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 347494 times)

Offline shopfdder

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Re: BitCoin Master Thread
« Reply #260 on: November 20, 2017, 11:43:44 AM »
Each GBTC share is worth about 1/10 of a bitcoin. The shares are priced a (huge) premium which shows that people are willing to pay extra to participate in this market without needing to learn how to open and manage a digital wallet

People will buy into anything that's trending and, yes, pay a premium for it. If you want to buy "actual" cryptocurrency and not give control over to a 3rd party, I can host a webinar on how to do it properly and within IRS regulations within your retirement fund.

Offline Live N Learn

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Re: BitCoin Master Thread
« Reply #261 on: November 25, 2017, 11:25:33 PM »
Where's the best place to buy with CC?
".איזהו חכם, הלומד מכל אדם"

Offline shlonx

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Re: BitCoin Master Thread
« Reply #262 on: November 25, 2017, 11:34:13 PM »
Coinbase?
Brevity may be the soul of wit, but floridity is its spirit.

Offline shlonx

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Re: BitCoin Master Thread
« Reply #263 on: November 25, 2017, 11:55:53 PM »
Just hit $9000
Brevity may be the soul of wit, but floridity is its spirit.

Offline Emkay

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Re: BitCoin Master Thread
« Reply #264 on: November 26, 2017, 01:43:21 AM »
Coinbase?
Not really, they start you off with $5 and very slowly work your way up although never to very much. All at a 4% fee.

Offline shopfdder

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Re: BitCoin Master Thread
« Reply #265 on: November 26, 2017, 01:44:41 AM »
Not really, they start you off with $5 and very slowly work your way up although never to very much. All at a 4% fee.

Youtube how to trade on the back end of their site for free ;)

GDAX

Offline Emkay

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Re: BitCoin Master Thread
« Reply #266 on: November 26, 2017, 01:46:48 AM »
Youtube how to trade on the back end of their site for free ;)

GDAX
Gdax isn't really the backend. And you can't use CC. And it isn't totally free.

Offline shlonx

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Re: BitCoin Master Thread
« Reply #267 on: November 26, 2017, 01:57:58 AM »
Coinbase is giving me very low limits, even for ACH. I want to buy a whole bitcoin for weeks already, but it looks like it will take a few months until I am able to do that on their site. Is there anywhere else I can instantly buy a whole bitcoin with no limits?
Brevity may be the soul of wit, but floridity is its spirit.

Offline Emkay

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Re: BitCoin Master Thread
« Reply #268 on: November 26, 2017, 02:02:25 AM »
Coinbase is giving me very low limits, even for ACH. I want to buy a whole bitcoin for weeks already, but it looks like it will take a few months until I am able to do that on their site. Is there anywhere else I can instantly buy a whole bitcoin with no limits?
Gdax if they give you the option for wire or ACH transfer.
Gemini.
Kraken.
.....

Offline shlonx

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Re: BitCoin Master Thread
« Reply #269 on: November 26, 2017, 02:03:30 AM »
They have no limits?
Brevity may be the soul of wit, but floridity is its spirit.

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Re: BitCoin Master Thread
« Reply #270 on: November 26, 2017, 02:05:19 AM »
They have no limits?
Not with wires.

Offline shlonx

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Re: BitCoin Master Thread
« Reply #271 on: November 26, 2017, 02:11:47 AM »
Thank you!
Brevity may be the soul of wit, but floridity is its spirit.

Offline shlonx

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Re: BitCoin Master Thread
« Reply #272 on: November 26, 2017, 11:43:29 PM »
I requested that this be moved to the General Discussion thread. Hope nobody minds.
Brevity may be the soul of wit, but floridity is its spirit.

Offline henche

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Re: BitCoin Master Thread
« Reply #273 on: November 27, 2017, 04:51:24 AM »
I requested that this be moved to the General Discussion thread. Hope nobody minds.

I object.

Offline Shauly101

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Re: BitCoin Master Thread
« Reply #274 on: November 27, 2017, 08:45:36 AM »
Hi

Does anyone of you have any experience with Ripple/XRP? What’s the best wallet?

Offline hachover

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Re: BitCoin Master Thread
« Reply #275 on: November 27, 2017, 09:31:30 AM »
I object.

I'm willing to hear arguments
I'm an optimist; but only because life isn't going to give me any other good choices.

Offline henche

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Re: BitCoin Master Thread
« Reply #276 on: November 27, 2017, 10:51:42 AM »
I'm willing to hear arguments

This belongs in just shmooze.  It's not a deal,  not a legitimate investment.  More like the NFL thread that you might make money by gambling

Offline shlonx

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Re: BitCoin Master Thread
« Reply #277 on: November 27, 2017, 11:00:25 AM »
It's a discussion that helps people. I, for one, was really helped by answers people gave me on this thread. I don't see why it has to be a legitimate investment or deal. It is definitely not guys coming to JUST SHMOOZE about something, IMHO.
Brevity may be the soul of wit, but floridity is its spirit.

Offline henche

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Re: BitCoin Master Thread
« Reply #278 on: November 27, 2017, 11:04:19 AM »
It's a discussion that helps people. I, for one, was really helped by answers people gave me on this thread. I don't see why it has to be a legitimate investment or deal. It is definitely not guys coming to JUST SHMOOZE about something, IMHO.

It's clogging up the boards, and I can't find the useful threads on 10% of a Honda air filter

Offline hachover

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Re: BitCoin Master Thread
« Reply #279 on: November 27, 2017, 11:15:29 AM »
Open to comments from the public now
I'm an optimist; but only because life isn't going to give me any other good choices.