It sounds like a marketer got a little too excited and decided to name their developer kit The 21 Bitcoin Computer, not realizing the confusion they were about to create.
My understanding is that 21 has created a board that fits on top of a Raspberry Pi 2 to offer a miner, full bitcoin node, wallet, some fancy hardware acceleration, and several development tools for engineers who are new to bitcoin and want to experiment with building products on top of it.
It's only been an hour since all this news is coming out but so far I think they're completely missing their target audience by dumbing down their marketing material and selling preorders through Amazon.
I actually don't think a marketer touched this project at all.
If one did, they didn't do a great job defining the purpose of this device. They didn't talk - or if they did, they didn't listen - to potential customers about what pain point this could solve. They didn't define a positioning for this product. Etc.
Sell goods for BTC? What about Stripe / Braintree?
Buy goods w/ BTC? What about buying BTC on Coinbase?
I met a few people from 21 in Potrero Hill at a coffee stand. When one of them paid, I saw a bitcoin address and it struck up a conversation. I told them I was interested in new things (and bitcoin as well), and they told me that their startup is in stealth and they couldn't divulge any information about it, but could send me a test to see if I had the right skills to continue the process.
It was a multiple-choice test on HackerRank. It was all pretty simple stuff related to general linux/bash/html/sql knowledge tons of questions about bitcoin protocol. Having spent a few hack days in the past on it, i did extremely well and went on to interview with the CEO.
It started to get funny, the CEO would only interview a candidate at 10pm on a Thursday. "pretty busy during the daytime" they said.
Despite the red flag, I did it. We talked about bitcoin for about 40 minutes straight and why I was into it. I got the impression from them that they were onto something really huge, or that they think they are onto something really huge that is going to massively flop. At the end of the call, I asked for any hint into what the product I'm interviewing for does and was told it had to do with hardware.
This is a TERRIBLE idea in my opinion. Apart from the blatant marketing LIES (this will NOT get you free money, you will lose money on the electricity, even the promotional material admits this in the fine print) this only claims to do things that EVERY OTHER computer already does.
You can already use APIs in half a dozen programming languages to do every one of the things they mention in this blog post, and you can do them for less than 5 cents per hour on EC2 (which is $400/year [compared to $400 upfront + electricity], but if you're running it for a year straight you can get it cheaper at places other than EC2).
If this didn't have the magic buzzword of "Bitcoin" in the name and a smorgasbord of people cross-promoting it for reasons I don't pretend to understand, everyone would see that it's just an overpriced, under-powered computer.
Perhaps the real value will be in the software. But I would expect that software to be open anyway.
There's nothing I see that can be done by this "Bitcoin Computer" that couldn't be done by a raspi + a few hundred thousand satoshis bought from an exchange for a dollar or two. But this solution has more buzzwords.
Is this the result of "Valley Economics" optimizing for investment, not revenue?
I believe they are using their mining power, plus what is added from this pool of devices to include the fee-less microtransactions created from these devices in their blocks.
In other words, this is intended to be a solution to the microtransaction problem.
It's a particular problem in titles that use title case.[1] What I mean is that in any such title, 21 Bitcoin Computer will read like 21 bitcoin computer. I would argue that due to the extremely unusual name (Edit: see replies to this comment) our title should read "21 introduces 21 Bitcoin Computer" or "21 Bitcoin Computer from 21" or something.
[1] Though editors in all media are slowly moving away from title case, especially in newspapers (I mean as opposed to films and books) - the NYT and WSJ are both still on title case, but not the USA Today, Boston Globe, SF Chronicle, or, for that matter, FT.
HN is mixed: for example, out of the 30 articles currently on the front page, 22 are in title case, but 8 aren't. (There are no ambiguous ones currently, such as a single word or a single word and then only numbers or prepositions.)
> you can leave it plugged into the wall to provide a steady stream of Bitcoin
This seems dishonest. How much $USD worth of Bitcoin could you realistically produce in a day with a pocket-sized computer, net of the cost of electricity used to mine it?
Even their official FAQ states that you won't be able to mine at a profit with their product:
"Can you make a profit with the 21 Bitcoin Computer after accounting for energy costs?
Yes, you can indeed make a profit with the 21 Bitcoin Computer. However, you would do so not by directly selling bitcoin, but by selling digital goods for bitcoin. That is, you are not going to get rich by immediately selling the bitcoin mined by the device for offline currency, but you can potentially do very well by selling digital goods and services to others for their bitcoin." [https://www.21.co/faq/]
Just like most developments in the bitcoin world, I'm having a lot of trouble figuring out what this thing actually does and why I want it. Isn't the whole major selling point of Bitcoin that it isn't physical and is instead totally digital? What does a "bitcoin command line" even mean?
"With this pocket-sized device, if you are an entrepreneur or developer, you can now instantly buy or sell digital goods and services at the command line using Bitcoin." Isn't that already all possible with just bitcoin itself? Why would I buy this thing?
Wrapping your software in a $400 dongle seems like a really roundabout way of driving Bitcoin adoption, but I suppose it will ensure that all the customers are true believers.
