4 ms·
While the video does look great, I'm afraid I still do not know how real-world value is attached to BTCs--it seems as if a 'step' is messing in the 'how it work
by pero 16y ago
While the video does look great, I'm afraid I still do not know how real-world value is attached to BTCs--it seems as if a 'step' is messing in the 'how it works' explanation.
I'm assuming that was the major desired end-result of this video; if it wasn't, it was the question I was hoping most to get answered.
- kiba 16y agoSupply and demand. On the supply side, it's limited to 21 million bitcoin forever. Demand is supported by people who accepts bitcoin. Currently, the price is around 0.80 USD per bitcoin. It used to be only 5 cents per bitcoin.
- kiboshas 16y agoThat price is fake, because the market has no meaningful depth. A single $50,000 transaction would drop the price back to near zero.
- pero 16y agoAnd the ones who own the initial supply are the ones cranking out the solutions to the problems?
- kiba 16y agoYes. Those who solved a problem get to send 50 BTC + transaction fees to himself.
- joelthelion 16y agoYes. Note that solving the problems is useful to the whole network: it records transactions and secures the network.
- pero 16y agoWhat's being solved are not just abstract mathematical problems, but equations that have implications on the whole system?
- sgornick 16y agoThe "equation" is a simple cryptographic hash performed on a block of data, as described earlier in this thread: http://news.ycombinator.com/item?id=2358396 http://news.ycombinator.com/item?id=2358396 The equation itself is trivial -- it can be calculated hundreds of thousands of times a second by even a really slow CPU. An artificially set difficulty is implemented and the result is that only one of those attempts across the entire network will succeed in about ten minutes, which is the targeted time for processing a batch of transactions (a block).
- cdr 16y agoAnd it was well over 1 USD at one point (the first time the subject really blew up on HN).