MineForeman http://mf.mineforeman.com Bitcoin Stuff Wed, 29 Jun 2016 04:05:48 +0000 en-US hourly 1 https://wordpress.org/?v=4.5.3 Physics and economics will [ensure] distributed mining… I’m not worried http://mf.mineforeman.com/2014/12/04/physics-and-economics-will-distributed-mining-im-not-worried/ Wed, 03 Dec 2014 23:54:20 +0000 http://mf.mineforeman.com/?p=3381 ]]> 200px-Arduino_ftdi_chip-1Every now and then I read something that I think is inspired.  In this instance I came across a reddit post by someone going by the handle of foolish_austrian.

His expertise and unique look on where bitcoin mining may be in the long term really captured my imagination and I thought readers may enjoy his far off vision of where mining may lead is in the future.  So, without any more from me, here is the [not so]foolish_austrian;-

“As someone who comes from a physics and engineering background, over the long run I’m not concerned with mining centralization. Physics will ensure it is distributed.

To qualify, I think there will be strong ebbs and flows while we catch up to Moore’s law. During the next few years, hardware is simply going to depreciate too quickly.

Around the year 2024, we are expected to hit the quantum mechanical limit, which broadly speaking means we will have perfected the silicon transistor to the atomic level. If we make them any smaller, they become transparent to matter. (Incidentally, I work on replacements for transistors that use the angular momentum of electrons to store data).

As we approach this limit, mining hardware is going to depreciate over years, not months. When this happens, the dynamics of mining investment will substantially change. Mining in Greenland with cheap energy and cool climate will actually be more expensive than decentralization. Actually, the profit from mining will go negative, Greenland mining will become impossible in it’s current form.

What mining does is convert electricity to heat, but not just any heat… specifically something between 90C to 120C, or heat around the boiling point of water. This heat density is too low for most industrial uses, except possibly things like water purification. It cannot be used for smelting, semiconductor processes, or anything that requires very high heat density without a heat pump.

As a result, what do you do with the enormous capacity to produce ~100C heat? For discussion sake, I’m going to address residential and industrial water heaters, although you could imagine other similar distributed use cases for small amounts of heat.

I just ran over to Sears website and checked the EnergyStar rating on water heaters, and found the average to be about $300/year. According to the US census there are approximately 115 million households in the United States. This means there is about a 34.5 Billion dollar market for electricity to heat conversion. Since 100C (semiconductor temperatures) is just about right to heat water to 55C, this is an absolutely natural market for bitcoin mining.

One could vaguely argue that with limited industrial uses and expanding worldwide, we could take the 34.5 Billion dollar market and multiply by about 5x to estimate the worldwide market. That puts the total market for heat conversion at just under 2 trillion.

Now for the economic argument. In a stable and predictable market (i.e. post superexponential growth), the profit from mining is going to be capped by the marginal cost of mining… ALWAYS. This means that anybody who can ‘recycle’ heat can afford a negative marginal cost, and therefore mine at a loss. The profit from mining will be negative. Simply speaking, approximately 2 Trillion dollars worth of heat can be produced in the mining of bitcoin, and ‘sold’ to the homeowner to heat water.

There are many possible incarnations of this, but we could imagine a water heater with a heater ‘rebate’. Electric power companies could act like mining pools. Since the marginal cost of mining for anyone not recycling heat is negative, the total profit from mining goes negative… It would require more than 2 Trillion dollars worth of electricity to be produced for free. (more than because of additional cooling costs required in a data center).

As a result, the mining centralization we see in Greenland and large data centers becomes enormously unprofitable. Any centralization of mining would REQUIRE heat recycling, which severely limits data centers and necessitates distribution unless you introduce heat pumps, which also increase cost.

So this leads to a new threat for centralization… mining pools operated by Electric Power companies. However, electricity production and distribution is inherently a geographically localized industry (you cannot cheaply transmit electricity across long distances). Therefore the number of power companies are likely to remain much much higher than the number of mining pools today. In addition, since nation-states distrust each other, Most want their own power generation. This makes at least 196 natural divisions.

