Topic Wiki

Editor’s note: I know enough about this topic to be dangerous, but I’m not a true expert so please feel free to add to or edit anything in this wiki that will improve it. The FAQs contain many oversimplifications but that is intentional to make the information relatable to the audience. Thanks!

Frequently Asked Questions

What are blockchains and bitcoins and what is the difference?
A blockchain is the fundamental element in a crypto currency system. A blockchain is an accounting ledger. Each block contains a bunch of journal entries (i.e. a chronological record of transactions) that gets encrypted (by miners) but can be downloaded and read by anyone on the network. Why the blockchain ledger is secure and how we can vouch for its integrity is a slightly more advanced topic.

An accounting ledger typically keeps track of money, and a blockchain is no different. But the only type of money that it can accurately track is digital money that lives on the blockchain network. So dollars, euros, etc are out. The digital money that lives on the blockchain is called a crypto currency, and the most well-known one at this time is Bitcoin.

Currently there are a few major blockchain networks: the Bitcoin Network, the Ethereum Network, and the Litecoin Network. Each one has its own currency, which are Bitcoin, Ether, and Litecoin, respectively.

I’m just a simple DDFer and not an accountant + cryptographer + hacker all at the same time. Can you make this a little simpler to understand?
Let’s try an analogy. There is a certain website called Dansdeals.com and it has quite a following. Some of the followers are just users/readers but others are more active and produce value for the website. When they provide value, they earn currency for their work – called “EQP” and “HT”. So we have something we will call the Dansdeals Blockchain Network that is simply a record keeper of various ongoing deals and it issues a native currency that is fractionable (10,000 EQP = 1 HT). This is similar to the Blockchain network recording financial transactions and issuing bitcoins. The ones who work for the network (miners) earn bitcoins and everyone else needs to buy it to participate.

The analogy improves if you imagine that the Dansdeals website visitors have to pay a small amount, let’s say 5 EQP, in order to access a deal or a code that is recorded on the network. If the website has 30,000 followers who love deals, but only 1,000 active members who earn EQP, then you can see that there is a need for a marketplace to be created where you can buy EQP for later use.

Of course, websites are not networks, and this analogy is far from perfect. But useful.

How much is a Bitcoin worth
No one knows. A few people are speculating its worth based on the potential that Bitcoin will one day become a major world currency that people use in their daily lives. Most people though are speculating its worth based on what the next new investor will pay them for it (google “Greater Fool Investing”).

Even if a crypto currency becomes dominant, who says it will be Bitcoin? Maybe it will be Schmitcoin?
This is completely possible. Bitcoin and Ether are the most likely at this point, but their long term survival is not at all guaranteed.

So why all the fuss about Bitcoin? Shouldn’t we wait for Schmitcoin and its cousins to come out?
You could, but you don’t want to ignore how hard it is to start up a network from scratch. It may be that as little as one person can create rival code to compete with the existing digital currencies and blockchains, but one person is not a network. You need a lot of highly technical and motivated people to join you and also to invest their time, energy, and money in making that network run. It’s a highly specialized group of people, and most of the people who would fit that profile are already tied up with an existing network. So it’s not impossible, especially in the long-term, but even if it does happen it would be unlikely to pop up overnight and so Vegas odds for Bitcoin are way shorter.

Let’s go back to the Dansdeals analogy. Imagine that Dansdeals is not the only such website, and there are other websites in existence that provide similar services. For the sake of the analogy let’s call them MMS and OMAAT. They too have big enough followings to survive independently, and even though each one offers a slightly different flavor that differentiates them, anyone on one of the networks could also get their most important needs met on one of the other networks. In this analogy, do you think it’s worth collecting EQP/HT or not? After all, Schmansdeals.com could open up one day and all the business could move there.

The argument for the difficulty of starting up a rival blockchain network is much stronger than in the analogy (especially if we start to include “smart contracts” in the discussion), but the basic idea that you need a critical mass of follows to be successful and compete with existing rivals is the same.

« Last edited by yuneeq on December 25, 2017, 01:05:21 AM »

Author Topic: BitCoin Master Thread  (Read 344905 times)

Offline Yitzshpitz

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Re: BitCoin Master Thread
« Reply #980 on: February 07, 2018, 10:06:04 AM »
Crypto can still be going strong and yet have been a bubble when it was at 15000

That is true but when most people reference the bubble they think crypto will completely lose value

Offline aygart

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Re: BitCoin Master Thread
« Reply #981 on: February 07, 2018, 10:07:15 AM »
That is true but when most people reference the bubble they think crypto will completely lose value
Straw man alert
Feelings don't care about your facts

Offline Yitzshpitz

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Re: BitCoin Master Thread
« Reply #982 on: February 07, 2018, 10:13:54 AM »
Straw man alert

Ha. People compare Crypto to the dot com bubble. Many companies from that period went bankrupt or lost over 90%of their value. It is with those people who make such comparisons I am arguing with.

Offline aygart

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Re: BitCoin Master Thread
« Reply #983 on: February 07, 2018, 11:01:08 AM »
Ha. People compare Crypto to the dot com bubble. Many companies from that period went bankrupt or lost over 90%of their value. It is with those people who make such comparisons I am arguing with.
It is not so far off from losing 90% from the high. Also, why would you be comparing with only the worst performers of the the dotcom burst and not dotcom overall?

