I’ve been following bitcoins pretty closely for the past ten days now and the market has been insanely volatile and highly entertaining. Here’s the chart
It’s gone from $50 to $260 all the way back to $60 in the past thirty days. I first heard about bitcoins a couple years ago back in 2011. I got a couple free ones from the bitcoin faucet and played around with them for a bit. I thought they were interesting, but ultimately useless unless they gained widespread adoption. Well lately, as a result of the crazy price increases they’ve been all over the news and some legitimate merchants have started accepting them. Some people think it’s a bubble, some call it a pyramid scheme, some think they’ll be worth hundreds of thousands of dollars one day. Whatever your opinion it’s been a wild ride lately. The TV news interviews you see about them are obviously done by people completely clueless about them, however, and they always have these two very basic questions so for you newbies out there I’ll go ahead and answer them for you.
What are bitcoins?
Bitcoins are basically just numbers stored in a database(blockchain) linked to a bitcoin address. Similarly, dollars are just numbers stored in a database linked to a bank account.
Can’t some hacker just create a bunch of bitcoins?
No. Creating bitcoins requires a tremendous amount of computing power. Just how no human can multiply two 100 digit numbers in their head, a single computer can’t just magically create a bunch of bitcoins.
Differences between dollars and bitcoins
1. Fixed supply
Only 21 million bitcoins will ever exist. The number of US dollars that can ever exist is infinity.
2. Money supply over time
The numbers of both currencies is constantly changing, however, bitcoins follows a fixed predictable schedule. As of April 11, 2013 there are 11,022,500 bitcoins and something like 10 trillion US dollars. In 2014 there will be 11,812,500 bitcoins. In 2020 there will be 17,718,750 bitcoins. I have no idea how many US dollars will exist next year, or ten years from now. Nobody does. The federal reserve controls and manipulates the money supply daily. They increase or decrease the money supply by changing bank reserve requirements, buying or selling T-bills, or changing the discount rate.
3. Issuing authority
All dollars are ultimately created by the federal reserve. All bitcoins are created by thousands of individual bitcoin miners. No one miner is in control. Right now about 3600 new bitcoins are created a day. Miners do pool their resources into various mining pools, but no miner pool can ever reach 51% of the hash power or there will be problems.
Pros of bitcoins
1. 24/7 Speedy Service
Bitcoin transactions can happen anywhere, anytime and be confirmed within 10 minutes usually. Normal banks are open 9am-5pm Monday through Friday and transactions usually take 1-2 business days to become confirmed.
2. Low Transaction Fees
Bitcoins transaction fees are 0.0005 BTC per transaction(okay not exactly, but pretty much, click the link for more details). At $100 USD/BTC that’s equivalent to five cents. A normal credit card transaction will cost the merchant a 3% fee with a minimum fee of 25 cents. A typical wire transfer costs $25 send and sometimes a fee on the receiving end as well.
3. Everyone has a merchant account
If you want to start accepting bitcoins all you need is a bitcoin address. You don’t have to be approved by a credit card company and pay them fees once you are accepted. It’s as simple as pasting people your bank account number(bitcoin address) and you’re good to go.
4. Ease of transport
If you want to carry $20k in cash with you to Vegas it’s risky. You can lose it, someone can rob you, and authorities can confiscate it and there’s not much you can do about it. Just ask Viffer With bitcoins you just need to remember a password and that’s all you really need.
5. No Chargebacks
If you sell an item on ebay and accept paypal money, confirm the shipment, but the customer says they never received it, or lies and says it’s broken and paypal will issue a refund and you are out your money or item and there’s not much you can do about it. Bitcoins are one way transactions and irreversible(pretty much).
Cons of bitcoins
1. No Chargebacks
If someone steals your credit or debit card number you can call up your bank and get your fraudulent transactions reversed. If someone steals your bitcoin wallet there’s not much you can do. That’s why keeping your bitcoin private key secure and encrypting your wallet is so important.
