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Bitcoin Releases Version 0.3
Posted by kdawson on Sunday July 11, 2010 @09:09PM from the nobody-to-prosecute dept.
Teppy writes
"How's this for a disruptive technology? Bitcoin is a peer-to-peer, network-based digital currency with no central bank, and no transaction fees. Using a proof-of-work concept, nodes burn CPU cycles searching for bundles of coins, broadcasting their findings to the network. Analysis of energy usage indicates that the market value of Bitcoins is already above the value of the energy needed to generate them, indicating healthy demand. The community is hopeful the currency will remain outside the reach of any government."
Here are the FAQ, a paper describing Bitcoin in more technical detail (PDF), and the Wikipedia article. Note: a commercial service called BitCoin Ltd., in pre-alpha at bitcoin.com, bears no relation to the open source digital currency.

WikiLeaks, Money, and Ron Paul
Posted by Soulskill on Sunday December 12, 2010 @01:16PM from the headlines-that-will-make-some-people-mad dept.
Another day, another dozen WikiLeaks stories, several of which revolve around money. PayPal has given in to pressure to release WikiLeaks funds, though they still won't do further transactions. Mobile payment firm Xipwire is attempting to take PayPal's place. "We do think people should be able to make their own decisions as to who they donate to." PCWorld wonders if the WikiLeaks' money woes could lead to great adoption of Bitcoin, the peer-to-peer currency system we've discussed in the past. Meanwhile, Representative Ron Paul spoke in defense of WikiLeaks on the House floor Thursday, asking a number of questions, including, "Could it be that the real reason for the near universal attacks on WikiLeaks is more about secretly maintaining a seriously flawed foreign policy of empire than it is about national security?" The current uproar over WikiLeaks has prompted Paul Vixie to call for an end to the DDoS attacks and Vladimir Putin to break out a metaphor involving cows and hockey pucks.

Online-Only Currency BitCoin Reaches Dollar Parity
Posted by timothy on Thursday February 10, 2011 @06:59PM from the computationally-intensive dept.
IamTheRealMike writes
"The BitCoin peer to peer currency briefly reached exchange parity with the US dollar today after a spike in demand for the coins pushed prices slightly above 1 USD:1 BTC. BitCoin was launched in early 2009, so in only two years this open source currency has gone from having no value at all to one with not only an open market of competing exchanges, but the ability to buy r

Only with a DDOS against the mining pools(easy), or the miner's computers (harder)

The Bitcoin network has a combined hash rate of 63,841.77 Petaflops ( http://bitcoinwatch.com/ ). Unless they buy a ton of the same kind of specialized chips as the mining community has, they don't have a chance at matching that rate.

What makes you think they won't? According to the calculations upthread, you need about $42M in hardware to hijack the network. You base your entire argument on the fact that the state doesn't have $42M to spend.

BTW: this is why bitcoin is not a currency - the only people who think it's a currency are those not capable of grasping basic logic. The rest of us have no problem acknowledging that it is a barter system based on trust. Barter systems based on trust are okay for small and insignificant communities, like remote tribes in the amazon, early proto-hominids and the like.

Only with a DDOS against the mining pools(easy), or the miner's computers (harder)

The Bitcoin network has a combined hash rate of 63,841.77 Petaflops ( http://bitcoinwatch.com/ ). Unless they buy a ton of the same kind of specialized chips as the mining community has, they don't have a chance at matching that rate. The fastest US Supercomputers rate 17 Petaflops (http://top500.org/lists/2013/11/), thus you would need 3,755 of them. I have no doubt the NSA has some supercomputers in the range of the top DOE machines, but not thousands of them.

The next question is why would the NSA *want* to overwhelm bitcoin? The block chain transaction database is publicly shared across the bitcoin network, and lists *every bitcoin transaction ever made*. That is perfect for cross-correlating with the other data the NSA collects, which is the main job the NSA performs these days, looking for "interesting" data matches. Some people even suspect the NSA *created* bitcoin. It uses ingenious crypto/hash math, and who has more mathematicians than they do? Further, the pseudonym of the creator(s) of bitcoin in Japanese is "Nakamoto SAtoshi". Notice the capitalized letters?

