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Sinkhole Sucks Brains From Wasteful Bitcoin Mining Botnet
judgecorp writes "A sinkhole has taken a quarter of the bots out of the ZeroAcess botnet which was making money for its operators through click fraud and Bitcoin mining. This particular Bitcoin mining operation was only profitable through the use of stolen electricity — according to Symantec, which operated the sinkhole, ZeroAccess was using $561,000 of electricity a day on infected PCs, to generate about $2000 worth of Bitcoin."
It would if we were interested in the botnet owner' profit margin. However, we're more interested in what costs the botnet owner impose on society in comparison to his private gains. Someone who would smash a $1000 computer to gain $1000 for himself is deemed less contemptible than the one would do it for $1 for himself.
xkcd is not in the sudoers file. This incident will be reported.
What is it with Slashdot and people using the phrase "Ponzi scheme" to refer to anything they think is a scam?
Yes, Bitcoin mining becomes less profitable over time, because the goal of the system is not to make people money, but to create a sustainable currency. The "gold rush" was engineered in to build up the basic level of hardware needed to make the system useful, and now that there are a lot of bitcoin machines doing transactions we no longer need to hand out a reward for showing up.
No kidding!!! What do you say at this point?
It would if we were interested in the botnet owner' profit margin. However, we're more interested in what costs the botnet owner impose on society in comparison to his private gains. Someone who would smash a $1000 computer to gain $1000 for himself is deemed less contemptible than the one would do it for $1 for himself.
I'm not sure about that. There was an article in a local paper about someone who did £1,000 worth of damage breaking into a soft-top sports car to steal a pack of biscuits on the seat. The general consensus was that he was a loser and a moron but he got a lower fine than someone stealing £1,000 worth of goods woula have done.
I'm probably being naive here, but without the ability to issue new bitcoins isn't the currency doomed?
If all of the bitcoins have been mined then surely either the currency will collapse, or inflation will be rampant. If inflation is rampant then people will just hoard the coins and the currency will collapse. Also I'm guessing bitcoins will be 'lost' in the same way that gold or paper notes are lost, so long term without the ability to mine new coins the total number is gonna go down.
I might be missing something but I have a feeling that a proper currency probably needs new money. A proper useful currency anyway.
A few months ago I mentioned that botnets would be used for bitcoin mining and everybody was all over me saying it could never work because people would be suspicious of their machines running at 100% all day and start running scans. Yet here we are...
No, no-one except for a troll was all over you, to everyone else that was obvious and they didn't care about your post.
The entire Bitcoin concept is a shiny, hi-tech Ponzi scheme. Those that "invested" by spending CPU cycles (electricty) early made out. By design, no one else ever will unless, of course, they can steal the resources necessary to do the mining.
For some reason, you seem to only look at BitCoin as some kind of an 'investment' tool.
No wonder you see Ponzi schemes everywhere if fast buck is all you care about.
To be fair, killing people with flu would reduce healthcare costs, and would increase the number of jobs available (or reduce the state pension costs if the person is retired). The undertaking business would also boom during Winter months, and inheritance tax income would be higher because people would be more likely to have higher savings due to dying early. Of course it would increase training costs for companies whose employees have been killed, so it's not all good news. Also, it might upset some family members.
Correct (other than the inflation thing, where you meant deflation). Essentially Bitcoin's "Growth" is (a) engineered to slow down to a standstill in a few years and (b) cannot in any way be related to the growth of the underlying economy. If the economy tries to grow 10% in a year, and would under normal circumstances, assuming there's not already slack in the monetary base, there will not be enough Bitcoins to cover the increased commerce.
About the best you can say about it is that if we had a problem where people are doing too much work, Bitcoins would fix that...
Now, in fairness, I should point out that Bitcoin's defenders here normally argue that it's all OK because what can happen is banks can issue tokens equal in value to a single Bitcoin, backed by a smaller number they'd have in reserve combined with themselves (because they're effectively loans of one bitcoin to the person who takes one.) This is called Fractional Reserve Banking, is used in the real world, works well, and has the itty-bitty problem that virtually all the people who seem to be obsessed with Bitcoins really, really, really, don't like FSB, considering it a form of fraud. It isn't, it's a quirk of accounting, but it's hard for many people to get their heads around as is the fiat money system, so they get upset and start saying "What we need is something backed by something real", "Oh, I know, what about a whole load of computational power that's lost when making the coins", "Yes, great idea, even though it doesn't make sense because you can't turn the coin back into that computational power so it isn't, actually, backed by anything after all", and then this happens.
You are not alone. This is not normal. None of this is normal.
This is a good illustration about how wealth transfer works, though. Each economic activity has a cost. Economic activities which are rent-seeking--which draw increased revenue without increasing actual value--are damaging in this way. Economic waste is also damaging in this way.
This is why, for example, overpricing the market by artificially limiting supply (labor i.e. electricians and plumbers, goods i.e. diamonds, etc.) makes some people rich but has a disproportionate cost--the profiteers gain $100,000, but the net economic impact is $150,000 or so, and so the economy is $50,000 less wealthy but these folks don't care because they're $100,000 more wealthy and fuck everyone else.
This is also how churn of goods works. Tearing down a bridge that needs $1M of work to remain viable for 10 years to instead rebuild a $100M bridge in its place doesn't make the economy stronger; it temporarily creates jobs at the expense of whoever's paying for the bridge (usually taxpayers), who end up poorer, thus don't spend as much in their local economy or in the wider (national, global) market, weakening the economy overall by reducing its ability to respond to new opportunities and instead diverting money to bridge builders.
Also like the bridge, buying a new iPhone every 3 months--a more personal decision, but one with the same impact, and one that's not "DEH GUBERMENT SHUDNT BE SO SOZIALIST!" Yes, we can have that same socialist wealth destruction in a completely capitalist free market by people being idiots. On the other hand, handing down that iPhone to someone who has less money and will get it free or at a discount will keep the wealth in society. That's why I encourage people to donate their old goods to i.e. Good Will or such, rather than trashing them. Those things still useful retain value, and passing them on at steep discount to those who cannot afford such goods will enrich society by retaining wealth that would otherwise be lost to landfilling or re-processing (recycling, etc., investing more labor) perfectly useful goods.
In this case, a lot of folks are poorer and a lot of resources are wasted; but power companies are a good deal richer, and the botnet operators have more money. Society is poorer, a few players are richer. The botnet operators are as a small boy who walks through the town periodically breaking random windows so that the glazier can retain his job... and he's coming to break your window, at $50 a pane to replace.
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This crap is so old it's actually mentioned in the bitcoin FAQ:
http://bitcoin.org/en/faq#wont-bitcoin-fall-in-a-deflationary-spiral
There is lots of academic research that indicates the "deflationary spiral" doesn't happen like that.
Bitcoin having a fixed final size is just fine - it means when the economy grows, everyones money becomes worth a little bit more, i.e. prices fall a bit. Things get cheaper. That's sort of what you expect from progress, isn't it?