Bitcoin Blog a1

Wednesday, February 25, 2015

Nyan explosion


I have found an amazing cryptocurrency. As I mentioned before in prior posts I enjoy having dogecoin, but is there a coin out there for cat lovers? Well the answer is yes! Nyancoin!


(Here is Nyan Cat just for reference)


Everyone loves Nyan cat! Although, perhaps it is not quite as quotable as doge ( when I try to quote Nyan cat it normally ends in just an incomprehensible series of meows, which attempt to follow the pattern of the video), nyancoin seems as fun-loving as dogecoin. The reddit for it is here, and has been stirring lately in activity. Much thanks to one user in particular, coinaday.


The technical specs for the coin are as follows (source):


SPECS:

Algorithm: Scrypt
337 000 000 Coins
337 coins per block
1% premine for bounties, giveaways & dev support (not 10%!)
1 Minute Blocks
Subsidy halves in 500k blocks
Difficulty Retarget Time: 3 hours
RPC port 33700
P2P port 33701


Note, it does have a small premine, which I feel isn't a huge deal it is the price of active developers. That is to say, nyancoin does have an active development team! This is something not all coins can claim.

Edit: Coinaday offered some clarification on the premine, "the 1% premine was spent in faucets long ago from what I heard from a random comment in this sub. I know nothing about it. I've spent almost 1% myself by now in giveaways. The premine doesn't pay for current development."

Thursday, February 12, 2015

Bitcoin Bill?

photoMarc K. Roberts of the Utah House of Representatives may be a bitcoin advocate!

I noticed on the internet that in Mr. Roberts has proposed a bill on… bitcoins! Wow! I may have implied in my first post that Utah, where I now live) perhaps isn’t the most interesting place in the world, but this this seems to disprove that! ( at least to a certain extent).

As I began to read the bill I noticed while it was written in English, it seems to use words and phrases differently than one might expect. I looked further online to see that there is certain wordage used for effective resolution making. The site I used asserts this as governance 101. I will reference this site again as it gives clarification.

One on the reasons cited for the adoption of bitcoin as a form of payment is that “... the state could be a key player in promoting the use of bitcoin.” Here below is that statement with more context:

NOW, THEREFORE, BE IT RESOLVED that the Legislature of the state of Utah, and
43     the Governor concurring therein, recognizes the potential benefits that could come from the
44     expanded use of bitcoin in the state and recognizes that the state could be a key player in
45     promoting the use of bitcoin.
(Emphasis added)
To clarify, the all capital letters preceding some sentences are identifiers. The previously mentioned site explains The THEREFORE BE IT RESOLVED statement:
  • This is the punchline. It is the action being taken. You should state EXACTLY what is to be voted upon….

THEREFORE, it would seem that Mr. Roberts is saying that one of the two primary reasons the state should adopt bitcoin is to further its acceptance. I also found some of his reasoning interesting, mainly his statements “ the state must remain open to new technologies” and “bitcoin is based on the principles of free-market capitalism and is not  centrally regulated.”

While this is a very interesting position, I think there are also some huge ramifications from this decision, and should it be excepted, I think there may be some constitutional issues, but that is an article for another day, stay tuned!

Also if you want to read the bill.

Tuesday, February 10, 2015

Earth revisited


The earthcoin subreddit has been buzzing! (relatively speaking that is)
One of the posts is this article.This article by no means is new, but it has been reposted, and I thought in light of current events the perspective of this article needs to be updated. In the article, hazzard asserts that earthcoin should be avoided due to its 2% premine and because its cyclical variations in block rewards allowed it to be instamined as well. The earthcoin development team,however, has abandoned the coin, either first selling their coins or allowing them to simply sit idle. Thus, it is likely those pre and instamined coins impact has already been felt and will not impact the coin further. I would assert, either way it doesn't matter all that much, with earthcoin trading at $0.000011 USD  that premine comes out to  a whooping $2970, so all things considered, it is not much. Maybe that is why the development team left :P.Perhaps if the coin drastically increased in price it could theoretically be a concern.


Also around the same time a link to a earthcoin “game” was posted. This however was not a game at all, but rather a ponzi scheme. I reported the post and I don’t see it up anymore.

I don’t think I gave eathcoin specs last time, but here are some ( from http://getearthcoin.com/technical-specifications):


Other Specifications:
  • 60 seconds block target
  • Diff retargets each block
  • Total coins will be 13.5 billion coins
  • 5 confirmations for transaction
  • 50 confirmations for minted blocks
  • Support transaction message
  • Normal block on average 10000 coins per block, varies seasonly
  • The block payout will be halved every year, minimum payout 1 coin per block
  • The default ports are 15677 (Connect) and 15678 (RPC)
Note: Earthcoin uses a Scrypt mining algorithm

Thanks for reading, and remember, To the Earth!

