It seems that you're using an outdated browser. Some things may not work as they should (or don't work at all).
We suggest you upgrade newer and better browser like: Chrome, Firefox, Internet Explorer or Opera

×
Community
General discussion (archive)Bitcoin: is anyone here mining or earning it?(83 posts)(83 posts)
(83 posts)
Pages:
1
2
3
4
5
6
This is my favourite topic
Posted April 05, 2014
So, uh, what is the "mining" process, anyway? I mean, the GPU is doing something to earn money. What is that something? Is this basically like the Genome or SETI projects, but for money? And if so, what sort of info is being worked on?
Posted April 05, 2014
avatar
DarrkPhoenix: These days unless you're using some kind of ASIC mining rig you're paying more for electricity than you're going to be making from the bitcoins generated (and stealing electricity from your employer isn't a solution to this problem- it just makes you a common thief using a very convoluted method to launder what you've stolen).

The biggest problem with bitcoin at the moment is the lack of liquidity. With exchange after exchange running into problems there's a limited number of people looking to buy bitcoins, such that not only is it non-trivial to get rid of any substantial quantity, but that because it's so thinly traded just one person looking to drop a bunch of bitcoins at once could easily tank the exchange rate. Just to see a simple illustration of this lack of liquidity, look at the different exchange rates between exchanges. For most currencies you'd see people looking to make as much as they can off arbitrage with those kinds of spreads (which would result in decreasing the spreads); the fact that that isn't happening with bitcoin shows the tremendous amount of uncertainly in actually being able to unload bitcoins once they're purchased.
avatar
monkeydelarge: And there are serious consequences for people caught stealing electricity at work so I don't know why someone would do such a thing...to mine worthless currency.
its not actually worthless if you can exchange it in to real money, but anyways, i havent got the GPU power to even bother attempting mining.
avatar
HereForTheBeer: So, uh, what is the "mining" process, anyway? I mean, the GPU is doing something to earn money. What is that something? Is this basically like the Genome or SETI projects, but for money? And if so, what sort of info is being worked on?
You could say all the computing power and electricity is just being turned into heat.

Ok, so if ive understood right, the processing has something to do with keeping the whole bitcoin system working - but it doesnt generate anything useful besides itself. So no, its not charity work nor is it saving world in any way.

And the more people are mining, the lesser your likelihood of getting any (bit)coins gets. I suppose in a way you could call it lottery where more processing power equals more tickets. Apparently some years ago mining with you home computers single GPU actually earned you money - these days youre more likely to waste money on electricity bill for running gpu at 100% 24/7.

...and this is the actual reason people are getting interested in dogecoins and whatnot - less people mining them, so you can get them without having 100 gpu farm of the newest AMD graphics cards.

If you want to think of cryptocurrency as money, the biggest problem they all have is that you cant buy too many everyday things with them. So if youre into illegal gungs, drugs etc - i can see the "value" of them - but you regular miner is doing it just for the sake of selling it for someone else at profit. So rather than currency i personally see cryptocurrency atm more as volatile investment.
Post edited April 05, 2014 by iippo
Posted April 05, 2014
No, I prefer not to aide scams, schemes, or pyramidal sequences.
Posted April 05, 2014
avatar
Darvond: No, I prefer not to aide scams, schemes, or pyramidal sequences.
I dont think BC atleast started as scheme or or such. Its definitely not pyramidal anyways - but ofcourse its sudden increase in worth from 0usd to 1000usd did kinda leave its mark. Whether MT Gox "bank" and the other such BC services in the scene are schemes is then whole another matter.
Posted April 05, 2014
avatar
monkeydelarge: And there are serious consequences for people caught stealing electricity at work so I don't know why someone would do such a thing...to mine worthless currency.
avatar
iippo: its not actually worthless if you can exchange it in to real money, but anyways, i havent got the GPU power to even bother attempting mining.
avatar
HereForTheBeer: So, uh, what is the "mining" process, anyway? I mean, the GPU is doing something to earn money. What is that something? Is this basically like the Genome or SETI projects, but for money? And if so, what sort of info is being worked on?
avatar
iippo: You could say all the computing power and electricity is just being turned into heat.

Ok, so if ive understood right, the processing has something to do with keeping the whole bitcoin system working - but it doesnt generate anything useful besides itself. So no, its not charity work nor is it saving world in any way.

And the more people are mining, the lesser your likelihood of getting any (bit)coins gets. I suppose in a way you could call it lottery where more processing power equals more tickets. Apparently some years ago mining with you home computers single GPU actually earned you money - these days youre more likely to waste money on electricity bill for running gpu at 100% 24/7.

