A pillar analysis of the market shows a promising future for cryptocurrency, despite the naysayers.
One of the biggest hurdles bitcoin has faced throughout 2017 has been poor journalism around the cryptocurrency, along with uneducated opinions from many so-called “experts” within the financial industry.
Jamie Dimon famously labelled the currency a “fraud” suitable for murders and drug dealers, while the chief economic advisor of Allianz said in September it should be worth half of what it was trading at back in September when it was edging US$5,000. I wrote about this in my last article when the price fell back to US$3,600.
Peter Switzer, a prominent and well respected financial commentator, was asked for his thoughts on the cryptocurrency around the same time in September. However in a more honest approach he advised he had chosen not to invest stating “I subscribe to the view that I don’t invest in things that I don’t understand”, further quoting Charlie Aitken’s reference to bitcoin being a “bubble”.
Bitcoin price chart (Image: geralt/Pixabay)
The real negligence here has come into play, as there have been few signs that many of the most prominent financial commentators actually understand the cryptocurrency. Myopia has hit many individuals we have historically trusted to understand financial markets.
Despite the numerous comparisons, the cryptocurrency boom displays very few characteristics to Tulip Mania outside of a huge price spike. Many more similarities are found in comparison to the oil rush in the 1850’s, which was actually the largest wealth transfer of this magnitude prior to the evolution of cryptocurrency. Those involved in it simply understood that the world was moving away from the horse and cart, and into a realm where oil would become an essential pillar of the economy. In the same way, currencies are changing and they are about to have a profound impact on everyday life.
It’s time those around the financial industry, especially those giving financial advice and opinion, actually understood the currency, and what its technology really means for the future of currencies.
After all, what was going on with Bitcoin in the last few months?
It looks like, in the last few months, Bitcoin has made friends with forking. When I wrote about Bitcoin forking the last time, I didn’t expect there would be this many so soon. But hey, here we are, trying to make sense of what the hell is happening in the crypto world.
Bitcoin fork pen and bitcoin keychains (Image: BTC Keychain/Flickr)
With this article, I try to put everything that has happened since Bitcoin Cash in a proper order that would become anyone’s go-to article for learning about Bitcoin forks between August 2017 and November 2017.
🍴 But first, what is a fork?
“You don’t need a silver fork to eat good food.”?—?Paul Prudhomme
You can think of blockchain ledger as a stack of pages. Every full node in the network keep a copy of this stack of pages with themselves. Everyone’s copy of the ledger is exactly the same because everyone followed the same set of rules to build it.
So, if there are ten people in the network, each of them will have a copy of the ledger that would look something like this:
Mining cryptocoins is an arms race that rewards early adopters. You might have heard of Bitcoin, the first decentralized cryptocurrency that was released in early 2009. Similar digital currencies have crept into the worldwide market since then, including a spin-off from Bitcoin called Bitcoin Cash. You can get in on the cryptocurrency rush if you take the time to learn the basics properly.
Which Alt-Coins Should Be Mined?
If you had started mining Bitcoins back in 2009, you could have earned thousands of dollars by now.
At the same time, there are plenty of ways you could have lost money, too. Bitcoins are not a good choice for beginning miners who work on a small scale. The current up-front investment and maintenance costs, not to mention the sheer mathematical difficulty of the process, just doesn’t make it profitable for consumer-level hardware. Now, Bitcoin mining is reserved for large-scale operations only.
Bitcoin mining (Image: Pixabay)
Litecoins, Dogecoins, and Feathercoins, on the other hand, are three Scrypt-based cryptocurrencies that are the best cost-benefit for beginners. At the current value of Litecoin, a person might earn anywhere from 50 cents to 10 dollars per day using consumer level mining hardware.
Dogecoins and Feathercoins would yield slightly less profit with the same mining hardware but are becoming more popular daily. Peercoins, too, can also be a reasonably decent return on your investment of time and energy.
As more people join the cryptocoin rush, your choice could get more difficult to mine because more expensive hardware will be required to to discover coins. You will be forced to either invest heavily if you want to stay mining that coin, or you will want to take your earnings and switch to an easier cryptocoin.
