Bitcoins are officially donkdown

[TheXFactor]

Bitcoin Mining in Iceland
http://mobile.nytimes.com/blogs/deal...?from=homepage

I guess the only real way to get Bitcoins is to buy them or steal them.

[sonatine]

"The energy required to run these computers is huge, and has led to criticism that Bitcoin mining is wasteful, not to mention socially useless."

rofl, face.

[DRK Star]

When bitcoins were around say $5-10 a coin, people were mining coins and saying the process was worth it because it didnt cost that much to mine them. People also said that the cost to mine them would begin to increase for some reason, and that seemed fair.


But then, when coins went up to $1000 a coin, people started to comment that it wasnt worth mining due to the high costs.



How could the cost to mine increase that quickly where it was worth it when they were worth $5, but not worth it when they are worth $1000? This makes no sense to me. People all over the world are investing thousands in resources to produces these ridiculous mining facilities, so I am assuming they realized the value in their mind, in doing so, so why do I keep hearing the costs to mine are -EV?

[chinamaniac]

When bitcoins were around say $5-10 a coin, people were mining coins and saying the process was worth it because it didnt cost that much to mine them. People also said that the cost to mine them would begin to increase for some reason, and that seemed fair.


But then, when coins went up to $1000 a coin, people started to comment that it wasnt worth mining due to the high costs.



How could the cost to mine increase that quickly where it was worth it when they were worth $5, but not worth it when they are worth $1000? This makes no sense to me. People all over the world are investing thousands in resources to produces these ridiculous mining facilities, so I am assuming they realized the value in their mind, in doing so, so why do I keep hearing the costs to mine are -EV?

I'm no expert on this shit but early days of mining I think it was easier to mine coins because less people were mining and it was effortless and more or less a freeroll

Now since these things have exploded, mining has increased so if u dont have the proper setup then u get shutout and since there are a billion people mining only xxxx amt of coins are available.

[Salty_Aus]

When bitcoins were around say $5-10 a coin, people were mining coins and saying the process was worth it because it didnt cost that much to mine them. People also said that the cost to mine them would begin to increase for some reason, and that seemed fair.


But then, when coins went up to $1000 a coin, people started to comment that it wasnt worth mining due to the high costs.



How could the cost to mine increase that quickly where it was worth it when they were worth $5, but not worth it when they are worth $1000? This makes no sense to me. People all over the world are investing thousands in resources to produces these ridiculous mining facilities, so I am assuming they realized the value in their mind, in doing so, so why do I keep hearing the costs to mine are -EV?

The difficulty goes up every couple of weeks by about 50% so every months it's 100% harder to actually mine a block, also the network hash-rate is going crazy. (more machines mining) The difficulty now is 1.1 billion times harder then when it first started.

[DRK Star]

OK

If there is some formula about the amount that can be mined combined with the quantity that are trying to be mined at the same time, that makes sense.


Whatever happened with that Butterfly labs business? I would imagine that they collected money up front from people to produce these machines of theirs, and at this point, havent produced or shipped them, and now, those machines would be pretty much useless.

[chinamaniac]

OK

If there is some formula about the amount that can be mined combined with the quantity that are trying to be mined at the same time, that makes sense.


Whatever happened with that Butterfly labs business? I would imagine that they collected money up front from people to produce these machines of theirs, and at this point, havent produced or shipped them, and now, those machines would be pretty much useless.

prob collected a ton, delivered some , will deliver more but they may be useless and outdated by now but I wouldnt know for sure

[Baron Von Strucker]

Bitcoin Mining in Iceland
http://mobile.nytimes.com/blogs/deal...?from=homepage

I guess the only real way to get Bitcoins is to buy them or steal them.

or........

[Sanlmar]

1 BTC = $109.16

Archival footage or brag post.

