All Questions

183
votes
21answers
89k views

What is a good way to concisely explain Bitcoin?

Often I'm asked to explain Bitcoin to someone and occasionally I come up with something stellar that really nails it, but most times it's a rambling incoherent mess. What I would like to see is a ...
168
votes
8answers
105k views

What exactly is Mining?

I have heard that mining is for people with ready hardware and blah blah blah... But what exactly is it? Does it operate like real mining? I mean, people talk about it like you are physically mining.
161
votes
5answers
223k views

What are “bitcoin days destroyed”?

The concept of bitcoin days destroyed has been proposed as a measure of bitcoin volume. However, I don't think the bitcoin wiki really explains the idea very well. What is the purpose or advantage of ...
147
votes
5answers
238k views

What is a 'Satoshi'?

I am aware that Satoshi Nakamoto is the author of the paper that originated Bitcoin and the creator of the original bitcoin client. However, I often hear the term Satoshi as if it was a monetary unit. ...
132
votes
2answers
39k views

How do Bitcoin clients find each other?

What protocols or algorithms are Bitcoin clients using in order to find their peers? I learnt that BitTorrent clients may rely on central computers called trackers. Do Bitcoin clients need any kind of ...
129
votes
8answers
46k views

What can an attacker with 51% of hash power do?

Suppose organization X has 51% of the hash power for a period of 1 week. In this week, what exactly can and can't X do?
128
votes
10answers
289k views

Why is my transaction not getting confirmed and what can I do about it?

I sent a transaction without (or with an exceptionally small) transaction fee using extremely small or unconfirmed inputs while the stars were not standing right. For whatever reason, I have been ...
126
votes
4answers
220k views

What are bitcoin miners really solving?

As with mining, what are the bitcoin miners really solving? I read they are solving hashes, but what does that really mean. Can we see what they are solving? Can someone give an example of what a ...
115
votes
10answers
48k views

How do you obtain bitcoins?

This is a question many people ask when they're introduced to Bitcoin. Bitcoin sounds interesting, but if I want to use this system I will need to get some coins, otherwise, there's no way I can ...
114
votes
10answers
39k views

How much will transaction fees eventually be?

Some people keep evangelizing that Bitcoin transaction fees are much lower than in PayPal or with credit cards. However, once nearly all 21 million bitcoins have been mined, the network will still ...
112
votes
11answers
54k views

Is it possible to brute force bitcoin address creation in order to steal money?

Bitcoin users frequently generate new addresses for each transaction they make, which greatly increases the number of bitcoin addresses being used to receive money. Would it be possible (and ...
106
votes
9answers
317k views

How much Bitcoin will I mine right now with hardware X?

Say I have a given piece of hardware (CPU/GPU). Where can I find out how much Bitcoin will I mine per day?
106
votes
5answers
18k views

Why is 6 the number of confirms that is considered secure?

Why is 6 is the number of confirmations that is considered secure? I haven't found any mathematical explanation or otherwise that explains why it is 6 and not 5 or 7. Is there a historical reason for ...
93
votes
17answers
218k views

How can I buy Bitcoin via a Credit Card or Paypal?

I want to buy some bitcoins. Ideally, I would like to buy them on the MtGox exchange (because the consensus seems to be that this is the most reputable exchange), however I have found the system for ...
93
votes
4answers
68k views

How does merged mining work?

How does the implementation of merged mining affect the global hash rate of alt chains? Does one solution fit all? Does one solution fit some? Does the rate of "solutions that will fit" decrease ...
91
votes
12answers
8k views

Is there a way to set up proof-of-work systems so they would be even more useful?

One of the arguments made against Bitcoin's design choices is that it wastes resources authenticating transactions. In particular, finding small hashes is completely useless for the world. Are there ...
86
votes
9answers
96k views

Why was 21 million picked as the number of bitcoins to be created?

Why did Satoshi pick 21 million as the number of bitcoins to be created? What is the significance of that number?
84
votes
15answers
20k views

Does hoarding really hurt Bitcoin?