Like everyone involved in cryptocurrency I know that Bitcoin and other coins are produced through mining:
Bitcoin mining is the process by which transactions are verified and added to the public ledger, known as the block chain, and also the means through which new bitcoin are released. Anyone with access to the internet and suitable hardware can participate in mining. The mining process involves compiling recent transactions into blocks and trying to solve a computationally difficult puzzle. The participant who first solves the puzzle gets to place the next block on the block chain and claim the rewards. The rewards, which incentivize mining, are both the transaction fees associated with the transactions compiled in the block as well as newly released bitcoin.
I also know that in most cases Bitcoin mining is done by big organisations, mostly in China and Eastern Europe, running large farms of mining computers. It’s tough to compete against that.
Cryptocurrency Mining Farm (Image: M. Krohn/Wikimedia)
However, in learning about my current ‘favourite’ coin, Bitcore (BTX), I found out that it can be mined on a home PC with a half-decent graphics card. I decided to give it a go.
The basic process is straightforward:
You run a dedicated mining app, typically CCMiner, which mines Bitcore by maxing out your graphics card.
You connect the app to an online mining pool server so your mining power contributes to a pool of other miners’ hardware and you share the coins created. I use Suprnova.cc.
You connect your mining pool account to your Bitcore wallet so that payouts come to you.
The details are covered well in a YouTube video by Mod Rage, ‘How to Mine Bitcore (BTX) for Beginners (From Scratch)‘, included below. There’s another one that gives some additional useful information by IMineBlocks.
My Setup
When I initially tried running CCMiner I got the error “qubit_luffa512_cpu_init” each time. I worked out this indicated my graphics card was too old to run the latest version of CCMiner – no great surprise there – so I went back through older versions to find one that worked for me. That turned out to be the x64 version of build CCMiner v2.2.
When you start up the miner, initially not a lot happens – you just get a command window with a basic startup screen:
CC Miner Screen – startup (Image: BIUK)
After a minute or two, however, you will likely become aware of a rising background noise as your graphics card starts to ‘take off’. You may also find your PC’s response becomes a bit ‘sluggish’. Here mine has started – the card temperature has increased from 68C to 88C, and the fan speed from 46% to 67%:
CC Miner Screen – startup 2 (Image: BIUK)
The key thing is the “yes!” message which tells us it has started to mine successfully (failure is indicated by “boo!”). Success seems to improve over time, so initially I only get occasional successes:
CC Miner Screen – early on (Image: BIUK)
But half an hour or so after starting up each time I see screens like this – we’re up and running (the card settles at a temperature of about 95C and a fan speed of about 85%):
CC Miner Screen – up and running (Image: BIUK)
In parallel we can monitor the status on the Suprnova website – this shows us in approximate real-time how much solving power (‘hashrate’) we are contributing to the pool, for example:
Suprnova Status screen (Image: BIUK)
To monitor the graphics card itself, which of course is now running hot, you can use various utilities. Probably the best known is MSI Afterburner – here it is (with its UI skin set to ‘Default MSI Afterburner v3 – big edition’) showing a real-time display of card temperature and Graphics Processing Unit (GPU) usage:
Afterburner Status screen (Image: BIUK)
The GPU usage varies over time, but if I stop using the PC for other things it starts to settle near 100% as you would expect.
Mining Results
So is Bitcore mining profitable with my setup? I decided to work it out over the course of an evening, specifically a 5 hour period.
First I used a watt meter to work out how much energy the PC consumed. This turned out to be about 240W when mining and about 180W when not mining, so about 25% of the electricity used in that period was used for mining.
The watt meter told me I had used 1.25kWh over the period so about 0.3kWh was used for mining. My evening electricity rate is about 14p/kWh so the mining cost me about 4p.
So how much did I earn? Suprnova tells me I mined about 0.0006 BTX, which is worth somewhere around 2p. So no, my setup isn’t profitable as I ran it.
Can Bitcore Mining Be Profitable?
The result is interesting to me because, actually, it’s not as bad as I feared. After all, I am running an old PC with a graphics card that is old enough it can’t run the latest – and presumably most efficient – mining software.
(Tip: you can look up the power, ‘Compute Capability’, of your Nvidia card here. A good value is 6+, mine – a 1Gb NVIDIA GeForce GTX 560 Ti – is 2.1).
With the current setup I could:
Run only at night, leaving the PC mining on Economy 7 electricity and unattended (which should get the efficiency up by 10%-15%). My overnight rate is about half the daytime rate so immediately I would be close to breaking even, and maybe even making a profit.
Run only during the middle part of the day, with the PC mining just on electricity from my solar panels. It would immediately become profitable, even if only at the rate of a few pence per day. And that’s without even trying overclocking on the card.
