How To Use Bitcoin – The Most Important Creation In The History Of Man

Discussion in 'General Discussion' started by Anonymous, Jun 1, 2011.

  1. muldrake Member

    The problem is the only way to confirm that SETI type data analysis has actually been done is to replicate it yourself. So rogue nodes would simply generate garbage results and submit them to get the monetary rewards, while the actual results would be useless. Part of the concept of "proof-of-work" as a unit of value is that it requires computations that are arduous to perform, but comparatively trivial to confirm.

    Basically, yes. However, I think there is utility in creating something of value, even if its value is purely monetary.

    There is one coin, Primecoin, that is based on searching for primes. However, arguably, there is no particularly compelling reason to search for primes. But there are already distributed networks searching for primes like the particularly interesting Mersenne primes. (Mersenne primes are not used for Primecoin because, being so large, even a huge network couldn't generate a block by finding a Mersenne prime in any reasonable period of time. Generally, the largest known prime is a Mersenne because so much effort is spent in trying to find them.)
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  2. JohnnyRUClear Member

    An open letter to Peter Schiff, who is a critic of Bitcoin, from a recent guest on Schiff's program, who is a proponent.

    Makes sense to me (the whole letter, not just this portion).
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  3. muldrake Member

    When orthodox economists throw around phrases like "intrinsic value," they are generally pointing toward something like gold. However, without context nothing has intrinsic value. What it has is intrinsic characteristics, such as malleability, ductility, a certain color, nonreactiveness, etc., which give it value but only in context to how humans relate to it. Additionally, a good deal of the "value" of gold is purely subjective: people find it pretty. It's an excellent electrical conductor. This is only relevant in a context where electricity is important. It was still considered "valuable" before humans discovered electricity, though.

    A criticism of a lack of "intrinsic value" is especially silly when it is comparing digital currencies to, say, pieces of green paper with letters and numbers on them. Where is the intrinsic value there? The only reason these pieces of paper have any value is based on presumptions about the government that issues them, e.g., that to make the promise on them good, this government will pony up actual value, even if this means taking it from someone else at gunpoint, through taxation or invading another country or whatever.

    Given the choice between trusting a government and mathematical certainty, the latter is preferable in many ways. Bitcoin has no "intrinsic value" but then nothing does. Value is always context-dependent. What it has is intrinsic characteristics, such as scarcity, divisibility, fungibility, transferability, etc. that are essential for any currency. Arguably, that actually gives it better value as currency than actually useful items like gold, the prison currency of cigarettes, etc. We can be sure that there will never be some competing industrial use for BTC that destroys its value as currency.
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  4. Anonymous Member

    Careful muldrake. Next, you'll be quoting Mises.
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  5. Anonymous Member

    I've been thinking about intrinsic value too.

    As you remark above, the intrinsic value of a fiat currency is based on the issuing nation's wealth (and prospects of future wealth).

    In that way, fiat currency is to countries rather like equity is to companies.

    So a cash-flow based valuation can give you the 'intrinsic value' of an equity - it's the unpredictable nature of the future cash flows that means there can be different opinions about this.

    So what's Bitcoin 'worth' - the value of the Bitcoin network? If so then the network effect should apply, in which case the intrinsic value of each Bitcoin rises as more people join the Bitcoin transaction network.
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  6. Anonymous Member

    A close relative of mine once wrote a letter to "their" congresscritter complaining about fiat money (among other things). They got back a letter expressing confusion over what the fuss was regarding "flat money". We lol'd.

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  7. Anonymous Member

    Said letter made a fair point IMO.

    Assuming you're in the USA, the US central bank has done a pretty good job in combating inflation - compared to many other central banks - over the long term.

    There's nothing inherently evil about the concept of fiat money - it's kind of childish superstition to think there is, IMO.

    Central banks' monetary policies can be misguided, but that's not the same thing.
  8. muldrake Member

    I too find the idea that fiat money is, itself, the spawn of Satan to be silly. However, with widespread enough adoption, the mere existence of Bitcoin (or some subsequent cryptocurrency) would tend to act as a pressure release. Excessively abusive practices by central banks would tend to drive people out of the currency and into a crypto beyond the effects of such policies, therefore creating a competitive pressure which would tend to discourage the worst of central bank practices.

