7 Feb 2014

Mining BitCoins

Inspired by the hype, I decided to put extra PCs sitting in my garage to better use. Let’s mine some bitcoins. It wasn’t as easy as signing up with your twitter account on iPhone but it wasn’t that difficult either. There are easy downloadable apps (GUI miner) from sketch looking forums that still run a beta geek look. You can also sign up in equally scary mining pool (e.g. slush) to share your compute. You can also download your graphic card SDK to allow the mining software run cycles on your GPU. For some reason GPU works better then big bro CPU when it comes to mining moolha. There are websites that give you a shareable key as your account conduit locked with your super long private key. And then you can swap those funds to your online locker (huh bank account) or a private wallet hidden in your Mac.

All this took me good one hour to figure out but if BTC sticks these interfaces would improve. On the other hand the command line like look does appeal to inner geek :-)

That said , the real reason for this post is to dwell a bit into the nature and history of currency.

Currency is actually a promise. An agreement that ensures value. The dollar note that you hold in your shirt pocket is a guarantee of reserve bank to provide you equivalent value. Now who can make that promise? Someone or something that holds the power. When you believe in paper issued by a central bank, you are actually believing in the power of a national government. Hence “power” is the currency NOT the dollar bill. In other words, the promise comes from the power of a nation, the dollar bill is just a mean to communicate that.

Long before governments started issuing the notes, the currency was Gold and it stemmed its promise from the desire. Everyone wanted gold for it was the best inert metal then known to man. And it took substantial effort to mine/ make gold. Hard work and properties make gold desirable and hence its charm assures the value.

Thus we moved from desirability to organized power. In essence power can dictate you to love paper more than Gold.

With bit coin, we are at the cusp of third major transition. Bitcoin stems its promise from compute. More computing resources means more money. Which means mankind has stated recognizing compute capacity ever more valuable than organized power. Which also means that we are moving from desire and power to a knowledge based intelligent species.

We are NOT there yet (:-

Update 07/14/2017 Cryto currencies have stuck. There was a brief down period post mount an attack on Mount Gox, but that too showed the resilience of crypto community. The investors interest peaked in 2015 with lot more VCs and ISVs understanding the the potential of block chain (the underlying technology of bitcoin).
Ethereum is a new platform for smart contracts. A very innovative implementation of generalized blockchain. I ill getting my head around am it. Installed the Ethereum Wallet today on on mint. its called mist. .