Free Money!!!

I recently started a new project, and so far, it's paying off little by little. I read a story about this "silk road" website, where people sell illegal goods. Well, supposedly they use this currency called bitcoins. They're supposed to be totally anonymous. I read into them, and although only a software engineer or hacker would completely understand exactly how the system works, I kinda get the basics.

Instead of the fed printing money, these things are released in blocks of 50 bitcoins. The cool part is they're given to people as a reward for creating a block using your computer to basically "guess" the password. It's called bitcoin mining, and it equates to free money!! Check out this link for more in-depth details:

en.wikipedia.org...

I downloaded free software and joined a mining "pool", and I'm making money by doing nothing!! These bitcoins seem like a hell of an investment, because they were worth $0.50 each in January, and now they're over $18 each!! I think this is the wave of the future, and will be used to pay for all goods instead of paypal, online debits, etc, because there's no fee to transfer them!!

What do you think?

This was mentioned on NPR the other day. Are you sure what you are doing is legal, as far as this "mining" stuff goes?

Anytime you start getting "free" stuff that's worth something (too good to be true), then it's either a scam, a racket, or straight up theft.

So be careful you aren't falling into a honey trap.

Do you really prefer a belt holster to a leg holster?
I'm a leg person myself. . .

As for your post it is news to me but it seems to follow a similar trend a friend of mine tried a few years back taking something and assigning value to it then watch it increase in price when the demand went up. He got quite a following for doing it and since he tracked the sales of this he sold his share when the trend started to decline and made a couple hundred grand off the idea. He needed it too for the lawsuits that followed were quite expensive!

It's legal, it's fair, and it's very hard for the currency to be taken advantage of. The currency is called Bitcoin and it is a decentralized, peer to peer digital currency. You create, by running the automatic software, bitcoins, which are really just a few bits of data. Bitcoins are a virtual commodity of known scarcity, and the rate of currency generation and scarcity is known publicly. There will be 21 million bitcoins in circulation in 2030, and there will never be more. The rate of generation decreases exponentially over time up until 2030 when it completely stops.

I have been generating bitcoins for about a month now and have 3.25 bitcoins so far (from the free software). So basically, I have generated and injected into the system about 3 bitcoins of currency. I have acted as the treasury/federal reserve in that I have "printed" the currency myself, and injected it into the economy by taking ownership of the currency. I can exchange my bitcoins for USD or any other currency by offering to sell my bitcoins to another individual who owns the desired currency.

What I am actually doing, however, is holding onto my bitcoins, because their value is increasing tremendously. I am making some money off of bitcoins, to be sure, by buying them and just letting them sit and appreciate in value.

Do yourself a favor and get in on bitcoin while it's still early in the game. This is going to unbelievably huge.

edit:
I should add that bitcoin is NOT a money-making scheme. It is not a pyramid scam or ponzi scheme. It is new CURRENCY, with a decentralized method of currency generation. This decentralized currency generation creates an effect where the more people buy or generate bitcoins, the more the value of bitcoins rises. But this is not a scheme, this is just the way that the currency is created. It is great for individuals who choose to generate bitcoins, because their time and electricity investment pays off big time. There is already a huge bitcoin economy with markets for many, many types of goods. There's even this one guy who sells collectible vinyl records for bitcoins *only*.

Check this topic out to get started:
forum.bitcoin.org...

reply to post by deesul69


What do I think?

Well a quick read of the Wiki link makes firstly i) doubt the legality of said system, ii) it's general lack of usefulness in the sense that the virtual notes can't be converted to real ones and iii) it's simply a variation of how our banks currently operate; money doesn't exist in the true sense of the word - it's all virtual zero's and one's, just transferred or transformed into something else (just like energy)

I'd also seriously question the security implications of such a system, seems dubious to me at least but not a smart enough idea to cause any serious problems -yet...

Wait: you downloaded their software into your system so you could make money by"doing nothing"?
what else is your computer doing that you don't know about?...You could you have inadvertently joined a giant "zombie"computer spambot or "codecracker" army.Your computer is using its processing power guessing passwords?


I don't know much about hacking but I do know nothing is ever "free". especially money.Somebody is benefiting from your "commerce"...

