A common argument advanced by Bitcoin proponents is that unlike banks and credit cards, Bitcoin has low (or even zero) transaction fees. The claim is a complete red herring, and in this post I’ll explain why. Let’s assume for the purposes of argument that Bitcoin transaction fees are, in fact, zero. There are small mining-related […]
How Consensus Drives Bitcoin
June 4, 2013 by
Josh Kroll, Ian Davey and I have a new paper on the dynamics of Bitcoin, which we’re going to release in a few days. This post is the first in a series exploring our paper’s analysis of why Bitcoin works and what could derail it. Consensus drives Bitcoin. Like any fiat currency (a currency not […]
Basic Economics of Bitcoin Mining
February 5, 2013 by
Arvind wrote yesterday about the availability of chips that do super-fast Bitcoin mining. I want to follow up by unpacking the economics of Bitcoin mining, to see what the effect of the new chips will be, and more generally what the future of Bitcoin mining looks like.
Bitcoin grows up, gets its own hardware
February 4, 2013 by
The big news in the Bitcoin world is that there are several Bitcoin-mining ASICs (custom chips) already shipping or about to be launched. Avalon in particular has been getting some attention recently. Bitcoin mining moved long ago from CPUs to GPUs, but this takes it one step further. The expectation is that very soon most […]