Some people believe that hoarding hurts the Bitcoin economy. But are they really right? As long as corresponding goods vendors and services will be here to stay and reinforce people's faith in ...
82
votes
9answers
172k views

Why don't people buy at one exchange and sell at another?

Bitcoinity.org shows that for the past 30 days, bitstamp's price is high at 101.00, low at 77.00, and current price is 98.04. On contrast, mtgox's price for the past 30 days is high at 115.00, low at ...
71
votes
6answers
18k views

How can I accept bitcoins on my website?

I have an online store and would like to begin accepting bitcoins. How can I go about doing this?
69
votes
7answers
66k views

Can I download the whole block chain from somewhere?

Every time I turn on the Bitcoin client it takes days to catch up with the block chain. Are there alternatives to getting it trickling through the peer-to-peer network? Can I just download it ...
63
votes
9answers
79k views

Where do bitcoins come from and what gives them their value?

Where do bitcoins come from? From the WeUseCoins.com video it appears they are just being produced by "miners" and sold to people. So who backs Bitcoin or gives it its value?
63
votes
2answers
9k views

If someone wanted to pretend to be Satoshi by posting a fake signature to defraud people how could they?

If a random fraudster wanted to post a bunch of mysterious ECDSA signatures that the public would believe came from Bitcoin's creator, in order to disrupt the Bitcoin market, extract money from people,...
63
votes
2answers
28k views

What is an SPV client?

I've seen SPV client mentioned in several places. What exactly is a SPV client? How is it different from a standard client?
61
votes
3answers
23k views

How to redeem a basic Tx?

Given a raw, standard Tx (wiki): 01000000 01 26c07ece0bce7cda0ccd14d99e205f118cde27e83dd75da7b141fe487b5528fb 00000000 8b ...
61
votes
4answers
20k views

What is a compressed Bitcoin key?

The standard Bitcoin client in version 0.6 apparently introduces compressed keys. What are they? Are there any drawbacks to using them? Any incompatibilities with older software? Reductions in ...
60
votes
9answers
24k views

How anonymous are Bitcoin transactions?

I read some sources that say Bitcoin transactions are anonymous, some that say they are semi-anonymous, and some that say they are not anonymous at all. In what ways are the transactions anonymous ...
58
votes
5answers
26k views

What is a soft fork?

When people talk about possible changes to how Bitcoin works they sometimes say a particular change can be implemented as a soft fork. What does that mean? How does this compare to a hard fork?
58
votes
11answers
10k views

Will Bitcoin suffer from a mining Tragedy of the Commons when mining fees drop to zero?

One issue that I haven't seen clearly addressed is the possible Tragedy of the Commons in Bitcoin's future (see this answer). 40 years into the future, the only significant direct benefit for honest ...
57
votes
6answers
154k views

How many bitcoins will there eventually be?

Since bitcoins are being regularly rewarded to miners, will the number of bitcoins continue to grow indefinitely, or will there be a maximum total number of bitcoins in existence? And if there is ...
57
votes
3answers
13k views

Should I leave the Bitcoin client open?

Some people recommended that I leave my Bitcoin client open because it helps the network. Apart from the security implications, why should I do this? I thought that miners were the ones responsible ...
56
votes
2answers
89k views

Can someone explain how the Bitcoin Blockchain works?

I'm trying to figure out how the blockchain works and how to read it via blockchain.info website. Is there a laymen way of explaining how the block chain works and how to read the blockchain to trace ...
54
votes
2answers
28k views

How is difficulty calculated?

Can anyone explain me in the plain English how difficulty is calculated. I have a very approximate understanding that it is calculated based on the amount of hash power in all the bitcoin community ...
54
votes
4answers
6k views

Have any cryptography experts vetted the bitcoin source code?

Theoretically, bitcoin's open source nature makes it more resistant to bugs and exploits. However, due to the specialized nature of the code, even many programmers don't fully understand the ...
54
votes
8answers
38k views

What effects would a scalable Quantum Computer have on Bitcoin?

