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  • #31
    Count me as one who has trouble grasping how BTC and blockchain works. Is it right to say that the "wallet" contains just a bunch of digital keys (like passwords) and not BTC itself? And the wallet also has its own password? How do "addresses" fit into it? The wallet has an address? Since BTC can be any fraction, does that mean infinite number of keys/addresses? Sorry if I sound dumb here but I find the online "BTC for dummies" explanations still go over my head.

    As for the price, friends of mine have been convinced (manipulated?) to think that "hold forever" is the only option. The same GME phrases "to the moon", along with the Braveheart GIF , have been ubiquitous on the BTC forums for years it seems (according to friends).
    Over thinking, over analyzing separates the body from the mind.

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    • #32
      Gold - bunch of alchemists tried to create gold. Never became economically feasible.

      Bitcoin - quantum computing will make bitcoin mining trivial - oh wait, that is at least months away.

      Comment


      • #33
        Originally posted by xrox View Post
        Count me as one who has trouble grasping how BTC and blockchain works. Is it right to say that the "wallet" contains just a bunch of digital keys (like passwords) and not BTC itself? And the wallet also has its own password? How do "addresses" fit into it? The wallet has an address? Since BTC can be any fraction, does that mean infinite number of keys/addresses? Sorry if I sound dumb here but I find the online "BTC for dummies" explanations still go over my head.

        As for the price, friends of mine have been convinced (manipulated?) to think that "hold forever" is the only option. The same GME phrases "to the moon", along with the Braveheart GIF , have been ubiquitous on the BTC forums for years it seems (according to friends).
        Whenever a BTC transaction is made, your wallet will generate a unique address. Say, you are receiving some BTC from someone else. Each party will generate a unique address and the transaction of BTC from one address to another will be recorded on the blockchain. This is why the blockchain is considered as a ledger. Note that you don't actually pass around BTC, but you are essentially recording the transfer of BTC ownership.

        (Note that the number of addresses that can be created is finite, but because of the combinatorial complexity the number is astronomical and the uniqueness of each address is almost guaranteed...)

        Note that all the addresses generated by the wallet will be associated with the private key stored in the wallet. In other words, you will need this private key to transact the BTC sent/received using those addresses again. To use this private key, you typically enter a user generated password into your wallet.

        Now interestingly, a private key is actually encryption of a 12-word phase. What this means is that you can recover your private key if you provide the associated 12-word phrase to encryption software. So, even if your wallet is lost or gets destroyed, you can create a new wallet to access your BTC if you remember the 12-word phrase (or most people write them down on paper).

        While the mania behind BTC and GME is similar, I think we all agree that GME was a short term thing. Some people argued for holding GME but that was in order to squeeze all the short sellers. The motivation for holding BTC is different IMO. Many people consider it as digital gold that in case our traditional financial system goes upside down, they believe that alternative assets like BTC will hold the value. It is based on a decentralized system that is not governed by any specific nation state.

        I know that such a scenario is hard to believe.... but IMO the important thing is that many people believe in this story and it has been ongoing over a decade now. To me, it's not fundamentally different than people believing that the government/society will honor your piece of paper that is money. Of course, the latter history is a much longer one, but intrinsically that belief is no different than a belief in BTC. Both money and BTC are social constructs collectivley created by humans. And just in case this story of BTC continues throughout my life time, I'm willing to allocate a small portion of my asset in BTC.

        Comment


        • #34
          Originally posted by mrcltuch31 View Post

          Whenever a BTC transaction is made, your wallet will generate a unique address. Say, you are receiving some BTC from someone else. Each party will generate a unique address and the transaction of BTC from one address to another will be recorded on the blockchain. This is why the blockchain is considered as a ledger. Note that you don't actually pass around BTC, but you are essentially recording the transfer of BTC ownership.

          (Note that the number of addresses that can be created is finite, but because of the combinatorial complexity the number is astronomical and the uniqueness of each address is almost guaranteed...)

          Note that all the addresses generated by the wallet will be associated with the private key stored in the wallet. In other words, you will need this private key to transact the BTC sent/received using those addresses again. To use this private key, you typically enter a user generated password into your wallet.

          Now interestingly, a private key is actually encryption of a 12-word phase. What this means is that you can recover your private key if you provide the associated 12-word phrase to encryption software. So, even if your wallet is lost or gets destroyed, you can create a new wallet to access your BTC if you remember the 12-word phrase (or most people write them down on paper).

          While the mania behind BTC and GME is similar, I think we all agree that GME was a short term thing. Some people argued for holding GME but that was in order to squeeze all the short sellers. The motivation for holding BTC is different IMO. Many people consider it as digital gold that in case our traditional financial system goes upside down, they believe that alternative assets like BTC will hold the value. It is based on a decentralized system that is not governed by any specific nation state.