Thankfully small amounts of heat is something that is needed every season, in every country, in every household worldwide. Data center heat is useless…

Also, 2 Trillion is a huge market for security 🙂

Just my musings….”

Bitcoin Difficulty Reversing http://mf.mineforeman.com/2014/12/02/bitcoin-difficulty-reversing/ Tue, 02 Dec 2014 01:24:33 +0000 http://mf.mineforeman.com/?p=3351 ]]> As the graph below from BitcoinWisdom shows for the first time since just before ASICs (Application Specific Integrated Circuits) started to work on the bitcoin network it is possible that we may see a decrease in the difficulty of the bitcoin network.  (This just in, it is official, the difficulty decreased to 40,007,470,271 a change of just under a percent.  It may take some time for your client to adjust and the number to stabilise)

If you click on the graph and go to BitcoinWisdom the telling like is the green one, it is the actual hashrate of the bitcoin network derived from the average time that it takes to solve a block. You will see that it is below the actual difficulty represented by the red line.

At present the average time over the past two weeks (or 2016 blocks) is just over 10 minutes meaning that the bitcoin network will soon adjust itself down from the current 40,300,030,328 to an estimated 40,050,115,135, that is a decrease of about -0.62%.

For a good and more in depth of how the difficulty works and how these adjustments are made you may wish to check out the difficulty page on the bitcoin wiki.

 Has this happened before?

Yes, many times (I have include a table below highlighting decreases for reference).  Rest assured that this is not the end of bitcoin and is, at least technically, a normal function of the network.  In fact it uses the exact same tried and proven mechanism that has seen the difficulty increase for the past 20 months or so.

Date Difficulty Change Hashrate
Dec 26 2012 2,979,637 -11.59% 21,329 GH/s
Dec 10 2012 3,370,182 -2.00% 24,125 GH/s
Jun 07 2012 1,583,178 -0.50% 11,333 GH/s
May 24 2012 1,591,075 -8.20% 11,389 GH/s
Apr 27 2012 1,508,590 -4.39% 10,799 GH/s
Apr 12 2012 1,577,913 -2.99% 11,295 GH/s
Feb 18 2012 1,376,302 -0.24% 9,852 GH/s

The first difficulty decreases happened in 2011 when CPU mining was still practical and massive botnets were using unsuspecting people computers to mine bitcoins.  As these botnets were discovered and taken down by security experts the difficulty took minor hits.  As the total network hashrate back then was measured in KiloHashs per seconds (1000’s of hashes per second) compared to todays TerraHashs Per Second (1,000,000,000,000’s of hashes per second) even a tiny change was felt quite dramatically.

The second set of decreases was due to economics and the imminent arrival of ASIC’s.  At the time the bitcoin price was measured in dollars (single dollars, not hundreds as they are now) and  mining was done with video cards and specialised mining software allowing miners clock their cards up to a typical speeds of about 100 MegaHash per second (A MegaHash is 1,000,000 hashes per second).  At the time of the last difficulty decrease on January 23rd 2013 when the difficulty drop to 2,968,775 (a -8.64% decrease) the total bitcoin network was only 21,251 GH/s (or 21,251,000 hashes per second).

Back then, the price of bitcoins no longer justified the electricity it took to run your GPU mining rigs.

Why is the difficulty decreasing now?

Their are many reasons for the difficulty to decrease apart from the obvious statement that there is less hashpower being pointed at the bitcoin network.  It is unlikely that the ASIC bitcoin miner manufacturers are voluntarily scaling back production, it is also unlikely that miners are voluntarily turning off their rigs for no reason.

There is a few possible reasons that the difficulty may decrease, but in the end there only one rational reason, economics.

Evidence seems to suggest that even the biggest hashing farms, with the cheapest electricity have reached the point where at the current price of bitcoin cannot justify adding new hashrate to the network.

Where do we go from here?

There are a few possible ‘next steps’ from here;-

  • The bitcoin price will increase allowing the current generation of mining equipment to generate more bitcoins for their electricity consumption.
  • The “Next Generation” of bitcoin miners using more electrically efficient ASIC’s will boost us into another period of expansion.

Where it goes exactly is hard to tell, but it will be an interesting phase in the continued development of the bitcoin network.

Are we still safe?