...and this is the actual reason people are getting interested in dogecoins and whatnot - less people mining them, so you can get them without having 100 gpu farm of the newest AMD graphics cards.

If you want to think of cryptocurrency as money, the biggest problem they all have is that you cant buy too many everyday things with them. So if youre into illegal gungs, drugs etc - i can see the "value" of them - but you regular miner is doing it just for the sake of selling it for someone else at profit. So rather than currency i personally see cryptocurrency atm more as volatile investment.
You are right. Crypto currency isn't worthless. Nothing is really worthless. If you find the right people, you could sell them rocks from your backyard and make some money... Anything is possible but does that mean, you should start spending time and money mining rocks?
Post edited April 05, 2014 by monkeydelarge
Posted April 05, 2014
avatar
iippo: its not actually worthless if you can exchange it in to real money, but anyways, i havent got the GPU power to even bother attempting mining.

You could say all the computing power and electricity is just being turned into heat.

Ok, so if ive understood right, the processing has something to do with keeping the whole bitcoin system working - but it doesnt generate anything useful besides itself. So no, its not charity work nor is it saving world in any way.

And the more people are mining, the lesser your likelihood of getting any (bit)coins gets. I suppose in a way you could call it lottery where more processing power equals more tickets. Apparently some years ago mining with you home computers single GPU actually earned you money - these days youre more likely to waste money on electricity bill for running gpu at 100% 24/7.

...and this is the actual reason people are getting interested in dogecoins and whatnot - less people mining them, so you can get them without having 100 gpu farm of the newest AMD graphics cards.

If you want to think of cryptocurrency as money, the biggest problem they all have is that you cant buy too many everyday things with them. So if youre into illegal gungs, drugs etc - i can see the "value" of them - but you regular miner is doing it just for the sake of selling it for someone else at profit. So rather than currency i personally see cryptocurrency atm more as volatile investment.
avatar
monkeydelarge: You are right. Crypto currency isn't worthless. Nothing is really worthless. If you find the right people, you could sell them rocks from your backyard and make some money...
Stuff like this: http://www.theguardian.com/technology/2013/nov/27/hard-drive-bitcoin-landfill-site

Current BTC -> usd http://preev.com/

so if you happen to have a bitcoin in your pocket, its worth around 450$ atm.

Getting that single bitcoin by mining TODAY is kinda no-no for the regular Joe. However had you started mining say five years ago, i bet you could have gotten several coins in single week. Ofcourse they had little worth back then and many sold all their coins when its worth hit like 10usd or something. I mean who would have thought someone was going to be buying them for hundreds of dollars?`

Maybe you should think of them poststamps with volatile value for collectors and it might be easier to understand how worthless or valuable they are :)

----

Atm speaking about monetary value. The practical value, well its different thing again. For anyone who has no issues about using credit card the practical value of cryptocurrency isnt atm really huge.

But you ofcourse never know in long term. Interesting thing to follow anyways.
Post edited April 05, 2014 by iippo
Posted April 05, 2014
So it's a currency "earned" by creating nothing of value except heat from the GPU cranking along, and solving some piece of math that isn't related to any useful goal?

I understand the usefulness of the digital wallet and tracking the path of the bitcoin as it's spent, but the generation of the bitcoin itself seems... I don't know. I always figured that the point of work was to accomplish something useful, for which one is compensated in currency or barter. However, I'm just not seeing the 'useful' part of the bitcoin equation. If I build a fence and you pay me $100, then you get a fence and I get $100. If I "mine" a bitcoin, I get a bitcoin and there's no other side to the equation. Thus, I don't see that there is anything to give it value.

Maybe I'm looking at it too literally.
Posted April 05, 2014
avatar
monkeydelarge: I know crypto currency has benefits but still it has no intrinsic value. The U.S. dollar does have intrinsic value...

Read this text copy and pasted from an article about crypto currency.

"Now this idea of "intrinsic value" when it comes to currency bothers people, and Bitcoin Bugs will immediately ask why the U.S. dollar has intrinsic value. There's an answer to that. The U.S. Dollar has intrinsic value because the U.S. government which sets the laws of doing business in the United States says it has intrinsic value. If you want to conduct commerce in the United States you have to pay taxes, and there's only one currency you're allowed to pay taxes in: U.S. dollars. There's no getting around this fact. Furthermore, if you want to use the banking system at all, there's no choice but to use U.S. dollars, because that's the currency of the Fed which is behind the whole thing.

