A while back (about a month or two) I started getting interested in the Bitcoin phenomenon. This was mainly caused by someone having all his money stolen, which got a lot of publicity.
I read about Bitcoin quite some time back, but now the global economic situation is going mad and a lot of questions are raised about the “trustworthiness of the monitary systems” I started to be curious and decided to have a look.
After a bit of reading, I installed the Bitcoin application. I now had a wallet, and an application to send and receive Bitcoins with. As simple as that. I’ve added a couple of options to this site, the possibility to donate just in general or donate for the download of my Lotus Notes troubleshooting document. I’m not expecting a lot of activity from those sources because I don’t recieve thousands of visitors a day.
I then started reading about Bitcoin Mining, the process of using CPU or Graphics card GPU to try to produce a valid block (part of the transaction verification process), and as a result ‘mine’ some Bitcoins. I won’t get into detail here, as there is a lot of info on the technical details already. Depending on the hardware available, this is a task worth spending some electricity on or not.
The laptop I tried this on is running a Pentium Core2 Duo on 2.4 GHz. I get a mining rate of approx 5.5 Mhash/s. This results in approximately 1 Bitcoin in about 200 days. If, however you use a PC with a powerful (and compatible) graphics card, you can get mining rates up till 700Mhash/sec, making this one Bitcoin in less then 2 days. Here’s a hardware comparison chart so you can check how your current hardware will or could perform.
The value of a Bitcoin is decided on several factors, one of the main ones being the amount of money on the market. There are several Exchanges available that will give you the value in a real currency and there are sites that will allow you to cach-in your bitcoins. Because of the growing amount of usage, some sites already accept payments for products directly. Since the hack (if you can call it that) mentioned at the start of this article, the value of the bitcoin has dropped significantly. Before that event, the value of one bitcoin was on approx 17.50$ USD, the days after it dropped to nearly 0 and it is coming back up slowly. The current value of one bitcoin is approx 4.50$ USD.
Taking the mining rates and the current values in mind, it would take me 200 days of a running machine to “generate” 4.50$. This is obviously not a very profitable business. However with the right set-up, using its idle time (when you’re not doing anything), you can actually make quite an “income”. you can calculate how your hardware would perform with this calculator here.
Another way of making money out of the Bitcoin currency is trading on virtual Stock markets. since the price is fluctuating a lot, there is quite some “money” to make for people who trade smart. I did not have a look at that yet as I like this to be a completely free experiment and I don’t feel like buying Bitcoins. A good list of the different stock markets and how they differ and change here.
For now, I’m still mining, even though at a very slow rate. I might start using several machines to mine so the rate multiplies and ideally to one day have a single coin I can do something with 
To be continued…
Bits Of Freedom, a Dutch organisation working in favour of Internet freedom and Protection of privacy has started a fundraising action to be able to continue their good work.
A few weeks ago, I wrote an article on how crowdsourcing could be used to bring politics a bit closer to where it should be, the people.
Since I wrote the article about the Mexican football team that was managed by its fans, I have not stopped thinking that this way of using the “wisdom of many” should get more and more presence in our lives, and could solve many problems related to the un-representation of our democratic systems.