I think the concept will have more merit when I can actually spend them. Just checked with my local supermarket, no plans to take Bitcoins. My cable company also refused, as did the power company. Nope, the gas station doesn't take 'em either.

So, what exactly makes these things worth $18? To me at least, in order for something to be worth $18, I have to be able to actually spend it.

reply to post by Death_Kron


see my post above your own - most of your concerns are touched upon.

I'm no expert, but I have spent a considerable amount of time researching bitcoins, their legitimacy, their economic power, stability, and security. Feel free to ask any questions and I will do my best to answer. At the least, I'll find a link to applicable info.

reply to post by deesul69


I heard about the same thing from some dude at work, on Saturday too, so pretty recent. But dude, this is illegal. By any chance is this from a proxy server were you can find "the hidden wiki"?

That is what I heard and basically you can distribute, engineer a scam or racket via this proxy server and fingers crossed not get caught. This guy at work was contemplating it until I told him that some of these proxy servers like TOR are government run.

I would seriously consider ending what you are doing. You may be playing into the wrong hands.

Word of caution: Bitcoins are not worth the paper they are printed on.

reply to post by tetsuo


To be honest, it seems like a clever idea that will turn out very ugly in the end.

Nothing in this world is free, regardless on how you base that definition, you always "pay" for "something" in one way or another and I (although tempted through personal circumstance) won't be looking into this one, screams far too dodgy for me.

Just to re-read the OP, so your basically turning your PC into a slave as part of a distributed computing network to guess "a password"

Stay well away!

I'd rather stick with my vault with paper in it. I dont want anonymous or the likes (maybe even cia/feds) to run away with my money. I cant chase people through data cords.

reply to post by Death_Kron


Bitcoins are not free. They take a lot of power/electricity to generate. Most people lose money generating them, because it costs more in electricity to generate than they are worth. Even though the value is skyrocketing, it is getting harder and harder to generate currency as time goes on, so it evens out for the most part. You can use a GPU miner (using your graphics card instead of CPU to generate) and almost certainly turn profit. If you take into account the cost of a nice computer dedicated to generating bitcoins, then it would take you several months to break even.

If you own a bank account, you will know that your money is nothing more than ones and zeros on your bank's secure server. There is far less cash in existence than are funds in USD. Bitcoins are just a series of binary digits, however, they only have meaning/value when they are stored in a wallet, which is a file on your computer. That wallet and its bitcoins are basically the unit of currency, like a dollar bill. Bitcoins ARE cash. They are worth something because they are a scarce commodity. Just like metals and gems are worth something because they are a commodity of known scarcity.

reply to post by tetsuo


Nooooo, your missing the point here big time.

Firstly, why would I use my electricity generating an unrecognised currency?

Secondly, why on earth would I allow peer-to-peer access to my computer? I don't even run P2P music apps simply from the security point of view.

Thirdly, the OP mentions breaking passwords; that sounds like allowing your machine to be remotely accessed and it's processing power harnessed for nefarious purposes.

Three questions:

1.) Can or have you used your BitCoins to buy anything?

2.) Are you happy that remote users can access your PC based upon the idea that your "creating money" by storing BitCoins?

3.) When or if do you believe this virtual cash will actually mean anything to you in the real world?

It's a scam, deluded idea or both in my honest opinion. That's no disrespect towards you but when something seems to good to be true it usually is and sometimes the simplest explanation is the most correct...

Originally posted by tetsuo
reply to post by Death_Kron

 

Bitcoins are not free. They take a lot of power/electricity to generate. Most people lose money generating them, because it costs more in electricity to generate than they are worth. Even though the value is skyrocketing, it is getting harder and harder to generate currency as time goes on, so it evens out for the most part. You can use a GPU miner (using your graphics card instead of CPU to generate) and almost certainly turn profit. If you take into account the cost of a nice computer dedicated to generating bitcoins, then it would take you several months to break even.

If you own a bank account, you will know that your money is nothing more than ones and zeros on your bank's secure server. There is far less cash in existence than are funds in USD. Bitcoins are just a series of binary digits, however, they only have meaning/value when they are stored in a wallet, which is a file on your computer. That wallet and its bitcoins are basically the unit of currency, like a dollar bill. Bitcoins ARE cash. They are worth something because they are a scarce commodity. Just like metals and gems are worth something because they are a commodity of known scarcity.