    Part of why the central banks have been able to get away with their excesses has precisely been that they're the only game in town, unless you want to go become a gold bug or something. While there have been attempts to establish gold-based non-fiat alternative currencies, they have generally been plagued by the same problem of central corruption, e.g. E-gold.

    I don't buy into the whole idea that somehow, Bitcoin is going to take over the entire world and overthrow all government, having heard similar messianic bullshit about every new crypto-related technology for the last couple decades. However, it's certainly going to have an impact on the way money is viewed and used.
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  9. Anonymous Member

    Interesting point - but isn't that already the case?

    Nations (well, their central banks) already compete (with each other) for their currency to be seen as more stable than the competition. You don't like the fiscal cliff? Swap your dollars into Euros!

    The issue with Bitcoin - well, one issue - IMO is that the present blockchain has no intrinsic advantage over some other blockchain.

    A competitor currency with all the same parameters as Bitcoin would be technically no better and no worse - the only difference would be number of users, number of miners and market sentiment.

    So this may be where the network effect comes in, as in effect existing scale is Facebook's real competitive advantage too...
  10. Anonymous Member

    You can get gold and silver denominated accounts today, if you are not a US citizen, The US makes it so onerous through reporting requirements that no broker will accept a US client for such accounts, but they are in use and they work.
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  11. The Wrong Guy Member

    Bitcoin takes 50% plunge after China's biggest exchange bans new deposits | RT Business

    The value of the cryptocurrency has crashed to $550, less than half the $1,200 trading level last week, after BTC China - the world’s largest bitcoin exchange - halted deposits in Chinese yuan.

    The ban followed a decision by YeePay, a third-party payment provider, that said on Wednesday it would no longer accept yuan deposits, while it’ll keep on processing withdrawals, Bloomberg News reports.

    “For reasons we all know, BTC China has had to cease renminbi-account charging functions,” the exchange said in its message.

    “We think this is due to government regulation. We have to play by the rules of the government of China,” Bobby Lee, CEO of BTC China, told Bloomberg News. BTC China began discussions with the People's Central Bank of China over bitcoin legitimacy on December 2.

    At the time of publication, the currency was trading at $550 on Japan’s Mt. Gox, one of the world’s largest bitcoin exchanges.

    The clampdown on the virtual currency was initiated by the People’s Bank of China two weeks ago, as they saw strong links between bitcoin and money laundering. Government ministries told financial institutions dealing with bitcoin must stop by January 31, the beginning of Chinese New Year holiday.

    Continued at
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  12. anonamus Member

    How I wish our ecclesiastical midget was talked into invest a billion in bitcoins on dec. 4 2013..
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  13. muldrake Member

    I think this is a case where correlation is being mistaken for causation. The selloff was largely because the top price was fueled by a speculative bubble, and would have adjusted itself regardless. While I wouldn't say there's no connection at all, it is more of a trigger than the actual complete cause. BTC does this kind of thing all the time.
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  14. veravendetter Member

    My bitcoins worth many now. Pm me and I may hand out one for most humiliating act
  15. Anonymous Member

    Isn't actually PMing you a most-humiliating act in and of itself? :D
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  16. The Wrong Guy Member

    Federal prosecutors in NY charge 3 in drug website | The Associated Press

    Three more men face charges for their alleged roles in the online black market website known as the Silk Road, federal prosecutors in New York City revealed Friday.

    An indictment unsealed in Manhattan federal court charges Andrew Michael Jones of Charles City, Va., Gary Davis of Wicklow, Ireland, and Peter Phillip Nash of Brisbane, Australia with one count each of narcotics conspiracy, conspiracy to commit computer hacking and money laundering conspiracy.

    Jones, 24, went by the online handle "Inigo" and Davis, 25, used the online moniker was "Libertas" while they monitored user activity and responded to customer service questions as site administrators for Silk Road, according to prosecutors. The 40-year-old Nash — who prosecutors say used online aliases including "Samesamebutdifferent" and "Batman73" — allegedly moderated a site forum.

