The best performing currency

[nathanhulick]

Re: The best performing currency

I don't agree.

The same logic holds for land - even if the same land is bought and rebought over and over again and its value rises, the cause may very well be due to marketing as opposed to economic need.

Secondly the supposedly indestructible algorithm - how do we know there isn't a back door?

I.e. the creator or someone else has created a very powerful algorithm, but one which can be perverted.

The answer to your questions is in the white paper.

http://www.bitcoin.org/bitcoin.pdf

We know there is no back door because it is open source.

[c1ue]

Re: The best performing currency

The answer to your questions is in the white paper.

http://www.bitcoin.org/bitcoin.pdf

We know there is no back door because it is open source.

From the pdf posted:

The system is secure as long as honest nodes collectively control more CPU power than any
cooperating group of attacker nodes.

So there is already a weakness noted: bitcoins relies on the hope that 'honest' transactions will outnumber dishonest. However, as false nodes can be created at will, this hope is indeed quite naive.

In fact this statement notes that backdoors can be created by anyone who puts together a way to generate large numbers of fake nodes. That's exactly what DDoS zombie networks are good for.

Secondly bitcoins isn't open source in the normal sense.

All it does is append all transactions into a permanent record attached to a given 'value'.

This theory is exactly how anti-money laundering operations are supposed to work - and we all know how successful they are (not).

Lastly bitcoins are vulnerable because they can only be accessed/used via computer. There are lots of rigorous ways by which computers can be attacked:

http://bitcoinweekly.com/articles/security-in-bitcoin

author: kiba
published: 2011-03-30 03:04:38 UTC A recent bitcoin scam was in progress until it was noticed that somebody's wallet had been stolen. The software was a trojan that deletes a bitcoin wallet and mails the copy to the scammer. Fortuntely, the criminal's stupidity allowed a bitcoiner to hijacked his gmail account and returned some of the stolen bitcoin to its rightful owner, although 30 bitcoins could not be recovered.
The victim in question learned from his loss. However, as the community grows, newbies will be caught unaware by scam attempts. It's also worth noting that even the most security aware could lapse and forget that he should not just download software. After all, we're all human beings.
Still, I believe that bitcoin clients could do better by addressing security concerns and making it easier for the average bitcoiner to secure their money. Here are some of the security proposals that are floating around in the bitcoin community:

1. Bitcoin wallets should be encrypted by default.
2. Bitcoin wallets should be spilt into saving wallet and spending wallet to limit the amount of damage that could be caused by trojan. This should also be default behavior too.
3. An application should not be able to write, copy, and read a bitcoin wallet without user authorizing or without being notified.
4. Backup should be built-in and obvious to users.

I think the forum community could aid in this process.

1. There could be bitcoin security firms that download new software and place it in the VM, then observe what's hpapening. Bonus point for analyzing the source code, posting security flaws, certification, and other practice that minimize security problems in the bitcoin economy. Of course, for proprietary software, they would need to pay high fees to the firm because the source code are not available for inspection.
2. The source code for software that interact with bitcoin wallet should be open to examination. If not, avoid it like a plague. Use MD5 hashes to verify the integrity of files.
3. A news source for bitcoin security would be useful in dissemintating information to bitcoiners. The Bitcoin Weekly obviously could carry such publication, but new publishing organizations could pop up exclusively for security news.
4. It should be a community norm for bitcoiners to spotcheck potential risk and educate new bitcoiners about security. For example, if a new software is released by a new forum member, bitcoiners would swing in to warn others of potential risk.

I am sure these proposals have risks and flawes. For example, if a keylogger is smuggled in, a cracker now have access to the password needed to crack the system. If the user forgot his password, he would be unable to access any of his wallet.
There will be continuous loss of bitcoins due to fraud and security compromise, but we can mininize and educate people about securing thier bitcoin. One less testimony about bitcoins getting stolen means that it will be easier for the bitcoin economy to succeed.

Say what you want about fiat currency, credit cards, and/or PMs - all of these either have legal remedies or are impossible to attack solely via computer.

[Chris Coles]

Re: The best performing currency

You have all watched the kids sitting there with their heads fill with music from their headphones; now get real and understand that they not only reject conversation with the older generation; they are now also rejecting the currency of the older generation. Arab Spring on the one hand and now Bitcoin Spring too. Way to go!

[nathanhulick]

Re: The best performing currency

From the pdf posted:

So there is already a weakness noted: bitcoins relies on the hope that 'honest' transactions will outnumber dishonest. However, as false nodes can be created at will, this hope is indeed quite naive.

