# Lifestyles & Discussion > Bitcoin / Cryptocurrencies >  The Bitcoin Cryptocurrency

## hazek

I know there's already been topics about this subject a few months ago but I feel it deserves a new attention especially since it's support is starting to snowball:

_An unexpected use of the herculean computational power of GPUs

Have you ever encountered something that is so cleverly designed, so profoundly unique, and such a polarizing concept, that when people first hear about it, they either dismiss it as something that could never work, or instantly grasp its immense potential? Bitcoin will trigger one of these reactions in you._

More at: http://blog.zorinaq.com/?e=49

And:

_Bitcoin: The Digital Currency of the Future

Ever since the dawn of the Internet and of the information age, writers and visionaries have visualized the disruptive changes that such technologies would eventually have on our lives; they have imagined futures where we spend more of our lives online than offline, and where ubiquitous access to technology and connectivity would be a strong decentralizing force, placing power in the hands of the people.

One of the cornerstones of this vision is the need for a decentralized, distributed, and pseudonymous currency in order to digitally transmit value from person to person. You cannot truly transfer power into the hands of the people without giving them economic sovereignty, and they cannot have economic sovereignty so long as money and currency are tied to the real world and controlled by monopolistic central banks and governments.

Many various ideas have been tried over the years, such as RipplePay, eCache, and ecash. For various reasons, none of these systems have taken off. Why did they fail? Some of them were flawed because they relied on a centralized model, and others were flawed because they only work if humans are completely trustworthy, something that cannot always be relied upon. However, there is a new distributed currency which has been rapidly gaining in popularity, and it has the potential to succeed where others have failed. This new system is called Bitcoin._

More at: http://www.investitwisely.com/bitcoi...of-the-future/

And:

Gavin on Omega Tau podcast

Gavin talked for an hour and a half on the Omega Tau podcast, where he gave a great overview of Bitcoin. Mostly he talks about how Bitcoin works technically. Even though the concepts were simplified (probably due to time constraints), this is the first Bitcoin overview on a podcast that I've felt was completely accurate. Way to go, Gavin!

Official page:
http://omegataupodcast.net/2011/03/5...ized-currency/

The download link on that page is very slow, so here is a faster direct link:
http://anyhub.net/file/2cXL-omegatau-59-bitcoin.mp3
And some even faster one-click sites:
http://www.mirrorzian.com/files/PVPYNXVC/

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## hazek

Here are all the important links I have bookmarked about BitCoins:

http://bitcoinwatch.com/
http://bitcoinmonitor.com/
https://en.bitcoin.it/wiki/Main_Page
https://en.bitcoin.it/wiki/Category:Technical
https://en.bitcoin.it/wiki/Anonymity
https://clearcoin.appspot.com/
http://freebitcoins.appspot.com/
http://bitcoincharts.com/markets/
https://www.bitcoinmarket.com/
http://coinpal.ndrix.com/
http://coincard.ndrix.com/
http://tradebitcoin.com/
https://mtgox.com/
https://btcex.com/site/index/type/value
https://en.bitcoin.it/wiki/Units
http://bitcoin-contact.org/
http://deepbit.net/
http://www.alloscomp.com/bitcoin/calculator.php
http://maps.google.com/maps?q=https:...ts/bitcoin.kml
--------------------
https://bitlaundry.appspot.com/
https://www.mybitcoin.com/
https://en.bitcoin.it/wiki/Securing_your_wallet

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## Elwar

I like the bitcoin concept. I tried running it on my laptop and could never get it to work.

I wish the numbers being generated were something more interesting like further numbers of PI or some other useful computations that themselves actually have some sort of value which gives more value to the bitcoin holders.

Either way, the value of it is only useful if people use it. Everyone could stop using bitcoins tomorrow and they'd be worth nothing. Though that's the same with any currency.

I couldn't find any graphs on those pages that clearly show the rise or fall of bitcoins vs the USD over the years. I'd be curious to see how it's doing compared to something like gold.

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## hazek

http://bitcoincharts.com/markets/ is the page you're looking for, and then click on the mtgoxUSD entry and then click on the graph and you can see the entire history of that particular exchange which is the most popular one atm

And if you need any help setting it up we can hop into chat and I can help you. I also run it on my laptop and so far in a week and 1 day I mined 0.35 BitCoins

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## Elwar

From the article:




> Bitcoin really took off last year; it rose from a market value of about $0.005 per BTC (bitcoin) to nearly $1 per BTC


Not too shabby...maybe I'll try running it again at home.