A "scarce commodity"? So are my nostril hairs! (I'm not saving those either ). (CURRENTLY25 OR 30 IN THE WORLD!;and I promise not to leave any more growing after the great "final reaping" of 2019.).

But They have ABSOLUTELY NO VALUE SIMPLY BECAUSE THEY ARE SCARCE(!)
Something is"worth" what somebody else will give ya' for it.

Money in my real bank account came from generating a real tangible product in the real world;not time (i.e."computer power" )spent cracking away against riddles. what is produced?

What is generated for the resources (i.e. electricity and time ) invested?

Sorry this sounds more and more like a crooked timeshare deal in florida "you can't lose money on this deal!!!!"

just imho "walk" ; no "run" away from this snakeoil.

Regarding the "guessing passwords" in exchange for bitcoins:
Bitcoin is a cryptocurrency. You have heard of encryption, right? Encryption is a way of keeping data private by scrambling the individual bits of data (that's a really basic explanation). Scrambled messages can be unscrambled, but it can take a lot of time and computing power to unscramble a message, depending on how well it was encrypted. Bitcoin uses encryption to "time" the generation of currency.

(I'm going to use some arbitrary numbers here to make it simpler, they are not necessarily the same values that bitcoin actually uses)

At the very start of bitcoin, the software encrypted a message with simple methods. It sent that problem out to all the people who are running bitcoin on their computer. Each person's own bitcoin software then attempts to unscramble the message, breaking the encryption. If somebody successfully breaks the encryption, then 50 bitcoins are created (just like the federal reserve prints money) and given to that person.

At the beginning, the encryption was purposefully very simple, so that currency was generated quickly. As time went on and more people started generating bitcoins, the encryption was purposefully made more and more complex, so that it took longer to each message to be decrypted.

The only reason your computer is "guessing passwords" is because it is known how long it takes to break certain types of encryption. The encryption is just a fool-proof way of making sure new currency is generated at the right rate. The encryption method also means that individuals get the chance to have the new currency they "generated" by breaking the encryption be deposited directly into their wallet file (aka bitcoin account).

With US currency, the money is generated by the federal reserve, then loaned to corporations and governmental organizations which then slowly spend that money, where it finally makes its way back into individual citizens' wallets.

If bitcoin wasn't a cryptocurrency, if the rate of new currency generation was not controlled by this method, then people could cheat in many, many ways, which I will not talk about here. The point is, your computer is not hacking somebody's password or anything silly like that, it is just breaking arbitrary encryption on arbitrary and meaningless data.

Originally posted by tetsuo
If bitcoin wasn't a cryptocurrency, if the rate of new currency generation was not controlled by this method, then people could cheat in many, many ways, which I will not talk about here. The point is, your computer is not hacking somebody's password or anything silly like that, it is just breaking arbitrary encryption on arbitrary and meaningless data.

Bolded text represents my whole point, I'm fully aware of how encryption and cryptography work.

So this system is basically lots of nodes, utilising their processing power breaking randomly generated encryption hashes and the ones who succeed are rewarded with worthless, virtual money?

It's a scam, that's all I can say.

Originally posted by Death_Kron
reply to post by tetsuo

 

e.

Firstly, why would I use my electricity generating an unrecognised currency?

Secondly, why on earth would I allow peer-to-peer access to my computer? I don't even run P2P music apps simply from the security point of view.

Thirdly, the OP mentions breaking passwords; that sounds like allowing your machine to be remotely accessed and it's processing power harnessed for nefarious purposes.

1.) Can or have you used your BitCoins to buy anything?

2.) Are you happy that remote users can access your PC based upon the idea that your "creating money" by storing BitCoins?

3.) When or if do you believe this virtual cash will actually mean anything to you in the real world?

Firstly, why would I use my electricity generating an unrecognised currency?
-Well, it IS a recognized currency. I'll write more in this post below about how it is recognized and how it has real spending power.

