# Bitcoin Mining



## ABenz99

So I've recently discovered bit coin mining, and am interested in starting a mine of my own, I love building computers, experimenting with different hardware, etc. and I think this will be a great way to earn profit. I was online the other day looking for GPUs and other hardware to build my mine, and I came across this http://www.butterflylabs.com/monarch/. I've done some research that says this can mine over 6 bitcoins per month! My only question now is what's the catch? This seams like a little too much money for doing essentially nothing, and the card will pay for itself in 2 weeks. Is there something I'm missing, or can it not actually mine that fast? Also, if anyone has any recommendations on other hardware to consider, please tell me!


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## PCunicorn

The catch is you have to spend over two thousand dollars. Also, in 6 to 8 months this will be relatively weak and wont mine very well. This happens with all ASIC miners, once this speed becomes mainstream you will be mining way slower.

For example, a year and a half ago, people could only dream of 5 gigahashes. Now, you might make 0.001 bitcoin a day.


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## ABenz99

Is it a good investment though, I know it's an expensive start, however it will pay for itself, and eventually earn profit. That's sort of why I'm asking, If I'm going to spend over 2,000; I want to make sure I will get something from it.


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## C4C

There was a recent thread on this.. The overall verdict was that you'll probably spend the same amount on energy costs as you'll get back in a virtual currency...


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## PCunicorn

You'll make your money back pretty quickly. But as these start to flood the market, you won't make to much.

And Digxt, no. A whole school with low end PCs won't be worth it in power. 4 5870s won't be worth it with power. But a 300w 600GHs miner won't use too much power at all.


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## ABenz99

What I'm concluding here is that buying one is fine (I'll earn the money back eventually), but I shouldn't expect to make much profit off it.


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## PCunicorn

Well no, I would expect to make a reasonably large profit off it until Bitcoin either crashes (if it does) or these become mainstream


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## G80FTW

There is no such thing as free money. Money comes at a cost, ALWAYS. I used to play a game called Second Life. Was fun for a bit, had its own virtual currency which could be converted for real money. However, at the end of the day it would only make me $20/month at best. Which to me wasnt worth the time to even play with it.  There was a story about ONE person who supposedly made a good living on Second Life however I think it was just a scam to get more people on it. I could not see any real profit in any of these kinds of things.


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## PCunicorn

And this isn't free money either. It's $2200.


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## G80FTW

PCunicorn said:


> And this isn't free money either. It's $2200.



So your saying that with an initial investment of $2,200 you will "quickly" see profit from that? How quick are we talking? Because I would assume that if you could make say $4,400 after 2 months then everyone would be doing it and it would quickly fall apart.

If thats the case, I would quit my job and just build computers and mine with them. But I really could not see the investment worthwhile.  Even on Second Life the developers claimed only 233 people made $5,000 in a year. And Im sure those people spent every waking moment on the game something I would not be prepared to do.


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## PCunicorn

Did Second Life require any risky investment? That's the problem with bitcoin, and why even the people who do it and make good money don't quit their jobs. Its extremely risky.


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## G80FTW

PCunicorn said:


> Did Second Life require any risky investment? That's the problem with bitcoin, and why even the people who do it and make good money don't quit their jobs. Its extremely risky.



Well is it extremely risky or can you expect to make a large profit quickly? Because right now I am confused.


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## PCunicorn

It's risky because of the way it can suddenly crash
 But you can in theory make a pretty large profit.


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## FuryRosewood

PCunicorn said:


> Did Second Life require any risky investment? That's the problem with bitcoin, and why even the people who do it and make good money don't quit their jobs. Its extremely risky.



Secondlife economy is relatively stable compared to bitcoin. The linden may vary by maybe a few percent, but doesn't swing by 100s of dollars. 

Current exchange rate is about 240L$ to a buck. Which is about what it was about 6 months ago. There were times when people were flooding the market with linden and artificially deflating the price, but there has been limits put in to stop this from happening now. With Bitcoin i see it as a rich mans market, Litecoin is where its at right now, far easier to get with off the shelf hardware however you still can get swings in price that bitcoin gets, but its not several hundred dollars, but 10ish at the most. 

-Secondlife member for since Feb 2006


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## porterjw

G80FTW said:


> So your saying that with an initial investment of $2,200 you will "quickly" see profit from that? How quick are we talking? Because I would assume that if you could make say $4,400 after 2 months then everyone would be doing it and it would quickly fall apart.



That.

I equate the people who believe that spending money to mine Bitcoins will somehow earn them profit to the people who watch the "buy my book and start earning $70k in 6 months by only working part-time from home" infomercial at 2AM. Bitcoins are *created*, not "mined". Mining implies there are a limited number of them and it's a race to see who can collect the most. Gold is mined, diamonds are mined...BC's are released to fuel the market for people who spend insane amounts of money to have better hardware specs to get a few more... When it crashes, and it *will* crash, anyone invested in them that didn't sell will be sadly disappointed.

I think the OP is gravely mistaken how much profit that card will generate. Keep in mind, the company is trying to sell you a product, in this case a very expensive product. If you have $2200 in on-hand throw-away cash then get it. If you don't, don't. Just don't be surprised if sometime in the near future the realization sinks in that you bought a $2k+ paperweight.


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## Okedokey

The issue with Bitcoin is that the more users and the more time goes on the algorithm gets more and more complex and the difficulty rises exponentially.  There is no money to be made any more in bitcoins, look at another cryptocurrency.


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## PCunicorn

imsati said:


> That.
> 
> I equate the people who believe that spending money to mine Bitcoins will somehow earn them profit to the people who watch the "buy my book and start earning $70k in 6 months by only working part-time from home" infomercial at 2AM. Bitcoins are *created*, not "mined". Mining implies there are a limited number of them and it's a race to see who can collect the most. Gold is mined, diamonds are mined...BC's are released to fuel the market for people who spend insane amounts of money to have better hardware specs to get a few more... When it crashes, and it *will* crash, anyone invested in them that didn't sell will be sadly disappointed.
> 
> I think the OP is gravely mistaken how much profit that card will generate. Keep in mind, the company is trying to sell you a product, in this case a very expensive product. If you have $2200 in on-hand throw-away cash then get it. If you don't, don't. Just don't be surprised if sometime in the near future the realization sinks in that you bought a $2k+ paperweight.



Bitcoins are limited, but as you said, aren't exactly mined. I made a post about it before.


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## G80FTW

PCunicorn said:


> Bitcoins are limited, but as you said, aren't exactly mined. I made a post about it before.




How can they be limited? Are they a physical product? If not, then they are not limited.  Like the other guy said, I think its just a marketing scheme to get people to buy a product.  Its a pretty stupid marketing scheme if you ask me, but I also have no interest in finding out if it actually works.  Much like the other guy said, I also dont buy those peoples books who supposedly hold the secret to making money that no one but them knows about.

Your saying a company is willing to pay people to solve "math problems"? There is no logic in the whole thing at all. I watched the video on their site, its hogwash.


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## Okedokey

G80FTW said:


> How can they be limited? Are they a physical product? If not, then they are not limited.  Like the other guy said, I think its just a marketing scheme to get people to buy a product.  Its a pretty stupid marketing scheme if you ask me, but I also have no interest in finding out if it actually works.  Much like the other guy said, I also dont buy those peoples books who supposedly hold the secret to making money that no one but them knows about.
> 
> Your saying a company is willing to pay people to solve "math problems"? There is no logic in the whole thing at all. I watched the video on their site, its hogwash.



Dude you really have to stop acting like you know anything, because here we are, yet again, and you're wrong.  You say its stupid, how could it be like that and in the same breath, i wont actually educate myself... unbelievable.  bitcoins work just like the United States dollar.  Once it was separated from the value of gold, it has a virtual value.  Sigh... they're no more or less a currency than the worthless piece of paper you call a dollar.  Unless someone honours that worth... and they're in demand.

There has to be a limit of supply, otherwise there is no value on demand.  Basic economics.  The algorithm of bitcoins means that Bitcoins are created at a decreasing and predictable rate. The number of new bitcoins created each year is automatically halved over time until bitcoin issuance halts completely with a total of 21 million bitcoins in existence.


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## G80FTW

Okedokey said:


> Dude you really have to stop acting like you know anything, because here we are, yet again, and you're wrong.  You say its stupid, how could it be like that and in the same breath, i wont actually educate myself... unbelievable.  bitcoins work just like the United States dollar.  Once it was separated from the value of gold, it has a virtual value.  Sigh... they're no more or less a currency than the worthless piece of paper you call a dollar.  Unless someone honours that worth... and they're in demand.
> 
> There has to be a limit of supply, otherwise there is no value on demand.  Basic economics.  The algorithm of bitcoins means that Bitcoins are created at a decreasing and predictable rate. The number of new bitcoins created each year is automatically halved over time until bitcoin issuance halts completely with a total of 21 million bitcoins in existence.





