Success Warrior: The Blog That Embraces ADHD

Saturday Video

Saturday Video

 "If" the US Government wants to block payments?  I think he meant "when" the US Government does block payments. It's an ongoing thing.

With bitcoin, you can send money to WikiLeaks if you want or, get this, even play Texas Hold'em online <gasp>.

When gambling with bitcoins becomes popular, Harry Reid is going to be all over it trying to earn all the bribe money he gets each year from the casinos to block Internets gambling.  Reid's current net worth is somewhere between $3 to $6 MILLION dollars, thankyouverymuch.

It's ironic (on so many levels) that in order to protect US subjects from the harmful effects of gambling, Harry Reid is allowed to accept millions of dollars in bribe money from casinos so they can use the massive violence capacity of the US Government to keep honest people from playing 2-5 Texas Hold 'em to unwind after working a 12-hour shift.

A *Little* BitCoin Info

 
So,

I did a little bit of research on bitcoin this morning before diving into homework.  I'm going to attempt to give a brief description here because I have much more homework to do tonight.  It's probably going to be difficult to keep it short so we'll see how it goes.

Chili described it as "dorky gamer currency" and there is a bit of truth to that but I'll need to backtrack a bit before getting to that.

Bitcoin is a cryptocurrency, a computer generated bit of bits that people have voluntarily decided to give value.  They have no intrinsic value to them like the US Dollar.  Except that in this case, the people using them have decided they have value and this sets them apart from the dollar, which has value because if you don't use it, the IRS or Secret Service will take all your positions, tase you, and throw your ass in jail.

There are other differences as well that are incredibly important.

There is no central bank for bitcoin.  Bernanke and Obama can't decide to put out $7 trillion to bail out their buddies at everyone else's expense.  In fact, there won't ever be more that 21 million BTC.  It's in the open source code.

The lack of a central bank plays another huge role in the grand scheme of things.  Somewhere around 2005 or so, e-gold was gaining in popularity.  For those that don't follow these things, e-gold allowed people to purchase shares of gold and then use gold-backed, digital money to buy things around the world with other e-gold users.  The US government was able to shut e-gold down in 2007 by indicting 3 e-gold execs and ordering them to knock it off.  The biggest threat to the US government is not terrorism, it's the creation of an alternate economy, what they lovingly call the "Black Market".  The black market is a loss of control by the government, something that cannot be tolerated in the least and must be squashed with a vengeance. 

Those of you that have been reading this blog for some time will remember what happened to a place called Liberty Dollar.  They made collector's coins out of silver and gold and people started using them as a barter system.  The government shut Liberty Dollar down and took all their gold and silver.  Again, everything was in a central location run by a few people.  An easy target for the power-hungry sociopaths scared someone might take their boot off the people's throat.

Bitcoin doesn't exist physically and doesn't have a central location.  It's software, downloaded on countless computers around the world.  It can't be raided.  It can't be shut down.  Napster is to e-gold what BitTorrent is to BitCoin.  You can take someone's computer away from them in attempt to stop them but they can just pull another computer out of the closet, download the software, and be off and running again. 

Supposedly, there are a couple of US Senators looking at existing laws to see if BitCoin is illegal.  Good luck with that.  Even if they find a law that makes it illegal for someone to give another person what is essentially gaming scores in exchange for a sandwich, it will be impossible for them to enforce it.  If the US government was to be as stupid as Mubarak and shut down the Internet, all that would happen would be instant rioting.  Not to mention that their corporate puppet masters depend on the Internet as much as anyone else.  Remember when Goldman Sachs was caught doing their massive insider trading deal that makes Martha Stewart look like a petty pick pocket in comparison.  They would get the morning's numbers a couple of seconds before the rest of the world and have their supercomputer make a gazillion trades before the market opened.  And, obviously, if you found a way to shut down the Internets for everyone but the people paying you millions in bribes, riots again.

That doesn't mean they aren't going to try and I'm going to be watching with interest.

There's much more but I'm going to lightly (very lightly) touch on the "dorky gamer currency" and then get back to my homework, which I was hoping to complete tonight but it's looking unlikely.  New bitcoins are created about every ten minutes (out of thin air just like the US dollar with one incredibly massive difference - later).  The software creates a puzzle, a proof of work, that must be solved before the bitcoins are created.  The person that owns the computer that solves the puzzle gets the new bitcoins (currently set at 50 BTC and after 210,000 BTC are created, the reward will be halved slowing the introduction of new BTC - again, the opposite of the US Dollar).  The processing power for solving this puzzle comes from your computer's video card.  This is referred to as "mining".  It's like panning for gold but it's based on the power of your video card and your ability to keep the video card from overheating and your willingness to pay the electric bill for running 3 ATI 6990's ($740.00 each just to purchase) and to run these bad boys overclocked with fans running on turbo 24/7 (and replace them every year or so when they burn out).  Guess who already already had max-GPU sitting in their towers when bitcoin started up?

It has expanded beyond gamers though into a global cryptocurrency that is accepted at brick and mortar retailers and restaurants. 

Well, there's more but I'll just finish with the last difference that I mentioned (promise) and do what I'm supposed to be doing.  The Fed has deliberately inflated the money (just like bitcoin but with a massive difference - I think I mentioned that) and the effect has been a steady decrease in the value of the dollar, which is seen as increased prices at the grocery store.  The US Dollar is worth 4% of its initial value in 1913.  The bitcoin, on the other hand, is being inflated and is increasing in value, which means that prices are going down if you buy stuff in BTC.  How much?  Well, if things keep going like they have been since last July, the bitcoin will have increased in value by about 600,000% by this July.

Okay, I suppose I have to mention one other thing because of that.  Bitcoins are virtual and currently can be broken down 8 decimal places.  A dollar can be broken down to a penny, a bitcoin can be broken down to a millionth of a BTC, with people already looking ahead to breaking it down further (you have to when prices are going to decrease by a half million percent a year).  This means that if you own Grandma's Scrumptious Pie Shop, you can sell memberships to your pie of the month club for 3.14195265 BTC (at least until the deflationary pricing forces you to change it).

So, there you go.  Probably much more information than you really wanted to know about the bitcoin but I was (and still am) intrigued and had to check it out.

BitCoin?

 
So,

A quick question and then I'm off to do homework.

oh yay . . .

Second that.

Anyone heard of bitcoin?  What do you know?