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Bitcoin Mining Reward About To Halve
First time accepted submitter ASDFnz writes "The reward for successfully completing a block (also called mining) is about to halve from 50 bitcoins to 25. From the article: 'Bitcoin is built so that this reward is halved every 210,000 blocks solved. The idea is as bitcoin grows the transaction fees become the main part of the reward and the introduction of new bitcoins slows down to a trickle. This also means that there will only ever be 21,000,000 bitcoins in circulation.' You can watch the countdown here."
My parents won't let me mooch off their electricty forever.
If there's only 21 million bitcoins that can be made, then if a lot of people started using them, they'd have to share them. There's something to be said for currency that has a indivisible limit -- for example, the smallest unit of currency in the US is the penny, though everything is typically counted in dollars. But while bitcoins can be divided, it adds a lot of complexity to the system and extra tracking and auditing. And it's main feature, anonymity, isn't really all that anonymous -- cash has serial numbers but there's no log of transactions built into the dollar. Bitcoins require that transaction log. In a lot of ways, it's about as anonymous as using a credit card.
#fuckbeta #iamslashdot #dicemustdie
currency.
That not even one bitcoin per person in the world, or even many countries.
Bitcoin is the greatest real-world experiment in Austrian economics. For once we'll get to actually see if a "deflationary spiral" will actually occur when the rate of money creation slows, or if the Keyensians were just full of it. Whether bitcoin actually succeeds or not, we'll at least get some really good data.
At 7 billion people, there exists 333 and 1/3rd people for every possible bitcoin.
People say.. well, you can use thouandths of a bitcoin, but is that really enough?
The current estimated wealth of the world is US$200 trillion. To get bitcoins down to dollar granularity, you would need to use 10 millionths of a bitcoin.
Seriously? And how was this sold as a currency?
PS: I don't reply to ACs.
Oh no, the bitcoin ponzi schemes will have to double their reward in order to be viable!
Apart from silk road, bitcoins have practically zero value in the vast majority of financial transactions, so why do we care about this?
Feed the need: Digitaladdiction.net
Am I the only one that has a problem with this syntax?
Can someone explain me what kind of calculation is done by BitCoin client in the process of "mining"? I have yet to find this information or receive an answer anywhere on the web.
If this is just abstract algorithm solving with no purpose whatsoever, I'd say that in terms of real world economy bitcoins are utterly worthless.
I think I mined part of a bitcoin then lost the files I used to generate them. Does that mean they're permanently out of circulation? How do they handle such a situation?
and get them to exchange their gold and silver (actual resources with actual industrial use and hence value) so they can use this crappy fisherprice currency supported by grown up fisherprice playing spineless virtual beings.
Bitcoin will let us see if money is something that can truly exist without government, or if the anarchists were full of it. Bitcoin's success or failure will almost certainly tell us more about this than about deflationary spirals.
Palm trees and 8
Get rid of them now. I suggest you send any bitcoins you have to this wallet address: 1AeCTNhF3Sovi8fkjq7Buy8sYoc2C4xoo4
Here's the highest-level view possible: a bunch of anarchists thought that an interesting cryptographic trick would let them have money without government, and then a bunch of opportunists realized that they could scam people with Bitcoin much in the same way that bankers scam people with unusual investments.
Palm trees and 8
If you believe the mhash/s speeds of (yet to be released) ASIC hardware, as well as decentralized P2Pool mining, then you'll need to factor in the effect of disruptive technologies on "deflationary spirals". Bitcoin mining was something I was recently evaluating and decided against after researching and factoring in the effects of profitability decline per year on revenue, especially if ASIC hardware delivers as specced.
sysadmins and parents of newborns get the same amount of sleep.
Since now they girls doing video clips for bitcoins! http://www.videos4btc.info/
I'm no crypto expert; but it was my layman's understanding that the bitcoin setup is(barring presently unknown attacks) unforgeable; but that there is nothing particularly special about the "Genesis block" at the beginning of the bitcoin block chain, aside from mutual acceptance of it.
Given that, while it is not possible to forge a bitcoin or to produce more than 21,000,000 of them, it should be possible for anybody who feels like it to simply define a new Genesis block and go hashing merrily away. The products of this block chain will be distinguishable from the products of any other block chain; but user convention could assign them value in exactly the same way as it did the old ones(or, more probably, they would trade at a discount against the 'original' bitcoins).
Any speculation on whether the people-who-care-about-bitcoins of the world are sufficiently rabid about some sort of deflationary theory of currency to prevent that, or will we start seeing N different distinct block chains trading between one another as well as select real world commodities?
