Bitcoin, Learned Something New Today

[tnguy]

Or on a piece of paper such as the ones I have pinned up on my cube wall for demonstration purposes (they are unfunded).

[tnguy]

I admit I know little about it, even though I've given it some degree of inquiry.   So the rumors of its decline are greatly exaggerated then, eh?

 

- OS

 

Yes. Basically, an exchange (at one time the major exchange) which had been acting in suspicious ways for a long time finally went under. It is unfortunate and potentially somewhat damaging but not fatal. In many ways, it is better that it is finally (hopefully) over.

[Sam1]

Up 60 dollars since yesterday and more than that (180) since the bottom of the last few days. Seems real dead to me...

 

(Oh, actually touched 610 last night).
 

 

Anything that fluctuates in value 75%+ in a quarter is pretty stable huh?

[tnguy]

Thanks, That is about as good an explanation as I've seen. Who originated the bitcoin?

 

Satoshi Nakamoto. Not a real person. A pseudonym which no one seems to know who it is. Mysterious, eh? :)

 

In truth, there's probably a few people who know who this is. Speculation is that it may be a small group of people from the academic community.

[tnguy]

Anything that fluctuates in value 75%+ in a quarter is pretty stable huh?

 

Who said it was stable?

[gregintenn]

Satoshi Nakamoto. Not a real person. A pseudonym which no one seems to know who it is. Mysterious, eh? :)

 

In truth, there's probably a few people who know who this is. Speculation is that it may be a small group of people from the academic community.

That alone scares me away from it.

[Guest Lester Weevils]

The wallet is digital, it can be stored online, on a flash drive, phone, or hard disk. As with nearly anything digital if is accessible to someone who would steal it, it is only as secure as the user's password. That is why I recommend everyone use a both a good password manager and a secure password generator for everything not just bitcoin wallets, as well as using 2 factor authentication wherever it is offered.

 

Can you make multiple backups of the wallet to guard against media corruption?

 

If so, what reconciles a backup wallet containing 100 bitcoins, against a working copy you just paid out from, which now contains 99 bitcoins?

 

I realize maybe I don't understand the concepts well enough to make the question sensible, am just assuming a wallet is a wallet. :) One can't back up a real wallet full of real paper dollars or real coins of course, but real paper dollars are not as subject to loss as are the bits on only one storage medium?

Edited February 27, 2014 by Lester Weevils

[tnguy]

That alone scares me away from it.

 

Because you know, personally, everyone who writes every piece of software you use?

 

The Bitcoin software is open source. Anyone can look at the source-code who wishes to and many have.

[KKing]

Have to admit, I've read the thread and still understand very little of it. But, something I think will be easy for some of you guys to answer is...How do I "spend" it? How or where do I exchange my 10,000 tickets for the $20 stuffed animal behind the counter? Edited February 27, 2014 by KKing

[tnguy]

Can you make multiple backups of the wallet to guard against media corruption?

 

If so, what reconciles a backup wallet containing 100 bitcoins, against a working copy you just paid out from, which now contains 99 bitcoins?

 

I realize maybe I don't understand the concepts well enough to make the question sensible, am just assuming a wallet is a wallet. :) One can't back up a real wallet full of real paper dollars or real coins of course, but real paper dollars are not as subject to loss as are the bits on only one storage medium?

 

You can make as many backups as you want. Though typically you should avoid using the same wallet in multiple places due to the way Bitcoin makes change (this actually bit someone* on here recently who I had sent bitcoins to). Though when I say Bitcoin, I mean the default wallet software and some other implementations. Some wallets do not work the same way.

 

Though as to what reconciles two wallets, it is the parsing of the blockchain which is the transaction ledger. If you spend say 3btc using a wallet in one place, the other wallet will see the transaction and adjust appropriately. This does bring up something I neglected to mention above which is that proper use of Bitcoin does require some form of internet connectivity

 

(*not in a permanent way)

Edited February 27, 2014 by tnguy

[tnguy]

Have to admit, I've read the thread and still understand very little of it. But, something I think will be easy for some of you guys to answer is...How do I "spend" it? How or where do I exchange my 10,000 tickets for the $20 stuffed animal behind the counter?

 

Quite a few places already. Some of the big names:

 

tigerdirect.com

playboy.com

overstock.com

Virgin Galactic

Lamborghini

 

Many places (including Amazon) via gyft.com (gift cards).

 

Plus many smaller retailers.

Edited February 27, 2014 by tnguy

[Chucktshoes]

If Mt. Gox had been a bank dealing in USD, it would have received a bailout. 

 

Let that marinate for a bit.

[TripleDigitRide]

I decided to do some more research, and I found a great article that went into great detail. If you got involved early, you would be sitting pretty at the moment. At this point, I'm looking at it more from an investment standpoint, and I'm wondering how much higher it can go. I wouldn't currently have any other reason to get involved. But after reading the last article, I sure do wish I would have tossed a few bucks in the pot at the beginning. 

Edited February 27, 2014 by TripleDigitRide

[KKing]

[quote name="tnguy" post="1117261" timestamp="1393465281"]Quite a few places already. Some of the big names: tigerdirect.com playboy.com overstock.com Virgin Galactic Lamborghini Many places (including Amazon) via gyft.com (gift cards). Plus many smaller retailers.[/quote] Ah, I see. Perhaps I just missed it before, it has to be an agreed upon form of payment from individual companies, no forms of converting it to USD or the like. So to most people it's more nest egg (loosely used) until it's a more widely accepted form of payment, correct?

Edited February 27, 2014 by KKing

[tnguy]

I don't even know how many times I ignored it before I paid it attention. At first, it just sounds like some daft scheme but when I looked at the details of what it was actually about, it made a lot of sense.