If you get bitcoins from "solving math problems" then how is that a limited supply? What backs the bitcoin? Nothing? As far as I have seen, it is like any other virtual currency and its value rather than being placed on a physical commodity is instead based on demand of itself.  

Basically what an economy is, is trade. You have a commodity, you trade that for another commodity. The bitcoin cannot be any form of an economy or currency because it has no base, was made up with no commodity to back it, and is limitless as far as I can see.  I have somewhat educated myself on the matter, read their site watched the video on their site did other reading etc, however it all boils down to this:

It is NOT a real currency. Those who are using it as such, will soon see no value in it, because it itself has no value being a virtual currency. Its only value is in a computer where it was created. And then its value becomes a series of 1s and 0s. 

Whats even more interesting is its tie with illicit activity:

http://www.forbes.com/sites/andygre...rom-ross-ulbricht-alleged-owner-of-silk-road/

Which is to be expected from a virtual currency.

Although, I would be interested to see the day when we can literally just make our currencies with no commodity and buy goods and services with it.  Would be nice to live in an economy where everything was free. Oh if we thought the global economy was in trouble before....

To be honest, I havent taken one class in economics. But any high school graduate can tell you that a currency with no commodity is not a currency and an economy with no trade is not an economy.  It has a virtual value. I like that. Its funny how you can say that and then tell me Im wrong when your saying exactly what I am and then following it with the exact opposite of that.

But like I said, I am no master of economics.  And with the global economy going further in the toilet with each passing day perhaps a virtual economy based on nothing will save the world from itself.

http://moneymorning.com/2013/12/20/impact-bitcoin-u-s-dollar/

If politicians are scared of it I suppose it cant be that bad.  But is it really a good idea to destroy an economy based on commodity and replace it with an economy based on virtual 1s and 0s? I think that is an even worse alternative than a default.

And one last thing, please explain the part to me again where this company thats sole purpose is to "solve math problems" is handing out a "limited" amount of FREE money to people who have to initially invest into said company? Thats my favorite part 

http://money.cnn.com/2013/12/13/technology/bitcoin-europe-regulation/


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## TrainTrackHack

What is the money you normally use backed by?

"Solving math problems" is obviously a simplification.


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## porterjw

Either a physical product or the word of the government that issues it. Or in the case of the dollar...China


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## Agent Smith

You're better off with a ASIC miner/s. I would use this bitcoin calculator to figure profit. http://www.bitcoinx.com/profit/

http://www.ebay.com/itm/RED-FURY-Bi...708?pt=LH_DefaultDomain_0&hash=item2588885004


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## PCunicorn

G80, if you have no idea about Bitcoins, which you seem not too, stay out of the thread.

Agent Smith, read the OP. That's already what we're discussing.


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## G80FTW

PCunicorn said:


> G80, if you have no idea about Bitcoins, which you seem not too, stay out of the thread.
> 
> Agent Smith, read the OP. That's already what we're discussing.



I read pretty much everything there is to read on the subject most of it from their own website, which also directs to wikipedia for more information on them.

It was a currency invented on a PC, with nothing to back it up, its virtual so has NO value (virtual value is just that, virtual meaning not real), it is theoretically a limitless currency because its supposedly limited by "processing power" which as we know gets stronger every day. Now Im sure a point will come when we reach the peak for processing power, and cannot go any further. However, that is lifetimes away and the amount of this virtual currency by then will be far more worthless than it already is.

Thats all basically from their own site, what else do I need to know? That some underdeveloped countries are using it as a currency? That says alot. And in the future they will suffer economically from it.

There is no such thing as a "self regulating" currency. Because a currency is regulated by its society whom determines its values as well. For us it happens to be our government, for the BitCoin, it happens to be its creator. Which is better?

I am just trying to help people from falling into an obvious scam. Its only the right thing to do.


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## TrainTrackHack

> It was a currency invented on a PC, with nothing to back it up, its virtual so has NO value (virtual value is just that, virtual meaning not real)


So it's fiat currency. Just like the money you use, and indeed most of the world.



> it is theoretically a limitless currency because its supposedly limited by "processing power" which as we know gets stronger every day. Now Im sure a point will come when we reach the peak for processing power, and cannot go any further. However, that is lifetimes away and the amount of this virtual currency by then will be far more worthless than it already is.


The rate at which new bitcoins are mined is limited by processing power; as more coins are mined, it becomes harder and harder to discover new blocks. However, there is still an absolute limit to how many bitcoins there can be. No amount of processing power and mathematical working will allow you to generate more than 100 integers in the range [1,100]; the number of bitcoins, similarly, is limited by math.



> There is no such thing as a "self regulating" currency. Because a currency is regulated by its society whom determines its values as well. For us it happens to be our government, for the BitCoin, it happens to be its creator. Which is better?


The creators have very little control over the currency. It's not "centralised" in any way, they can't regulate it. 



> I am just trying to help people from falling into an obvious scam. Its only the right thing to do.


It's a scam in the same way all fiat money is, including the US dollar.


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## PCunicorn

That's exactly what I would have said but you said it much better. Good job. And the one thing you didn't quite say is that the limit is 21 million. I assume that's what's related to the intergers?


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## TrainTrackHack

> And the one thing you didn't quite say is that the limit is 21 million. I assume that's what's related to the intergers?


The way bitcoins are limited is a fair bit more complicated, I only used the simple integer example to illustrate the point. I don't actually know why that's the exact limit.


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## Darren

Something has value if somebody will give you something else for it in exchange. I take a 5 dollar bill in to McDonald's and I'm going to get food. Simple. If I go to the bank and ask for 5 bucks in gold then present it to McDonalds for some food they're going to look at me like I'm nuts. Money has value because people give it value. You trade it for something that you deem valuable, so thus your money is valuable.

Sure it's being devalued and reducing inflation is beneficial but I think the days of needing a currency to be backed by gold or any other limited commodity are over. There's only so many 20 dollar bills so they are a limited commodity in the same sense. 


If people accept a bitcoin in exchange for something valuable, it becomes valuable.


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## Okedokey

http://www.abc.net.au/news/2014-01-22/vegas-casinos-accepting-bitcoin/5212660

And yes, its limit is 21 million bit coins.


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## G80FTW

Denther said:


> Something has value if somebody will give you something else for it in exchange. I take a 5 dollar bill in to McDonald's and I'm going to get food. Simple. If I go to the bank and ask for 5 bucks in gold then present it to McDonalds for some food they're going to look at me like I'm nuts. Money has value because people give it value. You trade it for something that you deem valuable, so thus your money is valuable.
> 
> Sure it's being devalued and reducing inflation is beneficial but I think the days of needing a currency to be backed by gold or any other limited commodity are over. There's only so many 20 dollar bills so they are a limited commodity in the same sense.
> 
> 
> If people accept a bitcoin in exchange for something valuable, it becomes valuable.



You are exactly right.  

However, I just talked this over with someone who went to college for economics and I will try to explain it like he explained it to me.

The Bitcoin is indeed a currency. HOWEVER, I said before it is not backed by anything except the people who invest into it.  

You cant compare the Bitcoin to the US Dollar because these currencies operate completely different while they do have 1 thing in common: Neither has any "true" value to it.  

The US Dollar is backed by the federal government, which may not sound like much, however the federal government is backed by gold.  So even though the dollar was taken off the gold standard, in a way the money can be still backed by gold. In theory. However that is completely up to the government.  

The Bitcoin, being backed by "investors" is a little bit harder to get behind. Because if you think of it in the simplest way, you are investing a currency into another currency whos sole value relies on the investment of other currencies.  Other people can give it a value, just like the government gives a value to the dollar, however this is why you see the bitcoin go all over the place in terms of its exchange rate. Its constantly going up and down in value because it is not regulated at all:

http://en.wikipedia.org/wiki/History_of_Bitcoin

If you look at its history, yes its possible to make a profit off of investing into this imaginary currency. However, at the end of the day it will be worth nothing in the future because there is nothing to keep it regulated and give a consistent value other than the people using it.  Which is a dangerous type of economy that will be in constant ups and downs with people going crazy.

