Académique Documents
Professionnel Documents
Culture Documents
What is bitcoin?
http://www.youtube.com/watch?feature=player_detailpage&v=Um63OQz3bjo
Open Source
(...to anybody that can read code...) (Will our financial system be left in the hands of engineers?? Are we crazy!!! Much better
in the hands of politicians J)
Software
(Decentralized Software in a Decentralized Repository... sounds like a Police song)
Features I Scarce
Features II Digital
Features V Cryptography
Features VI Anonymous
Courtesy of http://www.moneychoice.org/the-future-of-money/
Extracted from the M. Goodwin & D.E. Barr, Economix: How our Economy Works (2012)
http://bitcoin.org/bitcoin.pdf
The "nonce" in a bitcoin block is a 32-bit (4-byte) field whose value is set so that the hash of the block will contain a run of zeros. The rest of the fields may not be changed, as they have a defined meaning. Any change to the block data (such as the nonce) will make the block hash completely different. Since it is believed infeasible to predict which combination of bits will result in the right hash, many different nonce values are tried, and the hash is recomputed for each value until a hash containing the required number of zero bits is found. As this iterative calculation requires time and resources, the presentation of the block with the correct nonce value constitutes proof of work.
https://en.bitcoin.it/wiki/Nonce
"Winning" the next bitcoin in a chain means happening upon a bitstring, or nonce, that when combined with the data in the chain so far, produces a SHA-256 hash with a certain number of leading zeros. The probability of finding such a pattern by chance - and there is no better way known - is 1/2z , where z is the number of needed zero bits. The Bitcoin protocol estimates the amount of CPU power currently in the Bitcoin mining network, and continually adjusts z so that, on average, one successful solution turns up every ten minutes. Each successful solution is currently worth 25 bitcoins http://nakedsecurity.sophos.com/2013/03/13/anatomy-of-a-problem-bitcoin-loses-25-percent-in-value/
Mining is a distributed consensus system that is used to confirm waiting transactions by including them in the blockchain. It enforces a chronological order in the blockchain, protects the neutrality of the network, and allows different computers to agree on the state of the system. To be confirmed, transactions must be packed in a block that fits very strict cryptographic rules that will be verified by the network. These rules prevent any previous block from being modified because doing so would invalidate all following blocks. Mining also creates the equivalent of a competitive lottery that prevents any individual from easily adding new blocks consecutively in the blockchain. This way, no individuals can control what is included in the blockchain or replace parts of the blockchain to roll back their own spends.
The original is a Java application with an open source interface, yes, from those great folks that brought you vim!
Mining Client
One block every 10 minutes
https://en.bitcoin.it/wiki/Software#Mining_apps http://motherboard.vice.com/blog/a-guide-to-bitcoin-mining-why-someone-bought-a-1500-bitcoin-mineron-ebay-for-20600
&
Samsung Exynos 5 Octa incorporates a full HD 60fps (frame per second) video hardware codec engine for 1080p video recording and play-back, an embedded 13 mega-pixel 30fps image signal processor interface for high-quality camera functionality, and 12.8GB/s memory bandwidth interface that enables Full HD Wifi display. Read more at: http://phys.org/news/2013-03-samsung-exynos-octa-mobile-devices.html#jCp
Coal miner Lee Hipshire in 1976, shortly after emerging from a mine in Logan County, W.Va. at the end of his shift. At age 36, he had worked 26 years underground. A few years later, Lee took early retirement because of pneumoconiosis, or black lung disease. He died at 57.
(Courtesy of Earl Dotter http://www.npr. org/blogs/pictureshow/2012/07/06/1563 86882/documenting-dirty-jobs-minersat-work)
Digital Goods
Other Uses
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation. The Ponzi scheme usually entices new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent. Perpetuation of the high returns requires an ever-increasing flow of money from new investors to keep the scheme going. http://en.wikipedia.
org/wiki/Ponzi_scheme
Image and story courtesy of Aleix Sal, Simiocracia, Crnica de la Gran Resaca, 2011.
Nixon Shock
(...or why I am not backed by gold anymore (although I never was since I printed more money than the system produced), but by the fiat, the trust markets have in lending money to different governments.)
To prevent a run on the dollar, stabilize the economy, and decrease unemployment and inflation rates, on August 15, 1971, Nixon issued Executive Order 11615, pursuant to the Economic Stabilization Act of 1970, which imposed a 90-day maximum wage and price ceiling, a 10% import surcharge, and, most importantly, "closed the gold window", ending convertibility between U.S. dollars and gold. The President and fifteen advisers made that decision without consulting the members of the international monetary system, so the international community informally named it the Nixon shock http://en.wikipedia.
org/wiki/Nixon_Shock
Image courtesy of M.Goodwin & D.E. Carr, Economix: How Our Economy Works, 2011
In Banks we Trust
"The root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve. We have to trust them with our privacy, trust them not to let identity thieves drain our accounts." Satoshi Nakamoto, Bitcoin: A Peer-to-Peer Cash System, 2009
In Bitcoin we Trust?
Bitcoin isnt tied to any commoditybesides trust. As a statement on the global economy, Bitcoin is hilarious. As a currency for the disenfranchised and distrustful, its as serious as can be.
http://www.businessweek.com/articles/2013-03-28/bitcoin-may-be-the-global-economys-last-safe-haven
The whole thrust behind Bitcoin is that it removes the need for trust in currency; trust in bankers, trust in governments, trust that the two wont collude to do you over, like they did with everybody in Cyprus.
http://www.spectator.co.uk/columnists/hugo-rifkind/8874321/how-bitcoin-could-destroy-the-state-and-perhaps-makeme-a-bit-of-money/
The affair began with the arrest of five men for breaking and entering into the Democratic National Committee (DNC) headquarters at the Watergate complexon June 17, 1972. The Federal Bureau of Investigation (FBI) connected cash found on the burglars to a slush fund used by the Committee for the Re-Election of the President, a fundraising group for the Nixon campaign.[1][2]
Anarchist Entrepreneurs
(The yore of the Lira, the feel of the Franc and the heel of the Deutsche Marks not anymore...)