I'll be the first to admit I often miss the boat when it comes to cutting edge ideas. I'll read about them, or at least know enough to carry out a conversation, but I usually get tired of waiting for certain aspects to become more stable or I forget about X until I see it appear in the news a few months later, that kind of thing. It's a bad habit of mine: I don't usually follow through on the latest, greatest ideas until they are, by internet standards at least, mainstream.
Bitcoins fell under that description. I heard about them very early on, but the concept of a "Peer to Peer Currency" sounded ludicrous. It still is ludicrous, if I have to be honest. Backed by nothing, a potential for insane deflation, at least two crashes already...
So, why the sudden interest? Well, I'm bored! Simple as that. The Tested Folding Team has more or less imploded (not sure our marketing campaign of "Punch the shit out of cancer!" did the trick), there's a sort of weird lull in video game releases that I want to play (soon to be cured by BF3 and Skyrim, but not yet!), and I've been doing more and more work which means the vast majority of my computing power is sitting idle instead of being devoted to building troops to take over feudal Japan. Also, in a strange twist, AMD is ahead of the game when in comes to this implementation of that GPGPU stuff, and my two 6950s are actually quite good at it (I'm pulling 600 Mhash/s! Whatever that means!).
But, as in all things, I seem to have missed the boat. I'm not 100% sure how it works, but Bitcoins used to be a lot easier to get. A few intrepid souls have already made some posts here explaining how it works and the general idea behind it, so I won't get into it. The easiest description I can come up with is folding for money, with a catch: the more people mining for Bitcoins, the harder it is to...mine them, I guess.
Let me put it into perspective: The first, earliest and therefore easiest to mine BitCoins had a difficulty rating of 1 (one what? Not sure. Just consider it the base of this scale), and the entire network was humming along at slow 7 Mhash/s. As more people hopped on, the difficulty starting going up, but so did the network speed. Everything was working as designed. Around last July, something happened: the speed of the networked spiked. All of a sudden, BitCoins went from a difficulty of 45 or so, to around 140. By the end of October, it hit 3,100. Sometime in April of this year, it hit the 100,000 mark.
Now we're sitting at a difficulty of 1.75 million.
What does that mean, in practice? Well, for one thing, you can't really mine coins alone and expect to make any money. The entirety of the BitCoin network used to run at a speed that was 100 times slower then my machine. Now it runs at 12.7 Thash/s (Yeah, tera-hashes). But there's a bigger, underlying problem: if you hopped on early, you're sitting on a mountain of coins. Since each block (the actual thing you are working on) is worth 50 coins, and it used to be a more or less trivial thing to do a few blocks a day, you've got people sitting on piles of coins.
And then you have those, like me, who are now working for fractions of a coin. I think we need to unionize, or something.
So, why bother? Well, for one thing I was challenged by a friend to buy this badge (which costs one coin and only accepts BitCoins). Seeing as I'm sitting on a whole... 0.0624258406 of a Bitcoin, it may take a little while. Then again, I've only been doing this for about three hours, so who knows. I'd also like to see what I can really get with my
money generated from wasted electricity hard earned coins, as that neat little "What's a BitCoin?" video tells me I can get video games and...I don't know, maybe a pie out of the deal. (New idea: economy based around pies.)
So, question time: Has anyone bothered to give BitCoins a serious look? Has anyone actually bought something with their Coins? Does anyone want to help me work out the deflation issues in my pie-based economy?