The story of the British James Havells has recently shaken the network. A man accidentally threw away a disk with 7,500 bitcoins – a fortune of $273 million. And in general, those who were disappointed, forgot, or lost the password from a digital wallet, became a victim of a banal accident – according to some data, about 4 million.
Many hackers or even ordinary people try to pick up digital keys to wallets.
But where did the money in the wallets and the wallets themselves come from? And how to get rich, without picking up the keys?
In May 2020, when the author of the Harry Potter epic, JK Rowling, asked to explain to her how Bitcoin works, the world was on alert. When actress Maisie Williams, who played Arya Stark in the series “Game of Thrones”, asked her followers on Twitter whether they should buy bitcoin, the majority of the 90 thousand responses were – no, not worth it!
And a month later, the bitcoin rate skyrocketed – $41,000 was given for one.
Today, there are hundreds of cryptocurrencies in the world. The main idea is to create an alternative to a centralized banking system. Cryptocurrencies have no center, no regulatory or fiscal financial institutions, and this is their advantage.
“There is no central authority that has access to all participants. Globally, everyone works with everyone,” Semen Kaploushenko, director of the cryptocurrency exchange, told TSN.Tyzhden.
A bit of history
All this was invented by Satoshi Nakamoto, one of the most mysterious characters in human history. But who Nakamoto is, probably no one knows. Currently, it is not known whether this is one person or several. But it was Satoshi 2008 who described the principles of the creation and existence of the first digital currency – Bitcoin. He started mining cryptocurrency. The coolest idea was that there is a limit to the amount of this currency. The maximum number of bitcoins that can be created is 21 million bitcoins.
Is it possible to “hack” a host computer? It is where all thieves, swindlers, and even special services are in for a disappointment. Every purchase, transfer, or storage of cryptocurrency has no specific place. Everything happens as if at once everywhere: everything is recorded on all servers of the system. And if something is falsified in one place, all the others will immediately discover it.
Miners are the people who do the calculations and encode the history of all these transactions into separate blocks.
The director of the cryptocurrency exchange, Semyon Kaploushenko, explains to TSN.Tyzhden that once every fifteen minutes, all transactions are collected in one block. “It is encrypted, a key is selected to encrypt this block. Whoever collects this block first, in fact, will receive a reward,” he says.
That’s what mining is. Now we calculated: to code the first blocks in 2009 was 500,000 times easier than today! The first calculations could be done on paper!
New farmers
Four years ago, Dmytro Sus was in charge of the General Prosecutor’s Office and was involved in high-profile scandals. Today, when mining can only be done with special equipment, Dmytro assembles and sells special mining farms. “Earlier, you could run it on a home computer. And then the “bitcoins” were stamped by the dozens,” – he tells TSN. Tyzhden.
Farms that grow or mine electronic money are large computers, most of which are graphics cards. Such a farm costs $500- $5,000. Dmytro says that the money spent on this kind of farming is returned within a few months.
“One graphics card brings from one dollar to 15 dollars. A normal farm is eight cards. That is, two normal farms give 233 dollars in a week”, – says Dmytro Sus.
«Ali Baba Caves»
Dmytro sold about a thousand farms in a few years. He does not tell about his clients, most of them hide their mining as deep as possible.
“There are people who have one farm, and there are people who have mining factories. It’s just an obscene amount of money if you have more power than five farms or ten farms. We are talking about 100, 700 farms. But I know about ten people who have approximately 4,000 farms. It is a factory. But no one will tell you where they are – no one will run around the city and say that millions are dripping from me every second,” Dmytro Sus tells TSN.Tyzhden.
This “Ali Baba cave” is much closer than you think. Ukraine became the leader in cryptocurrency mining six years ago. We do mining in apartments, in garages, and even in workshops of abandoned factories!
“At one point, Ukraine had 60% of the Bitcoin power.” Around 2014. And there were even fears that a group of people has more than half of the network’s capacity,” Semen Kaploushenko, director of the cryptocurrency exchange, told TSN.Tyzhden.
Digital money is a real issue
Most problems can start when the miners start withdrawing the earned money to regular bank cards. These transactions are tracked by banks. And the origin of the funds may be of interest to law enforcement officers.
Anton, having gathered his first farm in 2017, brought their number to eight. He told TSN.Tyzhden that these farms were located in three apartments – at the grandparents’. “The farms gave warmth. There was no need to pay for heating at all in winter,” – he says.
At the peak of crypto mining, Anton earned up to four thousand dollars per month. At the same time, electricity costs reached 14,000 hryvnias. However, now he has left mining – now he earns by trading on the cryptocurrency exchange. Anton advises beginners to invest only in bitcoin and several other major cryptocurrencies: “I would advise bitcoin, ether, latcoin. You don’t need to buy a whole bitcoin to get into cryptocurrency. It can be purchased for 100-200 dollars. You can buy and simply keep. That’s the best strategy.”
Experts say that in the wake of the constant printing of trillions of new dollars in the United States, the price of Bitcoin could rise to $100,000. Then it will inevitably start to fall, giving rise to new rumors of the death of cryptocurrencies, and then it will start to rise again.
This cryptocurrency fever will stop only when one day the world wakes up and finds out that states have agreed on the creation of the first universal digital currency. But in such a fantastic agreement it is still harder to believe than in the first human city on Mars.
