Posts Tagged ‘economics’

Make Money Fast with BitCoin!

March 20, 2013

So I noticed these ads at these are high speed crypto devices designed to mine BotCoins. They literally make money, fast. But if they are actually capable of mining BitCoins cost effectively why is the company selling them? Wouldn’t it make more sense to simply run them and harvest the BitCoins themselves?

I did some back of the envelope math and they don’t look that cost effective (unless the price of BitCoins rise, but of course then all bets are off and in theory an Arduino would be cost effective). So I can only conclude that while this is some potentially cool technology it is not cost effective. If was going to try and make money with BitCoins, I would buy a ton of BitCoins, then sell them rapidly to crash the price (since the BitCoin market is still not terribly liquid) and then buy as the price bottoms out. Or I’d hack an exchange and steal a ton of BitCoins. Much like a Casino the only way to reliably mask money with BitCoins is to cheat.

Also if you want to get into BitCoins (beyond cheating/speculating) I suggest you read about deflationary spirals:

All in all considering that BitCoins are wholly unregulated, the exchanges keep getting compromised, and the long term deflationary issues I would imagine that most of us are better off investing in pretty much anything other than BitCoins.