What should I be reading to keep on top of bitcoins?
July 1, 2013 12:34 PM   Subscribe

I found myself with an unexpected couple hundred dollars, and have decided to do something I would never usually do: jump on a bandwagon that is fully in motion, namely, bitcoins.

I ordered a bitcoin miner, which is nothing more than a small, specialized computer that does nothing but crunch the numbers required to find the bitcoins hidden within.

It's backordered, so it's going to take a while to get to me. In the meantime what are the best sites should I be following in order to get a sense of what's happening with the market?

(I also have some general learning to be done w/r/t the currency in general before I start mining, so if you have anything super useful/fun/interesting to share along those lines, please do!)
posted by o2b to Work & Money (15 answers total) 7 users marked this as a favorite
I know this isn't directly addressing your question, but that was honestly a bad move.

I was in the same situation as you and had the same thoughts. I talked to several people i know who are either involved in bitcoin, or are just brainy when it comes to this kind of stuff and have been following it.

Every single one of them told me to stay the hell away because the combination of inflation and the value kinda fluctuating downwards after stabilizing since the crash, and that because of that you'd at most barely break even on your the hardware you buy. And at least one of these guys was previously all for it and into it.

You look at the numbers of "oh, it can generated this much a month. it'll pay itself off in a few weeks!"

No. Those were my thoughts too and they were repeatedly dashed.

It might seem conspiracy theory-ish, but the entire thing is a bit of a pyramid scheme. The ASIC miners are backordered because the people who designed them, and their buddies involved in the whole thing wanted a big headstart before the difficulty rate was raised. There's very little fun or gain to be had on the bottom of the totem pole here. The era of guys mining, trading, and buying in and then cashing out in 12 months to get a porsche for the $1000 they invested(or less!) isn't coming back. You're not "outsmarting the pundits and naysayers" here.

Sorry for not directly addressing any of your talking points, but i really wanted to warn you there. This is something i was really excited about that i've flipped to wincing whenever i see someone else with the same enthusiasm. The "golden age" of this has passed.

I have a feeling it may be an interesting way to anonymously store or send money in the future, but as an investment vehicle or general money generating method i think it's fucked at this point.
posted by emptythought at 12:48 PM on July 1, 2013 [22 favorites]

By the time you get the hardware, the difficulty will have risen to such a point that it will cost you more in electricity that you will gain in mining.

If you believe that bitcoin will increase in value, then buy some bitcoins instead.

The ecosystem is fascinating, and something awesome's going to come out of it, but not necessarily bitcoin.
posted by Leon at 12:57 PM on July 1, 2013 [1 favorite]

Mod note: OK, folks, at this point the premise has been challenged. From here on out please answer the question or at least provide references.
posted by restless_nomad (staff) at 1:10 PM on July 1, 2013

Stuff You Should Know recently had a How Bitcoin Works podcast which was very informative. It isn't totally accurate, but it is definitely easier to digest than the Wikipedia page. It covers both mining and speculation, and you should definitely be aware of the big difference between the two concepts.
posted by A god with hooves, a god with horns at 1:17 PM on July 1, 2013 [1 favorite]

Best answer: For bitcoin news, the bitcoin subreddit is decent.

Most people trade at Mt. Gox, but I prefer CampBX - it's in the US, has lower fees and more trading options than Gox, and is very good about complying with regulation. The downside is that the site is often slow, and the volume is smaller (although this only really matters for big traders).

Another noteworthy site is BTC-e, which is an exchange that works with multiple cryptocurrencies such as Litecoins and Namecoins. You can day-trade here if you have the time and attention span. It's in Russia, though, and you might have no recourse if they just disappear, so don't keep a lot of coins there unless you are actively trading them.
posted by Earl the Polliwog at 1:17 PM on July 1, 2013

Best answer: I was going to be a smart ass and say a ouiji board, because...bitcoin. *snerk* Okay, that's out of my system.

Here's a market site for Bitcoin. This shows you the trading prices, etc for the 'currency'.

It has charts, graphs and links to news items.
posted by Ruthless Bunny at 1:18 PM on July 1, 2013

The SA Bitcoin Thread will offer a more... Skeptical... take on Bitcoin news
posted by Benjy at 1:40 PM on July 1, 2013 [2 favorites]

Response by poster: Yes, I recognize this is a volatile market that has a very pyramid-y flavor to it.

I'm in it to learn and for fun! (Thanks for caring though :)
posted by o2b at 1:48 PM on July 1, 2013

Hey, make sure you have an exit strategy! Mine was originally going to be an iPhone case, but BTC store seemed to be out of anything. I ended up spending the equivalent of $40 on two tiny mediocre boxes of baklava. So no matter what anybody says about volatility and bubbles, that wasn't a good deal for baklava. But it was either that or... stickers.
posted by oceanjesse at 2:06 PM on July 1, 2013 [1 favorite]

Also if your ordered from BFL you are literally never getting your miner.
posted by Benjy at 2:19 PM on July 1, 2013 [2 favorites]

If you're on Google+, check out +BTC News Net, which is an aggregator of BTC news.

If I were you, I'd also research Mining Pools; it's very challenging, even with a dedicated machine, to hit that hashing jackpot by yourself, but with low fees it's possible to contribute your gigahashes to a mining pool and collect a reward proportional to your contribution. It's more like a steady income (and will help you with your cost/benefit analysis for operating the miner). I would not let your BTCs build up in the pool, though-- withdraw on a regular basis, and consider operating multiple wallets; you know what they say about eggs in a single basket.

Along those same lines, remember that it could all go away at some point, so insofar as you are able to control things, don't put into BTC what you can't afford to lose.
posted by Sunburnt at 2:44 PM on July 1, 2013 [1 favorite]

If you're in it for learning, the original bitcoin paper's the best description of proof-of-work I've seen. And I liked this O'Reilly essay, which hammers home the "protocol, not currency" point.
posted by Leon at 4:54 PM on July 1, 2013 [1 favorite]

This might be of interest - How a total n00b mined $700 in bitcoins.
posted by shoesfullofdust at 5:11 PM on July 1, 2013

There's a real time MtGox trade tracker at http://bitcoin.clarkmoody.com/.
posted by flabdablet at 10:37 PM on July 1, 2013

Some information here:
“It is remarkable that 97% of all owners had fewer than 10 transactions each, while 75 owners use the network very often and are affiliated with at least 5,000 transactions.”
posted by iviken at 2:10 PM on July 2, 2013 [1 favorite]

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