Extremely complex number-crunching.
...
But where do they come from? I am asking a very specific question here, and it leads to more questions.
There is vague talk of "Generating" bitcoins "Using unspent processor cycles."
What does this mean? Are we talking about the client processing data in exchange for currency created by the cloud? If so, why wouldn't I use the source code to make a virus that performs the same task but only for my bitcoin account? Or for that matter, why wouldn't I release a game, an app, a screensaver, whatever to do the same thing using the source code?
Or if we go "Legit", what about the IT guy who puts a client on every PC in an org?
It's open source, right? The source is there and if you aren't altering the primary mechanism what can anyone do about it? What is to stop a dude from setting up 500 accounts that do nothing but transfer bitcoins back and forth, creating the illusion of more transactions than there actually are? I mean, a motivated coder could probably design a single client that runs 1000 accounts at once, right?
You're not suggesting that open source developers can enforce some sort of control against abuse of the license, right? I mean you made very clear that no one can do anything about bitcoin and that it's pretty much unassailable from the networking standpoint.
I forsee fifty billion altered but fully functional bitcoin accounts sitting someplace in China being a problem.
As long as people want them and have FRNs or Silver or Gold to trade for them, then yes.
Lemme reiterate what I was trying to say -
If there is a run on Bitcoins, can I get them out before it devalues? Can I move it
quickly. I don't care about the medium of exchange.
There are several services that facilitate such things and there can be many more. It will depend on the market. It appears to be growing and getting better every day which is why Bitcoins are shooting up in value. Confidence in them is growing. More services are being provided. For instance there is service that let's you use Bitcoins to buy from anywhere online that accepts VISA. There's an elaborate gambling site that uses Bitcoins. There's no one entity that controls them. Whomever out there wants to become a part of the trading "cloud" by starting to accept them will broaden the possibilities and impact the market.
I'm predicting them becoming more of a tool for black and gray markets because they are nigh impossible to control. It would place them into something of a niche market (people distrustful of and willing to defy gubments) but I see that as a rapidly growing niche market.
Again, that wasn't the answer to my question.
I specifically want to know can I withdraw as quickly as I can put in? Are there withdraw limits?
I'm not busting your balls here, but I just don't see how it's a good move to keep any money sitting there for more than minutes at a time, and if the services that provide for the edge of the network don't offer quick access and unlimited access to funds there's a major problem.
Not to mention all of the software issues I see.
I was dubious at first, but now I am fairly certain that using Bitcoin would not be good for me as a medium of exchange and I won't be using it. If I, as a non programmer layperson (Sure, I'm a sharp cat, but I haven't written code since maybe 1990 or earlier) can see dozens of problems with this model then a real programmer would tear this thing apart and abuse the shit out of it.
And mind you, I haven't even gotten close to talking about the actual economics of it all.
This thing stinks of a ponzi scheme and I really really hope you don't end up getting fucked in the bad way.