Wait, what? Wasted? Don't they do something useful with the computing power? Such as guessing account numbers for real accounts in real banks with real money in them?

heh. My bad. I was running both a CPU worker and a GPU worker at the same time - this reduced the GPU to about 80MH/s, where if I ran it alone it does around 300MH/s.

It's a really interesting piece of technology, but I don't see how it could scale very well and still be distributed. Every peer stores a copy of the whole block chain (as I understand it). This could grow to a very large size I guess, if the system kicks off.

I still don't see anything that says this mining is put toward anything useful. You might as well pay me for counting integers. Since I'm already in my late youth, I probably wouldn't make it past a billion, and nothing of advantage would be produced. OTOH, if I became an accountant, then I could do something worthwhile for the money.

I remember hearing about this months ago (maybe the OP also mentioned it then?). I looked into it then, but didn't trust it and eventually just lost interest. I guess I'll give it another shot. See if I can get the code running. It better not h4x0r me.

As Thomas said, the computational work done by the miners is needed to create blocks.

There's an arbitrary difficulty factor added to the work. The hash needs to have a certain number of leading 1's in it's binary representation. As the overall computing power of the network increases, the number of leading 1's required increases.

In the grand scheme of commerce and economic utility, the energy cost to create BitCoins is dwarfed by the economic utility it provides.

Also, as Walter would say, "BitCoin is not the issue here, Dude." Napster didn't bring down the record companies. Napster simply ushered in a new era for digital goods. In the same way, BitCoin may not be a panacea for fiat currencies. But I certainly welcome competing electronic currencies which are based on solid mathematical principles.

I don't run it all the time anymore because I pay for power. Also, just letting cpufreq do its job saves a bit of power, but with bitcoin running, my system would be at 100% and thus not be able to do any cpufreq scaling.

Wow. You need to fix your machine.

And what if I want to use others' computers to render my extremely complicated 3D scenes?

Edit: BTW I didn't know that the yen it's also called "more"...

That video doesn't make sense to me. He gives some example of a receipt from a shop owner being used as money, and tries to portray it as being somehow more fair and sound than money from a centralized system; but really, what's to stop that shop owner from giving out these receipts willy-nilly, essentially printing money and being rich for doing nothing? I wouldn't trust that grocer to control the value of my currency. I'd much rather trust the reserve bank.

The guy ends by saying that money you have is more like debt than bounty. Like by having money you somehow own something to someone – well obviously that's not true. Maybe someone owns someone money because I have money, but it isn't me. The money is mine to do what I like with, with no obligations.

Anyway, as for bitcoin... It seems like a good idea, but there are a few things about it that bother me. Firstly, as many have already said, the whole 'mining' business seems like a waste of physical resources – but I'm in two minds about it, because I know that there will be waste like this assciated with any kind of currency. I guess it's just a matter of magnitude.

The second issue in my mind is probably a non-issue; I'm concerned that if everyone has the entire transaction history of their bitcoins, as seems to be implied from what I've read, then this mass of information will one day become impractically large, and thus the system is unsustainable. But surely this is something that has been thought of. It's a pretty obvious problem so I've be surprised if there wasn't a good solution to it already built into the system. I just don't know what that solution is.

Finally, the main thing that stops me from seriously using bitcoin as a currency is that I don't really trust it. With 'normal' currency, I find it easy to understand the system, and understand its weaknesses. I know that currency can be devalued if the central operators decide to bring too much of it into existence, but I trust them - mostly. The thing about this bitcoin system is that instead of trusting people, I would have to trust the system. My main concern is that if bitcoin really does catch on, and everyone is using it as their main currency, and everyone is happy and it's sustainable and useful and fair and everything... but then someone finds a new algorithm which breaks the computational complexity of the mining problem... then the whole currency collapses and we're all screwed.

Every four years I think?

And wont the system break down when no mining is possible/worth while? Since it's also what processes transactions and keeps the system running. Though at that point maybe transaction fees will be a better source of income.

Are you just running the binaries or did you compile yourself?

The system is already like 1 year old, and the value has been decreasing, so no, it's actually a very bad investment.

As for mining, you should use a GPU miner. It'll take you months/years (depending on what cpu you have) to generate a single block with a CPU miner.

I'd recommend you join a mining pool, unless you have a strong ATI card (nvidia cards are much worse at mining).