Of course, if I really want to mine seriously I would be looking at buying new hardware – specifically a powerful graphics card, as it’s not necessarily an issue if the PC isn’t particularly fast.
Initial research implies that a current top-end graphics card may have enough power (hashrate) to mine at perhaps 30 times the rate of my current card. Suddenly Bitcore mining starts to become a realistic proposition – a profit of £1-2 per day seems achievable – so I’m going to investigate further.
November has been a lively month in cryptocurrency, but particularly for the Bitcore coin (symbol BTX). I’ve written a number of blog posts about it, but I think a summary would be worthwhile:
1. One month ago, on 22 October, I had just 2.8 Bitcore, courtesy of a free airdrop from last April. Each Bitcore was worth about $6 so the total value was about £13.
2. To get the next big Airdrop I needed to own at least 10 Bitcore, so I decided to simply buy £100 worth on 25 October. That got me 19.77 BTX, for a total of 22.6 BTX. With Bitcore at about $7 that was worth about £120.
3. Having met the threshold I received a one-off airdrop of 25% on 30 October bringing the total to 28.2 BTX, at about $8 each, so a total of £170.
4. While the one-off airdrop was nice I was actually after the weekly 3% airdrops and the first one came in on 8 November. At this point I reached 29 BTX at about $10 each so worth £227.
5. The next weekly airdrop on 13 November took me to 30 BTX at $13, so £290. This was starting to look serious!
6. On 18 November I received my Bitcoin Gold airdrop. Since Bitcore was doing so well I used the money to buy some more. Bitcore had another airdrop of their own so my end result was 51 BTX, now at an impressive $30, so worth £1100!
7. The next day I sold a small Ethereum Dark airdrop for 1.25 more BTX.
8. This Monday the next weekly airdrop came in giving me another 0.9 BT
The end result for the month – not counting at least another weekly airdrop to come in before the end of this month – is that I now have 53.3 BTX. Today their value has dropped back a little to $27 each, so their total value still hovers around £1100.
Bitcore November transactions (Image: BIUK)
So, through a whole series of free airdrops, plus a big rise in the market, my outlay of £100 is now worth £1100. Just one reason why I love cryptocurrency!
To an extent it feels like I’ve earned the money, by ‘jumping through hoops’ to claim the free airdrops. Therefore the outcome is the most satisfying, despite the fact that over the same month, by doing nothing, each of my Bitcoins (BTC) has gone up in value from £4100 to £6200, so my 12.5 BTC have gone up by an astonishing £26,000 in a month. Somehow that seems less real than the BTX gains.
I’m a bit of a fan of Bitcore (BTX) as is clear from my BTX blogging history – largely, I confess, because it has so many airdrops! Who doesn’t like free coins?!
Airdrop (Image: NMUSAF/Wikimedia)
Less than a week after the last 25% airdrop on 30 October (based on how many BTX you own), there was another airdrop on 2 November (based on how many Bitcoin/BTC you own) – both taking place in parallel with the weekly 3% airdrops. It’s raining free Bitcore coins!
However, getting the private key to your BTC account as required by that description can be tricky, so here I’ll explain how to do it if you’re holding your Bitcoin in Electrum as per my previous posts.
To be eligible you need to have held Bitcoin on 2nd November in a wallet you control, i.e. one to which you have the private keys, and you will get 1 BTX for each 2 BTC. Log into your Electrum Wallet go to Wallet -> Private Keys -> Export, then enter your password and wait a few moments. Look for the address containing your Bitcoin in the left column and copy the private key from that right column:
Electrum Export Private Keys screen (Image: BIUK)
It’s this key that you paste into the Bitcore Wallet console as described in the Steemit description linked above. Note, as ever, as soon as you have exposed a private key you may have compromised your wallet security (you can see in the screenshot to be safe I had already moved out my Bitcoin from the wallet before making the claim). At this point, if you want to be completely safe, you should wipe the wallet before using it again.
Anyway, that’s it done – the new BTX should appear in your Bitcore Wallet straight away if it works, otherwise check that you used the correct location address for your BTC on 2nd November.
It worked for me – my 5.8 BTC gave me 2.7 more BTX, so in total currently worth about $50/£40 – not a bad freebie!