2. You can delete bitcoins
Sure you can burn dollars too, but no one accidentally does that. If you lose your wallet your money is gone. Ever had a hardrive crash? Ever accidentally deleted a file you weren’t supposed to? Backups are important.
3. If your computer gets hacked you can lose all your money
If you visit the wrong website or open the wrong e-mail attachment you can lose all the money in your account. This is very scary stuff. Backups and security are your friend. Bank level security is wonderful and has had many, many years to mature. Bitcoins have existed for four years now. It’s going to take awhile(maybe never) for systems to emerge for the average joe to feel comfortable putting money into bitcoins.
4. Not many merchants accept bitcoins
This may change in the future, and new merchants sign up daily, but right now if you want to buy something with bitcoins you pretty much have to convert bitcoins to USD which makes the whole thing pretty pointless.
5. High volatility
Price stability is important for bitcoins to succeed in the long run. No one wants their money to be worth 50% of what it was worth yesterday. The US dollar fluctuates maybe 3% a year vs most other currencies. In the short run speculation will drive price, but bitcoin will need to eventually become lower volatility for it to ever work as a legitimate currency.
Due to the fixed supply of bitcoins they are susceptible to hoarding. If their coins are worth more tomorrow then they are today why would people spend them or invest them in other commodities? Well, US dollars used to be based on the gold standard and there is a fixed amount of gold on the planet. People still spent US dollars just fine. It’s all a matter of how much the value of BTC increase over time. A deflationary spiral is definitely possible and could create bubbles like we’re possibly seeing now, which could ultimately undermine confidence in bitcoins as a currency.
Warning: Don’t buy bitcoins unless you are prepared to lose all your money. They are highly volatile right now and you have to be very careful you don’t lose them or get hacked.
Largest online exchange MtGox.com
Smaller Online exchange BitStamp.net
Trade cash for bitcoins from locals LocalBitcoins.com
The easiest, quickest and cheapest method will vary depending on what site/method you use. For an online exchange the quickest and easiest is probably to do an international wire transfer directly to them. It will cost you ~$25 + receiving end fees. You can also try going through Bitinstant (Reviews are mixed) or Dwolla (takes awhile to get verified and link your account)
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Well it’s been a busy two weeks. Obviously I didn’t update throughout the weekend like I was hoping but here’s a rundown of what happened.
Friday: People pitched maybe 50 ideas. All the ideas were put up on the wall and then we voted on the best 20 or so and formed teams around them. We then all went home by 10pm as the building was closing.
Saturday: This was the major workday. I got there a bit before 9am and we worked for 12+ hours until the building closed again at 10pm. A few people never showed up for the next day and a couple teams went by the wayside. I guess this was inevitable, but it’s kind of oddly funny seeing the teams shrink over the weekend. We probably had one of the biggest teams. We started with around 10 and by Satuday it was down to 8. We also had a lot of developers. 6 of us wrote code and the guy whose idea it was and a microsoft PM on our team worked on the market research validation side. I certainly learned a lot as it was the first time I’d really coded in a group. The fact that we had so many devs was both a blessing and a curse in my opinion. We spent most of our time coding and actually got a working demo going where as most of the other teams just had mockups or non working html files with no backend, but I think we were weak on the presentation and market validation side of things.
Sunday: This was presentation day and most of our time was spent meeting with advisors, preparing the presentation and finishing up some coding. Unfortunately we didn’t win. That award went to corki a wine menu rating converter app. If you’re interested you can see the pitches here Our pitch was around the one hour mark.
Here’s a short highlight video of the event where I make a cameo around the 10 second mark.
The site is live right now tonightsplaylist.com It doesn’t look too different from the initial launch right now. Our team has met once since the event and made a bunch of backend code changes that you can’t see. Overall it was a great learning experience and I’d definitely do another one.
I signed up for http://seattle.startupweekend.org/ this weekend. The idea is you get a bunch of people together interested in starting a company(usually an app or website), everyone pitches their ideas, you vote on the best ones and form teams around them.
