[ale] [OT] (but computer and cryptography related) Bitcoin, Litecoin

[Ron Frazier (ALE)]

Hi all,

Does anyone here have any personal knowledge of Bitcoin or Litecoin?

If you don't know what that is, see:

http://en.wikipedia.org/wiki/Bitcoin
http://en.wikipedia.org/wiki/Digital_currency

By the way, the treasury department recently issued a ruling that this is legal.  So that's not an issue.

Essentially, it's a digital currency that is created by having your computer do a certain amount of provable, not easily fakeable, work in calculating cryptographic algorithms.  After a certain amount of time, which may be days or months, you solve a certain cryptographic problem.  Your work is verified, then you get some digital currency, either Bitcoins, or Litecoins.  These are digital encrypted files that only you possess.  These can be traded for real USD on certain exchanges, and in some cases, can be traded directly for merchandise.

You can use Bitcoins and Litecoins without creating them by buying and selling them on the exchanges.

However, I'm interested in mining (creating) Bitcoins or Litecoins using my computer and its GPU.

Here is my understanding from my reading.

Bitcoins are currently trading for about $ 80 / BTC.  They are very hard to create, and may take months.  It is doubtful whether you can make more than the electricity costs, unless the BTC increase in value later.  They have increased in value from about $ 1 a few years ago, to $ 80 now.  However, the mining / coin creation algorithm continually gets harder to keep the rate of coin production constant.  Apparently, application specific integrated circuits (ASIC's) will shortly com onto the market which will make doing this work with CPU / GPU nearly impossible.

Litecoins are designed similarly.  However, they use an algorithm which is more conducive to CPU / GPU computations and harder to do, for example, on an ASIC.  This makes them, at least at the moment, more feasible to be mined by individuals without tens of thousands of dollars of equipment and without a $ 1000 / month electric bill.  Litecoins are trading at around $ 1 / LTC.

So, I'm considering doing some Litecoin mining.  I'm wondering if anyone has tried it or knows anything about it.

Sincerely,

Ron



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Ron Frazier
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