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Bitcoin-Explain to me how to buy these things (1 Viewer)

Charlie Harper said:
1) People send BTC over the bitcoin network to pay for goods and services.

2) Miners allow their computers and internet to be used to process these transactions. In return for use of their pc/internet/electricity...miners get BTC in return.

3) There can only be 21 million BTC mined ever. The closer it gets to 21 million..the harder it is to mine, but in theory it becomes more valuable.

4) Because the bitcoin network consists of all the miners computers it is considered "decentralized" and hard to hack because you would have to hack all the computers. 
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Sounds a bit like Mormonism to me.

 
Capella said:
Ok 

2) makes no sense to me at all 

3) why only 21M. Who decided that? How does it get harder to mine the closer it gets?
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Re: #2 I could be talking out of my ### but IIRC it has to do with processing algorithms. Early on one could do it with a souped up PC. But as the algorithms got more  and more complex the miners needed to pool resources. Now it seems there's "mining farms" where there's warehouses of processing power to handle the transactions/mining.

 
Capella said:
Ok 

2) makes no sense to me at all 

3) why only 21M. Who decided that? How does it get harder to mine the closer it gets?
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2) What doesn't make sense?

3) No idea, but the dude or group that invented BTC put that limit. No idea why. They get harder to mine because it requires more processing power to solve the algorithms, because that's how they designed it. If the problems were solved easily then the network wouldn't need to be up long and no one would be able to put through transactions.

 
Charlie Harper said:
2) What doesn't make sense?

3) No idea, but the dude or group that invented BTC put that limit. No idea why. They get harder to mine because it requires more processing power to solve the algorithms, because that's how they designed it. If the problems were solved easily then the network wouldn't need to be up long and no one would be able to put through transactions.
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The mining doesn't make sense to me either. Computing power is ultra cheap and the calculations needed to process financial transactions can't be that involved. This seems to me as the classic "getting something for nothing" arrangement. And if you're getting it for nothing then it's worthless. That's how it seems in my dense melon anyway. 

 
Dan Lambskin said:
You dont have to mine anything.   Set up a wallet, buy coins on an exchange and hold them

Now yeah some people are super paranoid and  will only hold large sums on hardware wallets and only do transactions in Linux and keep each word of their recovery phase in a separate safe deposit box, but if you're just putting in a grand and aren't afraid to lose it just set up a coinbase account and hold it there 
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I'm pretty close to going the hardware wallet route. If you have any significant amount I think you gotta

 
The General said:
It's unusual for something valued at 25 bucks to be worth 100 Million 7 years later.
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People using the word “unusual” in here in a very understated manner.

Like aliens landing on my front lawn and my neighbor saying, hmmm that’s unusual.

Its ####### insane!

 
Capella said:
So people can just steal them?
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it's not quite as easy as "just" stealing them, but yes, there have been hacks where people had their coins stolen.  I think there are definitely levels of 'more' and 'less' secure places to store them online, and if you're doing your due diligence on stuff like that, you should be safe.  desktop wallets are definitely the safest imo.

I would urge you to keep reading and trying to learn about crypto.  It's not intuitive at first and I'm not sure you ever really become an expert, but I think it's a really important and valuable knowledge base to have even if you're not investing in the short term.  I think it will be a big part of the future for sure, whether BTC goes to 25k like some think, or crashes back down to 1k.  

This is a decent starting point.  That whole site is a great resource, but you have to know what to look for or else you'll be reading about some altcoin ICO for 20 minutes and wind up asking yourself what the hell you just read.

you definitely don't want to end up screaming into the wind that it's only worth what the next guy will pay for it, but that's jmo.

 
Charlie Harper said:
2) What doesn't make sense?

3) No idea, but the dude or group that invented BTC put that limit. No idea why. They get harder to mine because it requires more processing power to solve the algorithms, because that's how they designed it. If the problems were solved easily then the network wouldn't need to be up long and no one would be able to put through transactions.
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You're telling me there aren't computers who can process these algorithms faster than humans? Why are humans being paid in Bitcoin or being asked to do this at all?

 
Someone invented a just so secure enough way to launder a #### ton of money. 