I confess to not understanding how it works too well, but what if I accumulate a bunch of bitcoins and then just lose all their details (ie, delete them, throw them away, whatever). Surely, as people lose, forget or just misplace them (and this happens with real money, too) this will lead to a number below 21,000,000 and eventually quite a lot fewer?
I used to be big on the BTC mining thing. These days, however, it just doesn't matter anymore.
I got into BTC fairly early, back when it was profitable to run the mining software on a single workstation to suck up unused cycles. At that time, it was actually profitable to invest in dedicated hardware to mine coins- so I (and a lot of other people) eventually did. My first dedicated rig was a HP ML350 G5, which set me back about $4000. It ran two 8 core processors and basically sat around all day mining bitcoins.
Later on when the GPU accelerated mining took off, I bought and built four systems from off the shelf components, and the ML350 was rededicated to running ESXi with a bunch of VMs for mining and managing the four slaves. Each slave had 3x ATI GPUs, later those were swapped out for NVidia GPUs for other various software reasons.
Then the FPGA (and later ASIC) players came into the game. It started with development boards (FPGA boards purchased direct from the chip manufacture), but later spiralled into custom FPGA boards in nice cases that you could stack or keep around on a metal shelving system easily enough. Now, the custom FPGA boxes for BTC mining basically put the GPU miners out of business- the introduction of FPGA hardware increased the BTC mining difficulty to the point that it was pointless wasting the power mining with anything other then.
The problem was that by the time the FPGA market exploded, it was *barely* worth investing in the hardware to get in that late in the game. Previously, buying a few PCs and loading them with GPUs was a cheap way to make some extra cash. FPGAs however cost a hell of a lot more and the difficulty of mining BTCs had increased so much that you would barely break even, and you'd be bloody lucky if you actually made any money in the end.
But FPGAs weren't good enough. People started thinking that they could build silicon to do things even faster, and thus the ASIC market started to emerge and take off. The problem here is that while an ASIC kicks the shit out of an FPGA (and anything that came before the FPGAs)- they're so expensive and the BTC difficulty has been bumped up so much by the initial ASIC wave and the FPGAs before it... That... Wait for it...
Investing in ANY form of ASICs to make **any** kind of reasonable money... Means that you'll never actually break even.
That's right, the ASICs they've got out there are so powerful and the BTC chain is becoming so difficult to mine, that if you invested $10K+ (which is what you'd have to spend) for a reasonable ASIC setup- you would never actually make any money. If your ASIC box is profitable, it won't be for long since the more ASIC miners join in on the party- the more difficult it becomes to mine BTCs.
So the whole system has kind of spiralled into nothing. Mining isn't profitable anymore. Even if you invest in serious hardware. It just doesn't matter anymore, and now that the "reward" for mining BTCs is about to halve- it's even more of a waste of time then it was before. You could have made money in the beginning if you were there, but if you weren't- it's not worth investing even a dollar into hardware to mine BTCs anymore. That train has long since departed.
BTC is basically just a currency now. Mining is vastly irrelevant and always will be, now that we've got FPGAs and ASICs flying around.
-AC
The reality is that all these sites are using Bitcoin for is a transaction mechanism. They are not keeping their rake in bitcoins, they are exchanging it for cash because that is what the real world operates in. Similarly, the people making the wagers are exchanging their cash for bitcoins in order to play the game. In essence bitcoins are just being used as a payment processor for these sites.
Also, people who think bitcoins are not under government control are woefully mistaken. Aside from the pittance of coins one can mine, how do you propose to get any substantial amount? You need to go to an exchange. How do you purchase using that exchange? Using your credit card. Which is easily regulated.
IE - government can force Visa and Mastercard to shut down all bitcoin exchanges whenever they want to, effectively killing the currency for all intents and purposes. They only reason they don't do this is because it is not relevant enough to care.
I wonder how many Bitcoins I can mine with a few hours in Amazon's Elastic Compute Cloud?
Or maybe I can put my mining in as the idle loop of some of these new petaflop supers.
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
Uh. The ASICs that are about to hit the market start at less than $200.
That begs the question, eh?
One word - STFU. Want more? How about "no real world value". Don't believe us? Try paying your taxes with BitCoin. Try buying much of anything with it, for that matter. Yes, yes, we can all dig up a few sites that, for now, will exchange things of value for BitCoin, but to consider that number anything but a statistically meaningless fraction is a fool's errand.
Done to death. Move on.
nt
Does anyone have a good estimate as to how much wasted electricty is going to "creating" bitcoins?
-- these are only opinions and they might not be mine.