Farily small. 60663.20 Peta FLOPS (60 exaflops) at my time of clicking if those numbers can be trusted (likely since the network hashrate can be derived from the average speed of blocks being found) Not that bitcoin mining uses floating point units since it is brute forcing a hash... but I digress.

The computing power in the bitcoin pool today is 8 times [qz.com] the computing power of the top 500 fastest super computers in the world combined.

That article stinks of BS. It claims "The bitcoin network also qualifies as the world’s first exascale computer, meaning it’s capable of a quintillion floating point calculations per second.". The source seems to trace back to http://www.bitcoinwatch.com/ who quote a "Network Hashrate PetaFLOPS" but don't seem to indicate how they come up with that number.

AIUI bitcoin mining is a purely integer process. My guess is they looked at the performance of a typica GPU at a floating point benchmark and at bitcoin mining and came up with a scale factor. That may have made sense when mining was GPU dominated but it makes a lot less sense with FPGAs and ASICs coming in quickly.

If you are serious about doing a 51% attack you certainly wouldn't be doing it on general purpose CPUs nowadays and probablly wouldn't be doing it on GPUs. ASICs would be the way to go but you'd need a way to get a lot of them quickly.

Probablly the most effective approach for a government trying to do the "51% attack" would be to seize the designs from one of the major bitcoin asic vendors and then use their own contractors to mass produce them.

Lets run some numbers, current total network hashrate is 307.67 terahashes per second. Butterflylabs is a US company who retail asic miners at
$22484 for 500GH/s. Lets assume the US governement can get butterflylabs plans and find a contractor who will produce them for the same ammount that butterflylabs retail them for. Based on that assumption it would cost about 14 million dollars to match the current total network hashrate.

Of course it would take time to build the hashing setup so lets say they shoot for ten times the current total network hashrate to give themselves some breathing room. That would be 140 million dollars.

What what exactly is the value of the US dollar?

B0.013354 as of this morning Eastern DST.

Next question.

Oh, and look at the exchange values .... Bitcoins are anywhere from $75 to $93 - depending on exchange.

You would NEVER see variations like that with the US Dollar - even when we were attacked on 9/11 I don't think it did that.

Forbes does have a point.

To spend Bitcoin money multiple times, you only need slightly more computing power than everyone else using Bitcoin combined.

Which sums up to 703 PetaFLOPS, which is (much) more than the top 10 supercomputers in the world combined. And not only that, you also need to have malicious, rather than financial, motivations - otherwise you wouldn't bother double-spending, but would simply gather transaction fees and coinbases.

It's not going to happen.

Right now, the most powerful private supercomputer for commercial use is the Hermit

Except for that 600 petaFLOP private supercomputer for commercial use which also happens to be the most powerful computer ever constructed by mankind for any purpose.

hit 'submit' instead of 'preview'. doh.

You can see at Bitcoin Watch various running totals for Bitcoin. In the last 24 hours about 2.5 million bitcoins were sent. If you watch this site daily you will see a wide variance, up to 6 million bitcoins per day. The total number of bitcoins ever made is now just over 9.2 million, so you can see that every few days an amount of bitcoins is been sent that is greater than the total amount of bitcoins created.

Individuals can exchange bitcoins directly, without the use of any intermediary. This is a big advantage to bitcoin; no ridiculous transaction fees. So now you can see that MTGox is nowhere even close being "the main financial activity in bitcoin." In fact, the exchanges make only a small percentage of the total number of transactions, and has been growing non-stop.

The number of bitcoins increases by 30-50 thousand every day, so guess what that means? If your peanut-sized brain was able to deduce that adding bitcoins every day means inflation, you guessed right! Bitcoin is an inflationary currency (until 2021).

The way people like you pop on here and start spewing bullshit about bitcoin makes me wonder if you aren't anything more than a fucking sock-puppet for the banksters.