          I know that such a scenario is hard to believe.... but IMO the important thing is that many people believe in this story and it has been ongoing over a decade now. To me, it's not fundamentally different than people believing that the government/society will honor your piece of paper that is money. Of course, the latter history is a much longer one, but intrinsically that belief is no different than a belief in BTC. Both money and BTC are social constructs collectivley created by humans. And just in case this story of BTC continues throughout my life time, I'm willing to allocate a small portion of my asset in BTC.
          Thanks, this helps quite a bit
          Over thinking, over analyzing separates the body from the mind.

          Comment


          • #35
            From today's Toronto Star.....
            • Toronto Star
            • 11 Feb 2021
            Bank of Canada’s deputy governor called recent cryptocurrency prices ‘speculative mania.’
            A top Bank of Canada official called the recent spike in cryptocurrency prices “speculative mania,” and said such assets don’t have the qualities to become the money of the future.

            In a speech on “payments innovation,” Deputy Gov. Tim Lane said costly verification methods and unstable purchasing power makes cryptocurrencies like Bitcoin a “flawed” method of payment.

            “The recent spike in their prices looks less like a trend and more like a speculative mania — an atmosphere in which one high-profile tweet is enough to trigger a sudden jump in price,” Lane said Wednesday, according to prepared remarks provided to reporters.

            Central banks around the world are trying to get to grips with emerging payment technologies. In addition to cryptocurrencies, private-sector initiatives such as Facebook Inc.’s Libra are adding urgency to the debate over how digital currencies should be handled.

            For years, the Bank of Canada has been analyzing which circumstances might lead Canada to decide to issue a digital currency as a sort of contingency should the need arise. In his speech, Lane said the shift to online activities caused by the pandemic is forcing the central bank to accelerate those efforts.

            Fortunately there are no rules limiting the number of golf balls you can carry during a match!

            Comment


            • #36
              Read that today:

              In 2014, the MIT Digital Economy laboratory conducted an experiment where all incoming MIT undergraduates were given a Bitcoin wallet with $100 worth of Bitcoin. One of their main findings was that 11 percent of the students liquidated their Bitcoin wallets within two weeks of receipt. (would be worth about $10 000 now) . . .
              If you think it's hard to meet new people, try picking up the wrong golf ball.

              Comment


              • #37
                Originally posted by Fore Warned View Post
                From today's Toronto Star.....
                • Toronto Star
                • 11 Feb 2021
                Bank of Canada’s deputy governor called recent cryptocurrency prices ‘speculative mania.’
                A top Bank of Canada official called the recent spike in cryptocurrency prices “speculative mania,” and said such assets don’t have the qualities to become the money of the future.

                In a speech on “payments innovation,” Deputy Gov. Tim Lane said costly verification methods and unstable purchasing power makes cryptocurrencies like Bitcoin a “flawed” method of payment.

                “The recent spike in their prices looks less like a trend and more like a speculative mania — an atmosphere in which one high-profile tweet is enough to trigger a sudden jump in price,” Lane said Wednesday, according to prepared remarks provided to reporters.

                Central banks around the world are trying to get to grips with emerging payment technologies. In addition to cryptocurrencies, private-sector initiatives such as Facebook Inc.’s Libra are adding urgency to the debate over how digital currencies should be handled.

                For years, the Bank of Canada has been analyzing which circumstances might lead Canada to decide to issue a digital currency as a sort of contingency should the need arise. In his speech, Lane said the shift to online activities caused by the pandemic is forcing the central bank to accelerate those efforts.
                He is the same guy who one year ago said the BoC was going to have their own cryptocurrency . . . not sure how that project is going . . .
                If you think it's hard to meet new people, try picking up the wrong golf ball.

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                • #38
                  Things are moving so fast that governments cannot keep up. Regulations cannot keep up.

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                  • #39
                    A government backing a cryptocurrency would defeat its purpose.

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                    • #40
                      Just saw resident genius Elon Musk comment that Bitcoin price seems "high". WTF, he probably sold his bitcoins and reportedly made $1 billion from it. Now he's trying to talk it down. Trying to manipulate the market.

                      Comment


                      • #41
                        cashed out on the first bubble... but have not been paying attention so I'm a little late to the party on the current bubble but I do use Shakepay to buy small amounts. It's more for my own amusement ... only 4 figures worth.

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                        • #42
                          Originally posted by hackerhare View Post
                          Just saw resident genius Elon Musk comment that Bitcoin price seems "high". WTF, he probably sold his bitcoins and reportedly made $1 billion from it. Now he's trying to talk it down. Trying to manipulate the market.
                          When Elon speaks people listen. He just created a buying opportunity.

                          Comment

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