Bitcoin's fatal flaw was nearly exposed

[Luxman]

Greed drives and controls our economies, and as history has shown countless times, they will eventually collapse and only a few aholes will benefit.

http://www.dailydot.com/business/bitcoin-fatal-flaw-exposed-ghash-io/

 

[vanlee1]

Thank you for the information.

 

[Rey C.]

There was a good story about Bitcoins on Bloomberg the other day. Unfortunately I only caught the tail end of it. But from what I could tell, some guy was running an Android phone to show the inefficiencies in the Bitcoin system(s). He had some sort of "mining" app or program which ran 24 hours a day and it put about $2 in his account each day... for no reason. Now, I don't know how this thing really works, but he surmised that a person could run multiple devices and if each could bring in just $2 apiece, at some point, a person could make some "real" money for doing basically nothing. A few pennies at a time, this cyber money just slips into your account because of the inefficiencies in the system. You can get an Android device for almost nothing these days. So let's say you got ten little junk phones, loaded them with this app and ran them 7 days a week on WiFi (to avoid data charges). That's $140 a week, over $600 a month and over $7 grand a year. You won't get rich, but (assuming this isn't illegal) $7K a year... just to let a bunch of Android phones run over in the corner of your home or office?

Has anybody else heard or do you know anything about this???

Bitcoins new theme song?

And even if it is illegal, my new best friend, Eric Holder, says I can lease out a corner of my home office to Rey C., Inc and run 100 of these things 24/7. If I get caught, I'll just pull $7K out of the $70 grand I made in year 1, pay the fine, say I'm real, real sorry (although I don't think I did anything wrong) and then just move the operation to my new HQ in the Cayman Islands. Just me and my new executive assistant, Misty Goodbody (who can't type or even spell).

 

[Rey C.]

Is this modern day tulip craze (finally) collapsing???

Mt.Gox site disappears, Bitcoin future in doubt

What was once the world's largest trading platform for bitcoins is now a blank page.

The Bitcoin-trading website Mt.Gox was taken offline late Monday, putting at risk millions of dollars put there by investors who gambled on the digital currency. The exchange also deleted all of its tweets, and Mt.Gox CEO Mark Karpeles resigned from the Bitcoin Foundation's board of directors on Sunday.

The news frightened Bitcoin investors elsewhere, knocking the price down about 3% to $490 -- its lowest level since November.

For now, there's no telling what's behind the shutdown. Mt.Gox did not respond to requests for comment.

However, an unverified document called "Crisis Strategy Draft" that is being circulated online claims Mt.Gox has lost 744,408 of its users' bitcoins, worth nearly $367 million. It also claims Mt.Gox is planning to rebrand itself as Gox.

 

[Marshall Stack]

It's a nice concept but is reliant upon the honor system which when it comes to money and specifically other people's money doesn't give me a lot of confidence. A bar I go to occasionally accepts Bitcoin and the owner says he has no problems with it so far.

 

[Rey C.]

Mt. Gox bankruptcy

The deep bowing by Karpeles was a nice touch. Looks so sincere.

Caught on hidden mic:

Hey, all your money is gone. I really don't know where it went. Honest. It's just gone. I'm so, so sorry. *bows for five minutes* OK, so I gotta go now. *bows again* I've got five teen hookers and a bath tub full of Dom Perignon calling my name! Hey Binky, fire up the Ferrari and let's blow this joint!

 

[knowone]

http://www.xbiz.com/news/177042
Mt. Gox Asks Japanese Police for Help

 

[Trollsome]

There was a good story about Bitcoins on Bloomberg the other day. Unfortunately I only caught the tail end of it. But from what I could tell, some guy was running an Android phone to show the inefficiencies in the Bitcoin system(s). He had some sort of "mining" app or program which ran 24 hours a day and it put about $2 in his account each day... for no reason. Now, I don't know how this thing really works, but he surmised that a person could run multiple devices and if each could bring in just $2 apiece, at some point, a person could make some "real" money for doing basically nothing. A few pennies at a time, this cyber money just slips into your account because of the inefficiencies in the system. You can get an Android device for almost nothing these days. So let's say you got ten little junk phones, loaded them with this app and ran them 7 days a week on WiFi (to avoid data charges). That's $140 a week, over $600 a month and over $7 grand a year. You won't get rich, but (assuming this isn't illegal) $7K a year... just to let a bunch of Android phones run over in the corner of your home or office?

Has anybody else heard or do you know anything about this???

Actually, it works like this:
Bitcoin, or any other digital crypto currency, is like gold: it's not unlimited (there can be only 21 million bitcoins). To get the gold you have two options: earn it by selling something in exchange of gold, or take an excavator and dig some mountain. In the same way, if you want to get the Bitcoin you can either earn it or "mine" it. Here, your android phone is the excavator that is doing the processing (mining) to create Bitcoins. But this cannot go on forever; there will be time when Bitcoins cannot be mined any further.