I will never accept bitcoins, as far as I'm concerned, this is not real money, has no actual value, because I am not willing to pay anyone to do whatever it is bitcoins are being given away for. Also, what the fuck is a bitcoin? Has anyone ever seen one? If the internet fails, gets shut down, etc., your bitcoins just became a collection of numbers, I don't want my ability to accept or spend money to be held at the mercy of a capricious internet. Fuck that shit, that's why we have paper money. Duh. Its cute that dweebs want to have their own species of play money, but count me out. If I can't buy a coke, a car, or a house with it, can't pay taxes with it, etc., it's fucking worthless. You guys are wasting electricity, if you're doing this with your own computers, and if you're doing it with someone else's computers, then it's probably illegal, and if it's not, it should be.
People started thinking that they could build silicon to do things even faster, and thus the ASIC market started to emerge and take off.
Well, maybe. Like much in the Bitcoin world, some of this is a scam. At least one of the "ASIC" products turned out to be an FPGA. As of right now, it's not clear that anyone is actually shipping an ASIC-based Bitcoin mining device. Suckers can pre-order from either of two vendors. Payment is in US dollars, not Bitcoins.
on the next bitcoin.
Bitcoin is a legitimate currency.
- no one ever
Can I charge .25 bitcoins? If not isn't the max of 21million coins a problem?
I'm sorry, but this whole bitcoin thing is nonsense.
I dropped my electric wallet in the toilet and had a heart attack. No really, I had like 200 dollars of electricity in there, I almost died.
Comment removed based on user account deletion
Bitcoin has it tough.
On the one hand, you have these libertarian wackos that demand a constant money supply
On the other hand, you have an algorithm that demands that people destroy resources to protect the currency.
On the third hand, you advertise the currency as having lower fees than paypal.
Bitcoin's solution is a three-way swindle:
1) Tell the libertarians. Hey we are printing money at a 25% annual rate, but that's only temporary. We'll be at zero printing before you know it.
2) Tell the tech-nerds. Hey, yes are algorithm won't work without printing money. Don't worry we're going to have big fees to replace money printing.
3) Tell the general public: Hey, unlike Paypal our currency has essentially zero transaction fees. (you guys are uninformed anyway)
It is going to be amusing when all three groups finally turn against each other. Who is swindling who?
And yet I have more than a few friends who actively replace their surplus currency with gold, whenever they can.
What do you mean, "and yet"? That makes a lot of sense because they are getting something they know, with as much certainty as they can, is real gold.
If the time ever comes where they need to use the gold they can simply reverse the process, go to someone who has the equipment to verify what they have is gold, and give them the equivalent amount of currency at the time.
That's the same way the bicycle purchase should have worked - the guy could to to someone willing to verify his gold and exchange it for enough cash needed to buy the bicycle.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
> This also means that there will only ever be 21,000,000 bitcoins in circulation.
No it does not mean that. It means the NSA's crypto boffins haven't bothered so far to pull the house down on BC miners. When they do there will be a lot of skeletons found under the rubble.
Keep in mind there is absolutely nothing preventing anybody from posting all the 21 million bitcoins on Full Disclosure tomorrow or cracking the crypto and disclose why the particular starting value with a particular backdoor was used by the fake "japanese" creator.
> Bitcoin is built so that this reward is halved every 210,000 blocks solved.
This is the very definition of a pyramid game (also known as a Ponzi scheme in the USA).
So how stable is the bitcoin exchange rate these days? Can I start using it seriously yet for receiving as payment for services?
So they keep reducing the supply of bitcoins until a fixed amoutn, right? What happens after that, when there is no incentive for people to do mining anymore? I thought the point was that the mininag activity was used to stamp adn verify all the transactions ? How will users know which transactions are real when all the mining stops?
And this, dear kids, is why libertarianism doesn't work. There's always that asshole that abuses the system.
There. Fixed that quote for you.
Bitcoin is not a currency or even a product. You guys are the product and bitcoin is just the honey to catch you.
Most types of money started without government, and came from merchants such as goldsmiths with governments coming late to the party to make sure they could tax everyone.
However that is no way justifies stupid deliberately flawed ponzi schemes like bitcoin designed to punish the late adopters for the benefit of early adopters. Ignoring all other flaws the price of entry late in the game will get to a point where it is unlikely to provide any obvious benefit for people joining in so it will stagnate leaving those at the bottom of the pyramid with far less than they've put in and no sign of any suckers to enlarge the pyramid and get their money back.
Gates' success came from connections via his already wealthy family.
Zuckerberg's came from his (possibly criminal) actions at HARVARD.
But thanks for playing.
BTC has got me out of a jam a few times.