In fact this statement notes that backdoors can be created by anyone who puts together a way to generate large numbers of fake nodes. That's exactly what DDoS zombie networks are good for.

Secondly bitcoins isn't open source in the normal sense.

All it does is append all transactions into a permanent record attached to a given 'value'.

This theory is exactly how anti-money laundering operations are supposed to work - and we all know how successful they are (not).

Lastly bitcoins are vulnerable because they can only be accessed/used via computer. There are lots of rigorous ways by which computers can be attacked:

http://bitcoinweekly.com/articles/security-in-bitcoin



Say what you want about fiat currency, credit cards, and/or PMs - all of these either have legal remedies or are impossible to attack solely via computer.

Open source means that the code is open, anyone can look and see exactly what the program is doing.

Also, you seem to be misunderstanding the size of the computing network that would be required to overwhelm the honest nodes. Based on the current size of the bitcoin network, you would need roughly all of the top 1000 supercomputers in the world to take over the network.

As to them being only accessible by computer, that is one of the benefits of bitcoins. Sure, if you don't practice good computer security, and/or don't secure your wallet, someone might steal your bitcoins. If I go to the bar tonight and leave my wallet sitting out while I walk around talking to people, the same thing might happen. Sure, there are no legal remedies, because bitcoins are new and not mainstream at all right now. That doesn't mean that there won't be changes to the laws in the future. Also it is completely possible to set up a debit card style system for bitcoins. People are working on new applications for bitcoins as we speak.

Maybe bitcoins will fail, maybe they won't. However, you need to do more research before you reject them out of hand. Your criticisms are solely based on your lack of technical knowledge of computers and how the bitcoins work.

[c1ue]

Re: The best performing currency

If I go to the bar tonight and leave my wallet sitting out while I walk around talking to people, the same thing might happen.

Yes, but a person across the world cannot attack your wallet. In the bar or otherwise.

I posted a story on Rant 'N Rave on how a computer repair person hijacked laptops and then manipulated users into stripping in front of their laptop webcams. I'd be shocked if it were not possible to do so without even physical access to the hardware.

You also fail to reply on the lack of recourse.

A stolen credit card number will get transactions refunded.

A lost check book or credit card can be cancelled/replaced.

Traveller's checks can be voided.

Even stolen cash can at least get a police report.

Your criticisms are solely based on your lack of technical knowledge of computers and how the bitcoins work.

My technical knowledge frankly is irrelevant - there are plenty of people who have and are looking at bitcoins supposedly decentralized and uncrackable baseline, and who conclude the same:

http://blog.ezyang.com/2011/06/the-c...hy-of-bitcoin/

Great, so how do we break this? There are several ways:

• We could break the underlying elliptic curve cryptography, by either solving the discrete logarithm problem (this is something quantum computers can do) or by breaking the particular elliptic curve that was chosen. Most research in this area goes towards finding vulnerabilities in specific elliptic curves, so the latter is more likely.
• We could break the underlying cryptographic hash function. In this case, we have a known signature from the user we would like to attack, and we generate another input transaction that hashes to the same value, so we can replay the previous signature. Such an attack would be dependent on the form of the serialized transaction that Bitcoin processes: it does a nontrivial amount of processing on a transaction, so some legwork by the attackers would be necessary; however, because transactions include a scripting system which permits complex transactions to be built, an attacker would have some leeway in constructing such an input. This would not work on single-use addresses, since no such signature exists for replay.

Breaking the signing algorithm requires a selective forgery attack or stronger, and means that arbitrary transactions may be forged and entered into the system. It would be a complete system break. For the signature replay attack, some protection could be gained by adding client-side checks that the same signature is never used for two different transactions.

You also fail to note that the issue isn't computational power as represented by a few core systems; it is computational power as a function of the network. Or in other words, a massive distributed attack such as by DDoS can corrupt the data trail by which bitcoins is supposed to be safe.

[nathanhulick]

Re: The best performing currency

Yes, but a person across the world cannot attack your wallet. In the bar or otherwise.

I posted a story on Rant 'N Rave on how a computer repair person hijacked laptops and then manipulated users into stripping in front of their laptop webcams. I'd be shocked if it were not possible to do so without even physical access to the hardware.

You also fail to reply on the lack of recourse.

A stolen credit card number will get transactions refunded.

A lost check book or credit card can be cancelled/replaced.

Traveller's checks can be voided.

Even stolen cash can at least get a police report.