With the network entering a possible stage of stagnation as far as mining hashrate is concerned you may ask yourself if the network can maintain it’s safety, after all, securing the network is the main function of all this hashpower.

Rest assured though, even at the current status quo it would take hundreds of millions of dollars and many months of time to threaten the network.  I plan to do a series of articles over the next few weeks to explore the possibilities and potential ramifications of the difficulty change that will be happening in less than an hour.






BTCGuild may be closing http://mf.mineforeman.com/2014/11/01/btcguild-may-be-closing/ Fri, 31 Oct 2014 20:39:46 +0000 http://mf.mineforeman.com/?p=3336 ]]> BTCGuildBTCGuild, one of the oldest mining pools that first opened on the 9th of May 2011 issued a statement on their website and reddit that the pool will be closing on the 30th of November 2014.

The full statement from the website follows.

BTC Guild Shutting Down

After many months of consideration, I have finally made the choice to announce the planned closure of BTC Guild. Below, I’ve outlined the closure process/timeline and reasons that this decision was made.

Closure Timeframe and Process

As identified in the support section and in the 2nd post on this thread, BTC Guild has had an official policy for the amount of time that will be given in the event of closure. The official date that BTC Guild will cease all business is January 31, 2015. This post is the start of the identified 3 months of warning.

  1. Effective immediately, registrations are closed to new users.
  2. BTC Guild mining servers will remain online until November 30, 2014.
  3. Users will have until 11:59 PM (PST) on January 31, 2015 to withdraw any remaining balances on their account.

The above timeline may change if BTC Guild is sold prior to the planned date of closure.

Main Reasons for Closure

1) Risk/cost of a successful attack against the pool. As pooled mining in general is shrinking due to large manufacturers creating private farms, the potential revenue for the pool has gone down as expected. While the pool is still very profitable, the amount of time it would take to recover from an attack has increased due to the overall share of the network shrinking.

BTC Guild has, to date, never been successfully hacked. However, I have seen a rise in attack attempts, and things like Heartbleed/Shellshock which show that efforts are being put into compromising common Linux services if possible. Neither of those attacks had any affect on BTC Guild, but they were both reminders that under BTC Guild’s own code, there are many services which could be a doorway into the pool’s servers if a vulnerability was discovered.

One successful attack could cost close to a year of pool revenue, maybe more depending on what happens in the mining landscape over that period of time. If something else happened in that time (subsequent attack or regulation forcing closure), it would mean continuing to operate the pool beyond this point has cost me more money than it might potentially make in the rest of its lifetime.

2) US government/regulators are already taking stances against specific business types in Bitcoin, applying requirements which would be impossible for BTC Guild to operate under if they attempt to extend regulation into pooled mining, either directly or indirectly due to unclear definitions. Nobody will mine on a pool which requires them to provide personally identifiable information when they can change a single line in their configuration to point elsewhere.

Additionally, state regulators are starting to make noise about Bitcoin. New York is the first to publicly put anything forward, but there are 49 other states which can put their own spin on things. Due to the ability for states to establish a nexus for businesses dealing with their state’s residents, it is a scary landscape to continue operating in.

I have no intention of leaving the US myself, and given the recent history of the US when it comes to online businesses, I don’t feel safe simply moving the business legal entity to another country while continuing to live in the US myself.

Aquisition and Users’s Privacy/Funds

In the event that BTC Guild is acquired prior to closure, users will not have their mining history and withdrawal history transferred to the new owner. All balances up to the date of aquisition will be retained by myself, and a separate service will be made available to claim any funds owed. I am unwilling to compromise on this, because I refuse to do anything where it puts the users of the pool at risk of not receiving what they’ve earned under my watch.

Pool Recommendations and Advice

For users looking for a new home for their miners, I highly recommend BitMinter, Eligius, and p2pool. I do not recommend Slush over any of those 3 options, and I actively encourage users to not use Discus Fish or GHash.io. Other smaller pools exist which are run by honest people, but due to their size, it is difficult to recommend them to the average miner.