China is struggling and their people are buying up these to get off the yuan. 

Then there is the cool factor the hype factor and the world is melting down factor.  

 
Capella said:
So people can just steal them?
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If the exchange gets hacked and they steal your private keys, yes.  

If it's secured at a hardware level and you keep your private keys written down somewhere safe, no.  Unless they physically steal your private keys, or physically steal your hardware wallet and randomly guess the passcode, your currency is safe.  

 
Capella said:
You're telling me there aren't computers who can process these algorithms faster than humans? Why are humans being paid in Bitcoin or being asked to do this at all?
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My understanding is it is algo based, and these miners are just giving up their physical resources for the algo to run, but aren't sitting in front of a cpu doing ####. Could certainly be wrong tho

 
Mining means what really, that you are lending your computer network out for use by a third party ... to do what?  And who will pay you $10k for a bitcoin?  How do you cash in this "value"?

 
Leeroy Jenkins said:
Mining means what really, that you are lending your computer network out for use by a third party ... to do what?  And who will pay you $10k for a bitcoin?  How do you cash in this "value"?
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I don't think mining is viable for the average Joe at this point, but buying and selling Bitcoin is a easy as buying and selling stock, hell, probably much easier actually 

 
Ketamine Dreams said:
The mining doesn't make sense to me either. Computing power is ultra cheap and the calculations needed to process financial transactions can't be that involved. This seems to me as the classic "getting something for nothing" arrangement. And if you're getting it for nothing then it's worthless. That's how it seems in my dense melon anyway. 
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This is the entire financial sector, IMO.  People making millions and millions simply shifting funds from account to account...over and over again.  The whole industry is a drain on our general population and takes tons of resources away from people who actually produce real goods and services.  I am a finance major and the whole thing is just asinine to me.

 
Mining is generally not financially viable for anyone now. Super hard to get into profitably. The getting something for nothing argument is wrong, that's not what's going on here. 

 
The General said:
Whenever someone explains bitcoin mining to me they end up get angry as I ask questions.
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I just got the full download from a buddy this week and I think I now understand how the mining works.  

 
lumpy19 said:
Who cares how mining works, invest and get rich, this is soooo simple, no need to overthink
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I wish I could get paid in Bitcoin and pay my bills from there.  Would be nice to just let my money grow while my wife isn't spending it

Also wish I'd have had a few racks to dump into it last year :kicksrock:

 
Jayrod said:
This is the entire financial sector, IMO.  People making millions and millions simply shifting funds from account to account...over and over again.  The whole industry is a drain on our general population and takes tons of resources away from people who actually produce real goods and services.  I am a finance major and the whole thing is just asinine to me.
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Whole lotta stupid in this post. But you're a finance major so you must be well versed in the inner workings of investment banking and corporate finance.

 
The General said:
Do I need a pickaxe and helmet to mine?
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You need a dedicated, high powered PC with a $2,000 or $3,000 video card(GPU) that will run 24 x 7 and turn your electric bill into a $10,000/month expense.  It will take you approximately 30 days to produce a bitcoin.  Your PC runs the bitcoin algorithm 24x7 and is validated through the blockchain. 

Other cryptocurrencies are generated also using Video cards, others use the traditional CPU processing power.

 
urbanhack said:
You need a dedicated, high powered PC with a $2,000 or $3,000 video card(GPU) that will run 24 x 7 and turn your electric bill into a $10,000/month expense.  It will take you approximately 30 days to produce a bitcoin.  Your PC runs the bitcoin algorithm 24x7 and is validated through the blockchain. 

Other cryptocurrencies are generated also using Video cards, others use the traditional CPU processing power.
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Solar powered gigantic server farms in the Nevada desert :moneybag:

 
urbanhack said:
You need a dedicated, high powered PC with a $2,000 or $3,000 video card(GPU) that will run 24 x 7 and turn your electric bill into a $10,000/month expense.  It will take you approximately 30 days to produce a bitcoin.  Your PC runs the bitcoin algorithm 24x7 and is validated through the blockchain. 

Other cryptocurrencies are generated also using Video cards, others use the traditional CPU processing power.
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And your entire rig might be obsolete a week after you get it set up.

