bitcoin

And So It Begins: The Feds Target Bitcoin Transactions

Internet News, Law, Tech News 542 Responses »

May 152013

In what may be the first move toward a federal shutdown of the wildly popular online currency known as Bitcoin, the Department of Homeland Security today issued an order that has restricted the transfer of funds in and out of Mt. Gox, the Bitcoin exchange that handles some 60 percent of the transactions.

A creation of bank-fearing techies, Bitcoins are now worth more than $1 billion, and consumer interest has been skyrocketing. For more background, read our Bitcoin explainer.

The DHS is focusing on Dwolla, an online payment system sort of like PayPal that has become a popular way for Bitcoin users to transfer money to and from Mt. Gox. A Dwolla spokesman confirmed to BetaBeat that DHS and the US District Court for the District of Maryland have issued a “seizure warrant” for funds associated with the companys Mt. Gox account, which is known as Mutum Sigillum.

MORE: And So It Begins: The Feds Target Bitcoin Transactions | Mother Jones.

Bitcoin value triples in a month to all-time high of more than $100

Internet News, Tech News 279 Responses »

Apr 022013

At the end of February, bitcoins hit an all-time trading high of just over $33. That suddenly looks like chump change, with the value of bitcoins today moving past $100.

You can see nearly real-time changes in the value of bitcoins at Coinlab and track the currency’s steady rise over the past month at Blockchain. We’ve seen the value go up and down today, fluctuating between $99 and $105. The new high is remarkable given that bitcoins were only worth about $13.50 at the beginning of this year.

Major glitch in Bitcoin network sparks sell-off; price temporarily falls 23%

Tech News 375 Responses »

Mar 122013

A technical glitch in the core Bitcoin software forced developers to call for a temporary halt to Bitcoin transactions, sparking a sharp sell-off. The currency’s value briefly fell 23 percent to $37 before regaining much of its value later in the evening.

The core of the Bitcoin network is a shared transaction register known as the blockchain. Approximately every 10 minutes, a new block is created containing a record of all Bitcoin transactions that occurred since the previous block. Nodes in the network, known as miners, race to “discover” this next block by solving a cryptographic puzzle. The winner of this race announces the new block to the other nodes. The other nodes verify that it complies with all the rules of the Bitcoin protocol and then accepts it as the next official entry in the block chain, starting the race anew.

It’s essential for all miners to enforce exactly the same rules about what counts as a valid block. If a client announces a block that half the network accepts and the other half rejects, the result could be a fork in the network. Different nodes could disagree about which transactions have occurred, potentially producing chaos.

That’s what happened on Monday evening. A block was produced that the latest version of the Bitcoin software, version 0.8, recognized as valid but that nodes still running version 0.7 or earlier rejected.

via Major glitch in Bitcoin network sparks sell-off; price temporarily falls 23% | Ars Technica.

Bitcoin-based casino rakes in more than $500,000 profit in six months

Tech News 402 Responses »

Jan 232013

As various tech companies report their fourth-quarter 2012 earnings numbers this week, so are two gray-market, Bitcoin-based casinos—and one is turning profits in the hundreds of thousands of dollars after only six months of being in business.

Recently, both SatoshiDice and bitZino released their financials. If these self-reported earnings are to be trusted and the companies say they are, given that a Bitcoin block chain can be read by anyone, then running a Bitcoin-based casino yields a tidy profit.

“These tiny startups are hitting some major online casino pain points. Theyre crushing it on those fronts and as an entrepreneur, I think thats rad—they are leveraging a disruptive technology to try and kick a large-scale industry in the balls,” said Peter Vessenes, the CEO of CoinLab, a Bitcoin-based business, which got $500,000 of venture capital last year.

SatoshiDice, which has servers based in Ireland, is a pseudo-random number generator game where players choose a number and then bet on the likelihood that a “rolled number” is greater than the one they’ve selected. If the rolled number is greater, they win. The house has a 1.9 percent edge—which is where the profit comes in.

The online dice game has returned profits to the tune of ฿33,310 $596,231 during 2012—an average actual profit of ฿135.96 $2,416 per day from May through December 2012. During that period, players put down a total of 2,349,882 bets. That’s minuscule by Las Vegas standards, but its still respectable.

MORE: Bitcoin-based casino rakes in more than $500,000 profit