[yaahello]

yeah they have bitcoin atms in vancouver.

hot chick plays poker n collect bitcoins apperently
Cristina Frey ‏@cristinafrey

Any Bitcoin experts here? I still own ca. 1500 over two wallets (got them back in the days), but with the recent "crash" ..sell or keep?  5:34 AM - 8 Dec 13

[sonatine]

butterfly labs are basically "pre-selling" units advanced enough to be competitive then sending out a handful of units, keeping the rest to mine with on their own, and spending the net on advertising for their next pre-selling advanced units campaign.

its actually quite amazing. micon dug into their staff and discovered a literal rogues gallery of ex cons and straight up scammers.

regarding the 'too expensive to farm' comment, when the prices rose, people bought hardware to mine. lots and lots of people. because of the influx of hash cracking Gh/z, the difficulty of solving hashes was increased so the number of bitcoins being mined remained static. on top of which, the hardware required to mine costs money to run (electrical draw, cooling).

at $1000 a coin, if you bought 12 AMD Radeon 7970 cards to mine with, along with 4 motherboards + cpus + power supplies to run them, you would mine about .20 coins a day and you just spent abooooout $8000 on hardware.

which seems great at face value. after electrical costs you would see a ROI in like, 8 weeks.

but you actually become your own worst enemy as you invest in hardware and mine more coins, and so does everyone else who had the same great idea;

more coins mined = harder to mine = lower prices, and in case you havent noticed the news about bitcoins is almost always bad, so the value of your investment is always getting its shit pushed in.

which brings us to: lol @ 1000 a coin. so now youre looking at a 120 day ROI. but not so fast. because everyone and their fucking mothers are mining bitcoins, *the difficulty is rising the whole time*. every time the difficulty jumps, it jumps about 13% that ive seen. which means your profit drops 13%, OUTRIGHT. and over the course of 8 weeks, youre talking about a fairly good chance its going to jump twice. so yeah make that 150 days for ROI.

so you might have to wait 5-6 MONTHS to have enough bitcoins in your wallet to sell to get back your $8000, *providing the price doesnt drop*.

"LOL whatever tho after 6 months Im in the clear; its nothing but profit!"

aaaaaaaaand in the meantime, a new generation video card miner just came out which offers a much higher hash rate as yours. so you cant even sell your miner hardware to reinvest into the new hardware, which youre going to need because that difficulty is 100% guaranteed to go up, every single fucking day someone out there mines. and all the people who are only _slightly_ less ambitious than you just bought the hot new video cards to mine with. so there are more Gh/z of hash solutions in the pool. much, much more. and because you contribute a lower percentage to that mathematic pool, 1) your contribution based profits are lower and 2) the difficulty just keeps on getting higher.

so ok cool tho you still have $8000 worth of coins, bully for you. lets do some day trading. one thing tho, i hope youre really good at that shit because there is a fee for every single buy/sell order. kiss 2% of your value goodbye every single time. oh and most places charge transfer fees. o yes. and chances are you dont live in country with a fucking bitcoin atm (which would also charge fees if you did btw).

so basically it took you about 7 months of mining to get your investment back, and now youre pretty much looking at breaking even AND EVENTUALLY EVEN OPERATING AT A LOSS because as the bitcoin/hz value of your rig drops, the cost of electricity does not.

bitcoins.

*jazz hands*.

[DRK Star]

[Dan Druff]

Noticed they've been hanging in the 600s for the last few days. I guess that's the new settling point.

[Belly Buster]

When the dust settles there's a reasonable chance that mining bitcoins will win the all-time "worlds most futile pastime" award.

[simpdog]

Hindsight is 20/20.

Anyone playing the game now is gambling. People are winning and losing thousands (or more).

At this point in time

:whocares

[DRK Star]

Just heard a rumor that Silk Road 2.0 has just been taken down by L.E.

Can anyone confirm?


Edit:
http://www.reddit.com/r/SilkRoad/com...ing_by_cirrus/

[Sanlmar]

Noticed they've been hanging in the 600s for the last few days. I guess that's the new settling point.

Surfing the channel between $600-$700 on the 3 day daily chart.

The more times it taps on the door of $700 and fails - the more likely it is going to make its 3rd leg down.

But you just wait and see here.

[yaahello]

Just heard a rumor that Silk Road 2.0 has just been taken down by L.E.

Can anyone confirm?


Edit:
http://www.reddit.com/r/SilkRoad/com...ing_by_cirrus/

fwiw i got this

Request Flagged

The marketplace is currently experiencing a DDoS attack. Your request looks very similar to a request a current DDoS attack is sending.

Try accessing the marketplace directly at silkroad6ownowfk.onion - if that does not work, try again in thirty minutes. In the meantime, check the community forums for updates.

We will prevail.

[sonatine]

Holy shit.