1) I clicked buy on ebay, only to have Paypal lock me out because I was preferring to link the account via debit card rather than Direct Debit to a bank account. There was a delay while I scrambled and apologised to the seller as to why I wasn't paying. In the end I remembered I had another account in another country (due to cross border resistrictions) so I tried to pay with that and that was blocked too. In the end I just converted some BTC to Paypal and paid that way. This was loads easier than trying to get credit into my Paypal.
2) Credit card security hassle. My card was declined while buying something abroad. Thought it was a mistake so ordered something I needed to do on Amazon - failed. I was able to use Bitcoin to buy that something on Amazon quickly. The credit card problem was fixed later when I was able to reach a land phone (mobiles too expensive abroad).
So twice it's really helped me out in a fix. I'd recommend anyone have a little bit of backup like this.
In much the same way that there is a difference between Leninist Communism and authoritarian dictatorship -- that is, the difference is purely an notional one in the idealized description, but not a difference that there is any reason to believe would actually have any practical manifestation were the ideal actually attempted to be put into practice in a real society with real people.
As Madison wrote: "If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary." Systems of anarchy or unrestrained government both fail in the absence of angels.
This comment has nothing to do with the increasing difficulty, I understand why that is so, but IMO Bitcoins are useless, except as a prototype of how a digital economy might work. Limited to 21,000,000 coins ? Can an economist explain how the world with 7 billion people would divide that up ?
Will you retract this statement if it can be shown that tomorrow bitcoin will have more users than it has today?
No, the statement started as, "The scenario is that"
Then after that was proven false, it became, "The more likely scenario is that"
Then it became, "I think the more likely scenario is that"
Then: "Maybe, but I think the more likely scenario is that"
Finally: "Maybe, but I _still_ think the more likely scenario is that"
Tomorrow: "Probably, but I still cling to the thought that today is the day that the scenario has finally become..."
Let me summarize my previous post with a question.
Has there ever been a society where the lazy melted away where women didn't die in childbirth--no matter how young or how beautiful--over random weaknesses of constitution?
When your wife is dying in childbirth, that must be about the most helpless feeling a man can experience. I suspect it's bad enough to make a man re-invent civilization all over again, when we've only barely rid ourselves of the beast.
Xenu is (for vary liberal values of "is") an extrasolar intelligence.
The distributed account book is what has value. It makes it easy to transfer funds between people, especially if they are in different countries. A bitcoin is just an arbitrary accounting marker in the book. It has no value in and of itself, only when part of a larger system that includes the whole account book and network. Since maintaining the account books is a useful function, the people who do that get credited with some coins by lottery, that is all that mining is.
Ask any business, bank, or brokerage house if keeping the accounts for the business has value.
What normally ends up as money is whatever is the most easily traded commodity in a given society. At times that has been cattle, gold, paper money, and now debit cards. But people prefer to accept that good which is most easily traded for what they really need and want. They would work directly for what they want, but finding someone to pay you in apartment leases (barter) is difficult, so they settle for whatever everyone else collectively has chosen to use.
I started with "what normally ends up...", but that can be subverted by force, as when a government bans some forms of money in favor of others (usually ones they produce themselves).
it primes a population of minions who have nothing, including intellect. When money or capital does come along, the people are like deprived addicts, and do anything they can to get it and step all over anyone in the process. Go to China and see it for yourself. It's a far right-wing system to keep people down while an elite sails over them in their cruel authoritarian control structure.
Not to be confused with Socialism - a real leftist system and one that I have no problem with.
In communism, the promise was "work hard, and soon in the future we'll all be living in the socialist worker paradise". Well, people started out believing in it. No, seriously. I'm serious. Look at how Russia developed in the 1920s, they turned from a backwards agrarian society that was close to a feudal system into an industry nation within a few years. At a horrible price, no doubt about that, but people believed in it and pulled through.
NO.
The economic model in Russia was to exploit everyone and keep them at a minimum of welfare, so that the profit can be invested into heavy industry for militarisation.
There was no worker's paradise. There was hell.
Mining wasn't meant to be the biggest business in the world of Bitcoin. It will never be the type of "work" that can feed the masses, just like in the real world, only a few people are miners. But that doesn't make the idea of donating your computing/networking/whatever resources to some crowdsourcing mechanism in exchange for micro-payment invalid. Here is a couple of services that your computer could provide to others in an automated, peer-to-peer fashion for a couple of 'toshis:
I guess there might be some real economic potential for the last couple of items on the list.
Has anyone attempted to write some kind of service-for-bitcoin software?
I do exactly the same though I'm on Economy 7 and thus only mine at night. I don't get anything like 4 bitcoins a month though.
Only difference between Capitalism, Socialism and Communism is the tax rate. And no, the US is not under capitalism.
It's done.