Closing Words

When I got into Bitcoin back in March of 2011, I never expected anything that we’ve seen over the last 3 and a half years. I had never built a computer before, never run a server beyond a Gentoo PC in a spare bedroom, and never setup a website that experienced even 0.1% of the traffic BTC Guild gets on an average day.

Bitcoin and BTC Guild have both radically changed my life. While I am closing BTC Guild, I still plan to remain a part of the Bitcoin community. I do believe, even in the face of over-regulation, that Bitcoin will continue to grow and become more useful and usable. I just feel that it is time to move on from BTC Guild, and take pride in the fact that BTC Guild’s closure can show that not all Bitcoin businesses end with somebody stealing funds from their users, either by “getting hacked” or outright theft.

It seems though that the bitcoin community is not finished with BTCGuild as a later statement within an hour alluded to the possibility of new owners;-

BTC Guild Shutting Down – Update 1: BTC Guild May Be Sold

This is a small update to the previous closure notice. It is likely that BTC Guild will be sold prior to shutting down. As such, while you may want to be prepared to move to another pool, you may not have to. Additional details will be posted if the pool is sold to another party instead of shutting down. As identified in the closure notice, user historical data of earnings and withdrawals would not be transferred to a new owner.


How I accidentally hacked the igot exchange http://mf.mineforeman.com/2014/09/24/how-i-accidentally-hacked-the-igot-exchange/ Wed, 24 Sep 2014 01:47:40 +0000 http://mf.mineforeman.com/?p=3249 ]]> igot logo

I agonized a bit about if should post this,  igot responded and acknowledged the problem but unfortunately they don’t see it as a major issue at the moment saying “Since this is a small amount, this is not going to be investigated on priority.”

My mind goes to MtGOX and Moolah though, both are recent examples of an exchange giving out more funds than the client had available (if we believe the official stories) and I think how things could have been different if the person that discovered a flaw in the exchange had, instead of doing what he/she did, informed the exchanges of the problem so the issue could be fixed.

Additionally, just submitting a bug report and leaving it at that is not an option in my mind, people deserve to know about issues like this before they decide on who to entrust their funds to.  If it later comes out that the issue was not fixed or other issues were found and it lead to the loss of peoples funds wouldn’t I bear a bit of responsibility?  After all, I had known something was up, my silence is consent.

The Situation

I am always on the hunt for a new exchange to use in New Zealand.  We have one called BitNZ but the order book and volume is quite small.

So a month ago when a new exchange called igot emerged that had New Zealand bank accounts I immediately headed over and made an account.  It had been getting a few hits in the local press and it seemed that igot would be ideal for me.

When I try a new service the first thing I do is perform a full “life cycle” functionality test.  This test is not to look for vulnerabilities but to go through and use every aspect of the service that I will likely be using.  For an exchange like igot the test would be something like this (I do not actually write it down and go through it, testing like this is just second nature to me and I barely think about it);-

My igot Ballance

My igot Ballance

1. Log in/out and get a feel for the authentication.

2. Deposit a test amount (0.1 BTC).

3. Withdraw the test amount.

That is as far as I got.

Normally I would have then gone on to exchanging some bitcoins to fiat and then withdrawing the fiat but what happened with the withdrawal stopped me in my tracks.

The Problem

As I mentioned, I got up to withdrawing my bitcoins.  I had only deposited 0.1 BTC so I was expecting 0.0998 BTC after fees to be deposited into my withdrawal address.  You can imagine my surprise when the transaction popped up in my client not once, but twice.

Here are the transactions;-

As you can see, they were both generated at the same time (2014-09-21 23:58:28) and included 2 minutes later in block 465403 .  I have the gmail timestamped withdrawal receipts for both transactions to prove it as well as the acknowledgement from igot that there was a problem.

Is this really a problem?

In my mind I can already hear people saying “it was less than $100, what’s the issue?”.   The thing is though, while I have not tried it, who is to say it won’t work with 1 BTC or 50 BTC?  If I could work out how to do this reliably, who is to say I could not have withdrawn my 0.1 BTC a thousand times.  How about a million?

The Method

I cannot say for sure why I got my funds back twice (I did not try to replicate the problem) but there was something unusual going on at my end.  Since igot have not placed a priority on fixing this issue though I am not going to go into how I think the problem occurred.  As any developer will tell you though, if it can happen once it can happen again, and if it can happen again an exploit can be made to make it happen.

