitalik could hardfork it to get investors' stolen money back.
Title: Re: Bitcoin currency (merged topics)
Post by: fratermus on July 06, 2018, 06:17:23 AM
So, instead of 17 million bitcoin, there's only 11 million available for trade now, and the maximum limit of 21 million bitcoin by the year 2140 will really be only 15 million. 

They are theoretically recoverable, so IMO the total will still be 21M.


Quote
Such is the harsh reality of a truly decentralized ledger of account, there's no central authority who can refund coins.

That's a bug, not a feature.  ::)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 12, 2018, 04:18:54 PM
Andreas Antonopoulos on the security of private keys cryptology and the overblown threat posed by quantum computing:  https://youtu.be/xxfUpIV9wRI (https://youtu.be/xxfUpIV9wRI)

Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 13, 2018, 06:06:13 PM
Russians Indicted for US Election Hacks Used Bitcoin to Fund Operations (https://www.coindesk.com/russian-dnc-hackers-used-cryptocurrency-to-fund-their-operations/)

Quote
"In an effort to pay for their efforts around the world ... the defendants paid for it with cryptocurrency," deputy U.S. Attorney General Rod Rosenstein said during a press briefing.

While the defendants allegedly used other currencies, including the U.S. dollar, "they principally used bitcoin when purchasing servers, registering domains, and otherwise making payments in furtherance of hacking activity."

Payments are said to have been made to companies in the U.S., with some of those funds being traced to a bitcoin mining operation.

The indictment explains:

"In addition to mining bitcoin, the Conspirators acquired bitcoin through a variety of means designed to obscure the origin of the funds. This included purchasing bitcoin through exchanges, moving funds through other digital currencies, and using pre-paid cards. They also enlisted the assistance of one or more third-party exchanges who facilitated layered transactions through digital currency exchange platforms providing heightened anonymity."


If these Russian cyberwarriors can't hide bitcoin transactions from a motivated adversary, nobody can.

Better pay your capital gains taxes!
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 24, 2018, 08:08:57 PM
As bitcoin is heading back up again, it might be a good time to read this article (https://www1.icsi.berkeley.edu/~nweaver/papers/cryptorisks.pdf) linked on Bruce Schneier's blog today (https://www.schneier.com/blog/archives/2018/07/nicholas_weaver_2.html) about cryptocurrency risk.

Quote
Cryptocurrencies, although a seemingly interesting idea, are simply not fit for purpose. They do not work as currencies, they are grossly inefficient, and they are not meaningfully distributed in terms of trust. Risks involving cryptocurrencies occur in four major areas: technical risks to participants, economic risks to participants, systemic risks to the cryptocurrency ecosystem, and societal risks. Fortunately, for all but the last case, there is little risk to anyone not directly participating.

I certainly agree about the technical risks to participants, that's what keeps me up at night.

I didn't know Schneier was a cryptocurrency skeptic, but I guess it's not too surprising.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 31, 2018, 02:10:04 AM
Most cryptocurrency wallets these days utilize a backup method consisting of a random 24-word mnemonic seed phrase that is generated at the time the wallet is initialized.  Entering this phrase into another compatible wallet regenerates all the keys generated with that seed allowing funds to be spent in the event the original wallet is lost or broken.  Hardware wallets come with a small card with 24 blank spaces for copying down the seed words from the device at initialization with the admonition to store the card somewhere safe and never digitally where it could be hacked online.  Some wallets periodically remind you to verify that you still have possession of the card by prompting entry of a certain number of words for verification.

This new technology now makes safeguarding the seed phrase more important that the actual wallet, with many not willing to trust those words to a piece of paper that could be destroyed from fire or flood.  One of the solutions has been to record the words onto corrosion resistant metals with a high melting temp.  Here's an article from a prominent crypto security guy with the results of a torture test he dished out on several of the more popular market solutions.


