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Comment by slacka | Hacker News Reader

As someone who lost over 100 bitcoins in a sketchy mining pool, for the love of god, please be careful. I was in early on this madness, and dedicated my gaming rig for a couple of years. Basically forgot about it, until one day I went to move my coins only to find the site just a Cloudflare mirror. Learn from my mistakes and be careful.

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How did you lose money in a mining pool? Hopped in a cloudmining scam?

Mining pools don't store funds, you tell them your payout address.

I seem to remember that in some pools you had to initiate a payout to your wallet through the pool website. Payouts weren't automatic.

They used his machine for mining over the years but never paid?

Not all pool software was, or even still is so enlightened.

They used to store funds.

In the early days, I fairly sure you had to manually request a payout. Even when automatic payouts were added, the default thresholds to trigger a payment were at what would now be a fairly significant amount.

eh, just 100 bitcoins (stop whining, back then).... $800K today. Damn!

It's still the wild, wild west in that world. Those few that saw it 6-7 years ago, made bets that were relatively small, sorta buying lottery tickets. It takes a lot of "faith," for a lack of better term to invest serious money now.

It's not quite that simple. I sold 5 BTC at the $32 peak and felt smart. It crashed right after, and I paid a phone bill.

The temptation to sell was far stronger in the early days, mostly because people were unprepared for the sheer volatility of BTC. It's been the most lucrative tulip farm in history, and unlike tulips BTC is useful. It's hard to know where it will top out.

How is bitcoin useful? Other coins do exactly the same thing with faster transactions, more anonymity, and lower fees.

the same applies to the dollar, which is useful, only not the cheapest, fastest or most anonymous...

So they are useful too?

Network effect. Try buying MDMA online with Dogecoin.

Liquidity is the most important property of the cryptocurrency. Faster transactions, anonymity or lower fees hardly matter if there are no places where I can spend the currency. Or if I sell services with it, there are no customers willing to pay.

It is a huge chicken-and-egg problem, but looks like Bitcoin has solved it at least some level, since it is accepted on quite many places. We might start seeing services and merchants adopting other cryptocurrencies as well, but currently those alternatives don't seem that widely adopted.

There's a ton more infrastructure behind Bitcoin, like ATMs, hardware wallets, point-of-sale systems, exchanges, and more physical and online stores accept it.

And the ability for cryptocurrencies to evolve and update over time means that the network effect could be the single largest factor in determining it's worth.

I'm interested to see how this will evolve.

Right now you can use bitcoin's network effects to some degree with altcoins. eg. You use xmr.to to buy anything that you can buy with bitcoin with Monero.

This is a band-aid of sorts for the time being but I don't see why services that currently allow you to use bitcoin could not upgrade to include a better currency/currencies?

Well, the security of a cryptocurrency (assuming Proof-of-work based) comes from the total amount of work that has happened in the chain since your transaction.

Because of that, the largest cryptocurrencies with the most work behind them will naturally be the most secure the quickest.

Monero might have some very good benefits, but the much smaller size of the network means it's a magnitude easier to attack from a state level adversary.

And the fact that Bitcoin can (and will) evolve over time means that the benefits from other cryptocurrencies can be put into Bitcoin as they become useful or proven.

This is already happening with Bitcoin, and it's not going to stop.

That being said, I don't think that other cryptocurrencies are pointless, and I do believe that they can continue to happily coexist. Ethereum is focused on the "smart contract" side of things. Monero is focused on privacy. They can all have their uses and specializations, and they can all exist together in the same ecosystem.

Even if Bitcoin ends up not being able to adapt and evolve for whatever reason, being a "store of value", your cryptocurrency savings account, is still a valid use case, and can continue to be one even if there are cryptocurrencies that do everything else objectively better.

Bitcoin radically gimped their VM at the start, destroying the inherent value of the coin.

BTC is going to die to a gen 3 VM that learns from the ETH mess of gen 2 and just ungimps the BTC VM.

I don't believe BTC has the political leadership to fix that poor decision, given that a) they've demonstrated poor leadership until now and b) some of the people involved in the gimping are still in positions of influence.

What do you want to do with BTC scripts that you can't do now? P2SH lets you use arbitrary scripts, at least.

Maybe they do.

I can't find a single reference on them that contains actual details on the computational model because the internet is full of vapid circular search bait, particularly about cryptocurrencies.

The last I checked, the BTC VM disabled most useful opcodes, which meant you couldn't actually make money automatically redeemable for a large number of constraints you would want to impose.

My quick search seems to support that the VM still disables many opcodes: https://en.bitcoin.it/wiki/Script

I only count 15 "disabled" opcodes on that chart, the majority are usable in P2SH transactions.

What specifically would you like to see done with Bitcoin scripts that can't be done?

3-SAT solution verifiers, and modest extensions to other kinds of problem spaces.

How do you verify 3-SAT? Just plug in the values and check if it evaluates to TRUE? I assume the idea is to pay people to solve NP-hard problems via TX's, which is a kinda neat idea imo.