Namecoins should be able to help here: a decentralized DNS with its own currency for registering DNSes (which already proved to be useful as bitcoins). Nobody will be able to block some DNS if you bought it with namecoins, because this DNS is yours, right in your wallet.dat. And everyone who installed a namecoin based DNS client can use it. All DNS names are stored with transaction data within namecoin block chain. This blockchain is copied on thousands of client's PC connected in p2p network. This blockchain is encrypted with 60 PetaFLOPs/sec processing power, which makes them really safe! (namecoin difficulty is now 463897, compare that with PFLOPS used for bitcoin for example on bitcoinwatch).

No government will be able to stop namecoins, just like it's impossible to stop bitcoins. Well it's even better for namecoins. Bitcoins could theoretically be restricted by passing laws prohibiting banks to cooperate with mtgox. Namecoins on the other side do not need exchange with USD for DNS functionality to be working. Such exchange of course will be good, but you can buy namecoins using bitcoins on bitparking exhange, or mine them on slush's pool (the biggest namecoin/bitcoin pool). Domains are really cheap, you should be able to afford one for you just after few days or weeks of mining (depending on your power), or - since you can buy bitcoins now on mtgox without any problems, and because namecoins are really cheap, you can buy your own domain for less than 0.50USD. That is today's prices.

Anyway, I think that namecoins is the wave of the future to save us from any kind of censorship.

http://www.bluishcoder.co.nz/2011/05/12/namecoin-a-dns-alternative-based-on-bitcoin.html
http://mtgox.com/ - get bitcoins BTC here
http://exchange.bitparking.com/ - buy namecoins NMC here
http://bitcoinwatch.com/

sure that's blatant ad. But I think namecoins are really going to help here.

According to bitcoinwatch.com, the computing power is around 10% of the bitcoin network.
145 (+/- a few) blocks are solved every 24 hours. Each block is 50 bitcoins, plus any transfer fees, but I'll ignore those.
50*145/24 = 302 bitcoins (and change) per hour. 10 % of that would be ~30 bitcoins per hour.
At current rates, that's around 88 dollars per hour.
Most, if not all, of that money would probably go to pay the electric bill.

Well obviously there is price deflation. That's sort of a requirement for any new currency. But you're welcome to print up twenty million of your own dollars with your face on them and see how much demand you get. Something tells me it wouldn't be nearly as successful.

Frankly, I don't have the time right now to correct every wrong assertion that Krugman makes about Bitcoin right now. At first glance, though, it's as though he did absolutely no research whatsoever. He read the main page and saw "limited quantity of Bitcoins" and then went off on another ridiculous aspie rant spouting his usual nonsense.

Here is a list of Bitcoin merchants in wiki form. You can look back through the history and see that real "gross Bitcoin product" has risen significantly, not fallen as he claims. Total "market cap" has risen as well. The value of a Bitcoin in terms of Dollars has only fallen due to the aforementioned 30% inflation rate.

Meh. The current processing power of the Bitcoin network is reportedly equivalent to 103 PetaFLOPS (according to http://bitcoinwatch.com/)

Of course, it is technically incorrect to refer to FLOPS (Floating Point Operations Per Second) in the case of Bitcoin, as the hashing algorithm doesn't use any floating point operations, but I digress.

Right now, there's no way to turn Bitcoins into dollars.

This isn't true. There are non-mtgox exchanges, they just aren't very liquid/prominent.

is far too flaky.

Oh its' definitely flaky. But too flaky for what? 130M marketcap? Perhaps. But for all we know this is all a beta-test for 'microsoft money' -- the open source terms on bitcoin permit microsoft to basically take the code, embrace & extend and own the whole network. Every mistake that's made, every fix that's produced, every problem every solution brings us closer to a world without banks as we know them today and have for recent history. Good or bad.

There's always Amazon. This guy is an intermediary, sure, but a good portion of Amazon's product is now handled through 3rd parties too, so it's really not a big deal.