Metal Bitcoin Seed Storage Stress Test (https://medium.com/@lopp/metal-bitcoin-seed-storage-stress-test-21f47cf8e6f5)


(https://cdn-images-1.medium.com/max/1000/1*dOsRCogGVTmtu-7WcaJuRQ.jpeg)

(https://cdn-images-1.medium.com/max/800/1*VvbHhf8WCPGLEGKy4q6rtA.jpeg)
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on July 31, 2018, 06:23:42 AM
  It will still all be waste with EMP
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 31, 2018, 04:24:01 PM
Maybe...

https://en.bitcoin.it/wiki/Nuclear_war_and_Bitcoin (https://en.bitcoin.it/wiki/Nuclear_war_and_Bitcoin)

Quote
Many nuclear scenarios could damage cables and backbone routers, segmenting parts of the Internet. In this case, it would be necessary for people wishing to transact to find some way of communicating with the single segment containing the most mining power, such as by using satellite communication, dial-up connections, or even by writing transactions down on paper and moving them physically. This would make Bitcoin more cumbersome to use -- perhaps too cumbersome to be realistic during or immediately after a nuclear war --, but still usable.

Quote
A likely scenario is that Bitcoin would become frozen and practically unusable - but not destroyed - until the Internet was restored to roughly its former capabilities.

Quote
Even if the entire world was affected, Bitcoin would be frozen with its pre-EMP ledger, not destroyed.

Quote
The Bitcoin block chain is so widely distributed that someone will undoubtedly have a safe copy of it somewhere.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on July 31, 2018, 06:05:13 PM
  If records of BTC are kept OFF the internet and not dependent of the 'life' of the internet.  I do understand that MOST all economy is now digital anyway...BUT...will Block Chain SURVIVE a non living internet??
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 31, 2018, 06:51:12 PM
The ability to actively process transactions requires a sufficient number of mining computers linked via low latency connections, but as long as there's enough in operation somewhere on the planet, the blockchain will stay alive until the damaged internet infrastructure can be repaired and rejoin the network.  Even if everything went dark across the globe, there's a complete history of every prior transaction and balance status of each bitcoin address that is permanently recorded and synchronized on the copy of the blockchain of every participating active node at the time of the catastrophe.  With this record intact, even after a period of dormancy to rebuild, the network could restart where it left off.

There must be a fair number of EMP-hardened nodes spread around the world that would preserve the blockchain until it could be brought back online, if there's sufficient will and resources available after such an extinction level event.  Most EMP events, short of the ELE variety, will not result in a global blackout, so having the ability to regenerate one's keys after the infrastructure comes back will prevent a total loss of funds.  The ability to relay transactions wirelessly has been demonstrated, via amateur radio, as well as mesh networks like the Gotenna.  I'm not sure how the pen and paper transactions work, but might be good thing to learn.
Title: Re: Bitcoin currency (merged topics)
Post by: Carl on July 31, 2018, 08:02:46 PM
The ability to actively process transactions requires a sufficient number of mining computers linked via low latency connections, but as long as there's enough in operation somewhere on the planet, the blockchain will stay alive until the damaged internet infrastructure can be repaired and rejoin the network.  Even if everything went dark across the globe, there's a complete history of every prior transaction and balance status of each bitcoin address that is permanently recorded and synchronized on the copy of the blockchain of every participating active node at the time of the catastrophe.  With this record intact, even after a period of dormancy to rebuild, the network could restart where it left off.

There must be a fair number of EMP-hardened nodes spread around the world that would preserve the blockchain until it could be brought back online, if there's sufficient will and resources available after such an extinction level event.  Most EMP events, short of the ELE variety, will not result in a global blackout, so having the ability to regenerate one's keys after the infrastructure comes back will prevent a total loss of funds.  The ability to relay transactions wirelessly has been demonstrated, via amateur radio, as well as mesh networks like the Gotenna.  I'm not sure how the pen and paper transactions work, but might be good thing to learn.

