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 347348 times)

Offline M218

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Re: BitCoin Master Thread
« Reply #280 on: November 27, 2017, 01:26:01 PM »
Open to comments from the public now
שנים שאוחזין בטלית יחלוקו

Offline henche

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Re: BitCoin Master Thread
« Reply #281 on: November 27, 2017, 01:39:34 PM »
Good idea.  Split the thread.  Put my comments on general discussion

Offline hachover

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Re: BitCoin Master Thread
« Reply #282 on: November 27, 2017, 01:56:02 PM »
Good idea.  Fork Split the thread.  Put my comments on general discussion

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

Offline Am

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Offline hachover

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Re: BitCoin Master Thread
« Reply #284 on: November 27, 2017, 05:10:05 PM »
https://www.cnbc.com/2017/11/27/buy-bitcoin-with-credit-card-is-on-the-rise-on-google-and-sparking-bubble-fears.html

DDF effect?

It would make a great post - Easy way to meet your spending threshhold: buy bitcoin and sell to pay off the card [/s]
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 #285 on: November 27, 2017, 05:19:54 PM »
It would make a great post - Easy way to meet your spending threshhold: buy bitcoin and sell to pay off the card [/s]

Sure, nothing like combining MS with a highly volatile asset.

Here's another MS opportunity: Use your credit card to bet on the superbowl, and pay your card with the winnings.

Offline hachover

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Re: BitCoin Master Thread
« Reply #286 on: November 27, 2017, 06:01:20 PM »
Sure, nothing like combining MS with a highly volatile asset.

Here's another MS opportunity: Use your credit card to bet on the superbowl, and pay your card with the winnings.

Totall agree. But thats just a once a year opportunity to MS with a 50/50 outcome. BTC MS (TM) is available throughout the year, until the end of time, and based on its history has a 100% chance of pay back in full.
I'm an optimist; but only because life isn't going to give me any other good choices.

Online Myccrabbi

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Re: BitCoin Master Thread
« Reply #287 on: November 27, 2017, 06:35:17 PM »


100% chance of pay back in full.
??
Nobody knows what tomorrow can bring. Especially with a revolutionary changing currency that governments HATE.


If u work for a living, why kill urself working?

Offline henche

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Re: BitCoin Master Thread
« Reply #288 on: November 27, 2017, 06:40:31 PM »
Totall agree. But thats just a once a year opportunity to MS with a 50/50 outcome. BTC MS (TM) is available throughout the year, until the end of time, and based on its history has a 100% chance of pay back in full.

That's not actually, true is it?  It has gone down in the past.  Unless you mean that today it is higher than it has ever been, so you could have always held onto it until today. But you'd have needed to make interest payments.

Offline hachover

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Re: BitCoin Master Thread
« Reply #289 on: November 27, 2017, 08:38:30 PM »
I was being completely facetious. I used the sarcasm tag in my first post, I thought we were just keeping up the joke after that
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 #290 on: November 27, 2017, 08:42:14 PM »
Oops.  I didn't know what the s meant

Offline hachover

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Re: BitCoin Master Thread
« Reply #291 on: November 27, 2017, 08:43:08 PM »
Oops.  I didn't know what the s meant

Bloody Poe's Law  ;)
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Offline Mikeoracle

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Offline shopfdder

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Re: BitCoin Master Thread
« Reply #293 on: November 28, 2017, 12:16:52 AM »
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

It's been called dead about 200 times so far and right now no one's laughing :)

Offline hachover

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Re: BitCoin Master Thread
« Reply #294 on: November 28, 2017, 11:11:41 AM »
BTC is moments away from trading at $10,000. I think that milestone will very quickly tell us how close to over the rally is. Crossing that milestone could either trigger a sell off or heighten interest. Will be interesting either way.

Looks like we have been moved to GD
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Offline Mordyk

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Re: BitCoin Master Thread
« Reply #295 on: November 28, 2017, 11:21:16 AM »
BTC is moments away from trading at $10,000. I think that milestone will very quickly tell us how close to over the rally is. Crossing that milestone could either trigger a sell off or heighten interest. Will be interesting either way.

Looks like we have been moved to GD
it hit already $10k today
#TYH

Offline hachover

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Re: BitCoin Master Thread
« Reply #296 on: November 28, 2017, 11:24:11 AM »
it hit already $10k today

KRW is not USD
I'm an optimist; but only because life isn't going to give me any other good choices.

Offline Mordyk

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Re: BitCoin Master Thread
« Reply #297 on: November 28, 2017, 11:38:16 AM »
#TYH

Offline SuperFlyer

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Re: BitCoin Master Thread
« Reply #298 on: November 28, 2017, 03:46:54 PM »
I started this thread almost 5 years ago.
I guess the tone here has changed  :-)

Offline henche

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Re: BitCoin Master Thread
« Reply #299 on: November 28, 2017, 03:48:14 PM »
I started this thread almost 5 years ago.
I guess the tone here has changed  :-)

not completely.