MindzEye
Wayward Ditch Pig
The current price in CAD is just over 15K
Hey Nerds: Blockchain
- Thread starter zeke
- Start date
The current price in CAD is just over 15K
MindzEye
Wayward Ditch Pig
Which isn't a bad starting point for understanding it...I'll see what I can do here with the rest.
The algorithm that needs to be solved is a pre determined function of that network's (bitcoin in this case) blockchain. The algorithm gets harder and harder with each "block" that is solved.
The network awards whoever solved the algorithm with the newly released coin. So when your computer completes the computation necessary to solve the math puzzle, the network gives the coin to the computer that solved it as a prize, for lack of a better term.
In theory yeah, but in the case of bitcoin it has a hard cap of coins that the bitcoin blockchain will ever release. So think of it more like mining for gold, there is a finite amount of gold in the planet and when we've mined it all, that's all there is to utilize. Bitcoin is the same in this case.
Answered part of that, the bolded though is a different issue. There's a bunch of technical issues involved, the most pressing though is the amount of computation necessary to mine. I run a rig with 6 graphics processing units in it (GPU's are better suited to perform the needed computation than a CPU is) so by a lay persons measure, my rig has a **** ton of computation power. If I was mining BTC solo (just my computer against the world), I would mine 1 bitcoin every ~7000 days or so. There's just so much computation power chasing these blocks now.
Why is there demand for gold? Why is there a demand for bad pop music?
That it's unregulated and decentralized is the draw for the core community. It stems from a distrust of banks and the financial industry. The idea of a decentralized currency that can't be manipulated by central banks is a core feature, not a bug. As for governments being able to shut it down...sure that's a concern going forward for crypto currencies, but it would require co operation on a crazy scale to stomp it over from every corner of the world.
The basic premise is what I said above. A potentially frictionless (no intermediary/gatekeeper like banks, etc) electronic payment and currency system with a fixed amount of supply (to avoid the inflationary issues you mentioned earlier) widely adopted and accepted by people and businesses all over the world (uhhhh...that part is a work in progress)
This could the electronic version of the Dutch Tulip Mania in which case it's wildly, wildly over valued and a lot of people are going to have a bad time, or it could be the birth of electronic gold and it's wildly under valued, in which case a bunch of newly minted billionaires are on the way. I don't see the idea of decentralized electronic currencies going away though, whether bitcoin wins out as the king of those or not is another issue.
CH1
The Artist Formerly Known as chiggins.
I assume that the problem that requires solving is keeping the blockchain going. In a sense, your computer chips in resources to keep this monetary system going and, in turn, is rewarded in bitcoins.
It sounds insane but cryptocurrencies have several advantages, including complete privacy and frictionless payments with zero service fees. When I travel to the US and swipe my credit card, at least 5 financial institutions are taking a small bite. Bitcoin will thrive as long as people trust it. Remember, at one point society had to trust a piece of paper with a dead emperor on it, so why not bitcoin?
The bull case for bitcoin is that only 21 million coins will ever be issued. If 1% of all monetary wealth diversified into bitcoin, each coin would be worth more than $350,000 US.
Of course, it can just as easily go to zero. Nobody knows.
CH1
The Artist Formerly Known as chiggins.
Don't remind me. I remember when it was trading for 10 cents. So just $100 CAD invested in 2011 is worth 15 Million today.
I got no cryptos at at the moment but i'm looking at ones that could solve real world problems (and issue a limited # of coins).
There's one called Filecoin that seems interesting -- it attempts to monetize all unused hard drive space and bandwidth. It is currently not available to the general public.
CH1
The Artist Formerly Known as chiggins.
buyers and sellers...up $500 US in the last few hours. it's a currency that trades 24 hrs a day/7days a week.
it will be interesting to see what happens when bitcoin futures contracts start trading this month...I can see a lot of whales shorting the hell out of it (bringing the price down) but leaving themselves vulnerable to a super squeeze to the heavens. it's going to be wild.
LeafOfFaith
Well-known member
Earlier I was under the impression they were talking USD. But it's obviously CAD.