THANKS...I had long thought that the net had to remain active (alive) for the survival of BTC and retention of transactions...
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on July 31, 2018, 09:42:55 PM
Starting Bitcoin Core as a full node (https://bitcoin.org/en/full-node#what-is-a-full-node) on your own machine requires a couple of weeks to download the entire blockchain, which is approaching 170 gigabytes in size right now, up 30 gigabytes from the beginning of the year.  It's a big chunk of data, but storage is cheap enough that pretty much anyone with an old laptop and a cable modem can have their own synchronized copy of every single bitcoin transaction since Satoshi flipped the switch back on January 10, 2009.

Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 02, 2018, 04:18:13 PM
Short big-picture vids from Jimmy Song, who tends to lean anarcho-capitalist, discussing decentralized governance and how that feature (not a bug) positions bitcoin as the sound money (ie. digital gold) of cryptocurrencies. 


(https://i.ytimg.com/vi/wZj8yUcQ5hY/hqdefault.jpg?sqp=-oaymwEXCPYBEIoBSFryq4qpAwkIARUAAIhCGAE=&rs=AOn4CLDEPWbVSJCaDJbCYEosVENt65_ucg)

What is Bitcoin Governance? (https://youtu.be/wZj8yUcQ5hY)


(https://i.ytimg.com/vi/RSuZRkD-cW4/hqdefault.jpg?sqp=-oaymwEXCPYBEIoBSFryq4qpAwkIARUAAIhCGAE=&rs=AOn4CLCnqbGJbAmc1alma_qFxPxDNzAoQw)

Why diversification in cryptoassets isn't as effective (https://youtu.be/RSuZRkD-cW4)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 15, 2018, 12:32:35 AM
Xapo exec says extinction level event for 90% of cryptoassets (https://www.ccn.com/90-of-cryptocurrency-market-facing-extinction-level-event-xapo-president/)

Half of the top 15 cryptocurrencies are down more than 90% from all time highs.

(https://248qms3nhmvl15d4ne1i4pxl-wpengine.netdna-ssl.com/wp-content/uploads/2018/08/cryptocurrency-market-down-from-ath-1.jpg)


A few days ago, bitcoin went above 50% market share for the first time in 2018.

(https://248qms3nhmvl15d4ne1i4pxl-wpengine.netdna-ssl.com/wp-content/uploads/2018/08/bitcoin-price-dominance-aug14.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: Mr. Bill on August 15, 2018, 12:30:07 PM
Chainstate, 8/15/18: AT&T Sued for $224 Million Over Cryptocurrency Theft (https://chainstate.org/2018/08/15/att-sued-for-224-million-over-cryptocurrency-theft/)

Quote
...[Michael] Terpin, the founder and CEO of Transform Group which has launched a number of high-profile ICOs including Ethereum, Golem and Gnosis, filed a complaint with the US District Court over the theft of three million coins in January 2018. At the time of the theft, the coins were worth over $24 million, and Terpin is looking to sue for an additional $200 million in punitive damages. ...

SIM fraud typically occurs when an attacker pretends to a customer, and contacts a carrier’s support service to have a phone number assigned to their own SIM. ... Hackers have begun to target known crypto holders....
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 15, 2018, 08:29:03 PM
Chainstate, 8/15/18: AT&T Sued for $224 Million Over Cryptocurrency Theft (https://chainstate.org/2018/08/15/att-sued-for-224-million-over-cryptocurrency-theft/)

Maybe it's the guy's like him that will shell out $10k per year for Casa's Key Storage System (https://keys.casa/).

.......if he's not up for rolling his own 3-of-5 multisig wallet with sufficient physical key separation.

(https://cdn-images-1.medium.com/max/1600/1*x4rItGnNSuJdINEDnnkG-w.png)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 16, 2018, 03:22:34 PM
Lots of details on the AT&T SIM fraud:  https://krebsonsecurity.com/2018/08/hanging-up-on-mobile-in-the-name-of-security/ (https://krebsonsecurity.com/2018/08/hanging-up-on-mobile-in-the-name-of-security/)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on August 24, 2018, 09:00:50 PM
WSJ:  It Was Meant to Be the Better Bitcoin. It’s Down Nearly 90% (https://www.wsj.com/articles/it-was-meant-to-be-the-better-bitcoin-its-down-nearly-90-1535115600?mod=hp_lead_pos10)

Quote
The bear market in cryptocurrencies has punished investors who bought bitcoin at the height of cryptomania last year. But losses have been even more brutal for those who invested in once-promising rivals of bitcoin.