When I first read the headline I was like "whatever, another anti-bitcoin evangelist, the fuck ever". What followed was a surgical assassination of the very premise of bitcoins and bitcoin culture.

http://www.businessinsider.com/willi...own-10-2013-12

FINANCE PROFESSOR: Bitcoin Will Crash To $10 By Mid-2014

In Bitcoin World, a week can be the equivalent of a decade.
At the start of December, Bitcoin topped out at over $1,200 as e-currency evangelists trumpeted the endless possibilities to be unleashed, comparing it to the breakthroughs not achieved since the start of the internet revolution. Bitcoiners claimed market disruption would bring credit card companies and payment platforms such as Western Union to their knees. Some even claimed that Bitcoin would supplant the U.S. dollar as the new global reserve currency. Adding more helium to the story, the Winklevoss twins of Facebook fame, not being shy about talking up their own book, predicted prices would rise to a staggering $40,000 per coin.

And from January to December 2013, markets obeyed with prices rising over 8,000 percent. In the mist of this hype, it appeared that the Bitcoin Revolution was on its way to transforming the economy, putting central bankers out of work and minting new e-currency millionaires daily. Bitcoin was priced for perfection. This past week, however, the market didn’t stick to the script. Instead it began to challenge the rhetoric, knocking prices down as low as $535, a drop of about 55 percent from recent highs. The market has finally realized that hype alone cannot support lofty prices. Bitcoin is not a legitimate currency but simply a risky virtual commodity bet.

Flawed DNA

Since inception, Bitcoin has had a flawed DNA. It was dreamed up in a virtual world -- by computer geeks -- but was to be applied in the real world. Bitcoin is steep in Libertarian and anti-Fed dogma but weak in understanding of how global economics, central banking policies and financial markets function. The lifeblood of the global capital markets is money – greenbacks -- transactional currency that facilitates commerce. Virtual currency can create value and efficiency but it needs to be linked to fiscal and monetary policy. To assume currency can be computer generated, run in a decentralized manner and outside of the central banking system and controls is farcical and economically dangerous.

For currency to be adopted as a medium of exchange there has to be trust in the ability to honor the underlying obligation and the ability for central banking policy to control inflation. Historically the Fed has done a remarkable job maintain an average inflation rate of no greater than 2.5 percent. Given that two-thirds of U.S. GDP is driven by consumption, price stability in currency is essential. Without it, GDP growth is retarded and standard of living shrinks.

Even from a basic operational standpoint there are major flaws in Bitcoin structure. For example, it is assumed that miners will behave in a responsible way and not game the system for greater financial reward. Ignored is the human element and need for controls to keep pace as increases in market prices increase incentives to cheat. Fraud is also on the rise. Recently reported was that $220 million in Bitcoins were stolen and not recovered (Business Insider, 12/4/13).

Meantime, the inherent secrecy of coin ownership decreases the ability to prevent and potentially solve crimes. There is also little legal protection for investors and significant financial risk if an owner’s hard drive gets corrupted, the computer is stolen or lost, rendering Bitcoin Wallets permanently lost. Should transfer instructions be incorrect and payments credited to a wrong account, Bitcoin transfers are not easily reversible. Moreover, the Bitcoin authenticity process also takes time which is not conducive to high volume retail sales where customers want to get in, pay for their goods and get out with no delay. In contrast, storeowners will be hesitant to have customers walk out the door with product, especially if authenticity process is not completed.

Unfit as a Currency

Bitcoin lacks the essential attributes that are needed to support a widely recognized transactional currency. If Bitcoin was allowed to proliferate as a currency it would produce greater economic uncertainty, reduced trade and lower individual standard of living.

Bitcoin has not taken off as a transactional currency and is further undermined by the fact that the majority of Bitcoin owners hoard e-coins. The more hoarded the less available to buy goods and services and spur economic growth.

In Bitcoin World it is not uncommon for prices to change by 20 or 30 percent in a given day, making Bitcoin toxic to economic growth. Price swings produce conflicting behavior. Retailers work on tight margins, sometimes as low as 10 percent. Such daily price fluctuations would eliminate all profit and inflict needless losses. Unless retailers want to be in the commodity trading business, they would not be interested in taking Bitcoin risk. At restaurants, Bitcoiners expecting coin values to drop might rush to pay for dinner even before the first entree arrives while restaurateurs would be motivated to delay payment until the drop occurred. If Bitcoin owners believe value would increase, they would hoard more coins and velocity of money would decline, harming economic growth.

In this Bitcoin World of currency uncertainty, guessing and risk, commerce would decline and bartering would increase. Naturally, as Bitcoin price swings increased, the number of businesses willing to accept e-currency risk would decline. This is why in recent weeks, as large price movements have occurred, we have seen more credible retailers saying “No” to Bitcoin.