However, unlike previous forks such as Bitcoin Cash (which made me 0.8 BTC, currently worth about £4k), this one seems to have been very disorganised. It has been weeks since the official blockchain snapshot was taken and only now is there an official wallet available – and that’s painful and resource hogging to use.
Further, this delay led to extensive trading in BTG futures so the current value of BTG is fairly low – it started at about $500 but is now hovering around $150.
The process to claim is a bit fiddly so you need to decide if it’s worth the effort of claiming – in fact, I would say that unless you own at least 0.1 BTC it’s barely worth it because you’ll lose too much in fees.
To begin, check to see if you’re eligible for the new BTG coins – essentially that means you held Bitcoin in a wallet you controlled (i.e. for which you have the private keys) on Monday 23 October 2017 (officially Block 491407).
(Just as a matter of interest note the value of that account showing there, 0.0227 BTC, has a value in the screenshot footer of £102.60. Now, less than a month later, it’s £134.37).
We go to the Addresses tab and look for the address that holds our BTC. If you have done many transactions it may be split across addresses – in this case you will have to make multiple claims. Right-click on the appropriate address and choose Copy Address to get it into the clipboard.
Go to the Bitcoin Gold Website and paste it into the claim box (‘Check Your Address Balance Before Block 491407’). With a bit of luck you’ll get a confirmation similar to this:
Bitcoin Gold claim confirmed (Image: BIUK)
The BTC Balance column may be empty if you’ve moved out your BTC since, which is fine. In fact, this process of claiming BTG will expose the private keys of your Electrum Wallet so you are advised to move out your BTC to a new wallet anyway; this is just to avoid the small possibility of hacking.
(Note: We will be using a respectable intermediate wallet so the risk is fairly low – I won’t go through the process here for simplicity since the amount risked is also low. However for my personal BTC stash I won’t use the source Electrum Wallet again without wiping it first).
At this point you need to decide if you want to claim or not. In this case the claim is worth 0.0227 x $149 = £3.38 so it’s not really worth it (fees will be about £4), but I’ll go through it anyway to illustrate the method.
The process is relatively straightforward, if a bit fussy. You install the Coinomi app on an Android phone and give it your private keys so that it can access your new BTG. Coinomi is used as it’s one of the few respectable wallets that currently support BTG.
There is an infographic available that covers this part of the process quite well:
Import Your BTG on HItBTC (Image: Goldenshow.io)
One thing that’s not made clear is how to get your Electrum private key in a form that Coinomi can recognise. To do that, in Electrum go to Wallet -> Private Keys -> Export, enter your password and wait a few seconds. Look for the line that matches the address of your BTC in the left column, and the key is in the right column – you need to type this into Coinomi as described in the infographic.
When it asks, hit Confirm and you should see your new Bitcoin Gold:
Coinomi screen BTG received (Image: BIUK)
Open an account on the HitBTC exchange if you don’t already have one – again it’s one of the few exchanges that support BTG. It doesn’t have a great reputation so I wouldn’t recommend using it for large amounts of BTC.
Go to the Deposit page (via the menu in the top bar) and click Deposit in the BTG Bitcoin Gold row. In Coinomi select the Send tab and type in the Wallet address from HitBTC and press Use All Funds. If it asks you to confirm coin type select Bitcoin Gold, then Send, enter the password and Confirm.
You’ll see the amount leave your Coinomi Wallet. Soon after you should see a wait cursor (rotating yellow circle) appear on the BTG line in HitBTC next to Main Account. Once the BTG appears, click on the arrow next to it to move it into Trading Account so you can sell it.
Click on Exchange in the top menu bar. To sell BTG look under Instruments for the BTC tab – click on Name to get the altcoins into alphabetical order and select BTG. To sell at a good price is, of course, an art in itself – you can use the chart on the left to judge whether it’s a good time to buy or not (has it just gone down or up, for example, what is the trend, etc.). However since i think BTG is generally going to trend downwards, as more people work out how to sell their free coins, let’s just sell immediately.
In the Sell BTG box click on your Balance to select all your BTG. Review the current Price (in BTC) and the resulting Total (in BTC). If you’re happy, press Sell Limit. You should get an acknowledgement and the BTG should be sold within a minute or two – you can confirm this in the My Trades tab under the chart. Note a small amount of BTG may not get sold and just be left behind in your BTG account (so-called ‘dust’).
If the market is falling your BTG may not get bought, for obvious reasons. If so you can find your BTG trade in the Active Order tab, cancel it, and try again at a lower price.