A scalable quantum computer is a quantum computer that is easy to extend - adding more (q)bits of memory is not a fundamentally hard problem, and will happen. Or, alternatively, that it follows Moore'...
53
votes
3answers
62k views

How to calculate transaction size before sending (Legacy Non-Segwit - P2PKH/P2SH)

I know that I pay the transaction fee per kB, so how can I calculate how large the transaction will be before I send it via the RPC api. I run a site using bitcoins, and I cannot let the user's ...
53
votes
7answers
42k views

Can bitcoins be counterfeited?

Traditional currencies have anti-counterfeiting features designed to make them hard to copy, but despite this attempt counterfeit money is a real threat. Since bitcoins are digital, it's trivial to ...
53
votes
5answers
53k views

What happens if your bitcoin client generates an address identical to another person's?

Here's a what-if scenario: Person A has a Bitcoin address with 25BTC. Person B opens up their Bitcoin client: which may or may not have the complete blockchain (the latter would mean no copies of ...
50
votes
6answers
50k views

What is the Merkle root?

The Bitcoin wiki Vocabulary article explains why the Merkle root exists: Every transaction has a hash associated with it. In a block, all of the transaction hashes in the block are themselves ...
50
votes
4answers
29k views

What keeps the average block time at 10 minutes?

I've been told "the network" sets the difficulty level such that there will be one new block mined every ten minutes. I imagine the rich would instead prefer to keep difficulty as high as possible to ...
49
votes
2answers
67k views

In the ASIC-age, is it worth starting mining Bitcoin at home?

I have recently learned about Bitcoin and would like to get rich quickly into mining. I have control of a laptop library full of ancient computers powerful gaming PC cluster of GPUs an old ASIC, I ...
48
votes
13answers
8k views

Will deflation destroy Bitcoin?

With the limited total quantity of bitcoins, and people losing their wallets constantly decreasing that number, won't rampant deflation destroy Bitcoin?
47
votes
4answers
744k views

What is the difference between kH/s, MH/s, and GH/s?

I started mining on a friend's computer and it shows 300 kH/s. But when I research other peoples' hash rates I usually see MH/s. Are these speeds the same as kilobytes and megabytes? Also, when I say ...
47
votes
9answers
5k views

What methods could a government use to shutdown Bitcoin?

Let's say that a government decided to shut down the Bitcoin network. What options would they have to achieve this? Would they need to convince other governments? All governments? Let's set as a ...
47
votes
3answers
17k views

How does the Lightning network work in simple terms?

Could you please describe how the Lightning network is supposed to work? How does it scale better than pure blockchain transactions? What are the advantages and disadvantages of Lightning Network ...
47
votes
2answers
36k views

What are bitcoin “confirmations”?

When I receive bitcoins I see a certain number of "confirmations" in the client. What do these mean? Why do most sites make me wait for 6 "confirmations" before a purchase will go through?
46
votes
7answers
9k views

Is there any way to track an individual bitcoin (or satoshi)?

For example, if I wanted to "collect" important bitcoins is there any way to track a coin rather than a series of transactions? If I wanted one of the bitcoins from the infamous "Bitcoin pizza" ...
46
votes
3answers
8k views

How does change work in a bitcoin transaction?

It seems that when you send a bitcoin transaction, all the coins in the sending address are spent in that transaction, divided into the amount that you intended to send, and "change", which goes back ...
46
votes
5answers
14k views

What is relation between scriptSig and scriptPubKey?

Scenario: A is sending 1 BTC to B. scriptSig appears in the Input Script. scriptSig = <sig> <pubKey> Here, public key is the Public Key of the sender, A. (this is the public key ...
45
votes
6answers
6k views

What unique business models has Bitcoin enabled?

Are there specific, unique business models that have been made possible by the invention of Bitcoin? And if so, what are they? Edit: I seem to be getting a lot of answers about the areas of ...

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