Consider Bitcoin Cash, an offshoot of bitcoin that launched on August 1, 2017, which moves independently of bitcoin itself. While bitcoin has fallen 67% from its record intraday high of $20,089 in December, Bitcoin Cash is down a crushing 88% from its peak of $4,355.62, according to CoinMarketCap.com. Friday evening, it traded at around $533.


Interesting video of Jimmy Song explaining the rumors of BitMain propping up BCH, to protect their million coin stake, by selling BTC and mining at a loss:  What's going on with Bitcoin Cash and Bitmain (https://youtu.be/Anni0DU2biw)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 04, 2018, 04:18:12 PM
The anonymous Shapeshift.io site will be moving toward required accounts for exchanging, which involves the collection of personal information.  Seems like KYC/AML catches up with everyone in this space, even though they're in Switzerland.

My guess is their Prague based competitor, Changelly, will find they need to do the same, at some point.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on September 23, 2018, 08:28:04 PM
While only tangentially related to bitcoin, here's an interesting talk by Jameson Lopp (he mutilated the metal hardware wallets earlier in this thread):  Extreme OPSEC for the Modern Cypherpunk (https://youtu.be/66ZoGUAnY9s)

As someone who wrote of his family's SWATting in the last year (https://medium.com/@lopp/reflections-upon-a-swatting-a45c0209135f), initiated by someone opposed to his public position on the Bitcoin vs. Bitcoin Cash debate, he's actually researching and implementing these procedures in his own life. 

Bottom line, everything must be siloed behind separate proxies.  Car, home, snail mail, pet licenses, pseudonyms, phones, internet, everything.  All of which is very difficult and expensive ($20k just in legal fees thus far), and yet still will not adequately withstand a motivated nation-state.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 03, 2018, 10:35:25 PM
NY-based Gemini announced they have obtained insurance coverage for cryptocurrencies held in custodial accounts on their exchange:  https://www.businesswire.com/news/home/20181003005283/en/ (https://www.businesswire.com/news/home/20181003005283/en/)

Quote
Gemini was approved for coverage after successfully demonstrating to underwriters that the company is a leading, best-in-class exchange and custodian. The digital asset insurance coverage further bolsters confidence and protection for consumers transacting on the Gemini platform.

“Consumers are looking for the same levels of insured protection they’re used to being afforded by traditional financial institutions,” said Yusuf Hussain, Gemini’s Head of Risk. “Educating our insurers not only allows us to provide such protections to our customers, but it also sets the expectation for consumer protection across the crypto industry.”
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 05, 2018, 09:29:33 PM
While only tangentially related to bitcoin, here's an interesting talk by Jameson Lopp (he mutilated the metal hardware wallets earlier in this thread):  Extreme OPSEC for the Modern Cypherpunk (https://youtu.be/66ZoGUAnY9s)

As someone who wrote of his family's SWATting in the last year (https://medium.com/@lopp/reflections-upon-a-swatting-a45c0209135f), initiated by someone opposed to his public position on the Bitcoin vs. Bitcoin Cash debate, he's actually researching and implementing these procedures in his own life. 

Bottom line, everything must be siloed behind separate proxies.  Car, home, snail mail, pet licenses, pseudonyms, phones, internet, everything.  All of which is very difficult and expensive ($20k just in legal fees thus far), and yet still will not adequately withstand a motivated nation-state.

Here's Jameson's long write up of the above talk:  https://medium.com/s/story/a-modest-privacy-protection-proposal-5b47631d7f4c (https://medium.com/s/story/a-modest-privacy-protection-proposal-5b47631d7f4c)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 08, 2018, 03:33:07 PM
In this animated cartoon, Jimmy Song argues that Bitcoin represents a form of decentralized Austrian hard money, while Bitcoin Cash is Keynesian fiat controlled by a central elite.

