Given the steady stream of Bitcoin stories being posted here (guilty!), I'm interested to know whether the HN crowd has literally bought in or if it's just a technically interesting topic.
What's your involvement, in order of decreasing BTC support?
I looked into purchasing some bitcoins and found the barriers to entry significant.
I find it hard to believe, at the moment, that bitcoins are generally acquired for non-speculative legal reasons.
Illegal usage seems unlikely to bootstrap the bitcoin economy, speculative usage seems certain to crash unless legitimate usage arrives in tandem to bolster it.
In principle I can see a crypto-currency economy emerging but I can't see how to get there from here without a crash on the way. So I'm not going to take the gamble.
Made the decision at $100, I see it's now at $200, my guess is it will rise considerably further before the crash so good luck to those going into this with their eyes open.
I've been kicking myself lately. I toyed with Bitcoin pretty early on and had a wallet containing roughly 200 BTC. I'm pretty sure that wallet was wiped just before turning in the work owned machine it sat on.
Interesting, does that mean that those Bitcoins are lost forever? Regular currency, coin and bills, are replaced at a steady pace. If Bitcoins are not replaced when lost, then it would be possible to lose all Bitcoins a some point, or am I wrong?
The idea is that there can only be 21 million Bitcoins, or something like that, but in the end there could be a lot less because they are lost.
Over a sufficiently large timescale, I think is an inevitable scenario. However, I have no idea whether that large timescale is measured in decades, centuries or millennia. If it's the latter, then it's probably not a huge problem.
Shish2k's point stands, only with "430 BTC is as many satoshis as there are US pennies".
But this is irrelevant anyway. If 1 satoshi ever becomes too coarse-grained, the whole Bitcoin community would obviously agree to revise the protocol to further subdivide satoshis...
Not nearly enough. I decided that it's important to let people actually spend their bitcoins. That's why I started http://bitcoinsaresexy.com - Basically selling amazon gift cards and Paypal USD transfer in exchange for bitcoin. Response has been good so far :)
The really important thing right now is widespread bitcoin acceptance. Until that comes around.. sigh we're in the wild west of bubble territory.
SO 74 Bitcoins are worth 75$ value Amazon giftcard? How is this not ripoff? I mean 1 Bitcoin is like 140$ and if you buy Amazon giftcards in bulk I assume one can get some sort of price reduction.
It's very hard to buy bitcoins - unless you're in the US or a tier 1 european city. You need a verified account at an exchange (mtgox is the biggest one) and then need to wire them money, etc. It's complicated.
The easier ways to get bitcoins are to sell something on bitmit or something like that. Or, you could try localbitcoins and try to buy from someone in your city.
With MtGox you can also make cash deposits at any local Chase Bank branch. MtGox has extremely easy to follow instructions for this on the 'funding' page in your account. This may only be available to verified users, I am not sure.
Try http://howdoyoubuybitcoins.com they have guides for many countries. In the US I would personally go with coinbase.com (I have used them).
Or post to your local craigslist and ask to pay cash for bitcoins. If you are in a big city, anywhere in the world, chances are you will find a Bitcoin seller.
If you are from Europe then https://bitcoin-24.com
Make a SEPA transfer, it costs 1.24 euro, then you can trade and withdraw any time. Beware, withdraws usually take couple of days.
I'm interested in mining. Buying feels too risky. What are the downsides of mining if I already own a decent GPU? Is it as easy as just joining a "pool" and leave my computer on overnight, and basically get paid to do it?
I have been mining since Dec 2010. I know what I am talking about, and let me tell you that at this very moment an AMD Radeon HD 7970 graphics card ($400) would mine the equivalent of $400 in 50 days:
600e6 (hash/sec) * 3600 (sec/hour) * 24 (hour/day) * 50 (days) / (2^32 * 7.7e6 (number of hashes to solve a block)) * 25 (bitcoins/block) * 200 (usd/btc) = $392
So it is very profitable to GPU mine right now. In fact, it has never been so profitable since June 2011 (previous Bitcoin bubble). However keep in mind a few caveats: (a) this assumes an exchange rate of 1 BTC = 200 USD which may or may not crash in the near future, and (b) this assumes a difficulty factor of 7.7e6 which is rising quite quickly (see the charts at http://bitcoin.sipa.be/, it rises by about 10-50% every 2 weeks or so, mostly due to ASICs).
Well, no. Mining is as profitable now as it's ever been, since the price is so high. Sure, you won't be mining 1 BTC a day any more, but when 1 BTC is $200 it doesn't matter.
Further, the announcement you linked to (by Butterfly Labs) isn't really all that accurate. They originally promised a ship date of early October. No products have shipped to date, and they've changed the specs and pricing on what they're going to offer a number of times. Some people think they'll never ship anything.
