Vocabulary
- Address: unique string needed to pay someone
- ASIC: application-specific integrated circuit (on wikipedia)
- Block Chain: public record of all bitcoin transactions
- BTC: currency abbreviation
- Mining: do mathematical calculations to confirm transactions
- Private key: needed to be able to spend money from a specific wallet
- Satoshi: original bitcoin proposal
Installation of full client and secure wallet
- Disable autorun on your machine
- Install bitcoin-qt on your machine
- Set the data folder to a drive with enough space (>100GB) - shortcut: "C:\Program Files (x86)\Bitcoin\bitcoin-qt.exe" -datadir="D:\BitCoin\Data-QT" - use: mklink /d "C:\Users\Ken\AppData\Roaming\BitCoin" "D:\BitCoin\Data-QT"
- Sync to bitcoin network (> 2 days)
- Install armory on your machine + data folder move - use: mklink /d "C:\Users\Ken\AppData\Roaming\Armory" "D:\BitCoin\Armory" - "C:\Program Files (x86)\Armory\ArmoryQt.exe" --settings=D:\BitCoin\Data-Armory --logfile="D:\BitCoin\Data-Armory" --datadir="D:\BitCoin\Data-Armory" –satoshi-datadir="D:\BitCoin\Data-QT"
- Create cold storage (never connected to a network, eg. Ubuntu 10.04.4 + Armory)
- Create Wallet on cold storage
- Backup to paper + passphrase
- Create watch-only export of wallet
- Import wallet into armory on your machine connected to the internet
- Generate some addresses by clicking on 'Receive Bitcoins'
Mining Bitcoins
- Get cgminer at https://github.com/ckolivas/cgminer
- Run cgminer -o 127.0.0.1:9332 -u userName -p fooPassword (this is the ip and port for local p2p mining, otherwise you would fill in the hostname and username for the mining pool you joined, often password is not required and then you should not put it)
- There is no use in trying to mine with cpu or gpu anymore. (except maybe for some alternative cryptocurrencies)
Choosing a mining pool
- Individual: unless you own some big asic miners, there is no use in trying to do this all by yourself. And even in pool you need plenty hash power to get some money.
- P2Pool: the peer to peer mining pool is the best way to support the network. If you do not have enough hashing power, you basically are just doing this to support the network because your shares will take to long to be paid out.
- Pool (eg. BTC Guild): easiest way, just create an account online and start mining (more pools can be found at https://blockchain.info/pools)
Installing an asic usb miner
- Windows USB support requires the installation of the WinUSB driver (NOT the ftdi_sio driver), you can use zadig utility for this. (can also be found on sourceforge and in the downloads of cgminer)
- Run Zadig and select WinUSB for each of your miners and install.
- If still problems to find your miners then use a USB to UART Bridge before using Zadig.
- Once you start cgminer, for most asic the led will be on when the miner is not working.
Intrinsic value of BitCoin
I think that the cryptographic currencies still have a lot of issues. Bitcoin is going to good way, but the ever growing size of the blockchain bother me. Even with the ultraprune. It all feels to much like a Ponzi schema or even a new central banking system.
So the only real value I can currently think of is when you want to timestamp a message you can put it in a very cheap transaction. And then it will be persisted through all the distributed network of the blockchain. Of course if you are very wealthy and you want to move money from one country to another without the taxation hassle, bitcoin might be a good solution. Buy and then sell on the other side of the globe a bit later.
Anyway, for now it is very interesting to play with this currency and I am sure it will bring a lot of new uses to the 'old' miners. Most of the asic miners are basically fast SHA256 hashers, so plenty of use there...
More:
Exchange Bitcoins:
More opinions about the intrinsic value:
And now send me some Bitcoins at:
1L6LT5coSjZqTWxFxizjwZSWiiBjUWZZ1h