(https://i.ytimg.com/vi/PExooztro-0/hqdefault.jpg?sqp=-oaymwEjCPYBEIoBSFryq4qpAxUIARUAAAAAGAElAADIQj0AgKJDeAE=&rs=AOn4CLCz2hsLGWwTs8avrKfD4_5WC-4UCw)
Bitcoin Cash is Fiat Money (https://youtu.be/PExooztro-0)

His in-depth article in preparation for a debate with Roger Ver, one of the BCash founding elites:  https://medium.com/@jimmysong/bitcoin-cash-is-a-fiat-money-39626c002f77 (https://medium.com/@jimmysong/bitcoin-cash-is-a-fiat-money-39626c002f77)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 12, 2018, 08:45:57 PM
Decentralized digital currency meets decentralized wireless communications network......and a cypherpunk lovechild is born.

The Samourai Wallet developers have a new app that allows a signed bitcoin transaction to be transmitted over a goTenna Mesh network:  TxTenna: Transact By Other Means  (https://www.inthemesh.com/archive/txtenna-transact-by-other-means/?utm_campaign=ITM+News+-+TxTenna+%28LPPznb%29&utm_medium=email&_ke=eyJrbF9lbWFpbCI6ICJtb2hybGFuY2VAc2JjZ2xvYmFsLm5ldCIsICJrbF9jb21wYW55X2lkIjogImFCV0RLVyJ9&utm_source=alice)

(https://www.inthemesh.com/wp-content/uploads/2018/10/Screen-Shot-2018-10-10-at-10.43.16-AM-768x310.png)

A simple signed transaction contains this information

Quote
Version: 02000000
Flag: 0001 (indicates segwit)
Input Count: 01
Input 1 Previous Output Hash: 1333183ddf384da83ed49296136c70d206ad2b19331bf25d390e69b222165e37
Input 1 Previous Output Index: 00000000
Input 1 script length: 0x17 (23 bytes)
Input 1 scriptSig: 160014b93f973eb2bf0b614bddc0f47286788c98c535b4
Input 1 sequence: feffffff
Output Count: 02
Output 1 Value: 00e1f50500000000 (100M satoshis / 1 BTC)
Output 1 public key script length: 0x17 (23 bytes)
Output 1 public key script: a914a860f76561c85551594c18eecceffaee8c4822d787
Output 2 Value: F0C1A43500000000 (899990000 sats / 8.9999 BTC)
Output 2 public key script length: 0x17 (23 bytes)
Output 2 public key script: a914d8b6fcc85a383261df05423ddf068a8987bf028787
Witness Count: 02
Witness 1 length: 0x47 (71 bytes)
Witness 1: 30440220434caf5bb442cb6a251e8bce0ec493f9a1a9c4423bcfc029e542b0e8a89d1b3f022011090d4e98f79c62b188245a4aa4eb77e912bfd57e0a9b9a1c5e65f2b39f3ab401
Witness 2 length: 0x21 (33 bytes)
Witness 2: 0223bec70d670d29a30d9bcee197910e37cf2a10f0dc3c5ac44d865aec0d7052fb
Locktime: 8c000000 (block 140)


And is broadcast to the network as this blob of hex

Quote
0200000000010111b6e0460bb810b05744f8d38262f95fbab02b168b070598a6f31fad4
38fced4000000001716001427c106013c0042da165c082b3870c31fb3ab4683feffffff020
0ca9a3b0000000017a914d8b6fcc85a383261df05423ddf068a8987bf0287873067a3fa0
100000017a914d5df0b9ca6c0e1ba60a9ff29359d2600d9c6659d870247304402203b85
cb05b43cc68df72e2e54c6cb508aa324a5de0c53f1bbfe997cbd7509774d022041e1b182
3bdaddcd6581d7cde6e6a4c4dbef483e42e59e04dbacbaf537c3e3e8012103fbbdb3b3fc
3abbbd983b20a557445fb041d6f21cc5977d2121971cb1ce5298978c000000
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 15, 2018, 10:56:10 PM
Fidelity Says It Will Trade Bitcoin for Hedge Funds (https://www.wsj.com/articles/fidelity-offers-professional-investors-access-to-a-new-world-trading-bitcoin-1539621000)

Quote
Fidelity Investments said it will store and trade bitcoin for hedge funds and other professional investors, becoming one of the first Wall Street giants to step into this volatile corner of the financial world.

