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 347471 times)

Offline ChaimMoskowitz

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Re: BitCoin Master Thread
« Reply #1040 on: May 07, 2018, 12:44:30 PM »
Yup, because it moves with you.
I give the guy I hate credit for the market. Of course when the massive correction happens I will pound him like he has never been pounded before.
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Re: BitCoin Master Thread
« Reply #1041 on: May 07, 2018, 01:20:04 PM »
I give the guy I hate credit for the market. Of course when the massive correction happens I will pound him like he has never been pounded before.

Even though you know that corrections are a normal part of the market and show nothing. Shows something about your "goalposts"
Feelings don't care about your facts

Offline ChaimMoskowitz

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Re: BitCoin Master Thread
« Reply #1042 on: May 07, 2018, 01:38:46 PM »
Even though you know that corrections are a normal part of the market and show nothing. Shows something about your "goalposts"
Ok I get you don't agree with my goalposts but I still don't move them.  :)
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Offline Yitzshpitz

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Re: BitCoin Master Thread
« Reply #1043 on: May 07, 2018, 01:41:04 PM »
Of course he has been wrong. You want put your track record against his?  :)

Obviously I wasn’t comparing resumes but rather pointing out that even great investors and business men can miss out on the next big companies or technology. If your view is to only invest in companies that Buffet endorses out thats fine. Many other very successful entrepreneurs have invested in bitcoin so I guess take your pick.

Offline ChaimMoskowitz

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Re: BitCoin Master Thread
« Reply #1044 on: May 07, 2018, 01:44:42 PM »
Obviously I wasn’t comparing resumes but rather pointing out that even great investors and business men can miss out on the next big companies or technology. If your view is to only invest in companies that Buffet endorses out thats fine. Many other very successful entrepreneurs have invested in bitcoin so I guess take your pick.
As you know I believe BC is a scam. Of course when I find someone like WB saying the same thing I am going to post it.
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Offline Yitzshpitz

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Re: BitCoin Master Thread
« Reply #1045 on: May 07, 2018, 01:45:26 PM »
When did he say that those businesses would come to a bad ending or that he would buy puts?
You’d have to go back and see his exact comments.
But i dont  care what his predictions were, by not investing in these companies he obviously messed up and  he himself admitted to it being a big mistake.

Offline ChaimMoskowitz

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Re: BitCoin Master Thread
« Reply #1046 on: May 07, 2018, 01:48:01 PM »
You’d have to go back and see his exact comments.
But i dont  care what his predictions were, by not investing in these companies he obviously messed up and  he himself admitted to it being a big mistake.
Five years ago when he called it rat poison BC was around 100? So squared now it would be 10k. Who knows maybe next time he opens his mouth it will be cubed.  ;)
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Offline Yitzshpitz

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Re: BitCoin Master Thread
« Reply #1047 on: May 07, 2018, 01:49:57 PM »
Five years ago when he called it rat poison BC was around 100? So squared now it would be 10k. Who knows maybe next time he opens his mouth it will be cubed.  ;)

Im not sure he will be around when hits a million dollars or when there will be no more dolars  ;)

Offline ChaimMoskowitz

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Re: BitCoin Master Thread
« Reply #1048 on: May 08, 2018, 10:05:23 AM »
I just found a new supply of forks!

Offline gingyguy

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Re: BitCoin Master Thread
« Reply #1049 on: May 08, 2018, 12:34:40 PM »
Bitcoin explained for the novice.  :)
https://www.forbes.com/sites/jayadkisson/2017/12/28/the-great-bitcoin-scam/#1fbf32115c1e
if you would be honest you would say that the author says that bitcoin itself is not a scam just the way it is being sold is.
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Re: BitCoin Master Thread
« Reply #1050 on: May 08, 2018, 12:39:29 PM »
if you would be honest you would say that the author says that bitcoin itself is not a scam just the way it is being sold is.
No difference at this point. All that there is is what is being sold.. This has been rehashed here over and over again.
Feelings don't care about your facts

Offline ChaimMoskowitz

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Re: BitCoin Master Thread
« Reply #1051 on: May 08, 2018, 01:06:04 PM »
if you would be honest you would say that the author says that bitcoin itself is not a scam just the way it is being sold is.
All I did was post the article to help everyone make their own choice.
Is there a way to own a BC without buying/selling?
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Offline yuneeq

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Re: BitCoin Master Thread
« Reply #1052 on: May 08, 2018, 01:33:02 PM »
All I did was post the article to help everyone make their own choice.
Is there a way to own a BC without buying/selling?

Yes, mining
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Offline ChaimMoskowitz

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Offline yuneeq

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Re: BitCoin Master Thread
« Reply #1057 on: May 25, 2018, 12:25:30 PM »
Bitcoin gold is, and always has been a scam.

This can be said about most of the alt-coins out there. Even many of the ones that are not scams, aren't really coins as much as they are blockchain projects.

Offline henche

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Re: BitCoin Master Thread
« Reply #1058 on: May 25, 2018, 12:42:28 PM »
This can be said about most of the alt-coins out there. Even many of the ones that are not scams, aren't really coins as much as they are blockchain projects.

As well as bit coin itself

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Re: BitCoin Master Thread
« Reply #1059 on: May 25, 2018, 01:44:18 PM »
As well as bit coin itself

*looks for unlike button