 

I don't advocate anyone puts any money into it. I just try to answer misconceptions when I see them posted. I think it will either go huge or fall to zero. If the former, I think it still has a long way to go yet.

[tnguy]

Ah, I see. Perhaps I just missed it before, it has to be an agreed upon form of payment from individual companies, no forms of converting it to USD or the like. So to most people it's more nest egg (loosely used) until it's a more widely accepted form of payment, correct?

 

Yes. There is an adoption curve which will have to be followed. It can't gain market share without gaining in value and it can't honestly gain in value without gaining market share. Speculation will help it get there and there will be plenty of volatility on the way.

 

There are companies that will allow stores to take payment in bitcoins and immediately convert it to dollars. Many do not consider this true adoption. Many of the smaller places take bitcoins directly though. Fiverr.com goes the conversion route for its sellers but many have been requesting that they be able to receive funds directly in bitcoins.

Edited February 27, 2014 by tnguy

[RC3]

If I remember correctly, a bank in china quit accepting them. And the fact that AMD graphics cards can mine the bitcoin derivatives such as litecoin, have made the cards skyrock in price. If anything, the payout was massive a while back and now its falling and falling. The strain put on the hardware also has to be taken into account. I will not buy a card used in mining only because the whole time its been used, its running at 100%. The processor on the other hand is not readily used. If you jumped into it early on, the payday for a lot of people was great. Joining the "late game" will not be lucrative for most once you factor in electricity and the cost of the equipament, ie AMD graphics cards. 

[tnguy]

This is true. Even ASIC mining is marginal these days. a NVidia card might be more reasonable value.

[2.ooohhh]

I decided to do some more research, and I found a great article that went into great detail. If you got involved early, you would be sitting pretty at the moment. At this point, I'm looking at it more from an investment standpoint, and I'm wondering how much higher it can go. I wouldn't currently have any other reason to get involved. But after reading the last article, I sure do wish I would have tossed a few bucks in the pot at the beginning. 

 

I wish I had realized when I tossed a few bucks in the pot that I had told my friends, family, and acquaintances to do the same. I bought in to play poker one night at a computer conference in vegas after listening to an hour panel essentially explaining the ins and outs of bitcoin and the encryption behind it. I never have cashed out only added coins where I could here and there, and lost a few to .gov in the silk road fiasco. It's hard to believe that they were just over a penny a piece once upon a time but then again I guess that's how some people feel about the apple stock they bought back in the 80s.

[tnguy]

If the stories of others are anything to go by, they probably wouldn't have listened (though one guy's father has made some serious money).

Crazily enough, the guy who bought the two pizzas with Bitcoin (10000 bitcoins) surfaced recently. He got out of Bitcoin after that and never really made anything out of it. Unfortunate for one of the seminal events in rise of Bitcoin.

The Lamborghini cost 216 bitcoins FWIW.

[Guest Lester Weevils]

You can make as many backups as you want. Though typically you should avoid using the same wallet in multiple places due to the way Bitcoin makes change (this actually bit someone* on here recently who I had sent bitcoins to). Though when I say Bitcoin, I mean the default wallet software and some other implementations. Some wallets do not work the same way.

 

Though as to what reconciles two wallets, it is the parsing of the blockchain which is the transaction ledger. If you spend say 3btc using a wallet in one place, the other wallet will see the transaction and adjust appropriately. This does bring up something I neglected to mention above which is that proper use of Bitcoin does require some form of internet connectivity

 

(*not in a permanent way)

 

Thanks tnguy

 

Is a wallet an active application, or a data file operated-on by an application?

 

Am still foggy on the concept, but you shouldn't "knock yerself out" explaining, because if I was curious enough would spend hours researching the answers.

 

If I have a backed-up wallet containing 100 bitcoins, stored off-line in a bank safe-deposit box on a usb stick or cdrom-- Then I spend 1 coin out of the active wallet-- How does the backed-up wallet ever find out its updated balance, if my active wallet gets corrupted in a hard drive crash, and I have to recover from the backup? Or alternately, if I'm paid another 100 bitcoins into my active wallet, which crashes before I have a chance to back it up?

 

If there are zillions of bitcoins distributed over the entire world web, what prevents the same bitcoin accidentally being in two people's wallets simultaneously, and in that case, how do you know which of the duplicate bitcoins is the error? It would seem very compute-intensive to reconcile all the wallets?

[2.ooohhh]

The wallet updates from the ledger which is stored on all BTC network nodes.(typically miners at this point but can be anyone helping process transactions) The ledger tracks each and every BTC individually virtually connecting it's unique code it to a wallet or multiple wallets since the coins are divisible. Each wallet is essentially an address at which the coins virtually reside, while a paper wallet can be put in a safe deposit box it actually contains a printable representation of the owner's private key to the encrypted address currently "storing" the coins. With the ledger being shared there can never be more than 100% of a single bitcoin nor less than 100% though you could own 50% of one and give the other half to another user. Since each bitcoin is unique and the ledger has track of all the coins in existence the only way to add new coins to the ledger is through mining.

[Guest Lester Weevils]

Thanks, 2.ooohhh.

[gregintenn]

 

The Lamborghini cost 216 bitcoins FWIW.

Sounds like a deal when you put it that way. :rofl:

[tnguy]

What 2.Ooohhh wrote is essentially correct. It's probably closer to think of a wallet as a credit card (or a collection of cards) and a wallet app as a POS system that interacts with the network. I actually think calling it a wallet was kind-of a poor choice since many people keep cash in their wallets.

 

It's also important to realize that there are no actual bitcoins, just transactions. You (or rather software) work out how many bitcoins you "have" by summing the ledger.

Edited February 28, 2014 by tnguy