It's just asking if many 3 term clauses ANDed together are true for a given input set, so you'd give the inputs to spend it to your wallet. Automatic bounties on optimization (sub)problems, yep.

For various reasons, you probably want to use arithmetic and string operations for encoding certain problens. You could do it in bit operations, but efficiency.

I can't take credit for it -- it's one of those things that was floating around as a usage early on, but the features were killed.

Which features? Looks like (arithmetic, not bitwise) AND/OR/NOT are supported, I'm not an expert but it seems like this could be do-able. I'll have to think about this more maybe I'm missing something.

I disagree. I don’t want to play the smartass, but I’ve been into Bitcoin since late 2012 and I just started to sell very recently, when a small investment (low 4 figures) and some lucky events like particiating in early ICOs (for ex. Ethereum in August 2014)became a life changing amount of money (high 7 figures).

This is not entirely true because I sold a little (very little) in November 2013 just to be able to “touch” those paper profits. I needed to see they were real and could impact my life. Anyhow 95% of my stash remained untouched until very recently.

The rationale for me was crystal clear: this technology has the potential to change the world forever (yes, I’m a true believer). This shit can be the biggest revolution since the internet. Sure, it can go to 0, but the downside is clear: I could just lose everything that i invested, which definitely was money I could comfortably afford to lose. On the contrary the potential upside is enormous, 1 dollar could easy become 10k.

Therefore I simply decided I was not going to sell unless I could comfortably retire on the profits. And that I would leave a little btc for my kids, no matter what.

I really can’t understand how anyone could buy Bitcoin early on with a different mindset.

I bought at $4 with the knowledge that it could hit $50k a coin in a relatively short period. But I sold most of it anyway. In my mind the odds of bitcoin being banned go up every day. People on HN underestimate how much we rely on the financial system to enforce regulations. Governments are not going to just give that up. It’s lasted longer than I though it would, and it might last forever if there is a way to get regulators involved, but 7 years ago I estimated that at 5% odds.

But the thing about Bitcoin is that it’s made to be censorship-resistant. It is resilient. If you read Satoshi’s posts on Bitcointalk he simply assumed Bitcoin would have been banned at some point, and that’s why he made the design choices he made. Bitcoin is designed not only to survive but to thrive in an adversarial environment.

But then, even if a government ban could really destroy Bitcoin (i’m certain it wouldn’t, I remind you that Russia banned it for a while and 0 fucks were given... what about sharing films on Bittorent? Did the ban do something?) you say there’s a 5% chance the ban will not happen.

I will take any day a bet that gives me a 5% chance that every dollar i bet becomes $10k. And I won’t exit that bet unless i’ve made enough money to retire comfortably, which is what is happening to me now.

Unlike websites governments can do a 51% attack on Bitcoin which would 'kill' it in weeks.

No, they can’t. And even if they could the network would just fork to a different hashing algorithm, which means that the attacker would have had burnt hundreds, if not thosaunds, of millions for nothing.

China can take console of all of their miners in the country which would all for a 51% attack to be profitable ignoring opportunity costs.

In this case forking does not help as they maintain control of the equipment and have access to massive CPU and GPU resources to swap to alternative architectures.

Now, if you think bitcoin maintains value if there are zero transactions for ~6+ months you are clearly mistaken.

Never underestimate what a government can do. If they want, they can make bitcoin as popular to hold as child p//n on your PC. Go ahead then

A few of us in my office bought several years ago. It went up 50% and then dropped dramatically. We've talked about how seeing it drop and then forgetting about it for a few years probably stopped us from bailing whenever it's peaked and trough-ed since.

eh, i sold my 250btc at the hugely inflated price of $20, made out like a bandit i did (bought at $4)! even got my cash out of mtgox before it imploded. a regular uncle moneybags i am!

I sold a fair number of bitcoin early on (30-50 IIRC) for a few dollars a piece. I feel like it was the right call at the time (paid for a new graphics card and a few nights out, and a few economics students with whom I was friends and I expected it to bubble and crash completely -- which it mostly did, then has repeatedly rallied after that), but the feeling of "What could have been" comes on every now and again.

Edit: found my Gox emails - it was in June 2012.

For what its worth, if you tried to cash out $800k today I think it would take some time to clear. The paper value of Bitcoins is grossly inflated over the actual market cap. It's a natural reaction to the inherently deflationary nature of the currency, everybody wants to hold on to them because they're only going up! This restricts supply and causes the prices to go up even more. Unless you can buy goods and services (more than drugs and burritos) with Bitcoin directly the wealth is a fantasy.

You can clear that much Bitcoin in five minutes with maybe 5% slippage, or in a day with close to 0% slippage.

I’ve never cleared that amount of money on an exchange. For ~1M and above you use OTC a brokers. You have brokers in the US that can transfer you $20M per day without impacting the market in the short term. That’s how big ICOs liquidate their crypto millions.

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