Off Topic Does anybody understand bitcoin?

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Geo quick question theres hundreds of sights for buying can I ask what platform did you use to buy your currency and did you have a online wallet to store he currency in?
 
Kempton said:
Ok so I've read this thread and I still don't know what Bitcoin is.
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Bitcoin is a cryptocurrency and worldwide payment system. It is the first decentralized digital currency, as the system works without a central bank or single administrator.The network is peer-to-peer and transactions take place between users directly, without an intermediary.These transactions are verified by network nodes through the use of cryptography and recorded in a public distributed ledger called a blockchain. Bitcoin was invented by an unknown person or group of people under the name Satoshi Nakamoto and released as open-source software in 2009.

See, what don't you get with the above explanation? <laugh>
 
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Walter Sobchak said:
Bitcoin is a cryptocurrency and worldwide payment system. It is the first decentralized digital currency, as the system works without a central bank or single administrator.The network is peer-to-peer and transactions take place between users directly, without an intermediary.These transactions are verified by network nodes through the use of cryptography and recorded in a public distributed ledger called a blockchain. Bitcoin was invented by an unknown person or group of people under the name Satoshi Nakamoto and released as open-source software in 2009.

See, what don't you get with the above explanation? <laugh>
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Oh right, erm...
 
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Walter Sobchak said:
Bitcoin is a cryptocurrency and worldwide payment system. It is the first decentralized digital currency, as the system works without a central bank or single administrator.The network is peer-to-peer and transactions take place between users directly, without an intermediary.These transactions are verified by network nodes through the use of cryptography and recorded in a public distributed ledger called a blockchain. Bitcoin was invented by an unknown person or group of people under the name Satoshi Nakamoto and released as open-source software in 2009.

See, what don't you get with the above explanation? <laugh>
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So its no different to how the world traded peer-to-peer a thousand years ago before banks using bartering, gold and slavery?
 
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Walter Sobchak said:
Bitcoin is a cryptocurrency and worldwide payment system. It is the first decentralized digital currency, as the system works without a central bank or single administrator.The network is peer-to-peer and transactions take place between users directly, without an intermediary.These transactions are verified by network nodes through the use of cryptography and recorded in a public distributed ledger called a blockchain. Bitcoin was invented by an unknown person or group of people under the name Satoshi Nakamoto and released as open-source software in 2009.

See, what don't you get with the above explanation? <laugh>
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I think what most people don't understand is the 'mining' aspect and why it uses massive amounts of electricity
 
Newland Tiger said:
I think what most people don't understand is the 'mining' aspect and why it uses massive amounts of electricity
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Mining is essentially using software to solve a puzzle, and being rewarded with a bitcoin. When the 'puzzle' is solved a new one is released. The puzzles are solved and new ones released approximately every 10 minutes. The software runs on electricity and the greater the computer power you have the easier it is to 'solve' the puzzles and this advanced powerful software uses more electricity.
 
Walter Sobchak said:
Mining is essentially using software to solve a puzzle, and being rewarded with a bitcoin. When the 'puzzle' is solved a new one is released. The puzzles are solved and new ones released approximately every 10 minutes. The software runs on electricity and the greater the computer power you have the easier it is to 'solve' the puzzles and this advanced powerful software uses more electricity.
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...why?
 
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Walter Sobchak said:
Which bit you whying to Den?
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why does someone want puzzles solving?
why is that worth anything?
why does the overall amount of "money" in the system increase dependent on the number of puzzles being solved?
why does the whole thing encourage increased use of electricity and therefore damage the environment?

so everything really!
 
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dennisboothstash said:
I'm not expert but here goes!

why does someone want puzzles solving?

It's not a 'someone' as such. The person/people who invented it designed the process in such a way that one has to 'earn' a newly created bitcoin. Theres only a limited number which can be made (as designed from its inception). I don't quite get it as such but you need very advanced software and computer power and the program spends time 'solving' the puzzle. The time the software has spent working out the answer is the 'mining' bit and then you are awarded a bitcoin when the correct solution is found. A new 'puzzle' is released when the previous one is solved. They're not puzzles like you or I would know them, it'll just be a load of computing equation mumbo jumbo.

why is that worth anything?

It;s worth something because people give it value, why is anything worth something etc. The price of bitcoin goes up and down like a share price on the stock exchange depending on the confidence in the market at the time. When it was first created no one used bitcoins so 10,000 of them were worth pennies. Now just 1 bitcoin is worth thousands of pounds just because people have collectively decided to trade in it and use it. It's a volatile market.

why does the overall amount of "money" in the system increase dependent on the number of puzzles being solved?

Theres something like 21 million bitcoins in total, there will be no more. About 16 million odd have already been 'mined' so in a few years no one will be able to mine them anymore. People will just have to buy and trade the ones already in circulation.

why does the whole thing encourage increased use of electricity and therefore damage the environment?

Essentially a computer chip uses electricity to work, thats why computers have fans on them because they got hot (the chip generates heat as a by product). Advances have meant more and more powerful chips that 'work' even harder and so 'suck in' more power. As loads of people are using very powerful tools with powerful chips etc. more and more electricity is being used.

so everything really!
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Thanks for trying to explain it Walter...genuinely

I still don’t think I really get it, but I’m ok with that

If I ever find one down the back of a settee in a pub I’ll give you a shout to help me figure out how to turn it into beer vouchers
 
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