Your new BTC will now show in the top menu bar, and its equivalent value in dollars (USDT). To withdraw it click on the Account tab and in the BTC line press the arrow next to the BTC Trading Account value to move it into your Main Account. Press Withdraw and enter the amount to transfer.
At this point you enter the address where you want the BTC to go – if it’s back to your Electrum Wallet then you would find the address there by selecting the Receive tab to display it – copy and paste the address into HitBTC and press the Withdraw button.
As ever there will then be a delay as the transfer takes place and the BTC appears in your Electrum Wallet. (In fact, in the example I’ve shown here the amount of BTC gained from the trade isn’t enough to pay the fairly high minimum fee – £2 – to move the BTC out of HitBTC so I’m leaving it there until I can add more to it with further forks or airdrops).
And there you have it – your original BTC coins have increased by an amount equal to the value in BTG of the same amount of BTG coins, less trading fees.
Although it’s not worth going through this process with a small amount of Bitcoin, as demonstrated, it can be quite lucrative with a larger amount of Bitcoin. My personal account gained about £400 and some people will have made much, much more (“to whoever has, to him more shall be given…”) and all effectively for free.
Bitcoin briefly surges more than 11 percent Wednesday after news that Square’s payments app Cash is testing support for the digital currency.
The gains brought bitcoin within 10 percent of its record high hit last Wednesday.
However, the controversy over the best way to improve bitcoin’s transaction speeds and costs remains unresolved.
Bitcoin has again recovered quickly from a sharp drop.
The digital currency briefly surged more than 11 percent Wednesday to a high of $7,336.80 , according to CoinDesk. That’s within 10 percent of its record high of $7,879.06 hit last Wednesday. Bitcoin had fallen 30 percent below that record over the weekend amid controversy over the digital currency’s future.
Bitcoin (Image: MichaelWuensch/Pixabay)
In the established stock market, a decline of at least 10 percent from a recent high sends a stock into “correction” territory, and a drop of at least 20 percent marks “bear market” territory.
Wednesday’s gains in bitcoin came after news that Jack Dorsey’s company Square is testing support for bitcoin through its payments app Cash. Early on Wednesday, Credit Suisse analysts published a report on the Square news describing how the “bitcoin buying option could help stock.”
When 10,000 Bitcoins were used to buy two pizzas, the digital currency was a truly decentralized peer-to-peer payment network that operated across the globe instantly.
Today, the price has risen nearly a million-fold, but the network is no longer quite as functional as it was back in those days.
Bitcoin split (Image: MaxPixel)
Bitcoin still struggles with its identity, as many would like it to revolutionize money, but they are equally happy sitting on hordes of it and watching it appreciate in value faster than perhaps any other asset in history.
A single dollar invested in Bitcoin on the original Bitcoin pizza day would be worth over $3 mln today.
While upgrades have been made to Bitcoin along the way, it looks like Bitcoin is becoming less of a payment network and is instead evolving into digital gold. The failure of SegWit2x, which aimed to decrease transaction costs and improve confirmation speed, failed for a number of reasons.
Some of them were good, and some were mere straw men. But at the end of the day, one thing is clear: there is clearly no rush to increase Bitcoin’s capacity.
I have registered for loads of airdrops recently, so many that I have not done a very good job of keeping track of them. Often they are barely worth the trouble of claiming so last weekend I decided to take stock.
I knew I had received EtherDoge (eDoge) and iBTC coins so I decided just to dump them as I couldn’t see any long term value in either of them. They are both Ethereum based so I headed to EtherDelta.
First to go was iBTC. Here you can see I had received 3312 iBTC in my attached Ether wallet:
iBTC balance on EtherDelta (Image: Bitcoin Investors UK)
I deposited them into EtherDelta and was pleasantly surprised that I was able to sell them for 0.116 Ether:
Selling iBTC (Image: Bitcoin Investors UK)
That’s worth about £27 so not bad for a complete freebie.
Next I offloaded my eDOGE. My impressive 5 million eDOGE, however, turned out to be nothing like so valuable. They had almost no trading value and selling the lot only got me 0.005 ETH, or about £1!
Selling eDOGE (Image: Bitcoin Investors UK)
In fact it was worth than that, as it looks like the transaction cost me 0.02 ETH (45p) so wasn’t really worth the doing.
Never mind, I’m very pleased with the iBTC outcome.
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