Maybe I can set up my online gadget store to accept bitcoins...

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## hazek

_Bitcoin: Virtual money created by CPU cycles

The Bitcoin virtual currency system was launched in 2009, but has gained increased exposure in recent months as a few businesses and entities announced that they would support transactions in Bitcoins (abbreviated "BTC"). Bitcoin is not the first attempt to create an entirely virtual currency, but it supports some very interesting features, including anonymity and a decentralized, peer-to-peer network structure that verifies Bitcoin transactions cryptographically.

One of Bitcoin's advantages over other currency systems is that it does not rely on a central authority or bank. Instead, the entire network keeps track of — and validates — transactions. It also separates "accounts" from identities, so transactions are, for all practical purposes, anonymous. Two users can make a Bitcoin exchange without knowing each others' real identities or locations. Because Bitcoin does not rely on brick-and-mortar banks and because the Bitcoin currency is divisible down to eight decimal places, it is seen by proponents as a potential micropayment system that works better than the fee-based, currency-backed banking systems of today._ 

More at: http://lwn.net/Articles/414452/

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## hazek

From the 42min mark forward:

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## hugolp

> From the 42min mark forward:


I watched that video. I had to stop because when they were talking about gold it was horrible.

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## hazek

> I watched that video. I had to stop because when they were talking about gold it was horrible.


Yeah I know I know but at least the explanation about BitCoins is somewhat decent.

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## cubical

can someone give a quick summery of what this is about? how do you actually get paid using this?

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## efiniti

Comp Sci here.  

BitCoin is a decentralized digital currency.  They generate their currency through your CPU's computation.  However, everyone grows close to the same amount of currency all the time.  They base identity on public/private key cryptography that you'd find in ssh keys so its very secure.  There is also a limit to the total money supply (21 million bitcoins I believe) so eventually once the coins are generated there will be enough for just trade.

Very neat project.

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## hazek

Basically a peer to peer network issuing it's users coins for having their computers do some math work which is then all gathered together and locked into a chain of blocks also containing any transaction between the users.

The coins they get are of a fixed limited supply, there are no middle men when you send them to someone, it is possible to transact with people anonymously and the whole thing is very secure and prevents through smart coding and cryptography any kind of an attack you can think of.

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## hazek

And because these coins are rare and secure and are easy to send/recieve people started to trust them and started to offer some services and so they are now traded for other fiat currencies.

You can find out the current prices here: http://bitcoincharts.com/markets/

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## jclay2

So what is the intrinsic value to bitcoins? If you were to give me a bitcoin, what would I value it for besides that it is accepted as payment by someone else.

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## hazek

You'd value it for it's scarcity, for it's security, for it's practicality and for potential complete anonymity.

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## Indy Vidual

Can you buy and use them without activating that program which used up so much CPU?
How?

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## hazek

> Can you buy and use them without activating that program which used up so much CPU?
> How?


In short: Yes

In long: When you download the client, the client downloads the whole history chain of blocks containing all the transaction that have ever happened from "conception" till that moment. Once you have that done your client either only listens to the network or if you choose can also gather transactions, do the math CPU work and try and find the right solution for the next block in that chain. And if you want some, without doing that CPU work which they call "mining" you find someone who will trade them with you for something else.

There are a few options already available to buy BitCoins all pretty much listed here: http://bitcoincharts.com/markets/

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## Indy Vidual

OK thanks, Bitcoin is a really creative solution, IMO. 
Installing the client is needed for transactions / verifications, correct?

_"...And if you want some, without doing that CPU work which they call "mining"..._

Do you know if the client program has an option to _opt-out_ of mining (or would I simply only start the client when preparing to do a transaction?)

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## hazek

> OK thanks, Bitcoin is a really creative solution, IMO. 
> Installing the client is needed for transactions / verifications, correct?
> 
> _"...And if you want some, without doing that CPU work which they call "mining"..._
> 
> Do you know if the client program has an option to _opt-out_ of mining (or would I simply only start the client when preparing to do a transaction?)


You have the client always running so it keeps up with the block chain of history and constantly updates it. The client has in it's menus an option "Generate Coins" which you only turn on if you want to dedicate your CPU to solve the math problem. If you don't the only thing that your client does is keep in touch with the network, update the history and give you access to your digital wallet.