And no, there is no limit.  You cannot put any limit on something that does not exist in reality.  Explain to me how this "algorithm" that was created has put a limit on this. And then explain to me how this "algorithm" cannot be modified or manipulated by anyone ever. If its software, it can be modified if the right person gets a hold of it. The bitcoin has in its short history already seen the negative effects of a virtual currency with many people hacking it getting however much they want. Which is easy to do when what your getting is 1s and 0s.  The only person who can modify the dollar is the federal government, otherwise it is highly illegal.

Keeping on the terms of legal stuff, its interesting that the bitcoin has been involved in alot of drug trade. And the FBI keeps having to step in.  You know why? This "currency" is a drug lords dream come true. And for any black market. Because the currency does not exist, it cannot be traced, there for it makes the exchange of illegal goods much easier without having to clean the money. Since the money only exist in 1s and 0s on a computer screen. 

So if the bitcoin does become more popular, I foresee the federal government shutting it down in a heartbeat. And other countries would follow suit.  The government does not like having something on the market that they cannot regulate, we already know that. And its highly illegal to make and distribute your own "money" in the US. The only way bitcoin has gotten around that is because its money that does not exist. If it did exist, it would not be legal tender in the US. Which technically the bitcoin is legal tender in the US, because as I said, it does not technically exist. Its value exist only in the minds of those who want to invest a real currency into it.


To put short, its very much the same as buying stock into a company that does not exist. Because that is all you are doing.

Now whether or not you believe in the life of the currency is up to you, like Denther said the more it gets accepted the more chance it has of becoming a real currency, and the far more chance of it becoming corrupted or banned by the worlds governments.

So in the long run, I would say its a worthless investment. And even others have stated in this thread that is a worthless investment, including the all-knowing OkeDokey.  I dont see how one can get behind a currency which takes no labor to obtain.  That alone, will make it worthless in the mainstream. If there is no labor needed to obtain it, it will quickly loose all value. Money has value because for the most part is given in trade of labor. If you had a currency which was mainly obtained by one sitting on the couch at home how could you put any value on it?

I can also put in this, if Rockstar didnt make it illegal in its EULA (which Im actually not entirely sure if it is or isnt) then I could turn around and sell my virtual money in GTAV.  Its the exact same kind of money as a bitcoin. It does not exist in reality and has virtually no limit, however I am certain there are people out there who value it to a degree. Then I could start using GTAV money as real money. Then you run into the problem of no one wanting to buy it anymore because everyone has all that they need. Same exact principles apply here. Whats funny is that the currency in GTAV would probably hold a higher value as it is harder to obtain than a bitcoin.

Also, comparing the bitcoin to the US Dollar:

In the past decade, the cost of living (value of the Dollar) has not changed significantly at all.  Because it is regulated, which is a good thing. By whom, is a different story.  But the bitcoin, in its short life, has been all over the place. If it were to replace the Dollar one day you would be broke the next day you would be rich. Providing it could be a stand alone currency without the investment from other currencies.


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## Okedokey

G80FTW said:


> You are exactly right.
> 
> However, I just talked this over with someone who went to college for economics and I will try to explain it like he explained it to me.
> 
> The Bitcoin is indeed a currency. HOWEVER, I said before it is not backed by anything except the people who invest into it.
> 
> You cant compare the Bitcoin to the US Dollar because these currencies operate completely different while they do have 1 thing in common: Neither has any "true" value to it.
> 
> The US Dollar is backed by the federal government, which may not sound like much, however the federal government is backed by gold.  So even though the dollar was taken off the gold standard, in a way the money can be still backed by gold. In theory. However that is completely up to the government..



Fail, the U.S. took away the government backing of the dollar with an actual gold supply (known as leaving the gold standard) in 1971, and every major international currency has followed suit.
The obvious question is, "Without gold, what does guarantee the value of our money?" The answer is: nothing at all.  Thats how nations like Greece, Portugal and Spain go bankrupt.  Its also how there is more dollars in circulation in the US as debt than the whole of the worlds gold on the planet at current market value.  Had you considered this for one simple moment, you'd have come to the same conclusion.

Tell your economics major friend to get a refund as he missed a lot of it clearly.  Tell him (and you) to look up fiat money... then come back and tell us how thats different to bitcoins.  The answer is it isnt.


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## TrainTrackHack

> And no, there is no limit. You cannot put any limit on something that does not exist in reality. Explain to me how this "algorithm" that was created has put a limit on this. And then explain to me how this "algorithm" cannot be modified or manipulated by anyone ever. If its software, it can be modified if the right person gets a hold of it. The bitcoin has in its short history already seen the negative effects of a virtual currency with many people hacking it getting however much they want. Which is easy to do when what your getting is 1s and 0s. The only person who can modify the dollar is the federal government, otherwise it is highly illegal.


Numbers don't exist in reality, they're an abstract construct humans have created. Therefore, there are infinitely many integers between one and hundred.

The protocol works by consensus; most nodes contribute to the "main" block chain. However, you can't just make arbitrary changes to the protocol and still do so; if you do, you essentially fork off a separate chain (this has happened in the past), but if you want nodes mining such blocks, you'll need for them to have a modified client too. There are quite a few "dead end" chains that split off for various reasons, but were abandoned by miners.

If you really want the details of how the protocol works, help yourself.


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## porterjw

Okedokey said:


> The obvious question is, "Without gold, what does guarantee the value of our money?" The answer is: nothing at all.  Thats how nations like Greece, Portugal and Spain go bankrupt.



That's not entirely accurate.


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## G80FTW

Okedokey said:


> Fail, the U.S. took away the government backing of the dollar with an actual gold supply (known as leaving the gold standard) in 1971, and every major international currency has followed suit.
> The obvious question is, "Without gold, what does guarantee the value of our money?" The answer is: nothing at all.  Thats how nations like Greece, Portugal and Spain go bankrupt.  Its also how there is more dollars in circulation in the US as debt than the whole of the worlds gold on the planet at current market value.  Had you considered this for one simple moment, you'd have come to the same conclusion.
> 
> Tell your economics major friend to get a refund as he missed a lot of it clearly.  Tell him (and you) to look up fiat money... then come back and tell us how thats different to bitcoins.  The answer is it isnt.



You really need to stop doing this because you only make yourself look bad everytime you do. You cant just tell me I am wrong and then say the same thing I did but in a different way.  

And by the way, in 1971 when Nixon announced the Dollar to be taken off the gold standard he then said the Dollar would be backed by the credit of the federal government. And what backs up the government? Gold.  Thats alot more than is backed by the bitcoin. 

I have already explained to you the difference between a fiat currency and a  cryptocurrency. Because you dont understand it, dont complain to me.

Just please think before you post.




hackapelite said:


> Numbers don't exist in reality, they're an abstract construct humans have created. Therefore, there are infinitely many integers between one and hundred.
> 
> The protocol works by consensus; most nodes contribute to the "main" block chain. However, you can't just make arbitrary changes to the protocol and still do so; if you do, you essentially fork off a separate chain (this has happened in the past), but if you want nodes mining such blocks, you'll need for them to have a modified client too. There are quite a few "dead end" chains that split off for various reasons, but were abandoned by miners.
> 
> If you really want the details of how the protocol works, help yourself.



And I have already posted a link pointing out the many flaws in this system that allow people to hack the system and get whatever they want out of it. In that link I posted, it said someone was able to get 18 BILLION bitcoins from one "block".  Explain to me how they are limited.


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## Okedokey

Oh wow... 

The U.S. has approximately 260 million ounces of gold, more than any other country by a wide margin. The total of gold reserves held by all countries is approximately 1 billion ounces. On the currency side of the equation, there are several measures of USD money supply, known as M, M1, M2 and M3. M3 is the broadest measure of the total amount of money (USDs) available in the economy.  It is noteworthy that in 2006, the Fed made a decision to discontinue publication of M3. The latest figures available from the Fed show M1 and M2 at approximately $2 trillion and $9.5 trillion, respectively.

At a current market price of $1,800 per ounce of gold, the U.S.’s gold reserves are worth $468 billion (260 X $1,800). Gold reserves held by central banks around the world are currently worth $1.8 trillion. There appears to be just over 4 times more USDs (based on a narrow measure of money supply, M1) in the economy than there is gold held by the Fed (M1: $2 trillion; U.S. Gold: $468 billion). Based on the broadest measure available of money supply, M2, there are just over 20 times more USDs in the economy than there is gold (M2: $9.5 trillion; U.S. Gold $468 billion).