High-Risk Commodity

Bitcoin has been trading like an out-of-control rollercoaster with price movements in 2013 climbing from $13 to $1,200 and then in only a week, careening down to a low of $535. This high-test virtual commodity has 8 times the volatility of the S&P 500 and presents significant liquidity risk. There are now over 12 million Bitcoins outstanding. This volume of ownership has not been bear-market tested and if enough sellers try to run for the door it is not clear that existing infrastructure is capable of executing trade orders without significant time delays and price risk.

The buying and selling of Bitcoin is also controlled by only a handful of exchanges in places like China, Slovenia and Bulgaria. These exchanges are based on a peer-to-peer model and regulation is light with price disparities between exchanges commonplace. Exchange bankruptcies are not uncommon. In November, GBL, a Hong Kong based Bitcoin exchange closed it’s doors, costing investors over $4 million. As a virtual commodity, it is a high-risk bet in a wild-west atmosphere, requiring speculators to stay cautiously alert.

China Pricked the Bubble

Every asset bubble has three stages; growth, maturity and pop. Growth started in 2011, followed by the maturity stage in 2013 and now the pop stage. The pin that burst the Bitcoin hyper bubble was China.

Ironically, China, the second largest economy in the world, helped push Bitcoin prices to the clouds and now is pulling prices back to earth. In the last week, China has delivered three knockdown punches. First the central bank forbade its banks from accepting Bitcoin as currency. Then, Baidu, China’s Google equivalent, announced it would no longer process Bitcoins. Finally, China banned third-party payment companies from transacting with Bitcoin exchanges. This last announcement significantly weakens market liquidity for BTC China, the largest Bitcoin exchange. By voting “No” on Bitcoin, China fueled greater market skepticism. Markets have already responded by lopping off, at the low, $6 billion in Bitcoin investment value.

Other wealthy and powerful countries have taken a similar position, warning against the risks of this wannabe currency. Moves by European Banking Authority representing the largest economy in the world, France, the fifth largest economy and Norway, the wealthiest in Scandinavia all point to a growing number of roadblocks. Last month, Fed Chairman Ben Bernanke indicated e-currency “may have long-term promise” but his statement was not a ringing endorsement for Bitcoin adoption. To the contrary, as large price swings continue, U.S. and other G20 countries will raise concerns, restrictions and begin clamping down on virtual currencies.

Bitcoin has seen an end to its hyper price run-up and can no longer support being priced for perfection. Unlike gold which has tangible value, Bitcoin is backed by hopes/dreams and only worth what people are willing to pay. As it becomes increasingly evident that Bitcoin will not be the global currency standard, but simply a novel idea that will be improved upon by more nimble competitors such as Litecoin, restrictions and new regulations will be imposed and prices will plummet.

I predict that Bitcoin will trade for under $10 a share by the first half of 2014, single digit pricing reflecting its option value as a pure commodity play. Miners/speculators will be best served to acknowledge the meltdown has begun, act quickly and take fleeting profit off the table.

(Williams, a former commodities trading floor senior executive and Federal Reserve bank examiner, teaches finance at Boston University School of Management.)

[DRK Star]

http://www.rawstory.com/rs/2013/12/2...d-by-a-viewer/

<watch the video in the link for laughs>



Bloomberg anchor gets Bitcoin on live TV and is promptly robbed by a viewer

By Travis Gettys
Monday, December 23, 2013 15:00 EST

A business news anchor who was given a Bitcoin certificate on air was promptly robbed after he briefly displayed the digital currency.

Bloomberg TV anchor Matt Miller gave two colleagues, Adam Johnson and Trish Regan, $20 in digital currency in a “12 Days of Bitcoin” segment.

But Johnson unwittingly displayed the digital QR code for his money to the camera, and a viewer was able to use the private key to take his Bitcoin.

Reddit user milkywaymasta said he used his smart phone to scan the QR code that was displayed in high definition for about 10 seconds, allowing him to take the money.

“I took it, it was only $20 worth,” milkywaymasta said. “It was exhilarating nevertheless.”

He promised to return the money if Miller provides a new address so the QR code can’t be swiped again, but the anchor said he could keep the Bitcoin.

“So freaking classic but also a GREAT lesson in bitcoin security!” Miller tweeted. “You can keep the $20 — well earned.”