There are, however, other companies who have shipped ASIC mining chips recently, hence the skyrocketing difficulty. At this rate within 6 months it will no longer be profitable to mine bitcoin on GPUs.
In solo mining, chances are that the difficulty will increase faster than your GPU can increase the odds of solving a block. Statistically, it would already take years to find a block and collect just 25 BTC (and by that time the reward may be halved again to just 12.5). But right now, you can join a pool and still get some fractions of a bitcoin over time, and get some profit. It costs me $2.70 to run my GPU for a week and collect 0.05 BTC, or ~$10 at today's rates.
Are you just assuming that, or have you actually measured it? With my modest setup (a single Radeon HD 7850, mining only when I'm at work or asleep) I'm currently earning about 0.3 BTC/month, and the electricity only costs me about $5-$10.
At the current difficulty its hardly worth it. For example i had a Rig with 3x ATI 6870 running 24/7 in 2011 when Bitcons were around 25$. I think it made about 20-30 USD a day in profit. The same Rig would make $12 today by running 24/7 even at the current BC price of 218$. Subtracting electricity (expensive in europe) profit is fairly minimal and you have to keep the beast somewhere which is very noisy and pumping out hot air.
The risk is that you'll pay more in the electricity bill than you'd get for what you mined. You'd be competing against a crowd that is a step ahead (FPGA) and a few early birds two steps ahead (ASIC). So better first check the current calculations.
I checked a few days ago and it seemed that my 2011 MBP would earn me a few cents per day...
Mining means using electricity today and buying hardware yesterday, which will be paid tomorrow to get coins today. If you're trying to "invest" (probably a bad idea) and anticipate a rise then mine. Otherwise its less risky to buy.
If you're interested in it as a transfer technology (A very wise idea, especially for small-ish international xfers) then just buy/transfer/sell, mining is ridiculous.
For a long time coins were being mined and sold at about the cost of electricity for the most efficient miner. It would be interesting today to see what the premium looks like, probably a pretty scary number. Back when the difficulty factor was a large two digit number I mined a hundred or so BTC in software (not GPU). It's a bit harder now.
Mining isn't free. You will need to purchase hardware if you want to mine in a capacity that's actually profitable. If those coins depreciate, then all that mining is for naught, same as if you had bought them with cash.
If you want to get by with the hardware you already own, look into Litecoin mining, then sell those Litecoins for cash or Bitcoin. Mt.Gox will support Litecoin transactions (indeterminate ETA).
Honestly I think the easiest path is to just buy coins and hope they continue to appreciate. I remember not too long ago buying a few when they were in their ~$90s USD, and then regretting buying them at that "high" price. Now it's more than doubled.
Don't listen to these people. If you already have one or multiple decent GPUs you can make money by mining right now. You wont generate many coins (between 0.01 an 0.05 a day) but the price is so high that this is still profitable. Do the calculations though and see how much your electricity costs.
DO NOT buy into the ASIC market right now though. The preorder waits are too long to accurately make ROI calculations, regardless of price. As more ASICs come online the difficulty will rise significantly making it hard to make back the money you spent on your ASIC.
It you are truly interested in mining with your GPU try litecoin instead. There isn't currently an FPGA or ASIC solution so GPUs are still the most efficient mining hardware. At the time of this post they are trading at ~$4.40 a coin.
Electricity is pretty cheap. The kind of gear required to make the electric bill a significant problem would be a bankrupting level of capital expense. I would estimate it would take a pretty large rack and tens of thousands of dollars to consume several kilowatts at which time hundreds of dollar energy bills would be a rounding error.
Also you need to correct for HVAC.
If its winter a KWh of BTC is the same heat as a KWh equiv of natgas, although the natgas is a little cheaper than electrical, by about a factor of 2. So spend $10 on a absolutely roaring system (About a KW continuously 24x7 which you're not going to be doing on non-dedicated hardware) and save about $4 on my gas bill so the NET is an expense of $6.
In the summer you have to correct for the overall system coefficient of performance, and people who have no idea what a COP is usually assume its "1" (legally mandated by local building code to be a minimum of 10 where I live, your experience may vary). So spend $10 on electricity and add an extra buck or so for HVAC cooling capacity.
What it comes down to is whether you will ever break even with what you put into your rig + all the ongoing expenses for what you get out.
> Electricity is pretty cheap. The kind of gear required to make the electric bill a significant problem would be a bankrupting level of capital expense.
Note that the initial values (60,000MHash/sec, and a very tidy profit in 3 months) are appropriate only for one of the specialised hardware options. If you start filling it in with realistic values for a PC with a graphics card (see, e.g., https://en.bitcoin.it/wiki/Mining_hardware_comparison) you'll likely find the calculations running rather less in your favour.
