Education Technology

Five most unusual facts about bitcoins [Economic Times]


How many of you were aware that a bitcoin -presently valued at around Rs 23,000 -can be fragmented to the power of eight, so that you can even buy a stick of gum with it? Did you know that every fragmented unit of the popular cryptocurrency, equivalent to the cents or paise of physical currency, is called a Satoshi and is named after the founder of bitcoin, Satoshi Nakamoto?

For his latest novel, God Is A Gamer, banker-turned author Ravi Subramanian extensively researched bitcoins and uncovered many an intriguing fact.

In a conversation with ETPanache, he revealed the five most fascinating nuggets:

The FBI owns 15 per cent of the world’s bitcoins

When the US federal government raided and shut down the first online drug marketplace, Silk Road, it also seized bitcoins to the tune of $28.5 million or almost 15 per cent of the world’s bitcoin mine. It is now auctioning them off to put them back in circulation without flooding the market and crashing their value.

A man threw away his hard drive with $4 million worth of bitcoins on it

In Newport, Wales, sometime in July 2013, a man named James Howell innocently threw away his old hard drive, without realised that it also held his digital wallet with 7,500 bitcoins. He had mined them in 2009 when bitcoins were only known in tech circles. By the time he discovered his mistake in November 2013, the value of those bitcoins had soared to $4 million and it was lost under five-feet of of rubbish in a landfill.

May 22 is Bitcoin Pizza Day

When Laszlo Hanyecz, a programmer paid a fellow bitcoin user 10,000 bitcoins (roughly $25 then) for two Papa John’s pizzas on May 22, 2010, little did he know that it would be worth around $4 million today. Since then, May 22 is celebrated as Bitcoin Pizza Day to celebrate the most expensive pizzas in history.

65 per cent of the world’s bitcoins are inactive

It has been observed that almost 65 per cent of bitcoins in the world are mined or bought and stored never to be seen again. These are the inactive wallets that may either be simply lost or waiting for a rainy day to cash out.The regular transactions that keep the bitcoins network working are only happening on the remaining 35 per cent that use it like a currency rather than a commodity.

Pooling 51 per cent of bitcoin network gives you control

Multiple miners pool the computing powers of their computers to create a powerful mining network.If any pool manages to control 51 per cent of the network capability, then they can wreak havoc with the bitcoins. They can spend the same bitcoin multiple times and they can erase revious transactions that are stored in the blockchain. They can also charge the existing bitcoin owners large sums of money as fees. In June this year, GHash Mining Pool acquired 51 per.cent capability which threw the entire bitcoin network in a tizzy.