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[Jimmy]

If you're looking to cash in on Bitcoin, there's an option for you if you live in the UK.

UK's first Bitcoin cash machine launches in Shoreditch

[LeoLeonardoIII]

Cue a hacker bugging it because he knows anyone interacting with it has at least $1000 to steal.

[Blargityblarg]

I had a thought.

NASA should dedicate its supercomputers to bitcoin mining to subsidise their science magic stuff.

Electricity used costs more than bitcoins mined at this point, I believe.

[BurnedToast]

I had a thought.

NASA should dedicate its supercomputers to bitcoin mining to subsidise their science magic stuff.

Electricity used costs more than bitcoins mined at this point, I believe.

This was (mostly) true before the recent price crashes, and it's just doubly true now. Getting into bitcoining mining these days is a stupid thing to do unless you're stealing the electricity.

If you really believe in bitcoin, you're better off investing the money you would have spent on a mining rig and electricity into just buying the coins off fools who are, essentially, working for negative wages.

[Mlamlah]

Bitcoin banks keep getting hacked. So that's also a thing. Basically the whole point of bitcoin is to circumvent government and traditional banks, but it seems to becoming increasingly apparent that bitcoin won't work without some legitimized authorities.

[Reelya]

Having legitimized authorities isn't what stops regular banks online systems getting hacked. So there might be merit in the suggestion, but the link between the two things is a bit of a non-sequitur.

Though, if you take a look at how the bitcoin network actually functions, it's clear that no sort of central authority is possible. Read up on "51% attacks".

[BurnedToast]

Though, if you take a look at how the bitcoin network actually functions, it's clear that no sort of central authority is possible. Read up on "51% attacks".

Quite the opposite - if someone gets 51% of the mining power they become the de facto central authority and are quite literally in charge of every coin in existence at that point. With 51% mining power, they could siphon all your coins out of your account and there's NOTHING you could do about it.

Something people with lots of coins don't like to think about... the two biggest mining groups already have well over 51% (and the biggest came damn near 51% on it's own a while back). If the leaders had a secret backroom deal they could make themselves very, very rich and cash out of the system before anyone realized what was happening.

It's just one more weakness of the "currency" that nobody likes to talk about, because it's built in to the system and nothing can be  done about it.

[mainiac]

And as the proceeds from mining decline and the value of currency increases, a green-strongarm tactic like that becomes more attractive.  If the costs from mining became so high that everyone stops mining and you can become majority miner with only a few tens of millions in investment, such a tactic would be very attractive.

[Darvi]

How does that even work that you can take people's money with a 51% majority?

[Putnam]

Mining is how transactions are carried out.

[kaenneth]

Mining is how transactions are carried out.

My understanding is that 'Mining' is just the bootstapping of the paid transaction validation.

Right now, validating blocks gives bonus bitcoin; but eventually, it'll only give the 'tip' assigned by the transaction submitter.

[Leafsnail]

How does that even work that you can take people's money with a 51% majority?

Bitcoin has no central authority, it instead works by having the majority of miners verify that transactions have happened (this is why Bitcoin transactions are painfully slow and/or expensive, by the way).  If "the majority of miners" happens to refer to a single individual they have complete control over what transactions are recognized, so they can just take all the money.

[lemon10]

And as the proceeds from mining decline and the value of currency increases, a green-strongarm tactic like that becomes more attractive.  If the costs from mining became so high that everyone stops mining and you can become majority miner with only a few tens of millions in investment, such a tactic would be very attractive.

I don't think it would be easy to make money that way. First off it would require a pretty big inital investment, and once people start to notice their bitcoins are missing, the value would crash to 0 very rapidly. So you would have to be able to move enough bitcoins rapidly enough that you could make more money selling them in a few hours then you would be able to if you sold your 51% at regular market price. That isn't impossible, but it would be a very risky move.

That said, I wouldn't be surprised if a government did it farther down the line to ruin faith in online currencies even though it would cost them billions of dollars.

[mainiac]

I don't think it would be easy to make money that way. First off it would require a pretty big inital investment, and once people start to notice their bitcoins are missing, the value would crash to 0 very rapidly. So you would have to be able to move enough bitcoins rapidly enough that you could make more money selling them in a few hours then you would be able to if you sold your 51% at regular market price. That isn't impossible, but it would be a very risky move.

You don't need a majority of bitcoins, you need a majority of the bitcoin infrastructure.  If all the transactions in the world were being handled by a single 300 dollar computer, then it would only cost 300 dollars to have say over who owns all the bitcoins.  You wouldn't need to own a single bitcoin yourself.

[BurnedToast]

How does that even work that you can take people's money with a 51% majority?

I misread or misunderstood previously, apparently they can't take people's coins... but they could double (triple, quadruple) spend their own coins, block (anyone's) transaction confirmations, and/or temporary stop anyone from being able to mine more coins.

So they could cash out all their coins multiple times as well as cause general havok for the network. But they couldn't steal your coins.

Apologies for the previous incorrect post.