Secondly, why on earth would I allow peer-to-peer access to my computer? I don't even run P2P music apps simply from the security point of view.
-You are not allowing peer-to-peer access to your computer. The network is peer-to-peer, however. The bitcoin software only interfaces with other bitcoin software, and all data is highly encrypted. There's negligible risk of bitcoin software being exploited. P2P security here is a non-issue (according to the people who know wayyyy more about this kinda thing than any of us in this thread so far).

Thirdly, the OP mentions breaking passwords; that sounds like allowing your machine to be remotely accessed and it's processing power harnessed for nefarious purposes.
-Got to that in a previous post of mine, read up

1.) Can or have you used your BitCoins to buy anything?
-Yes. I almost bought a record with them, but decided it made far more sense economically to actually buy MORE bitcoins instead of spending them. I could sell all my bitcoins right now for about $20 per. That's US dollars.

2.) Are you happy that remote users can access your PC based upon the idea that your "creating money" by storing BitCoins?
-They cannot.

3.) When or if do you believe this virtual cash will actually mean anything to you in the real world?
-It already does to an extent. There are websites where individuals are selling all sorts of stuff (not illegal crap either!) for bitcoins exclusively. There's a job search site as well where you can apply for jobs that pay in bitcoins (or offer a job paying with bitcoins).

Here's a great bitcoin site showing the value of bitcoins compared to numerous other physical and digital currencies: bitcoincharts.com...

reply to post by Death_Kron


Correct. Except that most people (myself included) are using a distributed/pooled miner network so that instead of one person getting 50 bitcoins once in a blue moon, everybody participating gets a fraction of a bitcoin every couple of minutes. If I was generating solo, I almost certainly would not have generated any bitcoins by now. And I probably never, ever would (very low probability). However, with the pooled miner, I can generate a little bit. About 1 bitcoin per week for the past month. Each worth around $20 right now.

Originally posted by tetsuo
Regarding the "guessing passwords" in exchange for bitcoins:
Bitcoin is a cryptocurrency. You have heard of encryption, right? Encryption is a way of keeping data private by scrambling the individual bits of data (that's a really basic explanation). Scrambled messages can be unscrambled, but it can take a lot of time and computing power to unscramble a message, depending on how well it was encrypted. Bitcoin uses encryption to "time" the generation of currency.

(I'm going to use some arbitrary numbers here to make it simpler, they are not necessarily the same values that bitcoin actually uses)

At the very start of bitcoin, the software encrypted a message with simple methods. It sent that problem out to all the people who are running bitcoin on their computer. Each person's own bitcoin software then attempts to unscramble the message, breaking the encryption. If somebody successfully breaks the encryption, then 50 bitcoins are created (just like the federal reserve prints money) and given to that person.

At the beginning, the encryption was purposefully very simple, so that currency was generated quickly. As time went on and more people started generating bitcoins, the encryption was purposefully made more and more complex, so that it took longer to each message to be decrypted.

Cracking crypto..bet the NSA loves you guys; hell you're probably the NSA anyway. So it is giant cracking network.I can COMPLETELY understand the "time limiting/consuming nature of the idea.BUT. nothing is actually produced.So intrinsically there is no value.


A less "paranoid" board might jump in here without seeing all the possibly illegal implications and uses.of a giant network ready and waiting to crunch "crypto problems".. who feeds the system it the "problem"?
and what embassy did it come from? Clever way to contract out decryption "services".I don't like it;not one bit "Andy";

Originally posted by tetsuo
The only reason your computer is "guessing passwords" is because it is known how long it takes to break certain types of encryption. The encryption is just a fool-proof way of making sure new currency is generated at the right rate. The encryption method also means that individuals get the chance to have the new currency they "generated" by breaking the encryption be deposited directly into their wallet file (aka bitcoin account).

With US currency, the money is generated by the federal reserve, then loaned to corporations and governmental organizations which then slowly spend that money, where it finally makes its way back into individual citizens' wallets.

If bitcoin wasn't a cryptocurrency, if the rate of new currency generation was not controlled by this method, then people could cheat in many, many ways, which I will not talk about here. The point is, your computer is not hacking somebody's password or anything silly like that, it is just breaking arbitrary encryption on arbitrary and meaningless data.