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## G80FTW

Okedokey said:


> Oh wow...
> 
> The U.S. has approximately 260 million ounces of gold, more than any other country by a wide margin. The total of gold reserves held by all countries is approximately 1 billion ounces. On the currency side of the equation, there are several measures of USD money supply, known as M, M1, M2 and M3. M3 is the broadest measure of the total amount of money (USDs) available in the economy.  It is noteworthy that in 2006, the Fed made a decision to discontinue publication of M3. The latest figures available from the Fed show M1 and M2 at approximately $2 trillion and $9.5 trillion, respectively.
> 
> At a current market price of $1,800 per ounce of gold, the U.S.’s gold reserves are worth $468 billion (260 X $1,800). Gold reserves held by central banks around the world are currently worth $1.8 trillion. There appears to be just over 4 times more USDs (based on a narrow measure of money supply, M1) in the economy than there is gold held by the Fed (M1: $2 trillion; U.S. Gold: $468 billion). Based on the broadest measure available of money supply, M2, there are just over 20 times more USDs in the economy than there is gold (M2: $9.5 trillion; U.S. Gold $468 billion).



Nice. Your point?


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## ABenz99

I don't really plan to use bit coins as my primary currency, I just want to mine them and convert them into U.S dollars.


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## G80FTW

ABenz99 said:


> I don't really plan to use bit coins as my primary currency, I just want to mine them and convert them into U.S dollars.



Well of course not, because you couldnt 

Id say if you ALREADY had the hardware to do it then go for it. But I would certainly not invest any money into the whole ordeal.


----------



## PCunicorn

Actually you could. It might not be extremely efficient but its very possible to use it, except for grocery shopping or eating out.


----------



## Darren

Currency is only good if people accept it. Most places don't accept it. So no. It can't be used as your primary currency. 

Okey, just because you can do math, assuming your numbers are right, doesn't prove a point.


----------



## PCunicorn

It certainly can't be used as you're primary currency. But its possible to use it more than a lot of people think


----------



## G80FTW

PCunicorn said:


> It certainly can't be used as you're primary currency. But its possible to use it more than a lot of people think



Except in any physical store in the usa. Its only good on select sites online.

One thing that interest me is that it does say that the bitcoin will stop at just under 21 million. However:



Okedokey said:


> The issue with Bitcoin is that the more users and the more time goes on the algorithm gets more and more complex and the difficulty rises exponentially.  There is no money to be made any more in bitcoins, look at another cryptocurrency.





Okedokey said:


> There has to be a limit of supply, otherwise there is no value on demand.  Basic economics.  The algorithm of bitcoins means that Bitcoins are created at a decreasing and predictable rate. The number of new bitcoins created each year is automatically halved over time until bitcoin issuance halts completely with a total of 21 million bitcoins in existence.




This does not appear to be the case at all according to this:

https://blockchain.info/charts/tota...ageString=1&show_header=true&scale=0&address=

09-10 = +1.6 million ~
10-11 = +3.4 million ~
11-12 = +3 million ~
12-13 = +2.5 million ~
13-14 = +2 million ~

The bitcoins "created" each year are not halved at all.  If it continues this trend, which I dont see why it wouldnt, then it will theoretically stop in 3 years. Not 2140 like this site claims:

http://bitcoinfaq.com/

Its hard not to be skeptical of something that has such a vague definition of what its actually doing. Solving math problems tells me absolutely nothing. And none of the numbers given seem to add up. I still smell a scam.


----------



## TrainTrackHack

> And I have already posted a link pointing out the many flaws in this system that allow people to hack the system and get whatever they want out of it. In that link I posted, it said someone was able to get 18 BILLION bitcoins from one "block". Explain to me how they are limited.


Which link? The only one I saw mentioning ANY successful hacking attempt was the wikipedia article, which finishes with "This was the only major security flaw found and exploited in Bitcoin's history." It was a flaw and it was corrected. And if you look at the actual vulnerability summary, you'll find that it was a programming flaw; the problem was not the mathematics or theory behind bitcoin.

They are limited because blocks are hashed, and acceptable hashes follow a certain format (they need to have a set number of leading zeroes, and the number increases with time, thus increasing difficulty.) Since the hashes have fixed length, there's obviously a limit to the number of distinct, valid hashes that can exist.



> Its hard not to be skeptical of something that has such a vague definition of what its actually doing.


What do you mean by a "vague definition"? It's very well defined, you can read the source of any bitcoin client/miner, you could read the actual protocol specification, Getwork protocol, or you could read the paper I linked to before.


----------



## G80FTW

hackapelite said:


> Which link? The only one I saw mentioning ANY successful hacking attempt was the wikipedia article, which finishes with "This was the only major security flaw found and exploited in Bitcoin's history." It was a flaw and it was corrected. And if you look at the actual vulnerability summary, you'll find that it was a programming flaw; the problem was not the mathematics or theory behind bitcoin.
> 
> They are limited because blocks are hashed, and acceptable hashes follow a certain format (they need to have a set number of leading zeroes, and the number increases with time, thus increasing difficulty.) Since the hashes have fixed length, there's obviously a limit to the number of distinct, valid hashes that can exist.
> 
> What do you mean by a "vague definition"? It's very well defined, you can read the source of any bitcoin client/miner, you could read the actual protocol specification, Getwork protocol, or you could read the paper I linked to before.



I guess only the good people of 2140 will know for sure. Or the next person who hacks it. Or in the next 3 years.


----------



## TrainTrackHack

> I guess only the good people of 2140 will know for sure. Or the next person who hacks it. Or in the next 3 years.


...know what for sure?


----------



## G80FTW

hackapelite said:


> ...know what for sure?



When the bitcoin will stop, or if it even continues until it stops.  Like I said, the governments would love to shut it down Im sure.  And just because it currently has a "theoretical" limit does not mean that cannot be altered at some point in time. Its a computer program, computer programs are made to be modified.

My guess is the bitcoin will disappear LONG before 2140 when its scheduled to peak. I bet it reaches 20 million in the next couple years giving the rate that its going at right now.  Of course, that also would strongly depend on the people investing into it.


----------



## PCunicorn

Its not a computer program. Its MUCH different then that.


----------



## G80FTW

PCunicorn said:


> Its not a computer program. Its MUCH different then that.



Client, application, all the same thing. Hash? In my day hash was something people smoked


----------



## PCunicorn

You're 24 so chances are "you're day" wasn't long ago, but that's beside the point.

And for the way Bitcoin works, its not based on any client. You're wallet is. Its impossible to manipulate Bitcoin itself.

And slightly off topic, but another step forward for BTC: http://www.tigerdirect.com/bitcoin/


----------



## G80FTW

PCunicorn said:


> You're 24 so chances are "you're day" wasn't long ago, but that's beside the point.
> 
> And for the way Bitcoin works, its not based on any client. You're wallet is. Its impossible to manipulate Bitcoin itself.
> 
> And slightly off topic, but another step forward for BTC: http://www.tigerdirect.com/bitcoin/



Well back on topic, we have established that there is no profit to be found in bitcoin mining and that its not an established currency in the usa (never will be).

So, i think the original question has been answered and then some.


----------



## TrainTrackHack

> When the bitcoin will stop, or if it even continues until it stops. Like I said, the governments would love to shut it down Im sure.


Oh, of course. Whether they will be successful is another thing, 



> And just because it currently has a "theoretical" limit does not mean that cannot be altered at some point in time. Its a computer program, computer programs are made to be modified.


No, of course it does not. But it does require that majority of the network upgrades to a modified client; under the current protocol it is impossible, however, and I don't see why the cap would be lifted.



> Well back on topic, we have established that there is no profit to be found in bitcoin mining and that its not an established currency in the usa (*never will be*)


Well, we don't know this yet.


----------



## G80FTW

hackapelite said:


> Well, we don't know this yet.



Actually we do, because in america along with many other countries its highly illegal to produce and distribute your own currency. Like i said, the only reason bitcoin gets around it is because its not a physical currency. It will never be able to be used in a physical store in america legally unless the law changes to allow it and i doubt that.


----------



## ABenz99

Alright, I've concluded that there is little to no profit in bitcoin mining. Also, I don't have enough $ yet to buy the hardware, so by the time I save up enough, there will be even less profit than there is now. I don't really care if bitcoin can be used as a primary currency in the US because like I said, I am only interested in mining. My only other question is about other crypto-currencies. Would it be more profitable to mine litecoin, or something like that?


----------



## G80FTW

ABenz99 said:


> Alright, I've concluded that there is little to no profit in bitcoin mining. Also, I don't have enough $ yet to buy the hardware, so by the time I save up enough, there will be even less profit than there is now. I don't really care if bitcoin can be used as a primary currency in the US because like I said, I am only interested in mining. My only other question is about other crypto-currencies. Would it be more profitable to mine litecoin, or something like that?



