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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."
Yea it's too bad nobody ever though of that or else they might have made sure each one is divisible to eight decimal places or something.
A BitCoin can be divided up into 8 decimal digits. So one BitCoin contains 1 billion discrete units that can be used for transactions.
It's the same as setting cash on fire. If you lost your private keys the unspent outputs they control can never be spent.
It's a proof-of-work calculation that records a transaction history. Basically, it's to prevent double-spending; if someone attempts to transfer the same bitcoin to two different people, the person who gets it is the person who had more computational effort go into recording them as having it. If the amount of computational effort in recording transaction histories were low enough, someone could double-spend by recording an alternative history on a powerful computer and having it supersede the transaction history everyone thought they were using.
In order to encourage people to put effort into recording the history, there's a reward for doing so. This lead (perhaps predictably) to "mining", where people race to record the transaction history first in order to get the reward.
So there is a purpose to mining, but it's only to keep the Bitcoin system itself running. If people stopped mining (perhaps because the reward got low enough), Bitcoin would collapse. (It's envisaged that once the mining reward gets low enough, people transferring bitcoins will pay a transfer fee to the miners to encourage them to keep mining, and they'd get their income that way instead.)
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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
So rent an apartment where electricity is included; most rental agreements don't have anything that specifically forbids bitcoin mining.
sysadmins and parents of newborns get the same amount of sleep.
Gold has actual mechanical uses (electrical contacts.) It also has bauble value.
BitCoins have zero intrinsic value, and they require electric and Internet connectivity to be used. Gold requires a civilization level just a step above pure anarchy to be useful.
IMHO, it is sort of suspicious that there is this ramp where early adopters get these bonuses, and people hopping on late end up having to put a lot more resources in for the same coins... that combined with the value of the currency going up/down in insane swings, makes it useless as anything other than a novelty.
There are services that will do this for you (ie. allow you to buy from Amazon using 'coin.) Admittedly, you're then beholden to that third-party who actually does the buying in your stead, rather than direct with Amazon, but nonetheless, without changing bitcoin into another currency, you can buy stuff on Amazon, and eBay, and a number of other sites, not to mention the ton of smaller, but no-less-useful sites that allow you to trade directly using Bitcoin...
The truth shall always be free: Boris Floricic is Tron.
Yes. You can charge 0.00000001 Bitcoins. (Although it would generally take a much larger fee than that to get timely transaction processing)
If more divisibility than this were ever required, this could be migrated to, provided the majority of network participants agreed. Increasing the divisibility this way would probably be uncontroversial if ever it were in such widespread use that it made sense - but other features such as the 21 Million limit would never get majority consensus to be changed.
And this, dear kids, is why communism doesn't work. There's always that asshole that abuses the system.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
People already pay mining fees, typically 0.0005BTC / transaction. Right now you get about 0.1 BTC in mining fees from a block, and 50 BTC from the built-in reward (which functions a a way of distributing bitcoin initially). As the reward halves every 4th year and number of transactions supposedly rises, a higher percentage of a miners income will stem from tx fees.
You can make a transaction without paying a fee, but not all miners will include your transaction in their block, and thus your transaction may take a long time to be confirmed.
What?
Communism never meant you could use whatever you want; not in theory, nor in practice. The principle was "to each according to his need".
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Except one can not buy bitcoins with a credit card or paypal,
1. because these companies hate bitcoin and what it represents for them
2. because of a high chargeback risk no one who doesnt trust you would sell you bitcoins for paypal