CH1
The Artist Formerly Known as chiggins.
correct...the last price I saw was 12,120 USD
LeafOfFaith
Well-known member
LeafOfFaith
Well-known member
This is enormously informative, dude. Thank you for taking the time to do it.
I'm still chugging along at the office and don't have too many brainwaves to devote to follow ups, though I do have some. Let me see if I can list a few.
The blockchain with the algorithm problems that need to be solved, who set it up? Whoever the evil genius was that formed bitcoin (in this case) in the first place? (I think I saw a video once that the identity of the guy is known but that there was some controversy or mystery surrounding it).
The blocks - are they unique to each person trying to solve them? Are there multiple different ones, or the same ones, and the more that get solved, the more the 21M max bitcoins get issued? How many have been issued so far out of the 21M?
If it's so tough to solve these algorithms (otherwise it'd have been done long ago and all 21M would be issued), what kind of genius is formulating these problems that has the world stumped and only slowly unlocking coins? And why the **** do they even call it coins when there are none?
Are all the problems preset, such that they are waiting hidden in the blocks as people open them up and solve them? Or is a ****ing computer just making them up randomly somehow and presenting them as you pass from one level to the next? Honestly, it sounds like a ****ing videogame.
So you run a rig, which I assume refers to a series of computers all working together to solve these algorithms? You programmed them to do this, so it's all on automatic, or you have to manually be involved in solving these ****ing problems? I keep swearing because the more I understand it, the more insane I think it is that this is something that has become so lucrative out of nothing.
There's demand for gold because people want to buy it to create jewelry, coins, and other things. People like bad pop music because it makes them sentimental and costs nothing to listen to. People have made bitcoin shoot to $12k per when it's so difficult to even trade or purchase it (my partner actually bought some a few years ago, and turned roughly $2,500 into $100k, but he told me he had to submit a copy of passport or something to open an account, which I'd have never done with these sketchmasters, so I don't feel like I missed the boat frankly), and its uses are severely limited, and the currency itself may at some point be heavily regulated and maybe turned into the equivalent of another credit card in your wallet. I mean, I'm exaggerating, but for it to go from nothing to $12k in such a short period of time is truly insane.
Even if the government doesn't really stick its hands into it much, I'm already seeing certain governments looking into creating their own digital currencies, which at least would be legitimate and come with some sort of compatibility with other nations' currencies. This thing, with blocks being set up and puzzles to be solved by supercomputers for the unlocking of currency really almost strikes me as a fad like the capturing pokemon nonsense and other stupid shit like that. Obviously, big money is involved, so it can't go by the wayside like those things do, but still.
By the way, I thought you were in the oil business? Maybe when you talked about working on rigs in the past, I totally misinterpreted?
CH1
The Artist Formerly Known as chiggins.
bitcoin might turn out to be a fad but blockchain is revolutionary --- it will displace all forms of businesses that make their money recording and validating information (bank transfers, stock trading, real estate notaries, etc)
think of all the various commissions and fees you pay in order to establish the transaction...poof. will all be performed by a reliable, decentralized network
think of all the various commissions and fees you pay in order to establish the transaction...poof. will all be performed by a reliable, decentralized network
LeafOfFaith
Well-known member
A reliable, decentralized network where "miners" are unlocking blocks with math problems? I don't get how that would be applied to banking or anything else.
So when I trade a stock over my online platform, instead one day I might be able to have some troll perform a math problem to unlock the ability to trade without a fee?
The application of this thing outside of the self-contained math game they've created doesn't register, not that I'm educated enough in this shit for it to be expected to register.
So when I trade a stock over my online platform, instead one day I might be able to have some troll perform a math problem to unlock the ability to trade without a fee?
The application of this thing outside of the self-contained math game they've created doesn't register, not that I'm educated enough in this shit for it to be expected to register.
CH1
The Artist Formerly Known as chiggins.
you're getting hung up on the "math game".
the problem blockchain solves (decentralized database with no single point of authority/failure that constantly updates itself ) is the game that matters
MindzEye
Wayward Ditch Pig
De nada
The type of algorithm itself was originally designed by the NSA. But it was Satoshi who decided to utilize it as part of bitcoin.