From what I am seeing, there is really only profit to be made at the start of these things. After that, its just a waste.  Im still puzzled at HOW there is a profit from this. The world just doesnt make sense anymore.


----------



## Okedokey

G80FTW said:


> From what I am seeing, there is really only profit to be made at the start of these things. After that, its just a waste.  Im still puzzled at HOW there is a profit from this. The world just doesnt make sense anymore.



That is because you don't get it.


----------



## bomberboysk

G80FTW said:


> Actually we do, because in america along with many other countries *its highly illegal to produce and distribute your own currency*. Like i said, the only reason bitcoin gets around it is because its not a physical currency. It will never be able to be used in a physical store in america legally unless the law changes to allow it and i doubt that.



Where, exactly, do these laws exist within the United States Code? Disregarding "virtual" currencies, there's a number of private currencies in circulation within the United States. U.S. laws only prohibit counterfeiting of U.S. Currency AFAIK.

And bitcoin transactions are allowed in thousands of stores across the U.S, with a fair number of retailers accepting various other virtual currencies.



G80FTW said:


> Well back on topic, we have established that there is no profit to be found in bitcoin mining and that its not an established currency in the usa (never will be).


There actually is _potential_ for profit in bitcoin mining. Specialized mining IC's such as FPGA's and ASICs can generate enough BTC than how much they cost to operate on power, but as difficulty increases, they may never be able to pay for themselves. On the other hand, it's entirely possible that bitcoin could go up enough in value that even though it appears you're running at a loss right now, you potentially profit. It's not guaranteed by any means though. And a US Federal judge has ruled that BTC is a "Currency or form of money", so at least in the Eastern District of Texas, it's a form of Currency.

http://arstechnica.com/tech-policy/...currency-can-be-regulated-under-american-law/


----------



## G80FTW

Okedokey said:


> That is because you don't get it.



Your right. I will never understand why people value things that are not real.



bomberboysk said:


> Where, exactly, do these laws exist within the United States Code? Disregarding "virtual" currencies, there's a number of private currencies in circulation within the United States. U.S. laws only prohibit counterfeiting of U.S. Currency AFAIK.
> 
> And bitcoin transactions are allowed in thousands of stores across the U.S, with a fair number of retailers accepting various other virtual currencies.
> 
> 
> There actually is _potential_ for profit in bitcoin mining. Specialized mining IC's such as FPGA's and ASICs can generate enough BTC than how much they cost to operate on power, but as difficulty increases, they may never be able to pay for themselves. On the other hand, it's entirely possible that bitcoin could go up enough in value that even though it appears you're running at a loss right now, you potentially profit. It's not guaranteed by any means though. And a US Federal judge has ruled that BTC is a "Currency or form of money", so at least in the Eastern District of Texas, it's a form of Currency.
> 
> http://arstechnica.com/tech-policy/...currency-can-be-regulated-under-american-law/



http://codes.lp.findlaw.com/uscode/18/I/25/486

"Whoever, except as authorized by law, makes or utters or passes, or attempts to utter or pass, any coins of gold or silver or other metal, or alloys of metals, intended for use as current money, whether in the resemblance of coins of the United States or of foreign countries, or of original design, shall be fined under this title (!1) or imprisoned not more than five years, or both."

http://blogs.findlaw.com/legally_weird/2012/01/make-your-own-currency-spend-5-years-in-jail.html

"This prohibition arguably applies to paper money as well. Article 1, section 8, clause 5 of the U.S. Constitution gives Congress the power to coin money and regulate its value. The Justice Department believes this gives the federal government the "concurrent power to restrain the circulation of [private] money."


The Liberty Dollar as an example:
http://www.nytimes.com/2012/10/25/u...his-fate-behind-bars.html?pagewanted=all&_r=0

Also, your link does not state that a federal judge actually RULED that the BitCoin was a currency in the USA, it said:

"In a four-page memorandum opinion issued on Tuesday, Judge Amos Mazzant wrote (PDF) to determine whether his court has jurisdiction in the case." Meaning he did not over-ride the government but is trying to.

"a US federal agency, the Financial Crimes Enforcement Network (FinCEN), published new guidelines stipulating that Bitcoin-related businesses should be considered as Money Services Businesses under US law." Simply states that it SHOULD be considered as an MSB, not that it IS. Originally, the BitCoin has been able to get around the first law that I provided you with because it is not "money" and does not exist in physical form. Nor is it accepted anywhere in the USA but online. 

Basically what I am getting from that article is that the founder of BitCoin was charged with running a ponzi scheme (which it really is) and that the courts are trying to regulate the BitCoin under US law. Which COULD make the BitCoin a legal currency in the US but would still have the same regulations as the Dollar defeating the purpose of BitCoin entirely.

Also, maybe take a look at the civil war. You may have missed this in history class but the civil war was mainly about the government getting rid of the confederate currency.


----------



## TrainTrackHack

> Your right. I will never understand why people value things that are not real.


lol

It is real. It just doesn't (generally) exist in physical form, and has little intrinsic value. But it is real, just as real as the pieces of paper and metal people buy stuff with.



> Basically what I am getting from that article is that the founder of BitCoin was charged with running a ponzi scheme *(which it really is)*


No.


----------



## G80FTW

hackapelite said:


> lol
> 
> It is real. It just doesn't (generally) exist in physical form, and has little intrinsic value. But it is real, just as real as the pieces of paper and metal people buy stuff with.
> 
> No.



Its real? I didnt realize that when a computer solves a "math problem" its result becomes real and in physical form. Real involves having 3 dimensions. The bitcoin does not.

Oh, and you meant "has no value". Not little. None. Zero.

Its real in the same sense that GTAV money is real. Its the EXACT same concept.


----------



## TrainTrackHack

> Its real? I didnt realize that when a computer solves a "math problem" its result becomes real and in physical form. Real involves having 3 dimensions. The bitcoin does not.
> 
> Oh, and you meant "has no value". Not little. None. Zero.
> 
> Its real in the same sense that GTAV money is real. Its the EXACT same concept.


wut

It is real. A thing does not need physical form to be real. Thoughts and the text I'm writing are real but they definitely aren't three-dimensional and have no physical form. Computer programs and information are real. And I didn't say "has no value" - I said has little _intrinsic_ value.

And yes, any competent mathematician or computer sciencist will agree that solutions to computational problems are indeed real.

And, again, yes, it is real in the same sense that GTAV money is real. The difference is that bitcoin was made to be used in the real world, and has been built around this (can be securely transferred, prevents double-spending, has limited supply and so on); as such, people are willing to use it as a medium of trade and value it.


----------



## Darren

That's like saying this forum isn't real because it's not 3 dimensional. I get that you don't see the use/feasibility of the currency but your arguments are pretty flawed.


----------



## G80FTW

Denther said:


> That's like saying this forum isn't real because it's not 3 dimensional. I get that you don't see the use/feasibility of the currency but your arguments are pretty flawed.



Yes, how ever when your dealing with money it helps if its real. Virtual currencies have no value and even less so than a fiat currency since they cost nothing to produce. The Dollar has a value in the sense that it cost money to produce and its limit is set by the government of the country its used in. The Bitcoins limit is set by its program nd is only limited by the people who use it. Like said, the limit of the bitcoin can easily be increased if the majority see fit. 

If people want to use bitcoin as a currency thats fine, i dont see it ever becoming a popular currency because its value drastically changes every day making it a highly unstable currency.


----------



## TrainTrackHack

> Yes, how ever when your dealing with money it helps if its real. Virtual currencies have no value and even less so than a fiat currency since they cost nothing to produce. The Dollar has a value in the sense that it cost money to produce and its limit is set by the government of the country its used in. The Bitcoins limit is set by its program nd is only limited by the people who use it. Like said, the limit of the bitcoin can easily be increased if the majority see fit.


The buying power of dollar is not related to the cost of producing the physical currency, though, so I don't think that's a terribly strong point to make. And bitcoins do cost money to produce - why do you think this thread got started? Even though nothing physical is produced, it still takes time and energy to create bitcoins.



> If people want to use bitcoin as a currency thats fine, i dont see it ever becoming a popular currency because its value drastically changes every day making it a highly unstable currency.


It's unstable because it's fairly new and currently has a higher ratio of speculators/investors to "ordinary users" than conventional currencies (I mean ordinary users as in people who use it primarily to buy stuff.)