My technical knowledge frankly is irrelevant - there are plenty of people who have and are looking at bitcoins supposedly decentralized and uncrackable baseline, and who conclude the same:

http://blog.ezyang.com/2011/06/the-c...hy-of-bitcoin/

You also fail to note that the issue isn't computational power as represented by a few core systems; it is computational power as a function of the network. Or in other words, a massive distributed attack such as by DDoS can corrupt the data trail by which bitcoins is supposed to be safe.

Your technical knowledge certainly is relevant. In fact, it's the most relevant part of your posts. You apparently don't understand what a DoS is, or how the bitcoin network works. The fact that the computing power supporting bitcoins is a distributed network rather than a centralized server is a strength of bitcoins, not a weakness. Also, saying that the bitcoin network is subject to attack by quantum computers is no different than saying that space aliens might use a tractor beam to suck up all the gold out of Fort Knox.

Your claim that some blogger thinks that bitcoin's crypto is not safe. He is assuming that bitcoin will keep the same encryption forever. It is the nature of computer technology that any form of encryption is eventually going to be obsolete, which is why newer and safer forms are always being developed. Do you have the same qualms about banking online? You do understand that the encryption your bank uses is not going to be safe forever, which is why it is updated every few years.

Your argument that there is recourse against stolen cash because you can file a police report, but that there is no recourse for stolen bitcoins is extremely weak. If bitcoins become popular, there is nothing stopping government from protecting them against theft the same way they protect stolen credit cards, cash, etc. Fifty years ago would you have claimed that credit cards are not safe because they are a new technology and someone can steal from you without physically accessing your wallet? Would you assume that governments would not use the concept of property rights to protect theft from credit cards, just because they were new and hadn't done it yet?

Also, you fail to address what might be the most important benefit of bitcoins. They can be sent anonymously anywhere on the planet, with no transaction fees.

[c1ue]

Re: The best performing currency

Your technical knowledge certainly is relevant. In fact, it's the most relevant part of your posts. You apparently don't understand what a DoS is, or how the bitcoin network works. The fact that the computing power supporting bitcoins is a distributed network rather than a centralized server is a strength of bitcoins, not a weakness. Also, saying that the bitcoin network is subject to attack by quantum computers is no different than saying that space aliens might use a tractor beam to suck up all the gold out of Fort Knox.

Given that I never even typed the word 'quantum' - clearly you're projecting something from somewhere not associated with what is real.

As for DDoS - the point of DDoS is remote control of a large network of computers. In the case of a DDoS attack, all these computers do is make requests toward a web site.

But it isn't difficult to reorient a botnet composed of servers to create fake bitcoin transactions.

But then your prescience concerning bitcoins' technology apparently does not extend to seeing how existing technologies can be used to exploit weaknesses in newer technologies.

Your claim that some blogger thinks that bitcoin's crypto is not safe. He is assuming that bitcoin will keep the same encryption forever. It is the nature of computer technology that any form of encryption is eventually going to be obsolete, which is why newer and safer forms are always being developed. Do you have the same qualms about banking online? You do understand that the encryption your bank uses is not going to be safe forever, which is why it is updated every few years.

Again, I'm not sure what you're reading. What the post noted was in no way a function of the encryption - what was noted was the fundamental weakness of the transaction structure.

To rephrase what you apparently cannot understand: whatever the encryption - the safety of bitcoins is not just a function of encryption but also what is encrypted. If anyone has access to the bitcoins' algorithm - and everyone does because it is 'open' - then it is possible to attack the system via fake transactions entered into the encryption loop in order to pervert the ownership chain.

It is the ownership chain which is supposed to confer safety - and demonstrably can be made unsafe.

The only safety this portion of bitcoins process offers is that the distributed nature of the transaction history makes it difficult for an individual person to pervert, but does not present the same difficulty for a systematic perversion.

The only reason this type of thing doesn't occur with say the address lookup tables in the internet baseband routers, for example, is that these are generally protected from access - even then it has occurred a number of times in the past.

As for your online banking comment - it is frankly irrelevant. Because the online banking - like credit cards and everything else - has both offline backup in paper/statement form as well as legal recourse should shenanigans occur.

Neither applies for bitcoins.

Your argument that there is recourse against stolen cash because you can file a police report, but that there is no recourse for stolen bitcoins is extremely weak. If bitcoins become popular, there is nothing stopping government from protecting them against theft the same way they protect stolen credit cards, cash, etc.