The aforementioned Satoshi is apparently the developer though yeah there's a bunch of rumours about who he actually is, if Satoshi is really a group of people, etc.
The block is a common block that everyone is trying to compete to solve first. When that is solved, the network will release another block to be solved. As for how many are already mined, last I looked it was like 16 million and change.
This is where the crypto part comes in. Think of it as an encryption that your computer is trying to break. The same way a hacker is trying to brute force a a network to get it to give him access, your computer is solving math problems to decrypt the block.
Why do they call it football when only one dude uses his foot? Shouldn't they call it armour ball or some shit?
Not all of them are referred to as coins. Ethereum's is just referred to as "ether" for example.
We're straying into cryptography stuff that I just don't have much understanding of. The best I can do here is to say that it's basically the same as trying to crack the encryption (password protection) on a protected file. It just takes time and computing power.
1 custom built computer, it's most of the same parts in your PC with the exception of the stack of graphics processors used to do the heavy lifting.
I didn't program it, so to speak. I use a piece of software designed to do the function.
Problems demand solutions. The problem of financial gatekeepers at every step of the system taking their chunk every time a few 1's & 0's shift columns is a real one (and a very lucrative one for the gatekeepers).
The concept of "value" is a funny one. We could pretty easily discuss dozens of examples of things with little to no intrinsic value but that carry significant amounts of financial value. If enough people with a large enough pile of compiled cash think that something has value, it has value. The potential future benefits of bitcoin are driving enough people to believe that it has value so here we are.
I think you're glossing over the potential utility of bitcoin as a payment system. There will be wider spread adoption by merchants over the next few years. I would suggest that when assessing bitcoin, look at the market cap (~200 Billion) and not the cost of each individual coin. Just Visa for example, has a market cap of 250B. Bitcoin really isn't that big, despite how expensive each individual coin is.
I'm investing and tinkering full time now (thank you green rush of 2017). I did very well this year investing in Canadian MJ stocks, and then in a California based cannabis beverage maker that 3 bagged for me over the last 2 months. I was able to leave my job in the oil sands about 6 weeks ago.
CH1
The Artist Formerly Known as chiggins.
Congrats ME on the career change. I'm still holding most of my California beverage co -- trimmed about 20% two weeks ago. Completely out of Aurora -- 300% move in six months was good enough for me.
Speaking of crypto, I threw a few bucks at an exchange play -- DIGAF. Hoping it catches fire with the momentum crowd.
And I'm using options in OSTK as a backdoor crypto move.
Speaking of crypto, I threw a few bucks at an exchange play -- DIGAF. Hoping it catches fire with the momentum crowd.
And I'm using options in OSTK as a backdoor crypto move.
CH1
The Artist Formerly Known as chiggins.
read this primer on blockchain and it will go away
https://www.forbes.com/sites/bernardmarr/2017/01/24/a-complete-beginners-guide-to-blockchain/#1a1b286b6e60
MindzEye
Wayward Ditch Pig
Glad to hear that, it's going to be an interesting 8 weeks. I'll start moving out of it slowly in early Feb I think, but as always, we'll see.
Did really well with Cronos & Canopy in the late summer and early fall, caught most of their steady move (though was out of Canopy before the Constellation deal....). Caught a chunk of RTI & Aurora's recent move as well, which was fun. Got in at a nice price and did well on DOJA as well.
It's been a nice 6 months.
I honestly don't know where to invest in crypto and don't know if I want to know. I tried to figure it out but that is what pushed me towards the mining side of it. I'm pulling about 450 a month on 1 rig, and plan on scaling up when I get back from Toronto after Christmas. I've already started ordering parts for 5 more machines. If it all goes to hell in 6 months, I can still part out the hardware and get a chunk of my money back. If it doesn't, I'll just keep adding machines and turn it into a solid bit of passive income.
It seemed like the best way to not be the dumb money in a trade on crypto.