Monday, February 2, 2015

Bill Gates Loves Dogecoin (but not really)

So I ran into this video on Reddit and I thought it was worth sharing:
 

Sometimes I think some shibes are a little eager to have dogecoin be in the spotlight :P. Here is the real video though.

 

Sunday, February 1, 2015

Dogecoin Paper

A while back I wrote a academic paper about dogecoin. I thought I might try to publish it but never got around to it, so I will put it here.

What is Dogecoin?

This brief will seek to answer some basic questions about cryptocurrencies. A cryptocurrency is “a peer-to-peer form of digital money that uses cryptography to ensure transactions can remain anonymous.” 1 The following questions are addressed in this brief: What is dogecoin? Why does it matter?  How does it relate to bitcoin? What are some uses and problems associated with both?

These questions will be explored topically: (1) bitcoin will be examined, (2) internet memes will be defined and explained, (3) the doge meme will be addressed (4) dogecoin and its origins will be analyzed, (5) issues will be discussed, (6) a unique community will be uncovered, and (7) potential uses will be expounded on.

Bitcoin. Bitcoin was created in 2009 by a person (or group of people) using the alias “Satoshi Nakamoto.” 2 The bitcoin is a peer-to-peer currency and, much like downloading on a peer-to-peer program utilizes multiple hosts for the sharing of a file, bitcoin has “miners” confirm transactions as they are made. When a user sends a bitcoin to another user, this transaction is sent to other bitcoin users. Bitcoin miners then verify the transaction’s authenticity. To be verified, the transaction is placed on the blockchain. These blockchains are then solved through a series of complicated algorithms, each part of the chain being a “block.” Blocks are often solved in pools or in other words a group of people working together. When the block is solved the miner(s) who solved it collectively receive 25 bitcoins. Modern bitcoin mining requires powerful application-specific integrated circuits. As more miners approve the transaction being sent, the transaction is recorded by more users, thus providing certainty that the money was indeed sent.

In every functioning bitcoin wallet, every transaction in the history of bitcoin is recorded there. Because bitcoin is a peer-to peer currency, bitcoin has no central authority with a ledger indicting who has which coins; rather, every wallet must first validate every transaction that has ever been made. This in turn allows the community to know who has how many coins; this knowledge is based on the public record of coins received and sent under that address. 3 The image below is one of the recognized symbols for bitcoin.



One should note that since bitcoins are not a physical object, this and all pictures of “bitcoin” are just representations of the currency.





 Figure 1
(Source: Bitcoin.org)
Bitcoins and other similar currencies fluctuate greatly in price. Figure 2 represents the closing prices of bitcoin since its creation.


Figure 2
(Source: blockchain.info Edit: by author)

This chart depicts bitcoin as not being very stable. Other cryptocurrencies also display similar patterns in fluctuations, or in other words the lack of stability and discernable trends.

Meme.    In psychology, a meme is defined as a behavior that spreads from person to person in a culture. However, when talking about internet memes, the term begins to take a new meaning that falls within the context of psychology’s definition of a meme. In The Gold Coast Bulletin, a meme is described as, “a visual medium used to share ideas and relate to situations in a humorous way.” 4 In other terms, an internet meme is generally a well-known picture that is captioned to fit the circumstances. An example of this is Doge.

Doge The word doge was a title used for a type of medieval Italian elected official. The word doge, as an incorrectly spelled term to identify a dog, was used in June 24, 2005 in an episode of Homestar Runner called “Biz Cas Fri 1.” Later, the word doge became associated with images of a Shiba Inu. 5 In fact, the Shiba Inu pictured below is the most common application of the meme.


Figure 3

As shown in this picture, the picture of the Shiba Inu is generally accompanied by multicolored comic sans font. 6 Further, the text will include phrases such as “wow,” “excite,” or “amaze.” Two word phrases may also be used, using the following modifiers: “much,” “many,” “so,” “very,” or “such.”  These modifiers must be used in a way that is grammatically incorrect in order for the meme to be properly applied. 7 For instance, when creating this meme one might say, “very business,” “much inform,” or “so bitcoin,” and this would be perfectly acceptable.

Dogecoin.  Dogecoin is, in essence, the marriage of bitcoin and the Doge meme. While many of the differences between the two coins, such as differences between SHA-256 and script mining, are too long and technical for a brief of this length to discuss. 8 Many others differences between these two coins, particularly the community surrounding both are quite interesting to look at.  Previously, a picture of a bitcoin was shown; if one were to transpose doge onto that coin, Figure 4 is what it would look like.

