Monthly Archives: November 2014

Europe a De-Facto Bitcoin Haven

Europe continues to be a hotspot for Bitcoin opportunity. Despite all those “warnings” and misrepresentations by a totally clueless EBA, European countries themselves continue to be  mostly Bitcoin-friendly. Many have established rules the Bitcoin industry can reasonably rely on. Most notably, Germany, France, Switzerland, Austria, Denmark, the Netherlands as well as the three Baltic states have developed into “very Bitcoin-friendly” places.

On top, if a European country happens to be less than what you expected in Bitcoin-friendliness, then in comes that general rule of freedom to do business in all of the EEA (European Economic Area, which includes not only the EEC or EU member countries but also the additional EFTA countries plus Switzerland), and an affected Bitcoin business would be able to re-locate to another member country offering “greener pastures”.

Still, this business and innovation-friendly situation should not be taken for granted either: it is something to be cherished and to be defended against possible future deterioration. Particularly during the early Bitcoin years its significance is not to be under-estimated, for it allows Bitcoin “room to breathe” and develop largely unhampered by needless bureaucrat intervention.

Why You Might Not Want to Buy from Amazon Marketplace has been all the rage for many years now. Notorious for burning through investor money and venture capital for a period of over ten years, have broken into most every market for consumer products there is, and have increasingly established themselves as The Number One in online shopping.

That this has been achieved largely by killing off everything that even remotely looks like “competition” to the still growing giant — and at a high cost to Main Street boutiques, employment, and small business in general — is not meant to be a matter of concern here. Though regrettable, it could also be argued that this is “a normal development” in the market (at least it has been done without government money and subsidies) and it has a limited amount of advantages for the average buyer too: convenience of shopping from home and saving the time and gas expense for a trip to the local mall or garden centre. Killing off those only slightly-frequented but still area-consuming unsuccessful branches of certain big-box stores may also seem advantageous both from an efficiency and environmental point of view. Let us some day re-forest these extra acres and make our urban, suburbian and even rural  surroundings a bit greener again!

Still, there are huge drawbacks even for the presumably-prospering buyer when it comes to using

In an attempt to grow and grow again their business even further, have discovered third-party sales and opening their platform to small and large outsiders. While this is a good thing from a selection point of view and combines lots of eBay-style attractions with hassle-free fulfillment, it also means eBay-style dishonesty and scammers have long entered the magnificent and apparently controlled environment.

Just as eBay is notorious for being susceptible to offering stolen goods or scrap of no value hyped up and presented as the latest must-have at some “bargain price”,’s marketplace is heavily contaminated with forgeries, low-quality copies and pirated brand items of all sorts. cannot, or will not, do anything to effectively police this situation in order to protect their unsuspecting customers. This is particularly despicable when it comes to food, nutritional, and general health items that can pose significant dangers of bodily harm to victims of these less-than-wonderful “marketplace” sellers. A current case is pending in the courts where certified organic foods meticulously checked for heavy-metal contamination and other toxins and then sold under a trusted label (if authentic), have been commercially re-produced by a New Jersey pirate company and sold under a forged version of that widely-respected label. The pirated items are diluted down using cheap glucose syrup fillers instead of the wild berries intended and paid for by the customer; or they are made of cheap imported raw materials from China, highly contaminated with cadmium and other heavy metals, instead of the laboratory-checked ones the buyer is willing to pay extra for.

As, obviously keen to not cut into their commission-generating business model, contend that these forged items are not illegal by themselves (because there are, curiously, no established USDA or FDA limits for heavy metals in those particular types of food), it is apparent that they don’t care about item quality the way a good merchant should. There are also  other examples where it has become equally clear that do not care about what you and I might take for granted, but only look at their self-interest and revenue stream instead.

All this means that should not even be considered for sourcing certain kinds of goods, particularly not “important” ones or something you are going to put in your body, and that they might well be in the process of ruining their own revenue model after all, albeit in a different way.

It still pays to not blindly click through for those “other items” after ordering that book or computer parts, but use a trusted and proven smaller vendor instead.

Troubles of Small-Scale Crypto Coin Mining

Whether for Bitcoin or Alt coins, Crypto coin mining or the operation of computing equipment for delivering the proof of work necessary to “create” virtual currency, has become “hot” during the past year and a half. With Bitcoin making headlines in late 2013 for breaking above $1000 — albeit for a very short time so far — attention has been drawn to the overall Bitcoin sector.

First-movers had long been mining bitcoins. When additional currencies both using the SHA-256 algorithm as Bitcoin itself (such as Peercoin) or the wider Alt coin selection headed by Litecoin (and based on the less resource-incentive Scrypt algorithm) started coming along, so did the first dedicated coin mining machines or ASICs (application-specific integrated circuits or usually arrangements of multiple such chips).

The result has been a dramatic increase in mining efficiency as well as profits achievable by operating such equipment. A side-effect is the constant, and accelerating, increase of network difficulty which basically means that a growing number of miners also means higher requirements and more investment of computing power before a new “block” can be “discovered” (or successfully calculated by someone’s machine).

During the first half of 2014, profits in Crypto coin mining have been good, or very good, with plenty of coins to choose from in both algorithms, SHA-256 as well as Scrypt.

The explosion of both stupidity (by way of yet more silly-sounding “coins”) as well as hashing power (with the release of very powerful Scrypt-specific ASICs), however, quickly and dramatically pushed up network difficulty to a point where daily (or monthly) profits are dwindling. Many Scrypt-based coins have seen their early-2014 profitability shrink to about a quarter or less. Even Lightcoin itself with its relative stability due to enormous total network hashing power has sunken to less than one third of its May 2014 profitability levels.

To counter the ever-growing “pump and dump” group of “miners”, a number of coins even have moved to drastic measures. These include talks by Potcoin to move to Scrypt-N (which at that time was believed to be ASIC-resistant) or pegging the Dogecoin network difficulty to the one of big and mighty Litecoin. The Feathercoin and Guncoin developers have actually hard-forked away from Scrypt and are now using the X11 algorithm for which there are no powerful ASICs in existence as of this writing.

The overall result for Crypto coin miners as well as users and coin developers is that choice is decreasing: choice of highly profitable and easy-to-mine coins, choice of coins for longer-term holding or similar real-life uses, and choice of “useful” algorithms for developers and operators of a coin who want to protect their invention and help it grow to meaningful every-day use by ordinary people.