It’s only Friday, but it’s been fun so far. Everyone has been really friendly and I’ve met a lot of like minded people. I joined “Tonight’s Playlist” It’s basically pandora for local bands that are playing concerts in your town tonight/this weekend. We have a big group, maybe 10 or so in total. It will be interesting to see how this evolves and what we create. I’ll try to update over the weekend on our progress.
We’re still a long ways away from passing and amending this bill, but pokerfuse came out with a couple details of the Reid/Kyl bill today.
It’s unclear whether this allows pokerstars or not, and we’re not sure how bad the rake will be with the 16% tax, but here’s hoping to something passing in the lame duck congress before year’s end.
A couple of sources are saying so. http://www.pokerplayernewspaper.com/content/full-tilt-pokerstars-negotiations-can-12310 Announcement on Monday I think. Let’s hope so.
I’m heading up to Vancouver tonight to play in a $1000+$100 poker tournament at http://www.blvdcasino.com/casino/tournaments/blvd_500.aspx Wish me luck. Hopefully I come back with all the monies.
David Sklansky, the head authority on logic has just come out with a new blog arguing baseball shouldn’t be in the Olympics because the best team doesn’t win often enough. Right… cause in other sports the best team ALWAYS wins and luck never plays a factor. Poker too. Phil Hellmuth always wins the main event.
On a more serious note I’d like to give my 2 cents on the Colorado shooting. This was a horrible tragedy and my heart goes out to everyone that was hurt by it, but why are we talking about the shooter 24/7 for a week now? This is why these shootings keep happening. We should not be giving these people the notoriety they desire. The way to stop these things from happening in the future is twofold.
1. Stop Talking about it. When was the last time you saw a streaker on TV? Could you imagine if every person that went streaking made it on TV and were talked about for a week straight? Loads of attention whores would do it. Do people still streak? Yeah. Will streakers always be a problem? Yeah, probably, but has streaking gone down since they stopped showing it on TV? I’d like to think so. There’s a reason the stations stopped showing it. They didn’t want to encourage that type of behavior. We should treat violent mass murderers the same way. I tried to find some statistics on streakers, both when they showed them on TV and after but couldn’t. Having the Colorado shooters face all over the news for a full week is exactly what he wanted.
2. Invest more resources in finding and helping these troubled young men before they go postal. How much resources to we spend trying to find the next Lebron James? On finding the next president? Billions. On finding the next mass murderer? Not much I’d guess. This is how you prevent future shootings. By reaching out and helping the troubled young kids before they turn to violence.
All this talk about gun control is nonsense. Do I think ordinary citizens should be able to buy body armor and assault rifles? Naw, not really. Do I think that banning them will prevent these shootings from happening in the future? Definitely not. Try googling how to make a bomb. I’m sure it’s not that hard. You’ll probably get put on some government watch list, but I’m just guessing it’s probably not that hard. How about poisoning a bunch of people? Okay, enough brainstorming on how to kill lots of people. It’s creepy. Needless to say, assault rifles are not the only way to do it.
Finally as many people have pointed out 12 people died and it’s a tragedy. Well the reason it’s news is because it’s a rare event. Over 6,000 people die in America per day. 43 are murdered every day. Why don’t we talk a lot more about how to make transportation safer before we worry about gun control. Take a look at these stats below.
On a lighter note its good to be back home in Seattle throwing TDs to my friends.
I lasted up until about an hour before dinner break on day 2. The day started off pretty well with me chipping up pretty slowly and people folding to my steals until I got up to my peak of 55k or so. I then lost a 30k pot where I flatted KQs in position and hit a Q on Q87 two spades flop. Utg bet the flop and turn, river was a spade and he overbet it a bit and I had to fold leaving me with 40k for my bustout hand.
Blinds were 400/800/100. I am utg+1 with KhQc and open it for 1800, utg+3 calls, button calls and the sb calls. Flop is KdQs7h. I bet 4500 into the nearly 9k pot and only utg+3 calls. Turn is the Js, I bet 9k and he quick calls again. River is an innocuous 6d and I shove my last 20k in the middle. He tanks for about 30 seconds before finally calling with 77. Absolutely nothing I could have done differently, just a massive cooler. It was the only time I was all in all tournament, and I managed to lose all three of the biggest pots I played all tournament. You’re just not going to win when that happens. Busting the main event is probably the saddest day of the year, but I’ll be back next year and at least I leave Vegas up five figures. Best of luck to anyone still in.