On top of all these laws requiring the U.S. dollar to be used, the United States has a gigantic military that can force people around the world to use dollars (if it came to that) so yes, there's a lot of real-world value behind greenbacks."
That blogger asserts that the dollar has intrinsic value, but his arguments only support that the dollar has value. He makes no point about intrinsic value, other than his obviously daft claim that "the United States says [the dollar] has intrinsic value". An intrinsic value would be inherent, not set externally by fiat or declaration. In fact, fiat is almost an antonym for intrinsic.
Posted April 05, 2014
avatar
HereForTheBeer: So it's a currency "earned" by creating nothing of value except heat from the GPU cranking along, and solving some piece of math that isn't related to any useful goal?

I understand the usefulness of the digital wallet and tracking the path of the bitcoin as it's spent, but the generation of the bitcoin itself seems... I don't know. I always figured that the point of work was to accomplish something useful, for which one is compensated in currency or barter. However, I'm just not seeing the 'useful' part of the bitcoin equation. If I build a fence and you pay me $100, then you get a fence and I get $100. If I "mine" a bitcoin, I get a bitcoin and there's no other side to the equation. Thus, I don't see that there is anything to give it value.

Maybe I'm looking at it too literally.
Fascinating Number: Bitcoin Mining Uses $15 Million's Worth Of Electricity Every Day

Yeah - you could say BTC is huge energy wasting scheme with little practical value - and well, suppose in certain way its not far off the mark.

From practical view of actually using BTC to buy say beer - its not working very well. Sure there are some shops which accept them, but you dont have too many options really.

From speculative view -> well its worth went from 0usd -> 1000+ usd, so i would say its pretty natural for alot of people to be interested in them :)

From ideological view -> Money that is not created nor tied to any bank or government. Is more or less anonymous. Impossible/difficult to track movements. Depending on your world view this sort of thing is very valuable or absolutely worthless.

From scheming view - well read the "speculative" part again. Lots of money moving around and its difficult to track and easy to sell...so naturally there will be people who want to steal or swindle it from people one way or the other.

But as system itself, BTC isnt controlled by any single person or group directly so you cant really call it your typical pyramid scheme.
Posted April 05, 2014
avatar
monkeydelarge: I know crypto currency has benefits but still it has no intrinsic value. The U.S. dollar does have intrinsic value...

Read this text copy and pasted from an article about crypto currency.

"Now this idea of "intrinsic value" when it comes to currency bothers people, and Bitcoin Bugs will immediately ask why the U.S. dollar has intrinsic value. There's an answer to that. The U.S. Dollar has intrinsic value because the U.S. government which sets the laws of doing business in the United States says it has intrinsic value. If you want to conduct commerce in the United States you have to pay taxes, and there's only one currency you're allowed to pay taxes in: U.S. dollars. There's no getting around this fact. Furthermore, if you want to use the banking system at all, there's no choice but to use U.S. dollars, because that's the currency of the Fed which is behind the whole thing.

On top of all these laws requiring the U.S. dollar to be used, the United States has a gigantic military that can force people around the world to use dollars (if it came to that) so yes, there's a lot of real-world value behind greenbacks."
avatar
grimwerk: That blogger asserts that the dollar has intrinsic value, but his arguments only support that the dollar has value. He makes no point about intrinsic value, other than his obviously daft claim that "the United States says [the dollar] has intrinsic value". An intrinsic value would be inherent, not set externally by fiat or declaration. In fact, fiat is almost an antonym for intrinsic.
The U.S. government is real, grimwerk.
Posted April 05, 2014
avatar
monkeydelarge: The U.S. government is real, grimwerk.
Would you like me to explain again?
Posted April 05, 2014
avatar
monkeydelarge: I know crypto currency has benefits but still it has no intrinsic value. The U.S. dollar does have intrinsic value...

Read this text copy and pasted from an article about crypto currency.

"Now this idea of "intrinsic value" when it comes to currency bothers people, and Bitcoin Bugs will immediately ask why the U.S. dollar has intrinsic value. There's an answer to that. The U.S. Dollar has intrinsic value because the U.S. government which sets the laws of doing business in the United States says it has intrinsic value. If you want to conduct commerce in the United States you have to pay taxes, and there's only one currency you're allowed to pay taxes in: U.S. dollars. There's no getting around this fact. Furthermore, if you want to use the banking system at all, there's no choice but to use U.S. dollars, because that's the currency of the Fed which is behind the whole thing.

On top of all these laws requiring the U.S. dollar to be used, the United States has a gigantic military that can force people around the world to use dollars (if it came to that) so yes, there's a lot of real-world value behind greenbacks."
avatar
grimwerk: That blogger asserts that the dollar has intrinsic value, but his arguments only support that the dollar has value. He makes no point about intrinsic value, other than his obviously daft claim that "the United States says [the dollar] has intrinsic value". An intrinsic value would be inherent, not set externally by fiat or declaration. In fact, fiat is almost an antonym for intrinsic.
all money is based on trust. in this basic sense BTC are no different from USD. If people value either and accept them at your local store, well then they have some value. But if say US economy crashes, there is fair chance you can use them at toilet paper in worst case.

