Category Cryptocurrencies and Bitcoin

The slides for my presentation on “Bitcoin and Other Cryptocurrencies: Illegal Money or a New Global Payment Option?” are now online. Download them here.

Further information:

• Bitcoin Part 1 – Byzantine generals and pseudonyms,or: What is Bitcoin?
• Bitcoin Part 2 – Bitcoin mining
• Bitcoin Part 3 – Hashes, public key cryptography “for dummies,” and the block chain
• Bitcoin Part 4 – Wallets, sending and receiving Bitcoin, faucets, exchanges

Most translators and interpreters, as well as everybody doing international business, know them well: high bank charges, sometimes coupled with exorbitant exchange fees, endless, complicated forms, long clearance times etc. Then there is the archaic way of paying via check. Given that this is the 21st century, one might think that there should be better, cheaper, faster ways for transferring money from person A to person B. There are, of course, Paypal and similar services, which however also involve non-negligible fees, and their newer relatives Apple Pay, Google Wallet, and the like. Neither of the aforementioned options is truly global. However, there are some new players on the global payment market: Bitcoin, or more generally, cryptocurrencies.

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Faucets are websites, where generous (or not so generous) people give out BTC, most of the time in exchange for advertisements. Usually, you also have to solve Captchas in order to prove that you are not an automated bot. More often than not, these sites load pop-up windows with occasionally questionable content, but that’s how these sites make money. (I recommend a good anti-virus program!) Usually, you can never get more than a few Satoshis. A Satoshi is 0.00000001 BTC, or one hundred millionth of a BTC, the smallest BTC fraction the algorithm can currently deal with. Since the minimal amount of BTC in a transaction is currently 5430 Satoshis (0.00005430 BTC), these sites usually pay to another site, where the micropayments accumulate until your faucet earnings are over the minimum transaction limit. When you have exceeded the limit, these micropayment sites will pay out to your Bitcoin address.

Bitcoin Faucets

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This is part 4 of my series on Bitcoin. Part 1 featured an introduction and can be found here, part 2 discussed the mysterious operation of creating Bitcoins, called mining, and part 3 explained the public ledger, the block chain. For those of you for whom this was all a bit too theoretical and/or esoterical, what with all the Byzantine generals floating around, here’s a practical guide.

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This is part 3 of my series of blog posts on the topic cryptocurrencies. The first, introductory part can be found here. The second part on mining can be found here.

Recap – Bitcoin = direct electronic transactions without intermediary

To recap, I explained the main idea behind the Bitcoin protocol, which allows electronic peer-to-peer transactions without an intermediary. In brief, the process works as follows:

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This is part II of my series of blog posts on the topic cryptocurrencies. The first, introductory part can be found here.

Recap – Bitcoin = direct electronic transactions without intermediary

To recap, I explained the main idea behind the Bitcoin protocol, which allows electronic peer-to-peer transactions without an intermediary. In brief, the process works as follows:

Read More