Poor man's bitcoin mining
September 29, 2014 12:40 PM   Subscribe

So you wanna join this bitcoin thing but can't afford the processing cycles to actually mine stuff? Now you can earn bitcoins using pencil and paper!
posted by Foci for Analysis (25 comments total) 11 users marked this as a favorite
 
I look forward to some enterprising folks mining bitcoins by hand, etching the private keys onto a piece of birchbark, and selling them at their local farmer's market.
posted by prize bull octorok at 12:49 PM on September 29, 2014 [12 favorites]


Though there's been a run on graph paper, the Office Depots and Staples assure us that more is coming every day. Some entrepreneurs are also putting out bespoke product with smaller and smaller grids, which should increase ROI per pencil.
posted by a lungful of dragon at 12:55 PM on September 29, 2014 [6 favorites]


I want a typewriter artist to draw a portrait of someone mining bitcoins via the pencil and paper method. Whereby I will embroider it onto a sheet of clean white linen made by the old methods and hang it on our wall with the title

"Scientist-Hipster: The Meta Is Strong With This One"
posted by RolandOfEld at 12:55 PM on September 29, 2014 [2 favorites]


Anybody want to get a human computing club together?
posted by Confess, Fletch at 1:01 PM on September 29, 2014


Training doge to mine dogecoin with paws. But all they do is write the Complete Works of Shakespeare. Stupid doge.
posted by fallingbadgers at 1:13 PM on September 29, 2014 [12 favorites]


I have tried to understand wtf bitcoins are but I just...can't. Anyone?
posted by SpecialSpaghettiBowl at 1:23 PM on September 29, 2014 [1 favorite]


Hash results deliverable per IETF RFC 1149.
posted by charlie don't surf at 1:35 PM on September 29, 2014 [2 favorites]


I'm not sure either, but from the article it sounds an awful lot like rerolling a roleplaying character until you get all the stats maxed out.
posted by Earthtopus at 1:36 PM on September 29, 2014 [4 favorites]


Now how many monkeys with typewriters would it take?
posted by T.D. Strange at 1:37 PM on September 29, 2014


I like to tell people that they're the internet's version of Franklin Mint commemorative coins.
posted by xbonesgt at 1:37 PM on September 29, 2014 [5 favorites]


The only problem with that, xbonesgt, is that Franklin Mint commemorative coins are at least composed of physical matter which has a non-zero value.
posted by truex at 1:55 PM on September 29, 2014


I have tried to understand wtf bitcoins are but I just...can't. Anyone?

Bitcoins are basically a public ledger of who owns what.
If the ledger says you own ten whatzits, then that means everyone agrees that you own ten whatzits. If you want to give five of them to me, then you tell the ledger (the public) that I now own five of your whatzits, we get some people to act as witnesses and update the ledger, and now I have five whatzits because the ledger says that I do, which means that everyone agrees that I have five whatzits.

So instead of offering you my gold coin, and you needing to bite the coin with your teeth to check that it's real gold, these days you bite the coin by looking in the ledger, and the ledger confirms for you that the (virtual) coin I'm offering is officially mine to offer you.
posted by anonymisc at 2:28 PM on September 29, 2014 [3 favorites]


I'm not sure either, but from the article it sounds an awful lot like rerolling a roleplaying character until you get all the stats maxed out.

Basically the value of bitcoin is that it produces a trust-free, distributed transaction tracking system.

The 'blockchain' is essentially a gigantic public ledger.

The ledger is essentially a list of account numbers (wallets) and how many coins each holds, and every transaction that has ever happened between wallets.

The computers on the network all have a copy of this ledger.

When someone wants to spend a bitcoin, they make an announcement to the bitcoin network that a certain wallet has sent coins to another wallet -- that's confirmed with fairly typical public key encryption techniques.

What happens next is what makes bitcoin what it is -- all of the computers on the network compete to be the one that officially adds the transaction to the ledger. They do this by combining it with a random number, and running it through a hashing algorithm, which is essentially a way to mix up the bits in the transaction. The key thing about a hash is that it's one directional -- it's simple to take a number and hash it, but hard (essentially impossible) to take the result and get to the original numbers. What everyone is competing to do is find the random number that you need to mix with the transaction to get a hash that starts with a certain number of 0s. The amount of 0s it needs is the current difficulty of the network, which increases as the network gets larger.

When they find it, they announce it to everyone else, and the other computers can confirm it quickly, and add it to their own ledgers. The computer that finds it gets free bitcoins -- that's what bitcoin mining is.