I don’t have a ton of chips (26.5k) but day one is all about survival. I lost about 13k chips on the 2nd to last hand of the night where I opend from EP with red aces, guy on my left calls, MTT pro on the button 3 bets I just flat, guy on my left flats. Flop is 8s7s3h, we both check to MTT pro who bets 3800 into the 10k pot, I make it 10k and guy on my left ships like 40k in the middle and I have to fold. The guy told me he had 77 so I’m pretty happy with how I played, but it’s still rough losing a huge portion of your stack at the end of the night.
If you’re wondering about the other tournaments I played I busted the 10 game pretty uneventfully. I had Venessa Selbst(the eventual winner) all in and was ahead on day one so it was kind of tilting to see her win but whatever.
I only played one other NL 1500 event where I had the biggest stack I’ve ever had early but just ended up donking it. I had 13k at 200/400/50 and had just been moved to a new table. Utg opened to 825 and I decided to defend Jh5h out of the big blind. It was only a minraise so I thought it was worth it at the time, but I just think it’s better to let it go vs utg in hindsight. Anyways, flop was Ah8hAs, he bets 850, I checkraise to 2500 (I should have just called) he flats. Turn is a brick and I shove for about pot (he started with 10k) and he calls with ATo and I brick river. After that I shoved my 8bb with 64s and got called by Tens and was out.
The last NL 1500 event I was planning on playing I was providing ATM tech support for a couple hours that morning and didn’t want to buy in late so I didn’t play. I’m going to need some run good on day 2 of the main so wish me luck!
I’m getting excited to head back to Vegas today. My flight is in a couple hours and I’m just finishing up packing now. I’m meeting up with some peeps tonight and then planning to play the $2500 10 game tomorrow. I’ve been working on my Badugi and 2-7 Single Draw for the past week or two and hope I’m not a complete fish in the those games tomorrow, but we’ll see. After that I’ll play two more NL $1500s and then the main. I think it’s about 50/50 whether I get any more cashes if my ITM rate is the usual 15-20%.
I did a lot while I was back home in Seattle these past few weeks. I went to Portland for a day to visit some of my Fiancee’s relatives that were in town, I booked a bunch of wedding stuff (the venue, caterer and photographer), I raced in the Urban Dare Adventure Race which was a lot of fun and went on a quick hike yesterday.
Here’s a hilarious welcome home poster my fiancee made for me when I got back last time which I forgot to post.
More tourney updates to come! Hopefully this is me when I come back.
So in case you haven’t figured out by now I ended up busting the shootout. The second table was pretty tough. I hadn’t really thought about it til I showed up that morning, but the level of skill after the first table of the shootout goes way up. Normally in an MTT you’re still going to be playing with a few fish up until the very end, but not so much in a shootout I think. Mark Seif was on my left, but no Ivey. Everyone else was unknowns to me. I think I played bad, but I’m going to chalk it up to any of these excuses
- Tough table, I’m more willing to gamble
- Like Ricky Bobby says if you ain’t first you’re last in a shootout. 2nd at your 2nd table pays the same as 9th. I’m more willing to gamble
- Got invited out to dinner with some friends that night and didn’t want to miss it nursing a shortstack for no extra pay
- Fatigue. At this point I’d been in Vegas seven days including the day I arrived and played in tournaments on six of those days. It wears on you.
In reality I think I psyched myself out a bit over all these factors and blew them a bit out of proportion. I should have just played my game and not think about these things. The first real hand I played UTG(who looked exactly like the android from Prometheus but younger) opens and I decide to just flat call QQ in the BB as we’re still 9 handed at this point. Flop is 68T. I check call. Turn is a brick deuce or something I check call again. River is another ten and I lead/block bet a bit less than half pot and he snaps with 9Ts. Not sure how I feel about this one.