Even if the crypto concept is still around, and there is a good chance that it is, it is unlikely that most or even possibly any of the current forms will be around.
Feelings don't care about your facts

Offline Yitzshpitz

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Re: BitCoin Master Thread
« Reply #984 on: February 07, 2018, 11:38:15 AM »
It is not so far off from losing 90% from the high. Also, why would you be comparing with only the worst performers of the the dotcom burst and not dotcom overall?

Even if the crypto concept is still around, and there is a good chance that it is, it is unlikely that most or even possibly any of the current forms will be around.


Well thats exactly the point. Some of those companies went bankrupt, some like Ebay and Amazon have gone up significantly since the "bubble". Other major companies emerged. No one is saying every cryptocurrency out there is legit or will definitely take off.  The technology is here to stay and  therefore many forms will continue to provide value and perhaps grow. The lesson from the dot com bubble is not to refrane from investing but rather to be more scrupulous as to what you are investing in and choose the right companies.


Offline aygart

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Re: BitCoin Master Thread
« Reply #985 on: February 07, 2018, 11:50:11 AM »

Well thats exactly the point. Some of those companies went bankrupt, some like Ebay and Amazon have gone up significantly since the "bubble". Other major companies emerged. No one is saying every cryptocurrency out there is legit or will definitely take off.  The technology is here to stay and  therefore many forms will continue to provide value and perhaps grow. The lesson from the dot com bubble is not to refrane from investing but rather to be more scrupulous as to what you are investing in and choose the right companies.
You left out a very important part. To know the actual value.
Feelings don't care about your facts

Offline Yitzshpitz

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Re: BitCoin Master Thread
« Reply #986 on: February 07, 2018, 11:54:11 AM »
You left out a very important part. To know the actual value.

and potential value

I dont mind having that discussion. But when people just make a lazy comparison as a reason people should not invest in crypto is what loses me.

Offline aygart

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Re: BitCoin Master Thread
« Reply #987 on: February 07, 2018, 12:04:31 PM »
and potential value

I dont mind having that discussion. But when people just make a lazy comparison as a reason people should not invest in crypto is what loses me.
Have you been following this thread?
Feelings don't care about your facts

Offline Yitzshpitz

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Re: BitCoin Master Thread
« Reply #988 on: February 07, 2018, 12:06:38 PM »
Have you been following this thread?

I wasn't specifically referring to this thread but there have been people who have mentioned it here too

Offline ChaimMoskowitz

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Re: BitCoin Master Thread
« Reply #989 on: February 07, 2018, 12:50:01 PM »
and potential value

I dont mind having that discussion. But when people just make a lazy comparison as a reason people should not invest in crypto is what loses me.
When something goes from 19k to 6k and you just say it is going to go back up is what gets me.
I just found a new supply of forks!

Offline yuneeq

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Re: BitCoin Master Thread
« Reply #990 on: February 16, 2018, 10:18:55 AM »
We're almost at the end.

Almost there...
Visibly Jewish

Offline Yitzshpitz

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Re: BitCoin Master Thread
« Reply #991 on: February 16, 2018, 10:30:49 AM »
Almost there...

Lol. I know things must be going well when this thread is quiet

Offline ludmila

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Re: BitCoin Master Thread
« Reply #992 on: February 17, 2018, 12:26:45 AM »
BTC is still in a downtrend for now, this is a retracement from the strong down move so far, the 50% retracement is at $13000. See chart below.

https://www.tradingview.com/x/yrrpUFBy/
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Offline hvaces42

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Re: BitCoin Master Thread
« Reply #993 on: February 17, 2018, 07:00:00 PM »
BTC is still in a downtrend for now, this is a retracement from the strong down move so far, the 50% retracement is at $13000. See chart below.

https://www.tradingview.com/x/yrrpUFBy/
When will you guys realize that this is not an investment like any in the stock market? Stock market trends dont apply to speculation. I was on  the downtrend at the blackjack table too a few times. I'm sickened that this is even discussed in our community.
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Offline yuneeq

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Re: BitCoin Master Thread
« Reply #994 on: February 18, 2018, 02:51:37 AM »
When will you guys realize that this is not an investment like any in the stock market? Stock market trends dont apply to speculation. I was on  the downtrend at the blackjack table too a few times. I'm sickened that this is even discussed in our community.

I don't tell anyone to invest in BTC, my point above is that no one knows with certainty where it will go.
The bears love to mention when it goes down and the bulls vice versa. It's all kinda meaningless in the long run when it will continually go through trends of up/down.
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Offline Yammer

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Re: BitCoin Master Thread
« Reply #995 on: February 18, 2018, 03:14:47 AM »
I don't tell anyone to invest in BTC, my point above is that no one knows with certainty where it will go.
The bears love to mention when it goes down and the bulls vice versa. It's all kinda meaningless in the long run when it will continually go through trends of up/down.
Well said.

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Feelings don't care about your facts

Offline yuneeq

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Re: BitCoin Master Thread
« Reply #997 on: February 20, 2018, 05:56:34 PM »
Salon magazine mines crypto-cash with readers' PCs

It's a reasonable way to increase revenue but if they want it to be useful they need to limit how much processing power it takes up.
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Offline henche

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Offline Yehuda25

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Re: BitCoin Master Thread
« Reply #999 on: March 21, 2018, 11:08:52 AM »
When will you guys realize that this is not an investment like any in the stock market? Stock market trends dont apply to speculation. I was on  the downtrend at the blackjack table too a few times. I'm sickened that this is even discussed in our community.
Stock market is legalized gambling too:)
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