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BitCoin – your new high yield investment!

27/3/11, 17:53
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Note – this post describes exactly what I think about BitCoin. Even though I have an interest in seeing BitCoin spread, this post represents my true opinions about BitCoin – I’m not trying to tempt you to buy it so I’ll get rich (although that would be a nice outcome :))

Update – After posting this, I found this Quora question: How can BitCoin be hacked. I’m still convinced that it can’t effectively be hacked, but I don’t know enough to prove why. I’ve asked the Quora community to refute it and convince that BitCoin is safe. I advise you to read these arguments and retorts before buying a significant amount of BitCoin. Note that this question is from two months ago, when the computation power of the bitcoin network was about ten times less than today (it keeps growing exponentially, see below).

About 4 days ago, I discovered BitCoins via this Slashdot Post. I spent most of the last 4 days reading about it, and here’s the executive summary.

  • What is it? BitCoin is a “startup currency”, a form of “peer to peer money”. It started about three years ago, and is starting to gain critical mass right now.
  • Where can I spend it? There are already several business that accept it, ranging from ordering books, to a digg style website, to porn. Yes, you can buy porn with bitcoins. If the porn industry are doing it, this means it will become mainstream (porn have been known to lead internet technology for years)
  • How much is it worth right now? About $0.8.
  • How much was it worth half a year ago (on 10/10/2010)? About $0.06. Yes, this means a growth of  X13 in 6 months!
  • Why is BitCoin better than “real money”? There is a variety of reasons. Read the link, I don’t want to repeat myself.
  • Will it continue to grow? Well, we don’t know yet. But we can bet on it. So far, I bet $350 of my money that it will grow, and I’m planning to purchase more.
  • Where can I find more about BitCoins? First, you can try the forums. If I were you, I would quickly obtain some free BiCoins from the BitCoin Facuet, then go and ask some questions over at bitcoin.witcoin.com (the Digg style, bitcoin powered website I told you about)
  • And, one last question – “WTF? Are you serious? You’re paying for virtual goods, this is like buying stuff on FarmVille!”To that, I answer a resounding no. I’m very confident that this will become more and more real. If you’re quick enough to decide, and brave enough, you can join me and bet on it to. If I’m right, you may become rich *
Update
A few important facts to add:
  • There will only be about 20,000,000 bitcoins, ever. Nobody can create an inflation at will, and create more bitcoins unfairly out of thin air. If you believe 1% of the world’s economy will be bitcoins by 2030, and you buy 1000 bitcoins now for the low low price of $800, and you hold the bitcoins for 20 years, then you will personally own 1/2000000 of the world’s economy. Yes, you. Personally. Read the figures again.
  • Today, the worth of all the bitcoins put together is $10,000,000. The worth of the bitcoins traded every day are $10,000. This is not a toy research project.
  • The userbase is growing exponentially.
If, after reading all this, you’re interested, here’s a small “how to get started guide“. If you have any questions, just let me know!
* – “Becoming rich” not guaranteed. Invest at your own risk. Use your head. And be sure to drink lots of water, and not to eat before swimming.
* – If this post somehow made you rich and you want to repay the favor, I accept donations at this address: 1G89pwL5FWKt7CPvJBaquNVVHkjtJ8sWEn
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9 Comments

  1. exponential stupidity:

    The userbase growth is not exponential. Just because people on TV use this word to sound clever and confuse simpletons, it does not mean You should toss this word around without knowing what it means

    29/3/11, 17:55

  2. ripper234:

    @exponentail – the graph is linear, but the scale is logarithmic, so the growth (in computation power actually, not strict userbase) IS exponential. Thank you for your kind words.

    29/3/11, 18:01

  3. Ian:

    There are currently around 5.9 million bitcoins in existence, valued at $0.76 each… so the worth of all the bitcoins together right now is about $4,484,000.

    11/4/11, 14:22

  4. ripper234:

    @Ian – sorry for the inaccuracies, and thanks for the correction. I quote some numbers that I remembered, but didn’t do enough research to reach exact figures.

    11/4/11, 15:52

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