I bare igot no ill will and would hate form something I said to be replicated and used to drain their funds.

I cannot remain silent though, if people have funds with igot they need to know that there is a problem.

 What did I do?

Start working on a framework to exploit the problem and withdraw as much as I can?  Shame on you for thinking that! 🙂

I immediately opened a ticket with support to notify igot of the issue;- (click for the full ticket log)

URGENT!!! I am able to withdraw more funds than I have

Hi Guys,

You have an urgent issue, as I have said in the subject, I can withdraw more than have in my account, check my balance, it is -0.1! This is a link to the withdrawl address;-


I withdrew 0.1, Yeah, nice try.  It would hardly be effective redacting if I just made the background of the text black and left the text unchanged wouldn’t it? There is no way I am going to tell you how I think this is done so don’t even ask. Here are a few extra words for you to read.


P.S. If you want to call me my phone number is +64 21 xxxxxx My message to igot

After a few days and providing a bit of extra information I got the message back from igot that I wanted to hear.  They have acknowledged the problem and would be working to fix it;-

Thanks a lot Neil.
We will let you know the outcome soon.

It is very unlikely that this would happen, but it has happened and we will get to the bottom of it.Igot support, Sep 23, 2014

At that point I sat back, confidant that the problems was going to be looked at and fixed.  It seemed that there was not about to be another “MtGOXing”.

It was not until a month later that I thought to bring up the issue again and to my dismay find that they had mostly forgotten about it and were not going to do anything about it.

Hello Neil,

Thank you for contacting igot.com.
This is a technical question that needs investigation.
We’re a small team and a ticket has been opened about this with our team.
They will review and give their feedback when they get to the ticket.

Since this is a small amount, this is not going to be investigated on priority.

I will get back to you as soon as we hear from the team.

Don’t worry, we’re not in the business to go belly up.


JulieIgot support Oct 23, 2014


As much as I would have liked to report an nice clean conclusion where the problems are all gone and everything is fine I can’t, it feels to me that this story is only half written.  If you think I sound hesitant to go into any depth, your right, I potentially know something that could cause igot, and all of its customers to have their funds drained and I really don’t want that to happen.  Would have far preferred to be writing about a success story how an exchange found an issue, and promptly fix it, but that has not happened.

Igot’s systems has the ability to leak funds and while they know about it, they don’t see it as a priority to fix the problem.

I will leave it up to the reader to decide if they should trust their funds to igot or not.

Warning: Do not download bitcoin from SourceForge http://mf.mineforeman.com/2014/09/09/warning-do-not-download-bitcoin-from-sourceforge/ http://mf.mineforeman.com/2014/09/09/warning-do-not-download-bitcoin-from-sourceforge/#comments Mon, 08 Sep 2014 23:32:18 +0000 http://mf.mineforeman.com/?p=3231 ]]> BCLogoIn a continuation of today’s earlier news that Satoshi’s email account has been compromised it now seems that the perpetrator has used the email account to compromise other Satoshi accounts.

First, Satoshi’s P2P Foundation account posted a message warning Satoshi that some of his information was being sold on the darkNet;-

Dear Satoshi. Your dox, passwords and IP addresses are being sold on the darknet. Apparently you didn’t configure Tor properly and your IP leaked when you used your email account sometime in 2010. You are not safe. You need to get out of where you are as soon as possible before these people harm you. Thank you for inventing Bitcoin.

Followed, rather bizarrely by a request for tips to be sent to the 19pta6x1hXzV9F5hHnhMARYbRjuxF6xbbV bitcoin address.  It seems to have already attracted 0.01281469 BTC.

On a more concerning note however, it seems that Satoshi’s account at SourceForge has also been compromised replacing all reference to bitcoin in the description to Buttcoin.


The description has since been corrected but there are still bitcoin downloads available and while the dates and SHA256 signatures seem to be correct I would recommend anyone downloading bitcoin to use the official bitcoin.org server.

UPDATE: You should be safe now, SourceForge has deactivated the Satoshi account and rolled back the changes.

