What is a bitcoin?

[G]

MrsIMDoc wrote:

I have no interest in investing in bitcoin, however both my husband and I cannot figure out WHAT a bitcoin is and how they are “mined” and why they are using up so much energy. We watched a video about bitcoin “mining” but it does not make sense.  I read that bitcoin mining is when a computer does math problem  – but who designs the math problem? I am not trying to be dense here I really just do not understand. Anyone have websites or can just explain it?  

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Don't know where you are at with your learning, but John Oliver delivers, as usual.

[djohnflatfeecfp]

Interesting and long read about a bitcoin mining town in Washington.

 

https://www.politico.com/magazine/story/2018/03/09/bitcoin-mining-energy-prices-smalltown-feature-217230

[ACN]

Time to buy..down to $11k.

[cozmopak]

Some of the third generation cryptocurrencies are a lot more interesting than bitcoin in my opinion.  I invested a very small amount into some of them and view it as basically a gamble.  Fine if I lose it all.  But I do think that this technology will continue to evolve and become more and more important in the near future.

[VagabondMD]

Fact: Yesterday morning, there was a discussion in the mammography reading room about Bitcoin.

Fact: Bitcoin plunged less than 24 hours later.

Coincidence? I think not.

[Rotish]

Just under 20k Saturday to 11k now

Is now the time to transfer 80% of my home equity to bitcoin?

[Dont_know_mind]

I think the argument that bitcoin has had a significant role in bringing commerce to people without ID has not happened to date.

In India, they have bought millions of people into transactional system from rural areas where ID is an issue through a nationalised payment card. This is much cheaper to implement and more efficient than block chain and it is centralised.

I imagine blockchain is useful currently mainly in the darknet to buy drugs, launder money, and buy illegal services (such as hire someone to kill someone else), and to distribute child pornography.

I imagine blockchain would be useful/valuable if there ever is a worldwide effective computer virus that cripples the usual Internet.

I am not sure how much it is being used to launder money out of China. One would think it is only
a small conduit but who knows.

[orthodds]

The number of BTC is limited. So what? There is no limit to crypto currencies using a form of blockchain. BTC was the first and it is the most well known, but it isn’t unique. So if the supply of blockchain currency has no limit (there is an ICO practically every day) then why would any one particular version of it be worth a huge amount of money if not solely due to speculative bets?

[Zaphod]

Complete_newbie wrote:

djohnflatfeecfp wrote:

https://www.youtube.com/watch?v=Um63OQz3bjo

 

https://www.youtube.com/watch?v=GmOzih6I1zs

 

Bitcoin was the first online, peer-to-peer, electronic cash system on blockchain.  It isn’t the only game in town as there are hundreds of other cryptocurrencies out there, like Dentacoin.  It is still the big boy on the block though.  The value of Bitcoin isn’t backed by gold or a government.  It’s value comes from the fact there is a finite supply (last one to be created in 2140) and how many retailers accept it.

 

Bitcoin, cryptocurrencies and the entire blockchain world are fascinating to me.  It is estimated 2.5 billion (yes, billion) people have limited access to this financial world right now and blockchain can open it to them.  Access is limited mostly because of an inability to verify their identities.  It is also estimated blockchain and cryptocurrencies could remove $20 billion out of the financial services industry too.  Basically because the middle man is being eliminated (trust me – Goldman Sachs will still get their cut).

 

Part of the greatness of blockchain is how it is a ledger system that is constantly updating and verifying and that it is decentralized. Also, its whole concept is instead of giving away your information which helps concentrate wealth into the hands of a few (like a Zuckerberg with Facebook who resells all the personal information you gave him for free on FB), you decide the value of your information and sell it on your terms.

 

There is a ton of information out there about it, but most of it is wrong.  Heck, I barely understand it and I did a presentation on it a few months back.  All I know is I am fascinated by its potential and hope it will be more beneficial to society than FB is (there are only so many cat videos one needs to see).

 

 

Click to expand…

This is part of the problem. People view this as just a ledger system and how it’ll be disrupting financial services and how it will affect Goldman Sachs etc etc. Thats what wall street is interested in – as usual – money.

I remember when I read Nakamoto’s paper – had goosebumps. If people are really interested in this read that. Very few people I want to meet in person and spend time and ask numerous questions: Satoshi Nakamoto is one. Incredible and elegant solution as non-trust math based solution to many of our trust related problems. When the code was available on sourceforge, friend and I forked it – heck I even sent him an email; never replied. He/she/them deserves a Nobel prize.

Very few give so much for nothing.

Anyways, short answer – and technical answer – bitcoin is the “currency”, laying on top of Bitcoin, the blockchain software.

Click to expand...

It basically just boils down to censorship (ie, the fed/irs/china cannot stop your bitcoin transaction, wont take note if over 10k, etc...), which then leads immediately to the obvious use cases of mostly nefarious activities and the keeping of capital from your authoritative government. The two quick articles I linked were super simple and very descriptive. Most other things are full of hope and prognostication about what it may be that is divorced from the reality of what it is and isnt. Just like a hammer, bitcoin and blockchain are not solutions for every problem or even better ways to do what we currently do on a currency type basis. A lot of the time bitcoin/blockchain is a terrible solution and would make things worse. Like everything, it has tradeoffs and those define where it is and isnt useful.