The reason they do all this is to prevent people from double-spending. Once the first transaction goes through and is confirmed, then it would essentially be impossible to spend that money again, short of building a super-computer more powerful than 50% of the network.

The price of a bitcoin tends to very closely track the cost of mining a bitcoin in terms of electricity and computer costs, and the value provided to people by the bitcoin network is the value of providing a decentralized means of transferring some value around.

What a bitcoin is really 'worth' is clearly a matter of some debate, but as long as people are willing to pay something for them and there are relatively fluid markets for exchanging bitcoins for money, there is clearly some value to the bitcoin network.

I have absolutely no idea what it will be long term, though.
posted by empath at 2:36 PM on September 29, 2014 [9 favorites]


Great news! All those of you with longhand bitcoin mining talents, do it for me using your own resources and give me the proceeds and you'll get exposure or whatever. You could put it in your portfolio that you did pencil-and-paper bitcoin mining for me, the world's biggest bitcoin millionaire. It will have a sort of arts festival feel.
posted by turbid dahlia at 2:46 PM on September 29, 2014 [2 favorites]


What happens next is what makes bitcoin what it is -- all of the computers on the network compete to be the one that officially adds the transaction to the ledger

I guess I'm just not blessed with enough (any?) engineering-type brain cells, but this sounds a lot like spec-work in the creative fields. What about all of the time, electricity and whatnot spent by those who don't generate the bitcoin? Are they SOL? Also, where can you actually spend a bitcoin?

I am so sorry for being dense andI appreciate those of you who are taking the time to explain. I do want to grasp this.
posted by SpecialSpaghettiBowl at 3:32 PM on September 29, 2014


The electricity turns into waste heat. Advocates say that it's the price to be paid for having a operating transaction network, and it is true that those paying for the electricity are doing it because they're earning a profit (or suitably satisfying some other desire, I suppose). The profit comes from the distribution of new bitcoins that are awarded when a computer solves the right problem at the right time. Bitcoins can be spent at Newegg, Dell, and Overstock.com, for example, as well as other smaller online sites, restaurants, shops, etc.
posted by Mapes at 3:49 PM on September 29, 2014


Paypal also accepts bitcoins nowadays.
posted by I-baLL at 4:12 PM on September 29, 2014


SpecialSpaghettiBowl, the part that makes it different from spec work is that the miner who finds the random value to add the transaction(s) to the ledger receives 25 BTC in payment. This reward will reduce over time, halving every 210,000 blocks.
posted by autopilot at 4:19 PM on September 29, 2014


Boy, people are turning to some desperate measures now that Butterfly Labs has been shut down.
posted by tonycpsu at 5:05 PM on September 29, 2014


I guess I'm just not blessed with enough (any?) engineering-type brain cells, but this sounds a lot like spec-work in the creative fields. What about all of the time, electricity and whatnot spent by those who don't generate the bitcoin? Are they SOL? Also, where can you actually spend a bitcoin?


People join pools to spread the risk. There are ways to distribute hashes to a large group of computers, so that there is less duplication of effort, and the bitcoins are spread out based on how many hashes you checked, whether you succeeded or failed.

As far as where to spend them, you can just sell them-- that's what most of the big miners do-- or you can use them to buy stuff at places like overstock, or whatever.

The best reason to buy them is because you need them for something, imo. If you live in a country whose currency is about to collapse, or you want to send money to someone without using a credit card, or whatever. Speculating in them is a suckers game, though.
posted by empath at 6:22 PM on September 29, 2014 [1 favorite]


"I have tried to understand wtf bitcoins are but I just...can't. Anyone?"

Half ponzi-scheme, half racket, really. Very similar to fiat currencies, in that respect.

Any other questions?!
posted by markkraft at 6:27 PM on September 29, 2014


What's the value of bitcoin now compared to the last thread we had about them?
posted by sevenyearlurk at 7:21 PM on September 29, 2014


Less. (The price has been downward trending for about 3 months.)
posted by anonymisc at 9:06 PM on September 29, 2014 [1 favorite]


Depends on the thread, it was at $1250 at its height. Its now like $380.
posted by Iax at 9:24 PM on September 29, 2014


"I have tried to understand wtf bitcoins are but I just...can't. Anyone?"

The best definition I've seen was posted to MeFi last year.
posted by TrialByMedia at 4:05 AM on September 30, 2014 [1 favorite]


« Older ATCSCC ADVZY 020 DCC/ZAU 09/26/2014 ZAU GROUND...   |   The Tylenol Murders of 1982 Newer »


This thread has been archived and is closed to new comments