 
So if these bitcoin can be mined and there are only going to be so many of them (did the article say 21 million or something), what percentage are in existencence currently?

 
urbanhack said:
You need a dedicated, high powered PC with a $2,000 or $3,000 video card(GPU) that will run 24 x 7 and turn your electric bill into a $10,000/month expense.  It will take you approximately 30 days to produce a bitcoin.  Your PC runs the bitcoin algorithm 24x7 and is validated through the blockchain. 

Other cryptocurrencies are generated also using Video cards, others use the traditional CPU processing power.
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Hmmm my work computer has a $5000 video card......i'm 5 min from niagara falls(super cheap power).......I'M GONNA BE RICH!!!!!!!!!!!!!

 
What's all this talk about mining? The days of lone keyboard warriors mining on their home PCs for bitcoin scraps are long over. You're FBGs, for god's sake: plunk down 10K for a coin and join the rest of the 1% of humanity that already has some. Wait for that number to become 2% (probably a few months, the way this thing is cooking) and enjoy your plunder. Choo choo!

 
Dan Lambskin said:
I don't think mining is viable for the average Joe at this point, but buying and selling Bitcoin is a easy as buying and selling stock, hell, probably much easier actually 
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John McAfee said it costs his company something like $1,000 to mine a bitcoin, and that's presumably in a place like China where electricity is dirt cheap using top of the line hardware.  

It's not really worth the trouble to mine in the US with energy cost, especially as the mining difficulty scales up.  Much easier to just buy the coins.  

 
chet said:
Whole lotta stupid in this post. But you're a finance major so you must be well versed in the inner workings of investment banking and corporate finance.
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I was too simplistic and overarching.  I'll back off of the "whole" and "entire" portions as that is simply hyperbolic speech.  To be certain, though, I'm well versed in the basics and understand the premises; corporate accountant for over 15 years, CPA license, life insurance license, etc.  Just pointing out I'm not some complete ####### with no clue about the industry.

Yes there are values to society and key components to our economy throughout the financial industry.  I'm not going to throw out the baby with the bathwater.  I'm a big believer in leveraging as a necessary part of a vibrant economy.  But there are also many parts of the sector that have lost their purpose and are a drain on the overall of society.  The ones that almost killed the golden goose in '08.

Point being, there is probably a lot more useless society draining schemes than you want to admit.  The overall value of the financial sector is constantly debated and questioned, especially after the crash and subsequent bailout.  I'm not some lone wolf in these opinions.  

http://noahpinionblog.blogspot.com/2013/01/how-much-value-does-finance-industry.html

http://voxeu.org/article/what-contribution-financial-sector

But that does not answer the question of what positive contribution finance makes in normal, non-recessionary states. This is an altogether murkier picture. Even in concept, there is little clarity about the services that banks provide to customers, much less whether statisticians are correctly measuring those services.  As currently measured, however, it seems likely that the value of financial intermediation services is significantly overstated in the national accounts, for reasons we now explain.
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Just a quick note on mining - There's lots of coins out there to be mined other than Bitcoin, with much better profits.

 
Lehigh98 said:
Congrats guys, too late to get into this thing?
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I think it'll go up more once ETFs are available. Seeing as this is a fantasy football website.....I don't see the harm in buying as much bitcoin as you'd take to the craps table. 

Sure we can shoot a 3 on the come out roll, but we might just be able to hit that fire bet.

 
Capella said:
Anybody know anything about USI-Tech? I have a friend kind of asking me to join in. I don't mind sloshing a few grand around in this as I can lose it without really caring, but when I google it, MLM SCAM is like the first 10 things I see. 
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it's a ponzi/MLM scam.  you could make money in it but anything that promotes gains like that has always ended up a scam.

Even if i knew i could make money in a ponzi i'd never do it.  In the end the ones making money in ponzi's are basically stealing from the ones who enter late.

 
If I would have read this thread 20 years ago I'd have said, no ####### way.  Of course if you'd have told me 20 years ago that the country would be in the state it is, I'd have said the same thing.

Just goes to show that literally anything is possible. 

 
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