----------



## G80FTW

hackapelite said:


> The buying power of dollar is not related to the cost of producing the physical currency, though, so I don't think that's a terribly strong point to make. And bitcoins do cost money to produce - why do you think this thread got started? Even though nothing physical is produced, it still takes time and energy to create bitcoins.
> 
> It's unstable because it's fairly new and currently has a higher ratio of speculators/investors to "ordinary users" than conventional currencies (I mean ordinary users as in people who use it primarily to buy stuff.)



If you want to believe that.


----------



## TrainTrackHack

Has nothing at all to do with what I want to believe.


----------



## G80FTW

hackapelite said:


> Has nothing at all to do with what I want to believe.



Perhaps I should specify my post. 

When I was referring to the value of the Dollar, the Dollar does have its own initial "value" given by its cost to produce. The Bitcoin does not as there are no resources put into producing Bitcoins other than processing power, which is essentially free. Unlike the Dollar which requires several different physical resources and machines to produce. No, the buying power of the Dollar is not connected to its manufacturing cost, but I am sure at one time it was taken into account.  If you are producing a currency which has less buying power than it cost to produce, that would be counter-productive in my opinion. Im not saying its buying power is more than its production cost, Im saying it has to be taken into account. Which is why the government was considering getting rid of the actual paper $1 bill in favor of coins to lower the production cost of money. As paper bills do not last forever, they eventually have to be replaced by new ones. 

Then you have Bitcoin which only has a resource requirement of processing power to "produce". I quote produce since there is no actual product being produced in the end. The cost of processing power is nill. If you had your own wind turbine (there are still some old ones working in Kansas) or solar panels(some homes have them), it would be absolutely free. But for the paper money you see now, in order for its production cost to be nill you would need alot more than a wind turbine....

Which is why I see no value in virtual currencies at all. I have no idea how anyone can value them period. There is little to no cost to obtain them. Only time. Whereas to get money, generally you have to work in exchange for it (some may be more fortunate). I see no value in something that can easily be obtained just by sitting and waiting for it. And once the rest of the world catches on to that, it will become useless is what Im saying.  Right now, Im thinking the only reason it has any value is because everything today revolves around the internet and pop culture. To me, the Bitcoin is just a fad. People got into it because it was new and knew nothing about it and that gave it value. In the end, they may or may not come to realize its completely worthless. I dont see it surviving for very long. And even if it does, as I said, the governments WILL begin to regulate it as a normal currency defeating the entire purpose of it. At which point, it will become no different than the Dollar once it is behind government control.


----------



## Okedokey

G80FTW said:


> Perhaps I should specify my post.
> 
> When I was referring to the value of the Dollar, the Dollar does have its own initial "value" given by its cost to produce. The Bitcoin does not as there are no resources put into producing Bitcoins other than processing power, which is essentially free. Unlike the Dollar which requires several different physical resources and machines to produce. No, the buying power of the Dollar is not connected to its manufacturing cost, but I am sure at one time it was taken into account.  If you are producing a currency which has less buying power than it cost to produce, that would be counter-productive in my opinion. Im not saying its buying power is more than its production cost, Im saying it has to be taken into account. Which is why the government was considering getting rid of the actual paper $1 bill in favor of coins to lower the production cost of money. As paper bills do not last forever, they eventually have to be replaced by new ones.
> 
> Then you have Bitcoin which only has a resource requirement of processing power to "produce". I quote produce since there is no actual product being produced in the end. The cost of processing power is nill. If you had your own wind turbine (there are still some old ones working in Kansas) or solar panels(some homes have them), it would be absolutely free. But for the paper money you see now, in order for its production cost to be nill you would need alot more than a wind turbine....
> 
> Which is why I see no value in virtual currencies at all. I have no idea how anyone can value them period. There is little to no cost to obtain them. Only time. Whereas to get money, generally you have to work in exchange for it (some may be more fortunate). I see no value in something that can easily be obtained just by sitting and waiting for it. And once the rest of the world catches on to that, it will become useless is what Im saying.  Right now, Im thinking the only reason it has any value is because everything today revolves around the internet and pop culture. To me, the Bitcoin is just a fad. People got into it because it was new and knew nothing about it and that gave it value. In the end, they may or may not come to realize its completely worthless. I dont see it surviving for very long. And even if it does, as I said, the governments WILL begin to regulate it as a normal currency defeating the entire purpose of it. At which point, it will become no different than the Dollar once it is behind government control.



Man there is so much wrong with this i give up.


----------



## G80FTW

Okedokey said:


> Man there is so much wrong with this i give up.



Why? You seem to enjoy telling me im wrong and then saying the same thing i did.


----------



## Darren

I rarely fully agree with Okey but he's right. Your logic is flawed. The whole production cost of a bill is totally negligible. When I get a 20 dollar bill I don't look at it and think "Wow, this cost the government (not me mind you) to make. It must be valuable and that's why I can go buy a game with it or some food." That's not how you think about it. You think, "Wow, this has value because I can go somewhere and trade it for something valuable." If people accept Bitcoins, they've valuable. Whether or not they're regulated doesn't affect if something is valuable. The dollar is regulated and it has value.

Your logic just doesn't make sense in general. 

Also, you hook a wind turbine up to a power outlet and it's not going to power your computer. It has to be converted in to power and it's pretty inefficient right now. That conversion costs money and you have to pay for that electricity. Wind turbines are out here in Kansas, but since you're in the KC area if I remember correctly, you're most likely getting your power from a resource that you have to buy, which you in turn pay for the electric service. 

So yeah, it does cost to produce a bitcoin. Processing power isn't free either. You kind of have to like, buy the processor and video card.


----------



## TrainTrackHack

Denther already covered what I wanted to say pretty well, but I'll add a few things: only a small fraction of world's cash exists as physical currency (most of it is just as virtual as bitcoins), and time is a resource too (and quite valuable one at that.) And the initial investment of your solar panels and wind turbines is going to cost you too. That's not the only flaw with the "sit back and wait" argument either; firstly, even though (after the initial investment and ignoring the fact that mechanical devices do need to be maintained) the electricity produced by your wind turbine might be free, that does in no way imply that it is no longer valuable; people still use it and are willing to pay for it. Also, humans are not necessary for creating wealth or something of value; even if something like assembly line only requires 5% human intervention to produce useful goods, we don't say that the goods are "essentially 95% free", and the machines involved in the production won't get any of the money for themselves.

In practice, it's going to be very difficult to regulate too, much harder than government-issued money, so whatever regulation might be imposed on it, it's never going to be practical to enforce regulations to the extent that bitcoin becomes "no different than the Dollar."


----------



## G80FTW

hackapelite said:


> Denther already covered what I wanted to say pretty well, but I'll add a few things: only a small fraction of world's cash exists as physical currency (most of it is just as virtual as bitcoins), and time is a resource too (and quite valuable one at that.) And the initial investment of your solar panels and wind turbines is going to cost you too. That's not the only flaw with the "sit back and wait" argument either; firstly, even though (after the initial investment and ignoring the fact that mechanical devices do need to be maintained) the electricity produced by your wind turbine might be free, that does in no way imply that it is no longer valuable; people still use it and are willing to pay for it. Also, humans are not necessary for creating wealth or something of value; even if something like assembly line only requires 5% human intervention to produce useful goods, we don't say that the goods are "essentially 95% free", and the machines involved in the production won't get any of the money for themselves.
> 
> In practice, it's going to be very difficult to regulate too, much harder than government-issued money, so whatever regulation might be imposed on it, it's never going to be practical to enforce regulations to the extent that bitcoin becomes "no different than the Dollar."



What fraction of the worlds currencies exist virtually? The 2 or 3 undeveloped countries using Bitcoin as their currency because they have no economy anyway? Bitcoin is the first currency to my knowledge that is virtual and useable in the real world. Name 1 developed country that uses a virtual currency system. 

If the government cannot regulate it like they can the dollar, what makes you think it will be usable as legal tender in the US? As of now, its technically not because you can only use it online here (on few select sites at that). Until its able to be used in a physical store, I wouldnt say its legal tender. In fact, I think our government decided that it wasnt. 

Time in this instance is not as valuable as you think....because it is not YOU that is wasting it, its your computer. You can spend your time as you please while your computer works away. I wouldnt even consider time as a true cost because your really not spending it just sitting and waiting. And if you are, I suggest a life.

As for the whole "free electricity" argument. Yes, you could put in the initial cost of such items and maintenance of them in the cost to create a Bitcoin. However here is the problem, your "free" electricity is not solely being used to create Bitcoins its also being used to power your house and things in it. Meaning, you have the initial cost and maintenance of such items whether you were creating Bitcoins or not.  So if you choose to use a turbine or solar panels as the power source for your residence (alot of people do) then the cost of such things is not related to the creation of Bitcoins. And the cost of such things will not increase while creating Bitcoins. If it did, then I would consider it the cost to produce Bitcoins.