    Jones and Nash, who were arrested this week, and Davis, who is believed to be in Ireland, were paid between $50,000 and $75,000 a year for their work, prosecutors said. A lawyer for Jones didn't return a message seeking comment. It wasn't clear if Davis and Nash had lawyers.

    Authorities have said the site's San Francisco operator generated $1 billion in illicit business from January 2011 through September by running the drug-dealing website that used a tough-to-track digital currency called Bitcoin.

    Ross William Ulbricht, 29, was arrested in October and is being held in New York for various charges, including for arranging a failed murder-for-hire plot. Prosecutors charge he operated Silk Road under the "Dread Pirate Roberts" alias — an apparent reference to a swashbuckling character in "The Princess Bride," the 1987 comedy film based on a novel of the same name.

    Ulbricht hasn't yet entered a plea. His lawyer has said his client is innocent and is not the person who used the "Dread Pirate Roberts" alias.

    Continued here:
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  17. muldrake Member

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  18. Anonymous Member

    He took me to his cabin and he told me his secret. 'I am not the Dread Pirate Roberts' he said. 'My name is Ryan; I inherited the ship from the previous Dread Pirate Roberts, just as you will inherit it from me. The man I inherited it from is not the real Dread Pirate Roberts either. His name was Cummerbund. The real Roberts has been retired 15 years and living like a king in Patagonia.'
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  19. Anonymous Member

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  20. Anonymous Member



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  21. muldrake Member

    How stupid is it possible to be? Making a QR code visible with a fucking key is basically saying "hey take my money cause I look pretty stupid don't I?"
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  22. Anonymous Member
    IT'S a tough gig being Kanye West.
    First people try to steal your limelight on stage, then they spoof your music videosand now the rapper is fighting a legal battle against a new digital currency made in his image.
    'Coinye' is the brainchild of an anonymous group of seven web developers who claim they are just a few guys "excited about the future of cryptocurrency."
    The digital currency is designed to rival bitcoin and uses Kanye's name and image as a parody in a bid to help it become more mainstream.
    However Kanye hasn't taken kindly to his monetary likeness, with lawyers for Mr West firing a 'cease and desist' letter against the developers.

    The group changed this original image but will continue to launch their currency. Picture: Screengrab. Source: Supplied

    "Mr West is an internationally renown musical artist, songwriter, producer, film director and fashion designer, to name just a few of Mr West's endeavours," says a letter dated January 6 that reads as if it could have been written by Kanye himself.

    IMHO nobody in this world is more ripe for trolling than Kanye West. :p
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  23. Anonymous Member

    Who could have expected that?
  24. muldrake Member

    Kanye West may be a douchebag, but generally, it is illegal to exploit someone else's likeness to advertise a product. In this case, this fairly obviously infringes on his right of publicity and any relevant trademarks. Another recent case was when Doritos tried to hire Tom Waits to sing an ad ditty. He doesn't do that shit. So they hired a sound-alike and he sued their ass off. Similarly, Crispin Glover refused to be in the Back to the Future sequel, and they reused old footage of him. Again, Glover sued their asses off.

    Kanye has an especially good argument if this is yet another pre-mined pump-and-dump scamcoin.
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  25. The Wrong Guy Member

    Kanye West Sues - STOP USING MY FACE On Virtual Currency | TMZ

    Kanye West has declared legal war on the people who released a virtual currency (like a bitcoin) called Coinye West. Only problem is, he doesn't really know who to sue.

    West filed legal docs in NY trying to get a judge to force the people behind Coinye to immediately SHUT DOWN the marketing and sale of the virtual currency, which can be used to buy goods and services through various online merchants.

    The "coins" - which feature a South Park-esque depiction of Kanye sportin' stunner shades - were first offered to the public for sale on January 7 and Kanye says, "With each day that passes, [my] reputation is irreparably harmed by the continued use of the Coinye West marks."

    So, in an effort to shut down the rise of the Coinye currency, Kanye has requested an injunction against several companies he believes are responsible for its release.

    But Kanye's facing a huge problem, 'cause with one exception, the people behind the companies are hiding their identities through various online privacy services, and Kanye can't crack 'em.