Profiting is also much easier when bitcoins are $188 each than it is when they are $10 each.
I don't understand the point of the '0-1' option because it completely overlaps with other options. But it's one of the most popular choices so far with 17 votes.
I think it's a technically interesting topic, but I wouldn't say I've bought into it even though I figure into the upper end of this poll.
I just happened to have multiple high-end GPUs and discovered bitcoin about the time GPU miners were coming to the fore.
I expect the stream of stories, particularly those which are little more than price reports have more to do with those who have "bought in" seeking to spread and re-affirm their bullishness than any technical merit or interest.
The type of story and the nature of comments within are virtually identical to what you'll find on traditional trader forums during any strong trend.
I think Bitcoin is going to crash at some point and I am not a very good gambler, I don't have the balls to risk everything on trying to get rich so I'm just staying out of it. I should regret not buying back in early 2011 (when I first saw HN submissions about it) but I know if I had I would have sold as soon as it hit anything close to $20. At least that's what I'm telling myself to make it easier to swallow. Therefore I have bought 0, but I do have 0.05 that someone gifted to me on reddit, which is worth $10 I think.
If the price is being driven by new speculative investment (ie, a bubble), the price should stagnate as fewer speculators join the pool. If the price stagnates, there will be little incentive for purely speculative investors to keep their money in BTC.
The last cynic buying in is just an indicator of late-adopters hitting the market, signaling little gains left to be had.
10k bitcoins would be a very large amount at the current price of bitcoins. However, today someone sold around $100k worth of bitcoins and the price stayed steady.. of course 100k isn't much but right now it's a significant portion of the bitcoin economy.
The #bitcoin IRC channel on freenode has a bot command/script that tells you how you will influence the total price if you sell a given amount of coins.
We arranged things so that we held onto 25% at the outset. Now worth ¥25B+ ($250M+), split six ways. Some of us have already cashed in a small fraction, but we're mostly holding out for another few years. Thanks everyone. S et al.
88.48131
Early adopter, alpaca sock purchaser, conduct all my business pseudo-anonymously over #bitcoin-otc and in forums. No silkroad. I've bought hosting, shell accounts, audio gear, video games, gift cards, etc.
I've sold audio restoration services, video games, custom AudioUnit/VST plugins, sound effects, etc.
I mined a block back when CPU mining was a thing.
The number is changing because I am slowly reducing my position in BTC given that it appears (to me) to be in a bubble. (Note: I DO think it has an inherent value and it is unquestionably an interesting technical advance. That inherent value may someday be around or above $200USD/BTC. But I believe that the current behavior is a bubble.)
You should have cashed out only half (to bet both that the bubble will crash, and that the price will continue to rise). That would have been obviously the best compromise and less stressful. Now you risk regretting it. Effectively you did the equivalent of picking B out of the following choices, and you are about to flip the coin...:
A. Flip a coin. Head you win $50k, tail you win $50k.
B. Flip a coin. Head you win $5k, tail you win $95k.
Yeah, I had done exactly that at 128-134. Then I put the other half in with a sell order if it hit 200, thinking it never would get that high. Imagine my surprise. I already regret it. I still think we're in a giant bubble, we have to be. The rise is crazy. But I am not an investor, I just thought Bitcoin was cool at the time, and got really lucky.
Sometimes I'll have the "isn't money/currency a weird concept/abstraction" conversation with my dad, so I want to tell him about bitcoin. The Wikipedia article is good, but is there a better article I can have him read?
Before everyone gets too excited about trading bitcoins. This quote from my father always had an impact on me - "Don't ever think making money is easy". Trading now is about as high risk as it gets.
I wonder how many bitcoins are lost, ie someone mines them, and then loses the information, hard drive crashes, etc. Once they are lost, aren't they lost forever?
That doesn't mean the crash will kill Bitcoin though.
In the longer term, government regulation may do that. A lot of fiscal policy, e.g. high taxes when withdrawing investment from china, or more significantly this [1] are very hard to pull off with something like bitcoin around. Thus it must die.
I was indeed wrong, glad my wife gave me the evil eye when I started talking about buying ~5 BTC at around $190 because I was starting to get confident that it'd climb to ~$500 before it crashed. Wives hey.
I find it hard to believe, at the moment, that bitcoins are generally acquired for non-speculative legal reasons.
Illegal usage seems unlikely to bootstrap the bitcoin economy, speculative usage seems certain to crash unless legitimate usage arrives in tandem to bolster it.
In principle I can see a crypto-currency economy emerging but I can't see how to get there from here without a crash on the way. So I'm not going to take the gamble.
Made the decision at $100, I see it's now at $200, my guess is it will rise considerably further before the crash so good luck to those going into this with their eyes open.