Most large financial-services firms have resisted the idea of trading digital currencies because of concerns about risk, regulations and stability.


Cue up the Institutional FOMO.....
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on October 16, 2018, 08:25:42 PM
$194 Million was Moved Using Bitcoin With $0.1 Fee, True Potential of Crypto (https://www.ccn.com/194-million-was-moved-using-bitcoin-with-0-1-fee-true-potential-of-crypto/)

Quote
On October 16, a Bitcoin user moved 29,999 BTC worth $194 million with a $0.1 fee, a transaction which with banks would cost tens of thousands of dollars.

An often pushed narrative against cryptocurrencies like Bitcoin and Ethereum is that it is expensive to clear transactions due to fees sent to miners. However, the $194 million payment on the Bitcoin blockchain demonstrates the potential of consensus currencies to optimize cross-border payments significantly.

Transferwise is a UK-based multi-billion dollar firm that eliminates hidden fees in bank transfers. On the platform, users can send small to large payments through bank accounts with substantially lower fees.

However, even on a platform like Transferwise, to send over $1 million, it costs over $7,500 in transaction fees. That means, through wire transfers and conventional banking methods, tens of thousands of dollars are required to clear a transaction that is larger than $1 million.

Percentage-wise, $7,500 is less than 1 percent of $1 million, and in that sense, a $7,500 fee is cheap. But, on the Bitcoin network, which is supposedly highly inefficient in processing payments, it costs less than $0.1 to clear a $194 million transaction.
Title: Re: Bitcoin currency (merged topics)
Post by: David in MN on October 17, 2018, 08:25:15 AM
Can crypto predict the broader stock market? Maybe...

https://cointelegraph.com/news/so-is-there-a-correlation-between-bitcoin-and-stock-market-yes-but-no

I actually had a friend alert me to this. Bitcoin has a negative relationship to both the VIX and VXX. In layman's terms it means that as volatility in the broader stock market rises Bitcoin sees a price decline. Does this really matter? Maybe. Traders are obsessed with patterns so we'll toil over any little data blip.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 14, 2018, 02:30:31 PM
After months of remarkable price stability around $6400, bitcoin is down over 12% today, along with pretty much all the cryptocoins, most of which dropped further percentage-wise than BTC.

Tomorrow is the date threatened for the Bitcoin Cash hardfork, so I suspect the big guys in that controversy are trying to manipulate the market to their advantage.

BTC still maintains >50% market share.

It’s looking like we’re in for a bumpy ride as fake satoshi and bitcoin Judas fight over the future of BCH.
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 17, 2018, 03:15:02 PM
Interesting new tool from CoinDesk (https://www.coindesk.com/data) for visually comparing cryptocurrency strength on the basis of Price, Network, Social, Exchange, and Developer activity.

(https://farm5.staticflickr.com/4900/44112008100_0462ff0f91_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 17, 2018, 03:49:02 PM
BTC price over the years.....


(https://farm5.staticflickr.com/4886/45879055922_b6b7f11abf_b.jpg)
Title: Re: Bitcoin currency (merged topics)
Post by: FreeLancer on November 19, 2018, 11:33:34 PM
The crypto blood bath worsened across the board today, with BTC hitting $4500.  I'm getting the impression that all but the hardcore HODLers are getting pretty spooked and fleeing the space en masse, and it could easily go to $2000 at this rate.  If this keeps up I might even be tempted to buy back what I've sold this year. 

Here's the top 6 mineable coins' performance YTD.......in log scale so it's not quite as vertiginous.

(https://farm5.staticflickr.com/4831/45965944831_87370ba003_b.jpg)