    However, Kanye has added to the list of defendants because he believes Amazon provides web hosting services to the websites behind Coinye, and Amazon has failed to pull the plug on those sites.

    Continued here:
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  26. muldrake Member

    As far as I'm concerned, Kanye is in the right here. These idiots are simply exploiting his name in an attempt to compete with the flood of bogus cryptocurrencies currently flooding the market. Anyone dumb enough to pull a stunt like this has, perhaps, not covered their tracks very well, and a few well-placed subpoenas might flush them out. It's worth a try if you have money to burn.

    After all, even the alleged Heisenderp of Silk Road posted his initial posts about starting up what turned into hundreds of millions worth of drug traffic under a Gmail address that contained his REAL NAME in it.

  27. The Wrong Guy Member

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  28. batool100 Member

    you can use bitcoin for everything from paying bills to investing.
  29. muldrake Member

    Personally, I mainly use it to hire hit men to whack my enemies. But YMMV.
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  30. A.O.T.F Member

    Somebody has around $200,000 worth. (Well, that's how much they will be worth now} Maybe a sizable donation to Jeremy Hammond & Barret Brown's legal fund would be an honorable thing to do. C'mon man, if you have any sense of decency, you'll cough some of it the fuck up!.
  31. A.O.T.F Member

    Silk Road 2 Hacked, All Bitcoins Stolen – $2.7 Million

    Today at 06:58:48 pm

    Humbled and Furious

    I am sweating as I write this.

    Christmas brought grave news. I cannot adequately express how deeply honored I was by your unconditional support of my staff.

    I do not expect the same reaction to today's revelations. This movement is built on integrity, and I feel obligated to be forthright with you.

    I held myself to a high standard as your leader, yet now I must utter words all too familiar to this scarred community:

    We have been hacked.

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  32. A.O.T.F Member


  33. muldrake Member

    This concept is really simple. If you have Bitcoin in your wallet, you have Bitcoin. If you don't, you have a balance in the control of someone else. You do not own Bitcoin. You own a balance.

    If you have actual Bitcoins under your control, you have them until the end of the world (or a crack of the protocol itself). If you have a balance, it is subject to the whim, integrity and solvency of whoever tells you you have a balance.

    Why in the world would anyone trust something like SR as an online wallet? Even actual online wallets are almost universally untrustworthy. Even assuming they didn't just steal the funds themselves, storing funds in something intended for illegal activities is a crap shoot at best, even assuming the activities involved don't, themselves, get you arrested.
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  34. JohnnyRUClear Member

    Also, as with any experiment, only risk what you can afford to lose. Owning bitcoins is something like owning a company stock. Proceed accordingly.
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  35. Perfecto Member

    #153 & #154 Well said both of you.
  36. mip Member

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  37. mip Member

  38. muldrake Member

    I once went so far as to sign up for an account there, but had a bad feeling about actually giving these guys bank account information so checked them out a bit. I wasn't impressed and noped on out of there without finishing it. They had a long history of taking weeks or even months to process withdrawals even at the best of times and the entire operation seemed shady.

    I use Coinbase, partly because they're in the U.S., so there's at least a possibility of suing them somewhat conveniently if they go belly up.

    Regardless, though, never keep Bitcoin on an exchange. More accurately, if you have "Bitcoin" on an exchange, you don't really have it. You have a balance at some possibly questionable business operation that could conceivably get hacked or shut down by the government. Only Bitcoin on your own wallet is actually in your possession.

    I never really understood why people would trust a "currency exchange" that started as a trading platform for Magic: the Gathering cards. I mean seriously people. Despite this, the Bitcoin community still seems full of suckers enough that if bronies set up My Little Pony Online Exchange (MLPOX) as a Bitcoin exchange, people would sign up. They could even shorten it to POX.
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  39. DeathHamster Member

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  40. muldrake Member

    If Preet Bharara is the guy going after these Gox scumbags, I am hugely in support. He may be a politically motivated New York fed, but as prosecutors in cases like this go, he's a motherfucker and a badass. Ask anyone involved with the Full Tilt Poker scam.

    The Gox idiots, more than anyone on the face of the planet, deserve this guy.

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