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Satoshi Nakamoto’s email address satoshin@gmx.com appairs compromised http://mf.mineforeman.com/2014/09/09/satochi-nakamotos-email-address-satoshingmx-com-appairs-compromised/ Mon, 08 Sep 2014 21:44:12 +0000 http://mf.mineforeman.com/?p=3229 ]]> BCLogoSatoshi Nakamoto, much revered and currently missing inventor of bitcoin seems to have had his email address compromised by an unknown agent.

You may or not remember, Satoshi  exclusively used one email address when he was active in the bitcoin community,  satoshin@gmx.com.  If you have a look at the original bitcoin whitepaper you will find it there at the top just under the title.  He also usually signed his correspondence with his PGP signature.

Earlier today, the head administrator of Bitcointalk Theymos received an email from Satoshi ‘semail address that appeared to originate form GMX’s servers and made a post on the bitcointalk forums saying;-

Today I received an email from satoshin@gmx.com (Satoshi’s old email address), the contents of which make me almost certain that the email account is compromised. The email was not spoofed in any way. It seems very likely that either Satoshi’s email account in particular or gmx.com in general was compromised, and the email account is now under the control of someone else. Perhaps satoshin@gmx.com expired and then someone else registered it.

Don’t trust any email sent from satoshin@gmx.com unless it is signed by Satoshi. (Everyone should have done this even without my warning, of course.)

I wonder when the email was compromised, and whether it could have been used to make the post on p2pfoundation.ning.com.

GMX, a free email provider hosted the email and according to Theymos the email does seem to have come form GMX’s servers.

Emails from Satoshi  can easily be verified by checking their PGP signature, you can download a copy of the signature here and OpenPGP (a free version of PGP) is available for download here.  The email in question apparently lack’s the signature.

UPDATE: The unknown agent has also seems to use the email address to compromise Satoshi ‘s account at the P2P Foundation and has now posted;-

Dear Satoshi. Your dox, passwords and IP addresses are being sold on the darknet. Apparently you didn’t configure Tor properly and your IP leaked when you used your email account sometime in 2010. You are not safe. You need to get out of where you are as soon as possible before these people harm you. Thank you for inventing Bitcoin.

UPDATE2: Satochi’s SourceForge account now appairs comprised, the perpetrator, rather childishly, is now changing Bitcoin to Buttcoin in the description of bitcoin.  It is important to note, the bitcoin source has not been hosted at sourceforge for a few years now but you should not download binaries from sourceforge.

New Zealand Exchange Bitnz.com hacked, 39 bitcoin stolen. http://mf.mineforeman.com/2014/08/12/new-zealand-exchange-bitnz-com-hacked-39-bitcoin-stolen/ Tue, 12 Aug 2014 01:43:27 +0000 http://mf.mineforeman.com/?p=3218 ]]> BCLogoNew Zealand bitcoin exchange site bitnz.com has been taken by the administrator leaving the message “bitnz.com under maintenance.  Apologies for the inconvenience (contact(at)bitnz.com).”.

It seems that last monday at 3am New Zealand time 39 bitcoins were transferred from the exchange by an unknown party.

Bitnz is one of the oldest (and perhaps smallest) bitcoin exchanges that started operators on 21 September 2011.

Danial Newton, the administrator of bitnz in a reddit post explained that he believes that the perpetrator gained access to the exchanges outward mail queue at MailJet.com and then set about resetting peoples accounts and intercepting the reset codes.  The perpetrator then used those reset codes to logon to user accounts and transfer out the bitcoins contained in the account.

It should be noted that users that had enable 2 factor authentication are safe from this theft.  It is unknown at the moment if any accounts with New Zealand Dollar balances are affected.

Danial is in the process of analyzing exactly how the theft took place but has already said that he will replace all of the bitcoin with funds from his own wallet.

The full post on reddit follows;-

On Monday, 11 August 2014 at 3am NZ time, ~39 bitcoins were stolen from bitNZ.

Our email relay service provider was hacked which enabled the attacker to view all outgoing emails. The attacker used this information to reset user passwords and intercept the password reset email. If the user did not have 2FA the attacker was able to log on as the user and initiate a withdrawal.