Figure 4
(Source: Dogecoin.com)


Figure 4  is the image for dogecoin on Dogecoin’s website. Here we can see the iconic picture of Atsuko Sato’s Dog, with brows raised in concern.9 I think this picture captures both backgrounds of the coin: its bitcoin origin and its doge meme silliness.

Issues. A big issue with these cryptocurrencies is they absolutely lack intrinsic value. In other words, the only value these currencies have is the value placed in them by people.
In his article, “Why Bitcoin Has Value,” Van Alstyne asserts  that bitcoins have value because people accept bitcoins. He explains that this acceptance is the reason any currency has value. He goes on to explain, “‘Money’ is a medium of exchange, a store of value, and a unit of account.” He claims bitcoin meets all three of these criteria. Specifically, he attacks the assertion made by some that to have value, a currency needs to be supported by a government body. He uses the example of Iroquois Native Americans to destroy this idea. He cites that this tribe of people used beads (wampum) to settle debts. He also uses the Weimar Republic in Germany as an example. In his example, marks were printed too fast and thus they were not accepted. 10

 Clearly, not all government-printed bills will be accepted in all circumstances. However, this doesn’t make the converse necessarily true either. The example of the Iroquois is a powerful one however. That is simply, value is given to things that people value, and even a government doesn’t necessarily create value.

Community. People often value community. Arguably, dogecoin has value in its sense of community, which is magnified because of the novelty of both the coin and the community. One example of this novelty in the community is the name it has branded itself with for its members, shibes. Perhaps, like a well-crafted bead, the doge is a well-crafted meme with a currency. Perhaps simply people valuing the dogecoin is sufficient to qualify it as a currency. I think that this sense of community amongst shibes helps give value to the coin. And, at the very least, both the coin and community are quite entertaining.

Because of this meme, an active culture and community surround the coin. Here, two particularly noteworthy phrases are used. The first is “to the moon,” which refers to the price of dogecoin skyrocketing. This expression is used to rally dogecoin users and encourage people to invest. The second expression is “1 Doge = 1 Doge.” This phrase is often used when the price of the coin drops. This expression serves as a reassurance to others that the price of the coin in US dollars doesn’t really matter; rather, the community as a whole is what truly matters. These ideas seem a bit contradictory.


Uses.  These coins have many potential applications. One application is mass fundraising. For instance the Jamaican Bobsled Team lacked enough money to go to the Sochi Olympics. When the dogecoin community heard of this need they created a fund raiser for the Olympic team. The dogecoin community gave the team money in the form of dogecoin, which was then exchanged for more traditional currencies to get the team to Russia. Cryptocurrencies allow this kind of fund raising by many people. 11 The closest comparable service to this is PayPal, which has much higher fees. Dogecoins transaction fees are less than a penny per transaction.

Another application is as the tip system of the internet. The dogecoin community is a very generous one. They have a culture of giving tips whenever something amusing is said, or something that is agreeable. This is possible due to the low transaction fees. It is also noteworthy that many other currencies have similar low fees, but the culture of tipping is not prevalent.



Closing.  Despite having shortcomings and issues, cryptocurrencies also have many uses. While they are not “investments” despite some popular belief, cryptocurrencies are an interesting way to exchange money, and one would be foolish to pass them off as nothing. The dogecoin, specifically, has had some big impacts on the world; one impact that was particularly visible was during the Sochi Olympics in which they helped sponsor the Jamaican Bobsled Team. Cryptocurrencies continue to have a diverse impact on the world.

Endnotes

1. Adam Greenberg. 2014. "The Value of Bitcoin." SC Magazine 25 (5): 33-35.

            2. Rajiv Prasad. 2014. "FBAR and FATCA Compliance in the Age of Digital Currencies." The Tax Adviser 45 (5):

            3. Ibid.

4. "It's All About Meme Naomi Hockins Asks What All the Fuss Is About with Internet Memes." The Gold Coast Bulletin, Jun 29, 2013.

5. “Know Your Meme.” July 20, 2014 http://knowyourmeme.com/memes/doge

            6. Ibid.

7. Gretchen  McCulloch. “A Linguist Explains the Grammar of Doge. Wow.” The Toast. February 6, 2014.  http://the-toast.net/2014/02/06/linguist-explains-grammar-doge-wow/

8. Rajiv Prasad. 2014. "FBAR and FATCA Compliance in the Age of Digital Currencies." The Tax Adviser 45 (5):

9. “Know Your Meme.” July 20, 2014 http://knowyourmeme.com/memes/doge

10.  Marshall Van Alstyne.  2014. “Why Bitcoin Has Value.” Communications of the ACM 57: 30-33.

11. Erika  Engle.2014. "Dogecoin Users Try to Widen Cybercurrency's Acceptance." Honolulu Star - Advertiser, Feb 17. http://search.proquest.com/docview/1498823165?accountid=4488.