From the very beginning there has been recourse for internet banking, credit cards, and what not.

Popularity is irrelevant because credit card issuers, institutions that offer internet banking, etc etc all have inherent incentive to make sure their customers don't get robbed by outsiders.

Bitcoins has no such incentive.

Also, you fail to address what might be the most important benefit of bitcoins. They can be sent anonymously anywhere on the planet, with no transaction fees.

And that is exactly why it will fail.

Criminals, terrorists, and what not will flock to this system were it anything more real than a cyberjunkie's toy.

Governments also have powerful reasons to prevent this - it makes tax evasion trivially easy.

[nathanhulick]

Re: The best performing currency

Suffice it to say that while I was trying to have an actual discussion about this topic, but you are insistent on being rude and condescending and apparently just want to argue about something you do not understand.

You didnt type the word 'quantum', but the post that you linked made the claim that quantum computers could crack the bitcoin encryption. I guess not only did you fail to read the bitcoin white paper, you failed to read the post that you linked.

The rest of your post is just a hodgepodge of nonsense. You seem to think that because a DDoS attack can take down one IP address, it can also take down thousands. You do not understand the mathematical basis behind bitcoins, and why it is almost impossible to create fake transactions, or a rogue network.

There is no sense continuing this discussion with you. I could spend my time pointing out the flaws in literally every single sentence you wrote, but I know from past experience that using logic and reason to argue on the internet with anonymous people who can't even understand what they are talking about is a pointless waste of time.

Have a nice day!

[c1ue]

Re: The best performing currency

You didnt type the word 'quantum', but the post that you linked made the claim that quantum computers could crack the bitcoin encryption. I guess not only did you fail to read the bitcoin white paper, you failed to read the post that you linked.

The referred to post noted quantum computing might crack the algorithm for encryption, but what I was referring to was not cracking the encryption.

Indeed the point of that post was not how to crack bitcoins encryption but to look at the overall system to see what ways it might be vulnerable.

The post spoke specifically that a way to pervert the system does not require cracking the encryption. All you need is to interrupt the tracking string embedded within any given set of bitcoins by corrupting enough of the servers which hold this information.

And the DDoS attack - which you still cannot comprehend - is where you set up a large number of servers in a botnet configuration to act as bitcoin history repositories in order to pervert the tracking strings.

So far as I understand it, the entire purpose of torrent type setups is that anyone can be a server - and this applies to bitcoins as well. By having innumerable servers available, it is very difficult for any individual to shut down the network.

However, the purpose of perverting bitcoins for gain isn't shutdown of the network. It is the addition of enough 'false' bitcoin servers so that you can overwhelm the 'true' bitcoin histories.

After all, since every bitcoin history isn't held on every server, there are mechanisms by which incorrectly matching histories are reintegrated - and that mechanism is a polling one.

Of course you seem to be far more interested in saying the technology is immaculate than actually understanding anything critical of it.

There is no sense continuing this discussion with you. I could spend my time pointing out the flaws in literally every single sentence you wrote, but I know from past experience that using logic and reason to argue on the internet with anonymous people who can't even understand what they are talking about is a pointless waste of time.

Riiiight. I put forward an entire series of challenges which bitcoins faces, and your response is again lacking fact and failing to address the challenges.

But by all means run away into ad hominem.

[cjppjc]

Re: The best performing currency

Down to 11 today. Must be the weekend. Don't all currencies lose 2/3 of their value on the weekends?

[*T*]

Re: The best performing currency

After all, since every bitcoin history isn't held on every server...

Actually, at the moment, it is.

[swgprop]

Re: The best performing currency

Indeed the point of that post was not how to crack bitcoins encryption but to look at the overall system to see what ways it might be vulnerable.

And in that vein we have this:

Bitcoin prices plummet on hacked exchange

The Bitcoin community faced another crisis on Sunday afternoon as the price of the currency on the most popular exchange, Mt.Gox, fell from $17 to pennies in a matter of minutes. Trading was quickly suspended and visitors to the home page were redirected to a statement blaming the crash on a compromised user account. Mt.Gox's Mark Karpeles said that the exchange would be taken offline to give administrators time to roll back the suspect transactions.

The extent of the compromise became clear when a copy of Mt.Gox's user database began circulating online. The file included username, email addres, and hashed password for thousands of Mt.Gox users. Karpeles's statement was updated to acknowledge the breach. He warned users who have re-used the Mt.Gox passwords on other sites to change them.