At the moment I am still analysing the the event and making sure the vulnerability is plugged (revoke email relay access, reset passwords/api-keys, purge sessions, check if user emails were modified etc).

I need to take the time to do this thoroughly so please have some patience. You can contact me at contact@bitnz.com or ask questions on this thread.

I am going to cover the loss. If you would like to donate to help here is the address 1NAVXrA8NnXURzdFNLf79p8YoLPBBfwnFi

13th Million Bitcoin Mined http://mf.mineforeman.com/2014/07/10/13th-million-bitcoin-mined/ Thu, 10 Jul 2014 00:43:24 +0000 http://mf.mineforeman.com/?p=3191 ]]> BCLogoIt is in truth a minor milestone but for those who like “large whole numbers” block 310001 has just been mined by Ghash.IO pushing the total amount of bitcoin to 13,000,000.

That means that there only another 8 million to be mined over the next 140 years or so until we reach the total maximum of 21,000,000.

The mining process used to mint new bitcoins and secure the network originally paid out 50 bitcoins for each block but that bitcoin reward halves every 21,0000 blocks.  Currently the bitcoin reward is 25 bitcoin every block making it so block 310,001 contained the 13th million bitcoin to enter circulation.

At the current price of somewhere about $622 per bitcoin that puts the market cap at $8,086,000,000 (or about 8 billion) US Dollars.

Because of the anonymity features of bitcoin here is no way of actually knowing how many of those 13 million are actually in circulation or who owns them.  It is supposed that  Bitcoin inventor Satoshi Nakamoto may have close to 1 million, there are many threads on the bitcoin community site Bitcoin Talk about people loosing bitcoins by loosing their private key’s but in the end, a total amount of bitcoins in circulation is just speculation.

However, we can now say that there are 13 million!

Timothy C. Draper won all of the FBI SilkRoad Bitcoins http://mf.mineforeman.com/2014/07/03/timothy-c-draper-won-all-of-the-fbi-silkroad-bitcoins/ Wed, 02 Jul 2014 21:57:59 +0000 http://mf.mineforeman.com/?p=3174 ]]> Tim_Draper200It was quite possible we may have never found out who won the US Marshal Service  auction for the 30,000 Bitcoin (just under 20 Million USD at today’s rate).  It was quite possible that the next time we saw any movement from the address containing the bitcoin (1a8LDh3qtCdMFAgRXzMrdvB8w1EG4h1Xi) it would be on its way to exchanges to be dumped for a fiat currency.

However, this is not the case, well known venture capitalist and bitcoin entrepreneur Timothy C. Draper has come forward and said that he, in partnership with emerging exchange Vaurum snapped up the bitcoin as a as yet undisclosed amount in order to “provide bitcoin liquidity in emerging markets.”

Not a lot is known about Vaurum at present apart from that they recently received funding from Boost Venture Capital causing some confusion on Slashdot but their Bitme service is designed to allow the purchase  of large amounts of bitcoin in a secure, trusted environment.  While it has not been said in the press release it seems likely that Bitme will be next port of call for the 30,000 bitcoins.

29,658.80112195 Confiscated FBI Coins on the move http://mf.mineforeman.com/2014/07/02/29658-80112195-confiscated-fbi-coins-on-the-move/ Tue, 01 Jul 2014 19:45:57 +0000 http://mf.mineforeman.com/?p=3139 ]]> Skull_and_crossbones We have been waiting and here it is, the 29,658.80112195 Confiscated FBI Coins held in 1Ez69SnzzmePmZX3WpEzMKTrcBF2gpNQ55 have started their move.

It is not into the eventual 30,000 BTC blocks from the auction yet but I will keep an eye on them and update this post as it happens.

They have been split out into the following addresses;-

It looks as if they are splitting off small change amounts from there.

Where they go from there and who actually owns them is unknown. As mention previously these coins are the first part of the Dread Pirate Roberts stash and there are another 144,341 bitcoins to go.

UPDATE: According to coindesk that is it.  One bidder ended up winning all of the bitcoins and they have now been delivered the the winners address (1a8LDh3qtCdMFAgRXzMrdvB8w1EG4h1Xi).