I think applying currency and coin to the conversation really just confuses everyone, while it has aspects of that, it certainly is not the dominant feature. As with all bubbles the use cases start to encompass everything imaginable, and it will likely end up very different in reality.

[Complete_newbie]

djohnflatfeecfp wrote:

https://www.youtube.com/watch?v=Um63OQz3bjo

 

https://www.youtube.com/watch?v=GmOzih6I1zs

 

Bitcoin was the first online, peer-to-peer, electronic cash system on blockchain.  It isn’t the only game in town as there are hundreds of other cryptocurrencies out there, like Dentacoin.  It is still the big boy on the block though.  The value of Bitcoin isn’t backed by gold or a government.  It’s value comes from the fact there is a finite supply (last one to be created in 2140) and how many retailers accept it.

 

Bitcoin, cryptocurrencies and the entire blockchain world are fascinating to me.  It is estimated 2.5 billion (yes, billion) people have limited access to this financial world right now and blockchain can open it to them.  Access is limited mostly because of an inability to verify their identities.  It is also estimated blockchain and cryptocurrencies could remove $20 billion out of the financial services industry too.  Basically because the middle man is being eliminated (trust me – Goldman Sachs will still get their cut).

 

Part of the greatness of blockchain is how it is a ledger system that is constantly updating and verifying and that it is decentralized. Also, its whole concept is instead of giving away your information which helps concentrate wealth into the hands of a few (like a Zuckerberg with Facebook who resells all the personal information you gave him for free on FB), you decide the value of your information and sell it on your terms.

 

There is a ton of information out there about it, but most of it is wrong.  Heck, I barely understand it and I did a presentation on it a few months back.  All I know is I am fascinated by its potential and hope it will be more beneficial to society than FB is (there are only so many cat videos one needs to see).

 

 

Click to expand...

This is part of the problem. People view this as just a ledger system and how it'll be disrupting financial services and how it will affect Goldman Sachs etc etc. Thats what wall street is interested in - as usual - money.

I remember when I read Nakamoto's paper - had goosebumps. If people are really interested in this read that. Very few people I want to meet in person and spend time and ask numerous questions: Satoshi Nakamoto is one. Incredible and elegant solution as non-trust math based solution to many of our trust related problems. When the code was available on sourceforge, friend and I forked it - heck I even sent him an email; never replied. He/she/them deserves a Nobel prize.

Very few give so much for nothing.

Anyways, short answer - and technical answer - bitcoin is the "currency", laying on top of Bitcoin, the blockchain software.

[Antares]

If you’d rather read a (very) short book, I’ll repeat a post from another bitcoin thread:

 

Books:
The Internet of Money by Andreas M. Antonopoulos
Merkle Bloom LLC (2016), 150 pages

In 2 short editions, Volumes 1 and 2

He’s an anarchist, but also an accomplished finance person and computer scientist. Lucid.

[hightower]

And another one

https://www.youtube.com/watch?v=Pl8OlkkwRpc

[Zaphod]

Here is another good article about blockchain. http://alexedmans.com/blockchains-how-they-work-and-how-they-may-transform-the-world/

 

[djohnflatfeecfp]

https://www.youtube.com/watch?v=Um63OQz3bjo

 

https://www.youtube.com/watch?v=GmOzih6I1zs

 

Bitcoin was the first online, peer-to-peer, electronic cash system on blockchain.  It isn't the only game in town as there are hundreds of other cryptocurrencies out there, like Dentacoin.  It is still the big boy on the block though.  The value of Bitcoin isn't backed by gold or a government.  It's value comes from the fact there is a finite supply (last one to be created in 2140) and how many retailers accept it.

 

Bitcoin, cryptocurrencies and the entire blockchain world are fascinating to me.  It is estimated 2.5 billion (yes, billion) people have limited access to this financial world right now and blockchain can open it to them.  Access is limited mostly because of an inability to verify their identities.  It is also estimated blockchain and cryptocurrencies could remove $20 billion out of the financial services industry too.  Basically because the middle man is being eliminated (trust me - Goldman Sachs will still get their cut).

 

Part of the greatness of blockchain is how it is a ledger system that is constantly updating and verifying and that it is decentralized. Also, its whole concept is instead of giving away your information which helps concentrate wealth into the hands of a few (like a Zuckerberg with Facebook who resells all the personal information you gave him for free on FB), you decide the value of your information and sell it on your terms.

 

There is a ton of information out there about it, but most of it is wrong.  Heck, I barely understand it and I did a presentation on it a few months back.  All I know is I am fascinated by its potential and hope it will be more beneficial to society than FB is (there are only so many cat videos one needs to see).

 

 

[HikingDO]

Thanks octopus, your first paragraph easily summarized it in a way to help understand it for the first time! Seems crazy that people are actually buying and selling math solutions.