mining cryto

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No one is going to pay you to write articles about how the last great boom in mining cryto was a bubble, or how the next one will be. People are not stupid enough to believe that there will be another great boom in mining cryto.

But they will pay you if they think that when the next great bubble in mining cryto comes, you will know that it is coming. That’s what professional investors do: they bet on bubbles, because it pays better than investing in stable companies.

An example: In 1999 I started a newsletter called “The Good Market” which predicted that the dot-com bust was over and a new bull market for technology stocks was beginning. It worked out, and I made money for my subscribers by betting against them.

This is a hard project, so I’ll be as brief as I can.

The main problem is that mining cryto is a very competitive business. There are many people with computer skills who have worked for years without making much money. Other people with computer skills only have the skills you need to make money in this business, and they have the same problem.

The biggest difference between them and me is that the people who have worked on computers for years are not very good at it, whereas I am really good at it. In particular, I never use tools or libraries written by someone else; they all suck. This means that I spend a lot of time writing code, whereas my competitors do not.

If you are not ready to work hard at this problem, then nobody who has ever made any money in this business will help you. If you think your idea is great but you don’t know how to program, then there is no market opportunity here. You should probably join the big companies doing what they do well: marketing and sales and customer service and finance and so on. If you want to be a miner of crypto-coins such as Bitcoin or Ethereum or Litecoin you need to learn how to write programs with an emphasis on security (cryptography)

In the spring of 2010, a few weeks before I left for the United States, I learned that the Chinese government had ordered the shutdown of an online exchange where people could buy and sell Bitcoins, a form of cryto. In China, cryto is an abbreviation for “cryptography.” The word is also a play on “crystallize,” as in crystal meth. Cryto meth is something you can make or buy at home, and it’s very effective; when produced in large amounts, it’s probably even more addictive than crack cocaine.

The Chinese government didn’t shut down my trading account because they thought I was making money; they wanted to make sure I wasn’t producing or selling any meth. They were right: I never bought or sold any cryto. But they were also wrong: if I’d done so, they would have shut me down too.

In fact cryto was not really “mine.” It was everyone’s mine. No one owned it; it was free for anybody to use.

Crytocurrencies are a new legitimate use of computers. The Bitcoin network is the first large-scale network to use them. But there can be many more.

The idea is that computers can be used for more than just doing things for people, like playing games or browsing Facebook. Computers can also be used to do things for people that need to remain private, like keeping bank accounts and sending money.

Whether it actually works depends on how well the cryptography is done, but it’s likely to be easier than people think. You don’t need super-strong encryption to keep your bank account secret. You don’t need encryption at all if you’re using a dumb machine (which is what most people do).

The whole thing is actually rather simple. You need a computer, and a few hundred dollars worth of equipment. Then you just click on a link in an email, and you’re online for life. You can become the owner of any bank account in the world, to the value of several billion dollars.

There is no way of knowing how many people have done this. The number is probably small enough that it doesn’t matter. What matters is that no government has yet cracked down on it. So far everyone who’s tried has succeeded.

There is a kind of cryptographer who has been called the “miner of crypto.” They spend their time finding and inventing cryptographic algorithms. The most famous is probably Bruce Schneier. He started out with a simple idea: if you want to send secret messages, how do you protect them from eavesdroppers or anyone else who might intercept them?

If you only want to send the message once, encryption is easy. You can use the same key for both sending and receiving, or you can use a different key for each. But what if you want to send lots of messages? It would be inconvenient to have to keep using the same key.

Schneier came up with a way to make keys that could be used for every message, which he called asymmetric encryption. In theory it was quite secure: there were plenty of papers in his inbox from security experts saying that it couldn’t be broken. But in practice it was breaking all the time. It took years before cryptographers agreed that this was because of bugs in the mathematics; it’s not clear that they ever fully understood why it was secure in theory but broken in practice.

Schneier’s algorithm was not just a clever way of making keys; it was also a new way to understand

Bitcoin is a new kind of money. And the reason it is a new kind of money is that it is not money at all. It is more like gold.

Bitcoin, in fact, is an electronic variant of gold. It has no intrinsic use except as a store of value and as a medium of exchange. What makes it special as a medium of exchange, compared to other forms of electronic money, is that it can be transferred directly from one person to another without going through any central institution.

When you have the right private key, you can take bitcoins out of your account, buy something for them and then put them back again. Because this cannot be done with gold or other physical assets, gold will always remain superior as a store of value, but bitcoin will probably remain superior as a medium of exchange.

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