I still do not know what they mine
I still do not know what they mine
Heya guys!
Yes I've read the stuff about it too with the Feds and all. They don't like it because they don't have control over it or a way to monitor it since it's very much like a torrent p2p network. Just because some people choose to use it for illegal purposes doesn't make it illegal. And there are a few people in the Senate rolling something around about trying to shut it down or make it illegal, but there hasn't been a committee investigating or anything yet. I'm not certain if there will be. Bitcoins aren't untraceable, it's just difficult, and since someone pointed out to a legislator that you -can- use the money illegally if you choose, he made it his battle cry to act like he's doing something. I'm not concerned with the legal issues at all because it's not like Free-DC is joining the tor network after mining to buy large piles of dope to share. We're just helping confirm transactions.
@laurenu2
Here's a wiki link to help explain mining: https://en.bitcoin.it/wiki/How_bitco...Bitcoin_mining
It's all a bit confusing to explain, but I'll try to make it as easy as I can. I had to reread the article a couple times myself when I looked it up.
Basically, since Bitcoin is a distributed p2p currency, there needs to be a way of approving transactions without every user having an individual log file that could easily be modified to allow double spending. The log is therefor a hashtable that sent to all nodes and the longest hashtable is considered the "true" one by the nodes, meaning all transactions within the hashtable are valid. As new transactions take place, blocks are generated and need solved to add the block to the chain.
The currency is set to grow at a predetermined pace until it reaches 21 million bitcoins, at which point no more bitcoins will be created (though blocks will still be added to the chain to confirm transactions as is now, but no reward will be given for adding a block to the chain).
Now, Bitcoins, for all purposes, have only the value that people believe they have, just like any other currency. There is only a limited number of Bitcoins in circulation, so as the demand for them goes up, the value of them goes up, and vice versa. There are people out there that enjoy knowing they can pay for legal goods without the fear of new bitcoins being added to the network (remember, once 21 million are generated, there will never be any more or any less).
The programmer built it in so that not all 21 million bitcoins are out there already. As demand for the currency grows, more blocks are created to be "solved" and added to the chain, and the system currently rewards 50 Bitcoins for each block that is solved. But, since the blocks have become increasingly difficult to solve with just one person's computer, pooling has been created as a way to split the workload up among a pool of users (usually with GPUs now because they just crush CPU processing). Then, as the block is solved and the reward given to the pool, it's distributed proportionally to the amount of work you and others have done. Those who do more get a bigger portion of the reward.
Every 210,000 blocks, the bounty (currently 50 bitcoins) halves itself until it reaches the point where no more are created.
From a cost of electricity and hardware standpoint (if your electric cost per kW/h is high, it may be less appealing because you make not make enough to cover your expenses of mining), you can make more mining (helping solve the blocks) bitcoins than you initially put into the project. Seeing how 1 bitcoin is worth ~$20 right now, 50 bitcoins is worth $1000 (once you sell it out at a Bitcoin exchange and have it sent to your paypal). So solving 1 block makes since while the reward is 50 and even 25 bitcoins. Depending on the future value of the Bitcoin, maybe even processing up through the 12.5 reward could be economically feasible.
Now is this going to make anyone rich? No. But bitcoins are in demand. Creating new ones helps stem the cost of buying them for those who wish to actually use the currency for goods. If no one was mining (helping produce) the currency and demand is how it is now, people would be paying a much larger price per Bitcoin.
**deeeep breath** So, you crunch some numbers with your GPU in a pool, the pool solves a block and it gets added to the chain, the system rewards the pool with 50 bitcoins, the bitcoins are distributed proportionally amongst the pool for how much work each user did, each user is responsible for their own wallet (kept on their own computer, or can be hosted at an online wallet website, but they charge small fees for keeping it safe and you never know if they'll disappear and take your Bitcoins with them, no FDIC here), then the user, on their own, goes to an exchange and sells/trades the Bitcoins in exchange for physical currency (USD or whatever you use) that can be sent to their paypal accounts or however the particular exchange does their disbursements.
Okay, hope that was helpful laurenu2. There's lots of articles if you search Google. One that explains bitcoins more is http://www.economist.com/blogs/babba...rtual-currency
This may help too: http://doppnet.com/2011/05/mining-bitcoins/
Okay, that's all I've got. Let's hear it guys! And it would be awesome Bigred if Bok setup a pool, as most pool managers take a 1 bitcoin fee for every block solved. If there's enough power here to do X amount of blocks per week, Bok could take the fee and use it to cover server costs and stuff for sure!
Last edited by CaptainMooseInc; 06-15-2011 at 11:24 AM.
Distributed Hold'em
One simple question - How much actual spending money have you personally made?Originally Posted by CaptainMooseInc
Cheers,
Al.
Chertsey,
I have literally just started. Haven't made any yet. I just got back from Europe on Friday since being there from March 15. I saw BitCoin in the news and was reading up about it and stumbled upon all this stuff. The first thing I thought when I read about the pooling was how it was distributed computing. And there have been for-pay projects before, so I came to the forums to see if there had been any discussion. When I saw there wasn't, I started a thread. I didn't know if anyone in Free-DC would be interested or not, but I know there used to be a LOT of power over here and wasn't sure if there still was. If the interest was high enough, then a pool could be created and kept to Free-DC users as to not spread it out amongst so many. And people would earn what they give to the project.
Right now I'm a part of a pool that I just joined last night. If a Free-DC pool is created, though, I will most definitely swap over the GPU I've got running to contribute to the effort.
And no one but each member has to try and manage all the money. The pool can be programmed to auto-disperse it and a payout automatically sent to the receiving wallet of each member with the threshold of payout minimum set by each individual user. Then it's on the user to choose a currency exchange and cash out the Bitcoins into real cash. It's no different from trading dollars for euros then.
Distributed Hold'em
That's all I needed to know.
There's nothing better than a personal recommendation in ways to make $0.00.
And for that reason, I'm out
Cheers,
Al.
Oh Cool it sounds like a DC Tron game
What does Bok think of this
I'm not really too keen on it. I've heard from a few other people who have looked into it and it doesn't really seem worth it..
Oh and the stats aren't interesting......!
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