Denther said:


> I rarely fully agree with Okey but he's right.



He also said that Bitcoin was not a good investment.

The difference between me and him is that I explain my argument, he does not.

What it really all boils down to is that I am against this whole idea of virtual currencies. And I have explained why.  Its a bad idea in general, and can very easily lead to hyper inflation making it more worthless than it already is.

If people want to value something that does not exist, let them. But dont take all the work out of getting that something that doesnt exist. All it really does is show how fast our once intelligent society has gone down the drain. The movie Idiocracy comes to mind. I for one would not be surprised if the world came to that given some of things I have seen even today.

Again, the idea of using an unregulated computer program to produce a currency is just idiotic. I guess people forgot how easily computer programs can be manipulated. Thats kinda what they are designed for....


----------



## Okedokey

When Germany accepts bitcoins as legal tender, i think your argument goes up in smoke.


----------



## G80FTW

Okedokey said:


> When Germany accepts bitcoins as legal tender, i think your argument goes up in smoke.



Dont see how. Even if the US accepted it as legal tender all the negatives i have pointed out will still exist....
Having it accepted as legal tender does not change how it is obtained and what it is, or isnt...


----------



## TrainTrackHack

> What fraction of the worlds currencies exist virtually? The 2 or 3 undeveloped countries using Bitcoin as their currency because they have no economy anyway? Bitcoin is the first currency to my knowledge that is virtual and useable in the real world. Name 1 developed country that uses a virtual currency system.


Howstuffworks says only 8% exists as physical currency. I got a little graph 
	

	
	
		
		

		
			
		
		
	


	




:





 Where M1 is the total physical currency in the US plus some more (and M3 is of course shown only up to when its publication was discontinued.) I think US makes a fine example.



> If the government cannot regulate it like they can the dollar, what makes you think it will be usable as legal tender in the US? As of now, its technically not because you can only use it online here (on few select sites at that). Until its able to be used in a physical store, I wouldnt say its legal tender. In fact, I think our government decided that it wasnt.


Of course, whether US thinks it's legal or not probably won't have great effect on its usability.



> Time in this instance is not as valuable as you think....because it is not YOU that is wasting it, its your computer. You can spend your time as you please while your computer works away. I wouldnt even consider time as a true cost because your really not spending it just sitting and waiting. And if you are, I suggest a life.


This makes no sense. It doesn't matter who or what is using (or wasting) time. If I own a factory to make certain goods, their value depends only on what people are willing to pay for them, not whether I personally invested my time into producing them or if I bought a machine/assembly line to do all the work for me while I sit around and wait. Time is not a resource only humans are capable of expending.



> As for the whole "free electricity" argument. Yes, you could put in the initial cost of such items and maintenance of them in the cost to create a Bitcoin. However here is the problem, your "free" electricity is not solely being used to create Bitcoins its also being used to power your house and things in it. Meaning, you have the initial cost and maintenance of such items whether you were creating Bitcoins or not. So if you choose to use a turbine or solar panels as the power source for your residence (alot of people do) then the cost of such things is not related to the creation of Bitcoins. And the cost of such things will not increase while creating Bitcoins. If it did, then I would consider it the cost to produce Bitcoins.


And this makes even less sense. I'm not sure what point you're trying to make. Of course the panels/turbines cost regardless of what I use the electricity for. How is this relevant? They don't generate infinite amounts of electricity; if you use a certain amount electricity for bitcoin mining, you won't be able to use that electricity for the rest of the household, so either you make up for it for buying electricity off the grid (i.e. running the rest of the household WILL cost more), or you simply live with the fact that the amount of electricity for the rest of the household is reduced, in which you simply have less value (for the rest of the household) for the same initial investment, which again means that it does cost more.

And in any case, I repeat that the cost of creating bitcoins (or any fiat money) has little relation to its value. I'm simply pointing out that the "creating bitcoins is free" argument is fallacious.




> What it really all boils down to is that I am against this whole idea of virtual currencies. And I have explained why. Its a bad idea in general, and can very easily lead to hyper inflation making it more worthless than it already is.


But you don't seem to accept the fact that the money you normally use is no less virtual.



> If people want to value something that does not exist, let them. But dont take all the work out of getting that something that doesnt exist. All it really does is show how fast our once intelligent society has gone down the drain. The movie Idiocracy comes to mind. I for one would not be surprised if the world came to that given some of things I have seen even today.


"Does not exist".

Yes it does. I already went though this once. Now you're just deliberately ignoring arguments. Not something you should be doing if you want to comment on the intelligence of the society, mind you.



> Again, the idea of using an unregulated computer program to produce a currency is just idiotic. I guess people forgot how easily computer programs can be manipulated. Thats kinda what they are designed for....


"Unregulated computer program"

It is regulated; it just isn't regulated by the government. And what does easy to manipulate have to do with this? Yea, you can do that, but the protocol works by consensus, and your "easy modifications" are _WORTHLESS_ unless you can get a people to use your modified protocol. Again, I've been through this. You still seem completely unaware of how the protocol actually works, and given that it's already been explained in this thread with plenty of links to more in-depth material, it's as though you're being deliberately and wilfully ignorant.


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## G80FTW

hackapelite said:


> Howstuffworks says only 8% exists as physical currency. I got a little graph
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> :
> 
> 
> 
> 
> 
> Where M1 is the total physical currency in the US plus some more (and M3 is of course shown only up to when its publication was discontinued.) I think US makes a fine example.
> 
> Of course, whether US thinks it's legal or not probably won't have great effect on its usability.
> 
> This makes no sense. It doesn't matter who or what is using (or wasting) time. If I own a factory to make certain goods, their value depends only on what people are willing to pay for them, not whether I personally invested my time into producing them or if I bought a machine/assembly line to do all the work for me while I sit around and wait. Time is not a resource only humans are capable of expending.
> 
> And this makes even less sense. I'm not sure what point you're trying to make. Of course the panels/turbines cost regardless of what I use the electricity for. How is this relevant? They don't generate infinite amounts of electricity; if you use a certain amount electricity for bitcoin mining, you won't be able to use that electricity for the rest of the household, so either you make up for it for buying electricity off the grid (i.e. running the rest of the household WILL cost more), or you simply live with the fact that the amount of electricity for the rest of the household is reduced, in which you simply have less value (for the rest of the household) for the same initial investment, which again means that it does cost more.
> 
> And in any case, I repeat that the cost of creating bitcoins (or any fiat money) has little relation to its value. I'm simply pointing out that the "creating bitcoins is free" argument is fallacious.
> 
> 
> But you don't seem to accept the fact that the money you normally use is no less virtual.
> 
> "Does not exist".
> 
> Yes it does. I already went though this once. Now you're just deliberately ignoring arguments. Not something you should be doing if you want to comment on the intelligence of the society, mind you.
> 
> "Unregulated computer program"
> 
> It is regulated; it just isn't regulated by the government. And what does easy to manipulate have to do with this? Yea, you can do that, but the protocol works by consensus, and your "easy modifications" are _WORTHLESS_ unless you can get a people to use your modified protocol. Again, I've been through this. You still seem completely unaware of how the protocol actually works, and given that it's already been explained in this thread with plenty of links to more in-depth material, it's as though you're being deliberately and wilfully ignorant.



And all of this is why i fear for the future.


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## Okedokey

The irony is that the US dollar and economy is screwed, and you worry about a non-government regulated currency???


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## G80FTW

Okedokey said:


> The irony is that the US dollar and economy is screwed, and you worry about a non-government regulated currency???



The economy here actually isnt that bad anymore. The Dollar isnt worth any less than it was 10 years ago, and plenty of jobs here at least in my area. While our government struggles to do anything except sabatoge themselves it doesnt seem to be effecting me quite yet. 

But yes, i am worried about society in general becoming less intelligent by the minute. Besides its already proven a government regulated currency is far more stable than a non regulated one. For very obvious reasons.


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## TrainTrackHack

> And all of this is why i fear for the future.





> But yes, i am worried about society in general becoming less intelligent by the minute.


Care to elaborate? I know it's easy to ignore arguments, remain wilfully misinformed, make fallacious arguments and then finish off with something glib like "I'm worried about intelligence", but it really doesn't reflect very well on you.



> Besides its already proven a government regulated currency is far more stable than a non regulated one. For very obvious reasons.


I'd like to see that proof.