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## Indy Vidual

Thanks for the details, I'll try it again sometime.

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## hazek

bump

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## Acala

I'm afraid of money that I'm too stupid to understand.

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## hazek

> I'm afraid of money that I'm too stupid to understand.


It's not that hard to understand really. If you have some particular questions I can help you. You can also ask on the forums or in their irc chat and people will help you out like they did for me.

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## hazek

Gavin on Omega Tau podcast

Gavin talked for an hour and a half on the Omega Tau podcast, where he gave a great overview of Bitcoin. Mostly he talks about how Bitcoin works technically. Even though the concepts were simplified (probably due to time constraints), this is the first Bitcoin overview on a podcast that I've felt was completely accurate. Way to go, Gavin!

Official page:
http://omegataupodcast.net/2011/03/5...ized-currency/

The download link on that page is very slow, so here is a faster direct link:
http://anyhub.net/file/2cXL-omegatau-59-bitcoin.mp3
And some even faster one-click sites:
http://www.mirrorzian.com/files/PVPYNXVC/

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## pcosmar

When the internet is shut down, or the grid is gone (natural or man made disaster) what are Bitcoins worth?

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## hugolp

> When the internet is shut down, or the grid is gone (natural or man made disaster) what are Bitcoins worth?


http://www.guifi.net

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## hazek

> When the internet is shut down, or the grid is gone (natural or man made disaster) what are Bitcoins worth?


They are worth what ever people think they are worth. Obviously you'd have no way of making new transactions until the internet was backup and running..

But come on man. How about a realistic concern? I mean don't you think that if something went so horribly wrong that there was no internet on the whole planet, we'd have bigger more existential problems than whether or not BitCoins are worth anything?

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## pcosmar

> They are worth what ever people think they are worth. Obviously you'd have no way of making new transactions until the internet was backup and running..
> 
> But come on man. How about a realistic concern? I mean don't you think that if something went so horribly wrong that there was no internet on the whole planet, we'd have bigger more existential problems than whether or not BitCoins are worth anything?


No, I"m serious. 
This is not "Sound Money". This is cyberspace trading in fictitious currency.
 Created out of thin air and can disappear just as quickly. Backed by nothing in the real world.

Though an interesting experiment and and likely entertaining. But so is collecting gold in WOW.
And about as useful in heating my home. or putting meat on the table.

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## hazek

> No, I"m serious. 
> This is not "Sound Money". This is cyberspace trading in fictitious currency.
>  Created out of thin air and can disappear just as quickly. Backed by nothing in the real world.
> 
> Though an interesting experiment and and likely entertaining. But so is collecting gold in WOW.
> And about as useful in heating my home. or putting meat on the table.


You know it really doesn't matter what you and I think but what the world market thinks. If it's a good thing, the market will eventually use it and if not it wont.. I think it is and I bet there will be many more like.

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## Acala

Over the weekend a guy called me a Luddite because I was using a hand drill instead of a power drill to mount some shelves at the meditation center.  I asked him how that electric grid was working out for the folks in Sendai.   

I think the future is in a localized, simplified, underground economy.  A currency that is dependent on both buyer and seller having the availability of good quality 110v, 60 cycle electricity, an internet connection, and a computer is risky - especially as a store of value.  And without savings you can't have accumulation and investment of capital.

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## Napoleon's Shadow



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## psi2941

@hazek, i will no longer debate the concept of bitcoins but i'm just wondering. don't u think the value of bitcoin is kinda high when were approaching 1bitcoin=1oz of silver?

if no, after 10 years (or after US decline) where do you see bitcoins as in terms of oz of silver and gold

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## hazek

TBH I have no idea. It's in it's infancy so who knows where the price discovery will go.

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## angelatc

The Daily Caller is being hacked by a Bitcoin Mining App at this very minute.  If you go there, a survey pops up telling you that it will permanantly unlock The Daily Caller.  It's bogus, and it tries to download an applet that I can only assume stealz ur bitcoinz.

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## Dreamofunity

Should have known that all the recent bitcoin threads were a result of the Collins spamming $#@!.

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## low preference guy

> The Daily Caller is being hacked by a Bitcoin Mining App at this very minute.


I don't understand. Bitcoin apps either generate bitcoins or transfer them between people. How can they hack?

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