Next hand I’m in the small blind with pocket 7s and flat a CO open. Flop is pretty gin 79T two or three spades(I forget, it was like 2 weeks ago!). I lead out and he calls. The turn and river were bricks, I led out and then shove the river to double up to 60k or so. I lose a couple pots after that bleeding away until my final bust out hand arrives.
Same villain from first hand opens utg+1 to 2500, but we’re six handed at this time. I know he’s opening very wide from his 9Ts hand earlier and have 75o in the big blind at 600/1200/200. My stack is 55kish. It folds around and I decide to defend. The flop is 6d9dTd and I have the 7d for the one card seven high straight flush draw. A suckers draw really, but I decide to lead out for 5k. He calls and we see the 3s turn giving me three additional straight outs. I decide to lead out again for 10k and he shoves. It feels like he has a pair in which case its a bit less than 50/50 if he has a diamond if he has a pocket pair, and a bit less than 25% if he has a pair matching the board. Of course he can have the made straight or flush already, but he could also have a set or two pair with no diamond. I have to call 35k into what would be a 115k pot or so I need 30% equity for it to be +EV. I could fold and wait for a better spot and still have 20 big blinds, but I decided to gamble and call it off.
Vs his actual hand I was slightly +EV (34% equity) as he showed up with KT no diamonds but vs his range it’s definitely a -EV call. I kind of hate every decision I made in the hand and think I should just fold preflop despite the great pot odds because of situations exactly like this. Whatever, in my head I justified it with the excuses above, but there’s really no excuse for the hand. Live and learn I guess. If anyone has comments on it I’d appreciate them.
Since I’ve been back I’ve just been relaxing mostly. I had some business to catch up on initially(installed two ATMs my first couple days back) but that’s about it. I went to go see Prometheus Spoiler Alert and it was decent, but felt like such a let down. It was hyped up pretty good and I along with a lot of other people were expecting awesomeness but it just turned into your typical slasher film with better special effects on another planet. Here’s a good link summarizing the gripes http://www.juliansanchez.com/2012/06/11/whats-wrong-with-prometheus-a-partial-list/ I mostly have two complaints about the movie
1. The movie goes through the trouble of coming up with a reasonable explanation for how the humans will be able to communicate with the alien humans (the android studied ancient languages and sorted it out). Then when the climax of the movie comes and they finally meet the alien human face to face and start talking to him he just rips peoples heads off and starts trying the kill the rest of the gang without saying a word. Really? It might as well have been freddy krueger at that point. The best movies are the ones where the villain has reasonable motives. The Rock he was just trying to honor soldiers who died for their country, Predator is big game hunting Alien wants food and to breed. Alien humans? Wants to kill people just cause. Lame.
2. The casting. They dressed up Guy Pearce
as a ninety year old man and put him in the movie for maybe 10 minutes. Why didn’t they just cast an actual old man? I just found out a week after seeing the movie it was even him.
Why didn’t they oh I don’t know maybe let the stars be the stars of the movie?
Random, but I stumbled across the best summary I’ve ever found of Obamacare on reddit today.
If you have no idea what Obamacare does like I did and I’m sure 90% of Americans do read that. It’s ridiculous that the actual bill is almost 1000 pages. The constitution is six pages. There’s no reason any bill should ever be longer than the constitution.
Also please sign this poker petition. It probably won’t change anything, but it can’t hurt either. It takes less than 30 seconds.
So I made another day 2. I’m obviously running good. I had one big suckout vs the best player at the table who won a bracelet in event #1 this year. I didn’t really mind gambling vs him and I had some fold equity when I limp shoved 25bb or so vs him with QJ and he called me with A9. Other than that I just got it in good and held. First pays $311k and I’m guaranteed $5k right now. Ivey is still in too. I’m not exactly rooting for him to be at my table for EV sake (I have a 1/12 chance) but it would be fun to play with him. Hopefully the run good continues.