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## G80FTW

hackapelite said:


> Care to elaborate? I know it's easy to ignore arguments, remain wilfully misinformed, make fallacious arguments and then finish off with something glib like "I'm worried about intelligence", but it really doesn't reflect very well on you.
> 
> I'd like to see that proof.



Already provided it. I have provided all the evidence needed to back up my argument.

I see nothing wrong with pointing out all the negative flaws in something, someone needs to. If no one else wants to see them i really dont care.

Feel free to read back through the thread for anything you may have missed but im done here. Good luck on your bitcoin investments.


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## TrainTrackHack

> Already provided it. I have provided all the evidence needed to back up my argument.
> 
> I see nothing wrong with pointing out all the negative flaws in something, someone needs to. If no one else wants to see them i really dont care.
> 
> Feel free to read back through the thread for anything you may have missed but im done here. Good luck on your bitcoin investments.


No, you did not. In fact you've provided very little evidence at all; you've only provided (largely flawed) arguments, while ignoring those others have made. And there's nothing wrong with pointing out negative flaws, the problem is that what you're pointed out are either bogus or apply equally well to the money you use every day and you still seem oblivious to it. 

FWIW, I haven't invested in bitcoin, but thank you nonetheless.

I also think it's funny that you keep going on about worrying for the future of society and what's happening with people's intelligence, when one of your main arguments that wasn't completely shot down was that dollar can be trusted because government regulates it, the government that certainly hasn't spied on you or tried to excessively police the world or its own people. Which is somewhat ironic, given that for every movie and book of your "unintelligent society" there are at least ten stories of a dystpoian future with an oppressive government which came about because of the "trust the government" and "doesn't affect me" attitude which you seem to hold.


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## ScottALot

So I'm at the dorms right now and I've room in my desktop for a graphics card. I'd love to have a card running a mining process while I'm here because I pay standard rate for electricity. Any recommendations, or do you think my yield would be too low to even bother?


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## Okedokey

ScottALot said:


> So I'm at the dorms right now and I've room in my desktop for a graphics card. I'd love to have a card running a mining process while I'm here because I pay standard rate for electricity. Any recommendations, or do you think my yield would be too low to even bother?



Not worth it.  You will pay more in electricity.


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## ScottALot

Okedokey said:


> Not worth it.  You will pay more in electricity.



No, I mean the point is that I _won't_ pay more in electricity. The housing rate is standard, so electricity isn't factored in for each resident.


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## Okedokey

in that case yes, but will it be worth it, proabbly not, as it will be very very slow


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## PCunicorn

Scott, its probably not worth it unless you already have a GPU capable ofinig. Bitcoin mining will make NO profit at all anymore, last I heard litecoin difficulty was really high and it isn't very profitable anymore. I would think you could make a profit with middlecoin or feathercoin, but only if you already have a GPU. And by profit I mean making a amount of money more then 5 cents every 12 hours.


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## 87dtna

Everyone knows you can't mine straight bitcoin anymore with GPU's.  You mine scrypt coins, or new on the scene are Keccah coins but you need to know what you're doing to mine those are they require modified mining clients and they are hard to setup.

Mining straight litecoin, well it depends.  Right now the difficulty is low, so profitability is up.  But it's been fluctuating pretty rapidly, and it's still not as profitable as other scrypt coins right now.

I personally use middlecoin, it's an autoswitching pool that mines the most profitable scrypt coin at the moment.

Right now I have three 7950's, a 280x, an R9 270, and  a 7850 mining.  I'm making roughly $20 per day mining, and that's only because BTC value is down.  It was more like $25 a day, but I'll take the low end right now to state my profitability.  Electricity will cost me about $100 a month (on top of my normal bill), so I'm making $500 is pure profit a month.
Now, I did spend about $1400 on all those cards, so it'll take me 3 months to recoop my investment, but that's not bad.

Mining straight litecoin I'd be making $400 a month, minus electric so $300 profit.


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## Okedokey

assuming you can sell the coins...


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## 87dtna

Okedokey said:


> assuming you can sell the coins...



I sell them all the time 

I've exchanged BTC for paypal to the tune of ~$700 now.


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## G80FTW

PCunicorn said:


> Scott, its probably not worth it unless you already have a GPU capable ofinig. Bitcoin mining will make NO profit at all anymore, last I heard litecoin difficulty was really high and it isn't very profitable anymore. I would think you could make a profit with middlecoin or feathercoin, but only if you already have a GPU. And by profit I mean making a amount of money more then 5 cents every 12 hours.



My god how many of these false currencies are out there now? What a trend.... I shouldnt be surprised though. The trends in pop culture to me have gone so far out of whack Im not even sure I can really relate to the world anymore haha.

I do so miss the 90s..... As much as I love computers, I feel technology is starting to go too far.


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## 87dtna

False currency?  It's far from false.  Some major retailers are actually accepting bitcoin for payments now such as overstock.com and tigerdirect.


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## Okedokey

G80FTW said:


> My god how many of these false currencies are out there now? What a trend.... I shouldnt be surprised though. The trends in pop culture to me have gone so far out of whack Im not even sure I can really relate to the world anymore haha.
> 
> I do so miss the 90s..... As much as I love computers, I feel technology is starting to go too far.



You miss the 90s??? how old were you ?  1995 you were what 4, may be 5???  What planet are you on man?  You were having your ass wiped in the 90s.

False currency?? Again, epic thread about this before... please tell me how 87 got around 700 bucks US from a false currency?


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## 87dtna

I thought the same thing, but I'm not THAT much older so I didn't comment to that.


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## Okedokey

87dtna said:


> I thought the same thing, but I'm not THAT much older so I didn't comment to that.



I was in the RAAF in 95 so i think i can comment.  LOL, 24.  My GF is 24 and im telling you, she wasn't getting the 90's.


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## G80FTW

Okedokey said:


> You miss the 90s??? how old were you ?  1995 you were what 4, may be 5???  What planet are you on man?  You were having your ass wiped in the 90s.
> 
> False currency?? Again, epic thread about this before... please tell me how 87 got around 700 bucks US from a false currency?



In 1995 I was 6. A year later my step-brother died. I still remember him, as he was the closest thing to a brother I had. A year after that my grandma died.  I remember more than you think.  As you get older, you start to remember things. I have stayed in touch with all the music from the era, I remember all the shows.....6 is old enough to remember.  Even if I was 3 in 1999, I would still rather live in the 90s.

And who are you to comment? Judging from your posts I wouldnt have assumed you to be older than 13.


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## StrangleHold

I grew up in the 70s was a teenager. That was the time for Rock n' Roll. Okedokey I was in the military from 1980 thru 1986. Your still a kid if you have the need to brag, like you say ( I think I can comment).


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## G80FTW

StrangleHold said:


> I grew up in the 70s was a teenager. That was the time for Rock n' Roll. Okedokey I was in the military from 1980 thru 1986. Your still a kid if you have the need to brag, like you say ( I think I can comment).



Why is this thread still open though?


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## Okedokey

StrangleHold said:


> I grew up in the 70s was a teenager. That was the time for Rock n' Roll. Okedokey I was in the military from 1980 thru 1986. Your still a kid if you have the need to brag, like you say ( I think I can comment).



No bragging, strange post in the extreme.  I simply was saying that at 6 years old, its rather odd to say 'i miss the 90s'.  I don't see how any of it was bragging.  I also grew up in the 70's i was 3, those were the days...


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## G80FTW

Okedokey said:


> No bragging, strange post in the extreme.  I simply was saying that at 6 years old, its rather odd to say 'i miss the 90s'.  I don't see how any of it was bragging.  I also grew up in the 70's i was 3, those were the days...



So its impossible for someone to miss the culture from their childhood? Why is your logic always so flawed?


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## StrangleHold

Okedokey said:


> No bragging, strange post in the extreme. I simply was saying that at 6 years old, its rather odd to say 'i miss the 90s'. I don't see how any of it was bragging. I also grew up in the 70's i was 3, those were the days...



 Not strange at all. You said you cant understand or its odd at 6 he can remember/miss the 90s. Then at the same time you say you were 3 in the 70s and those were the days. How do you remember?


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## G80FTW

StrangleHold said:


> Not strange at all. You said you cant understand or its odd at 6 he can remember/miss the 90s. Then at the same time you say you were 3 in the 70s and those were the days. How do you remember?



I honestly think this thread should be closed about 2 weeks ago.


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## voyagerfan99

G80FTW said:


> I honestly think this thread should be closed about 2 weeks ago.



Yeah reading through it I'm in agreement with you.


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