[Chugalug] Bitcoins: It's all about cash, that is, the real stuff

James Nylen jnylen at gmail.com
Thu Sep 5 00:05:20 UTC 2013


Mike,

I can't speak to what you said about "getting suckered" - you and I simply
have a difference of opinion there.  I'd advise people to steer clear of
the

However, your point about there being a "private key" to the Bitcoin
"puzzle" is factually incorrect.  Here, it may be helpful to have some
background on the algorithm used to create new bitcoins.  Bitcoin relies on
a chain/tree of repeated SHA-256 hashes, and the "difficult" part of the
"mining" process is finding a string which, when hashed by SHA-256, yields
the required number of zero bits at the beginning of the hash.  (This is
very different from the algorithms underlying public/private key
cryptography.)

The only *known* way to create new bitcoins is to do a brute-force search
over the solution space.  There are several known ways in which Bitcoin
could be broken or subverted:
 - A single entity controlling >50% of the network's total hashing power -
they would still be obeying the cryptographic rules in place, but they
would have some measure of control over which transactions are approved.
 - An attacker finding a flaw in the SHA-256 algorithm, which would enable
them to gain a significant advantage in terms of earning new bitcoins.

Much more intelligent people than I have taken apart the Bitcoin algorithms
(after all, it's all open-source), and to my knowledge, these are the only
significant vulnerabilities of Bitcoin that have not already been addressed
in software updates.  The first is being watched closely (for example,
https://blockchain.info/pools).  I'm not sure what consequences the second
would have, but the SHA-256 / SHA-2 algorithm has been around for a long
time without showing signs of cracking.


On Wed, Sep 4, 2013 at 12:23 AM, Mike Robinson <miker at sundialservices.com>wrote:

> Now, mining has largely become a matter of getting your hands on the newest
> miners [[ early enough to generate a profit (barring another bubble). ]]
> There
> are [[ very few ]] [[ technical ]] barriers to mining other than cash.
> Right now, that
> requires a minimum $5K [[ investment ]] and [[ may ]] not deliver returns
> [[ any time soon
> (if at all). ]] [[ That is, barring another bubble. ]]
>
>
> "There are none so blind as those who will not see."
>
> YES, "there are NO technical barriers to 'mining.'"  Other than the O-N-E
> ... T-H-I-N-G ... that actually matters to the clever mathematicians who
> conceived of it:
>
> UNITED STATES DOLLARS.
>
> You're paying $5,000 USD for "a magical money machine," and it's
> S-L-O-W-L-Y dawning on you that the words which I have enclosed in [[
> double brackets ]] can be omitted entirely from these sentences.
>
> You're being very cleverly suckered.  It's as simple as that.  And, you're
> pouring serious money ( >= $5000 USD ) into "the same damn con" that has
> been foisted upon "clever, smart" (sic) people, well, since time began.
>
> "Public-key cryptography" is designed around a truly-intractable (so far
> as we know ...) mathematical problem. Whereas "bitcoin" is designed around
> a =difficult= problem (at least, "difficult" in the way that all of you
> have been taught to approach it ...), yet "not so difficult that it cannot
> be, by sheer brute force, periodically solved."  A quarter has to drop out
> of the one-armed bandit now and then, just to keep the suckers going.
>  Obviously, there IS a "private key" to this puzzle, and, equally
> obviously, you don't have it.  All of this is plenty good enough to enable
> people to sell you(!) these mathematical one-armed bandits for $5,000 USD a
> pop.
>
> There is no "bubble."  There is only:  "sucker."
>
> " ... and two to take him."
>
>
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