The real thing that will make BitCoin take off is increasing market capitalization of the currency, which is already happening. I mean, over $50 million dollars of Bitcoins in circulation, with $135,000.00 worth of BitCoins exchanged per hour? Shit man, that's an economy already.

I'm not a futurist, and there are certainly threats to BitCoin from other established internet exchangers, but I think it's got potential, especially for anyone who'd like to see the internet really achieve its true potential as a free medium.

Last I checked, the entire bitcoin network had a mining strength of 1,747 Ghash/s

Then you're out of date, it's 3653 Ghash/s now.

1511.61 is ~21% of the 7200 daily BTCs, so you'd need around that in computing power.

According to the NICS page, the Kraken has a peak performance of 1.17 PetaFLOP.
According to bitcoin watch, the network has now a performance of 46.4 PetaFLOP.

Now, I'm no mathematician, but it seems to me that 1.17 is far from 21% of 46.4; according to my calculator, it's in fact little over 2.5%.

Have you seen Bitcoin? Economy is already ~$5mil.

I offer you to check it out on Wikipedia as an alternative to using banks and fiat money. It's free software cryptocurrency being used by many. Current trading volume on the largest exchanger (mtgox) is $50k and 200k BTC (around $200k) was sent by various people in the last 24h.

To get you up to speed:

While completely un-user-friendly at present (just take a look at Bitcoin.org whenever it comes back up), BitCoin is a phenomenon of significant scale:

Value of BitCoins in current circulation: > 5 million USD
Quantities traded daily on exchanges: in the 10's of thousands of dollars' worth daily
Bitcoin transactions on the network itself: around 10,000 BTC per hour
Computational power of the BitCoin network: 186 Ghash/sec (about 42,000 quad core CPU's, or around 2 petaFLOPS)
Active nodes right now on the p2p network: >2,600

Security: vetted by leading cryptographers as many orders of magnitude better than online banking. Cheating on a single transaction with BitCoins you already own requires you to outpace those 2 petaFLOPS above. Usurping the entire network requires you to beat the *cumulative* cycles of the network over it's whole existence. "Stealing" someone else's coins without direct access to their keys: laughable to even try and compute.

Mining/where BitCoins come from: don't be confused by this, it is as irrelevant to using them as the paper money engraving and printing process is to using cash. Many people seem to get hung up on it as the primary source of getting bitcoins, which it isn't by a long shot.. TL;DR: an open, competitive process is used to "create" the coins, with increased competition resulting in increased security so that the more valuable bitcoins become the more secure they will get. In practice this means that the cost of creating coins stays reasonably close to the market value of them. In paper money this would be like if 5$ worth of security features actually went into each individual $5 bill as opposed to the few cents that goes into the most secure paper currency, and then $100 worth of security into each individual $100 bill. Now you begin to understand why BitCoin is so much more secure than traditional banking.

Privacy: individual transactions are public, but can be split over an arbitrary # of addresses, and nobody knows who owns any addresses so in practice all transactions are completely anonymous with regards to the receiver, and you would have to be watching all connections to a given node to catch a spend, identical to traffic analysis plus discovery powers on a traditional bank. Unlike a traditional bank, BitCoin happily works over Tor and other anonymisation protocols.

And finally, the eternal question of whether BitCoin is going to seriously succeed or end up on the fringe: This is silly to pontificate on. BitCoin, like anything else on the internet, will succeed if we cause it to succeed, and fail if we ignore it. It takes a lot of hard work to establish a digital currency, and whether people put that in or not all across the web will determine what happens to BitCoin. The underlying math is provably secure; thanks to the copyfight we know that the p2p network can't be taken down by authorities. Now we just have to see if an open transaction standard that allows anyone to participate can, like the web before it, gain enough traction to matter.

Sources: http://www.bitcoinwatch.com/ http://twitter.com/bitcoineconomy https://en.bitcoin.it/wiki/Main_Page

See bitcoin which is experiencing massive growth (see bottom graph) with an economy of $4.7 million.

Slashdot article. Wikipedia article.