The crash appears to be the fault of the Mt.Gox exchange rather than a collapse in the value of the currency itself, as the integrity of Bitcoin's underlying peer-to-peer transaction clearing process does not appear to have been compromised. Prices at a competing exchange showed Bitcoins trading down about 25 percent to $13 per Bitcoin earlier today, although it has edged up since.

It's been a bad weekend for Mt.Gox, which until now has been the most popular method for converting between Bitcoins and more conventional currencies. Earlier in the weekend, it was reported that the site was vulnerable to a cross-site request forgery in which a logged-in user could be tricked into submitting fraudulent transaction requests. On Sunday, dozens of irate Bitcoin users pledged to stop using the exchange, arguing that the site's administrators lacked the technical sophistication to build a secure and reliable currency exchange.

But Bitcoin users have few alternatives if they wish to convert their Bitcoins into more stable commodities. A recently-launched competitor, called TradeHill, has capitalized on Mt.Gox's troubles by encouraging members of the Bitcoin community to use their exchange instead. But the site is so new that no one knows if its administrators have the resources or technical expertise to avoid the security and reliability problems that have plagued Mt.Gox.

It's been a wild couple of months for Bitcoin traders. Between April and June, the currency rose from a dollar to more than $30. This month, it fell back to $10 and rose again to $20. It was at $17 at the beginning of this weekend before a string of bad news pushed it down again.

Theoretically, this weekend's developments shouldn't damage Bitcoin's long-term value, since the security model of the underlying currency remains uncompromised. But Bitcoin is a fiat currency; its value ultimately depends on nothing more than public confidence. If the recent string of Bitcoin-related security woes convinces more Bitcoin users to cash out, the currency's value could continue to fall.

[nathanhulick]

Re: The best performing currency

And the DDoS attack - which you still cannot comprehend - is where you set up a large number of servers in a botnet configuration to act as bitcoin history repositories in order to pervert the tracking strings.

I am not going to address each of your points, only this one as it is so laughable.

A Distributed Denial of Service attack is when a network of computers attack a single website by sending large numbers of protocols, overwhelming the site's ability to respond to normal users trying to visit the site.

There is no such thing as a "bitcoin history repository", so good luck trying to "pervert the tracking strings". What website do you think you would be attacking with your DDoS?

Again, the fact that you have absolutely no technical knowledge whatsoever means that your statements do not even make sense. It is as if you just took a bunch of technical words you saw on the internet and mashed them together without even understanding them.

There is nothing "ad hominem" about that.

[laphroaig]

Re: The best performing currency

A Distributed Denial of Service attack is when a network of computers attack a single website by sending large numbers of protocols, overwhelming the site's ability to respond to normal users trying to visit the site.

I disagree.

A common form of Distributed Denial of Service attack is when a network of computers attack a single website by sending large numbers of protocol messages, overwhelming the site's ability to respond to normal users trying to visit the site.

But there could be many other forms of DDOS. Any attack that (a) uses a distributed network of computers and (b) is intended to disrupt a service, could reasonably be described as DDOS attack.

I don't know enough about bitcoin to know how vulnerable bitcoin is to such an attack, but I think you are dismissing c1ue's argument far too simplistically.

[c1ue]

Re: The best performing currency

2 more chimes on the botnet theme- both from wiki:

Symantec:

A digital currency known as Bitcoin (BTC) has been causing a bit of a media stir of late due to its use for illicit purposes. Some readers of this blog will be familiar with and have used a digital currency of some form in the past to purchase goods online. Some may even remember failed digital currencies such as e-gold, which had operations suspended by US authorities after its proprietors were indicted on four counts of violating money laundering regulations back in 2007. With Bitcoin, we now have another multi-million dollar digital currency market without any central authority for regulation. (An in-depth explanation of Bitcoins is available on Wikipedia.)
One of the selling points of the Bitcoin currency is that anyone with a computer can begin to earn Bitcoin blocks by using his or her computer’s computational power, along with open source Bitcoin software, to solve a difficult cryptographic proof-of-work problem. This is referred to as Bitcoin mining and, if successful in solving a block, it will lead to a reward of up to 50 Bitcoins per block. As of June 2011, there are just over 6.5 million Bitcoins in existence, with a finite number of 21 million possible to be reached over time. With Bitcoins presently trading at close to $20, Bitcoin mining sounds like an easy way to make some money. Well, cybercriminals might just be thinking the exact same thing.
It has been known for some time that a botnet’s combined computing power could be used for a number of nefarious purposes. We can now add Bitcoin mining to that list. While Symantec has not observed any botnets currently being used to mine Bitcoins, the possibility is there. Through the use of pooled Bitcoin mining, a botnet herder could covertly mine Bitcoins using the computational power of a victim's computer. Another selling point of the Bitcoin currency is its apparent anonymity; along with decentralized authority spread across a peer-to-peer network, this makes the currency even more attractive to cybercriminals. But is Bitcoin mining really worth a botnet herder’s time? Let’s find out.
Using an average computer and only the CPU for computational purposes, we found that when Bitcoin mining, we were able to compute roughly 1 mega-hashes/second. So what does that mean if we want to do pooled Bitcoin mining on a botnet? Using an online Bitcoin mining calculator—which takes into account the current difficulty factor for solving Bitcoin blocks, the computer's hash rate, and Bitcoin exchange rates—we get the following data for Bitcoin botnet mining:


Caveat: calculations based on mining constantly for 24 hours using CPU only at current exchange rate and difficulty factor.

Difficulty Factor	567358.224571
Hash Rate (mega-hashes / second)	1.0
Exchange Rate ($/BTC)	$20

Bot earnings broken down
	Coins	Dollars
Per Day	0.00	$0.03
Per Week	0.01	$0.23
Per Month	0.05	$0.97

Botnet mining per day
Bots		Bot earnings per day	Total earnings
100	x	$0.03	$3
1,000	x	$0.03	$30
10,000	x	$0.03	$300
100,000	x	$0.03	$3,000

Botnet mining per week
Bots		Bot earnings per week	Total earnings
100	x	$0.23	$23
1,000	x	$0.23	$230
10,000	x	$0.23	$2,300
100,000	x	$0.23	$23,000

Botnet mining per month
Bots		Bot earnings per month	Total earnings
100	x	$0.97	$97
1,000	x	$0.97	$970
10,000	x	$0.97	$9,700
100,000	x	$0.97	$97,000

A point to note about these figures is that, as mentioned in the caveat, the compromised computer systems would have to be running 24 hours a day, which is highly unlikely. Also, the earnings would vary from day to day depending on luck. So, as we can see, there is the potential for cybercrimanals to earn money this way. However, another question is if Bitcoin mining is more profitable than other uses for the botnet. Let’s just compare one alternative: renting the botnet out for DDoS attacks. While Symantec has observed DDoS attacks being offered for as little as $5, the more usual offer is similar to what is seen in the screenshot below, offering at the high end of $400 dollars rent a week for a few hours a day.


Taking this information into account, Bitcoin botnet mining as an attractive and profitable venture for cybercriminals is very questionable. However, with recent spikes in the valuation of Bitcoins reaching as high as $26, it may become more appealing in the future to cybercriminals as another source of illegal earnings from their botnets.
We are already starting to see reports on fraud involving Bitcoins and a Bitcoin account being hacked with a substantial monetary loss of approximately $500,000. Symantec has seen one such threat designed to steal Bitcoins from your digital wallet called Infostealer.Coinbit, and we expect to see more in the near future.
As always, Symantec recommends that you keep your antivirus definitions up to date to ensure protection against new threats such as Infostealer.Coinbit.

Australia Broadcasting News employee busted.

An employee of the Australian Broadcasting Corporation has been caught using ABC servers to mine for Bitcoins, the Sydney Morning Herald reports.
New Bitcoins are generated through “mining” — a process that takes time and a lot of CPU power. As more Bitcoins are generated, the network self-regulates, producing fewer coins over time, and making it less likely a solo computer will complete the “blocks” that reward the user with new Bitcoins.
The unnamed employee, a part of the ABC’s IT department, had installed the miner on the ABC’s servers to make use of idle CPU power. Nobody at the ABC would comment on the issue, though the Herald quotes communications head Sandy Culkoff saying that “there is a serious misconduct case underway in relation to this matter.”
Bitcoins can be traded for cash, with the currency having reached highs of around US$20 per coin. I’m sure the consequences the unnamed employee now faces for using company equipment for personal gain aren’t going to be worth the effort.
Bitcoin hasn’t had a great month. Half a million US dollars worth of Bitcoins were stolen from an early adopter, the most popular Bitcoin exchange was hacked and prices temporarily flatlined shortly after, U.S. senators pushed a crackdown on the currency and, to add insult to injury, the EFF (who lent the currency some of its earlier legitimacy) have stopped taking donations in Bitcoins and say they won’t even make use of the sizeable number of Bitcoins they’ve already been sent.