General Consultant Discussion

So I was thinking on my long drive to work...I know...dangerous. So my understanding is that Bitcoin is managed via users running 'specialized' hardware to process transactions and they get a small fee for this. I've also read that the new AMD Vega graphics cards are really good at this and the concern is you will have a hard time buying one for video games because of all the bitcoin miners wanting them. If making money bitcoin is about having computational power then... 1) Why doesn't someone create a virus that does nothing more than grab GPU & CPU cycles from infected computers. In essence having a free mining operation? Remember that screensaver years ago that used to analyze SETI data looking for patters of intelligent life or another that computed genome results? Same concept but without permission. 2) We know that hardware gets faster and faster (Moore's law) so isn't a career as a bitcoin miner going to be short lived?

From a hardware standpoint - it is my understanding that the new coins get exponentially harder to find. From a laymen's perspective, I believe it has to do with discovering prime numbers in some sort of way. Ie., 1,3,5,7,13 are really easy to find without much computing power - but the 10th billion prime number is much harder to find and require exponentially more processing to find that ""next coin"". From my understanding - this will keep the value of bit coin in check with the growth in computing power. Keep in mind that my information comes from a 19 year old gamer that was trying to convince everyone that mining was a career.

Did SETI ever find anything?

I believe the term miner is a misnomer. I believe the amount of new currency is fixed by the algorithm and is halved each year and will eventually stop. At that point, people can then 'split' the currency, like stock, to make transactions more manageable. This avoids 'hyperinflation'. As crazy as it sounds, it would work miracles if our country ran on it because the ability to 'print' money is what is sending us on the road to doom. (Just look at Venezuela) I believe the miners are validating and moving the transactions around, but its not like some guy wakes up in the morning and says 'look, i Just found a coin, I'm $1,300 richer!'. If that were the case, I'd think you'd see this mad dash of AWS and every one elses hardware being crushed as people look to mine more and thus the value would drop and faith would be lost. They don't actually 'mine' more currency, they are really just electronic transfer agents. Sort of like how peer to peer file sharing works, where everyone's machine makes the transfers faster, but the original content only came from one place. In the case of bitcoin, that one place is a fixed algorithm with a fixed amount of new coins per year and that amount halves each year until zero.

So what is the craze for the gamers to use video processor and such to ""mine"" coins. It was my understanding that they were $1,300 richer when they found one but it is substantial effort to find them. https://www.bitcoinmining.com/getting-started/

You can probably make more money, grabbing a pick ax and starting to dig for gold in your back yard lol

Actually, I think you are right. The number of coins are fixed, and they are purposely made difficult to find, but if you find one you get the money. However, even with these new Vega cards, it can take years. Thus for a mere mortal, you can on average make $1.50/day and that doesn't take into account the electricity costs. This revenue goes down each time a new coin has found, so the 'mining' side of this is becoming irrelevant unless you have a massive data center with little to do with it, and the transaction fees side is the only way to make anything.