...its the same with BTC and other cryptocurrency. As long as people trust in them enough, they will have "value".
avatar
grimwerk: That blogger asserts that the dollar has intrinsic value, but his arguments only support that the dollar has value. He makes no point about intrinsic value, other than his obviously daft claim that "the United States says [the dollar] has intrinsic value". An intrinsic value would be inherent, not set externally by fiat or declaration. In fact, fiat is almost an antonym for intrinsic.
avatar
monkeydelarge: The U.S. government is real, grimwerk.
Governments rise and fall. From economists point of view US government is just one among many. Certainly strong one, but its not somehow eternal.
Post edited April 05, 2014 by iippo
Posted April 05, 2014
avatar
monkeydelarge: The U.S. government is real, grimwerk.
avatar
grimwerk: Would you like me to explain again?
Yes, I see my mistake now. And his(or her) mistake. Intrinsic means real in the English dictionary. But when people speak of intrinsic value, they mean money that isn't backed by a government etc. For example, gold has intrinsic value because it's gold. It doesn't need a government to back it up. So I misused the words "intrinsic value". The author of that article misused these words too. The U.S. dollar is real money unlike crypto currency but has no "intrinsic value". Feel better now? Want an imaginary cookie for pointing out my mistake? How about 100 monkeycoins?
Post edited April 05, 2014 by monkeydelarge
Posted April 05, 2014
avatar
monkeydelarge: And there are serious consequences for people caught stealing electricity at work so I don't know why someone would do such a thing...to mine worthless currency.
Most likely you'd just be told to stop, then reprimanded and eventually fired if you keep doing it. However, there was a case I recall from a little while back where a man was actually being charged with theft for going to a local high school to charge up his electric car.

avatar
iippo: I dont think BC atleast started as scheme or or such. Its definitely not pyramidal anyways - but ofcourse its sudden increase in worth from 0usd to 1000usd did kinda leave its mark.
Actually bitcoin does somewhat resemble a pyramid scheme. This is because 1) there's a hard limit on the maximum number of bitcoins there can be and 2) the value of a bitcoin is basically the amount of economic activity bitcoin is being used to process (the size of the bitcoin economy) divided by the number of bitcoins. The more people using bitcoin the larger the bitcoin economy, and hence the more each bitcoin is worth (due to the limit on how many there are). The people who see bitcoin as an investment need more people to start using bitcoin to pump more actual money into the system and drive up the value of bitcoins. However, if people stop buying in then the value stagnates or drops, and if people start trying to cash out then the whole thing starts to collapse. Ultimately this can look like either a speculation bubble or a pyramide scheme, depending on how much credit you want to give the people who got in at the very beginning.
Posted April 05, 2014
avatar
monkeydelarge: And there are serious consequences for people caught stealing electricity at work so I don't know why someone would do such a thing...to mine worthless currency.
avatar
DarrkPhoenix: Most likely you'd just be told to stop, then reprimanded and eventually fired if you keep doing it. However, there was a case I recall from a little while back where a man was actually being charged with theft for going to a local high school to charge up his electric car.

avatar
iippo: I dont think BC atleast started as scheme or or such. Its definitely not pyramidal anyways - but ofcourse its sudden increase in worth from 0usd to 1000usd did kinda leave its mark.
avatar
DarrkPhoenix: Actually bitcoin does somewhat resemble a pyramid scheme. This is because 1) there's a hard limit on the maximum number of bitcoins there can be and 2) the value of a bitcoin is basically the amount of economic activity bitcoin is being used to process (the size of the bitcoin economy) divided by the number of bitcoins. The more people using bitcoin the larger the bitcoin economy, and hence the more each bitcoin is worth (due to the limit on how many there are). The people who see bitcoin as an investment need more people to start using bitcoin to pump more actual money into the system and drive up the value of bitcoins. However, if people stop buying in then the value stagnates or drops, and if people start trying to cash out then the whole thing starts to collapse. Ultimately this can look like either a speculation bubble or a pyramide scheme, depending on how much credit you want to give the people who got in at the very beginning.
It all depends on who is in charge and how much he or she likes the person caught stealing electricity. You could be fired after being caught the first time, no warning. And after getting fired for such a thing, you will be blacklisted for life...
Post edited April 05, 2014 by monkeydelarge
Pages:
1
2
3
4
5
6
This is my favourite topic
Community
General discussion (archive)Bitcoin: is anyone here mining or earning it?(83 posts)(83 posts)
(83 posts)