My Bitcoin Story: A Little Bit about How I First Got into BTC
This will only be a quick little bio highlighting some of most notable parts of my history with Bitcoin.
*I, like everyone else, was pretty skeptical at first hearing about some "magical internet money". *
I thought that I'd basically be giving Anonymous access to my computer if I downloaded the original client. I couldn't wrap my head around what "proof of work" and blockchain ya-ya this-and-that. But eventually, I did go back and once just a tiny bit of it clicked, I dove in head first.
I first laid eyes on the term 'Bitcoin' in January 2011, started learning more about it thanks to @keiserreport around March 2011, but thought it was dead that summer when it crashed from over $30 back down to $2.
I laughed the hearty belly-laugh that everyone does the first time they hear about a crash in Bitcoin's exchange rate before they own any.
Then months later, after seeing that it hadn't died, I ate a big dose of crow and started reading and learning as much as I could. Before I could even explain what bitcoin was, I tried mining with some old CPUs I had laying around. I connected to Slush's mining pool and watched a small balance start accumulating. That was about March 2012.
I obsessively watched my hashrate on my dashboard on Slush's site for a few weeks as my satoshis started "stacking." After accumulating enough millibits to cash out, the first thing I did... I went shopping!
Sometimes I take my own experience for granted, because I'm always surprised when I learn that someone has never heard of Silkroad, the first market on the dark web where bitcoins were exchanged for goods. Even among those who have heard of the Silkroad, most only knew it as a market for drugs online. Beyond the copious amount of drugs, there were also a lot of other catagories of products to browse. As you can see the list of categories in the photo above, there were actually a LOT of products to browse through, and the third largest was "Digital Goods." Buried among all the pirated movies and software were ads for scripts, DDOS LOICs and HOICs, botnets, and other custom goodies from black, grey, and white hat hackers.
My first purchase was a tiny bit of self-loading code that was a custom CPU bitcoin mining program that only started when its host computer had been idle for longer than 60 minutes.
It really was a thing of beauty; it was cleverly disguised to run under the name of a normal windows .dll. But even better than that, it was practically impossible to actually catch running, because it would shut down as soon as someone woke the computer up.
Ethical quandaries aside...
In order to pass it round, I carried it on a key-shaped USB stick on my keyring and recruited every "institutional" computer or server I came into contact with, and got them to spend their spare time "doing some math" for me. After all, I did have it designed to not even start until the host computer was idle for longer than an hour in order to ensure that it would never bog down when it was being actually used. I targeted the hundreds of idle computers in the cubicle farm at the company I worked for, stores I shopped at, and any other institutions where I could access a USB slot for the 2.5 seconds that was needed for the self-loader to auto-exec. (That university IT tech that was so kind as to give me such a detailed tour of their basement server farm will always be my hero. I tried to talk him into getting into bitcoin himself, but as tech-savvy as he may have been, it was hard to talk about bitcoin back in 2012.)
Tracking the hashrate, I would watch it peak between 8pm to 6am and go to almost zero during working hours, so judge me as you wish, I made about 10 bitcoins over two years with that little gem of a program. As the computers and servers were replaced, the hashrate became a tiny trickle, and eventually the mining pool the code was proccessing with shut down.
The Gamble on ASIC
Later, I put $65 from PayPal into a ButterflyLabs "Jalapeño" ASIC miner. Eventually, I would expand my personal mining operation to over 2TH/s. Soon after the debacle with MTGOX in 2014 and the subsequent price crash, I had to unplug all my ASIC gear. Since then, the difficulty rate has risen so high, my now tiny bit of hashing power cannot mine enough to cover the electricity needed to run them locally. I have someone that has access to a cooled server room and free electricity, so my gear may be able to go back online, more on that as the plan develops.
I started buying BTC via MTGOX in the summer of 2012. I watched the price oscillate between $6 and $10 for months and slowly built up a nice wallet-full of bitcoins. Starting the late fall and on into the spring of 2013, the value of each BTC steadily rose from $10 to $260. It was awesome, but it was also my first lesson in setting and forgetting about Sell Orders. Just like today, there were huge movements up and down as it climbed, the main difference was the moves were by $5 increments instead of $500. The day the the price surpassed $25, I came from home from work and found NO BITCOINS but about 7500 DOLLARS! WTF??
Yep, when the price had been between $6 and $10, I set a sell order at $26 just in case and forgot about it. Well, DON'T DO THAT! The price of bitcoin NEVER again would drop below $26 so I was forced to buy back in between $30 and $35.
Mountain of GOX or Empty GOX?
April 2013 was also the first real clue that there was trouble within MTGOX. Once trading became so heavy and the price was reaching new ATHs, MTGOX was forced to shut down their trading book for a few days. We now know it was because they probably didn't actually have all the bitcoins they were were selling, so when they finally came back online, the price crashed back down to $50. I stopped using MTGOX in May of 2013, as soon as I was able to withdraw all of my bitcoins to my own wallet client. It took several days for the transaction to complete and I was a nervous wreck until they all finally came.
I opened up accounts on every exchanges as they opened and I was one of the first 10,000 users of Coinbase. For me, Coinbase was always been easiest off-ramp for dollars from bitcoin sales; that is, until recently as more decentralized exchanges like Bisq are going online. I still maintain my account with Coinbase.
We moved to Ecuador in 2014 and were able to live for the first two years on our bitcoin savings alone, even through the price crashes. I finally reached the point in 2016 when I stopped spending them and pretty much ignored the BTC world altogether as the "scaling debate" raged on and acrimony grew.
Last summer, I started paying attention again when I heard that Roger Ver had gotten enough support for the bcash hard-fork. I don't believe in bcash, but that hasn't stopped me from taking all the 'free money' that came with the fork and investing into about 30 different coins, tokens, and ICOs.
I'm not one of those guys who got into bitcoins so long ago that I'm now a multi-millionaire. From early on, I've always been "long" on bitcoin, but I've also been a spender. We bought our plane tickets for our flights to Ecuador with bitcoin. We bought computers and other electronics for discounted prices in bitcoin. We bought thousands of dollars of goods and services using our bitcoins since 2014. We were hurt by the huge price dip between 2015 and 2017, but we managed to keep some whole bitcoin that we will not touch.
Thanks for reading my some of the highlights from my bitcoin history. I'm grateful for any upvotes and comments!
Follow me for more Steem missives like this.
I tweet from @Dr_Revelator about bitcoin, economics, politics, comedy, entertainment, and culture.