There are actual benefits of having a finite supply of money: As the production of goods goes higher and higher, the prices go downward. It creates stability, prosperity, and prevents wastage of resources (which is good for the health of our planet).
There're only few downsides of Bitcoins: transactions cannot be rolled-back, theft, etc.
The other downside of Bitcoins is that banks cannot create it out of thin air to lend it out for interest. So, the banks and usurers will do what is in their capacity to hamper the acceptance of such a finite currency.

 

[Red XXX]

Bitcoin, or any other digital crypto currency, is like gold

No it's not, Gold is a naturally occurring chemical element, both on Earth and throughout the Solar system, the gold supply is carefully controlled just to maintain it's value etc, etc.

Bitcoins on the other hand are limited, by the length of time that the internet exist or when someone pulls the plug out of the wall - they more closely follow 'The Kings New Cloths' approach to investments!

:2 cents:

 

[Rey C.]

Mt. Gox bankruptcy...

Caught on hidden mic:

Hey, all your money is gone. I really don't know where it went. Honest. It's just gone. I'm so, so sorry. *bows for five minutes* OK, so I gotta go now. *bows again* I've got five teen hookers and a bath tub full of Dom Perignon calling my name! Hey Binky, fire up the Ferrari and let's blow this joint!

Looks like I wasn't so far from the truth. But instead of a Ferrari, this goof imported a Honda Civic from the UK. I don't care if it was "souped up" or not. It was still a freakin' Honda Civic!!! He deserves to go to jail just for that!

By early 2012, a small group of Mt. Gox employees, all of whom worked on one-year contracts, began to worry that customer funds had been diverted to cover operating costs that they estimated to be rising. Those costs included rent in a Tokyo high-rise that also housed offices for Hulu and Google, high-tech gadgets such as a robot and a 3-D printer and a souped-up, racing version of the Honda Civic imported from Britain for Karpeles, people who have reviewed expenses said.

 

[knowone]

http://www.xbiz.com/news/178178

 

[bobjustbob]

The more telling thing from Rey's link is the fact that $25 million in cash is gone too.

 

[Rey C.]

http://www.xbiz.com/news/178178

Good link. Anybody catch this at the bottom?

Adult companies gravitated towards the anonymity that the cryptocurrency afforded, and the roster of companies that set up a bitcoin payment gateway was long and respectable, including Playboy Plus, MOFOs, Naughty America, Wicked Pictures, Porn.com, Grooby.com, DominicFord.com, ClassyCams.com and MetArt.com and Internet payment service provider Verotel, among others.

I recall that last year the FreeOnes team mentioned that the site was accepting (or thinking about accepting) Bitcoins. Did FreeOnes lose any money in the Mt. Gox scam?

 

[Luxman]

Current value of Bitcoin is about $9350US, it was about $850US in Jan. 2014, when I started this thread, and it was at $5US in Feb. 2012.
You can by a piece of one Bitcoin, not sure what the minimum is, from when I've read the value will continue to rise, some say that eventually each Bitcoin could be worth millions.
So it's not too late to buy Bitcoins or some of the other 700 or so crypto-currencies.

 

[xfire]

Problematic. It could all be gone before breakfast, don't be the one getting fucked.

 

[Rey C.]

Even though Bitcoin has had a meteoric rise since this thread started, I can't say that I'm sorry that I didn't jump on the (Greater Fool Theory) bandwagon. As a sidenote, I never bought any shares of Enron or WorldCom either.

Good luck to those riding the wave though.

 

[Supafly]

This smells like "Hot Potatoe" to stupid mne. In the days of Wikileaks, a never ending series of cloud hacks, darknet crimelords... I do not have either the big funds nor the nerves to gamble with Bitcoins.

I remember some billionaire or another said, he has stacked up on that currency, and will drop out to cash in, while still being ahead of the game. No shit. I wouldn't want to sit on a vcyberwallet that looks like a trillion happy dollars floating in space, and like a puff of smoke the next second

Buy gold, buy rare earth stocks, buy land.

 

[xfire]

I remember some billionaire

John McAfee is heavily invested in Bitcoin, not sure who else, but whoever is a fucking fool.

 

[Rey C.]

This smells like "Hot Potatoe"

I totally agree. And since I was never good at that game, I'm staying away. Anything that has 20%+ swings overnight, I wouldn't touch with somebody else's money.

 

[D-rock]

I always think real world normal currencies can potentially be shaky as is considering they are backed only by the the credit and confidence of the nation that creates them. The ability of backing an economy directly by something physical not being viable in the modern world. In essence in a roundabout way they are backed by the economic might, output, and ability of a country or union to say a currency is worth what they say it is,...but at least that's actually something. Buying into a currency that's backed by nothing more than tenuous digital time based algorithms seems foolish to me. The self preservation parts of me practically scream that it's only a matter of time before something like that ends very badly.