You know how mobile networks made lots of money by letting third parties charge things to people's cell phone bills? I think 21 is trying to build carrier billing for everything. If everyone has a hundred dollars a month of mining power plugged in, 21 can issue those people a credit line secured by the ability to charge arbitrary, limited amounts to their electricity bills.
Carrier billing worked because there were zero alternatives back in the day and they could charge whatever they wanted. When App Stores became popular with free/low-cost apps, carrier billing died out.
In this case, there is an alternative to the 21 computer known as money.
That's the only interesting application of their low-power mining tech so far in my opinion - having the ability to offer innovative pricing schemes or heavily subsidize nearly any electronic good.
These two comments from the /r/Bitcoin thread [1] sum it up nicely:
"So it's an overpriced SHA256 ASIC attached to a Raspberry Pi? For $400?" [2]
"I'd rather just buy $399.99 worth of Bitcoin..." [3]
EDIT: Its first-listed "feature" on Amazon [4] seems disingenuous at best:
"Buy digital goods with the constant stream of bitcoin mined by a 21 Bitcoin Chip"
especially since the makers themselves refute this in their FAQ [5]:
"Yes, you can indeed make a profit with the 21 Bitcoin Computer. However, you would do so not by directly selling bitcoin, but by selling digital goods _for_ bitcoin. That is, you are not going to get rich by immediately selling the bitcoin mined by the device for offline currency, but you can potentially do very well by selling digital goods and services to others for their bitcoin."
In other words, there will hardly be a significant "constant stream of bitcoin mined" as the tech specs [6] make clear:
"the 21 Bitcoin Chip has an efficiency of approximately 0.16 Joules per Gigahash and can calculate 50-125 Gigahashes per second"
At the current difficulty, that would produce somewhere between 0.01289890 and 0.03224725 bitcoins per month [7]. Even if the difficulty remained constant, it would take many years to recoup the initial $400 investment.
"Can you make a profit with the 21 Bitcoin Computer after accounting for energy costs?
Yes, you can indeed make a profit with the 21 Bitcoin Computer. However, you would do so not by directly selling bitcoin, but by selling digital goods for bitcoin."
These guys deserve an award for sleaziest PR spin.
This is fascinating. It doesn't look like it's designed for bitcoin miners. It looks like it's the start of a future where computing power is traded for digital goods and services.
> The 21 Bitcoin Chip means your 21 Bitcoin Computer has access to a constantly replenished source of bitcoin.
> This means you can now write programs that connect to the Bitcoin network just as easily as they connect to the Internet.
It sounds like the mining is intended to create a constant supply of bitcoins so you don't have to "top up" your wallet. Then the bitcoins are used to process things (putting information in the blockchain) and you're also selling access to run sandboxed code on your machine - presumably code which interacts with the blockchain.
They've phrased this terribly by saying you're selling "digital goods and services", overly broad and meaningless words.
Question for the bitcoin enthusiasts out there - if stolen computing time is a reasonable component of the current hash power, why would market rate for mined coins ever be above the cost of electricity?
I don't think the question is well-posed. Why would the market rate for electricity affect the price at all if stolen computing time were a reasonable component of the current hash power?
If bitcoin mining were competing for the market for stolen computing time, then the "pwner" of each zombie would make an economic decision as to whether to use the machine for other tasks (spamming, password cracking, etc.) based on the relative value of those tasks in bitcoin vs. the amount of bitcoin produced by the machine. As the price/hashrate ratio increases, more zombies would switch to mining; as it decreased, the flow would go in the other direction. The price of electricity is irrelevant to the "pwner" of the machine as regards this decision; for them electricity is free.
In terms of how this were to affect price, that's a more complex relationship, even in theory. As the difficulty increases, it gets more expensive to attack the network (and thus artificially expand supply), so the price will presumably face upward pressure to keep the relationship of difficulty to inverse price constant (assuming price/hashrate as the function is disingenuous, but is probably reasonable for local price and difficulty changes).
That said, it is unlikely that the antecedent holds -- it is extremely doubtful that stolen computing time (or even total CPU + GPU mining) is a reasonable component of the current hash power.
Whats the standard world wide cost of electricity? It varies by well over 10:1. Also it varies over time. Its an arbitrage market for electricity, kind of. This is assuming a perfect efficient market, LOL.
Note that if you mine your own coins its very hard to track where they came from, what with there being no paper trail of you purchasing them from anyone. If you buy coins from someone then that someone can be strong armed by a .gov or .com into telling them who they sold coins to, assuming they don't have a direct data feed right to the DEA or whatever. So in the stereotypical bleating tabloid form of "buy weed online with BTC" if "they" have a list of BTC buyers as 0.001% of the population and give it to customs as a filter on packages coming in from Amsterdam... On the other hand if you're not on a list of BTC buyers because you mined your own... Of course WRT paranoia, being on a list of known custom ASIC owners is about as bad as being on a list of weed grow light purchasers, so I'm not sure this product fixes anything.
Because the cost of electricity required to mine competitively is variable. When the price of bitcoins goes up, mining becomes more profitable. More hashpower is added by new and existing miners until it no longer makes financial sense to do so. The value of a bitcoin is almost always near the cost of mining one, but it's the value that determines how much mining there is.
tldr: It's a market. If demand that day is greater than the supply, then you'll make money. The cost of bitcoin is dependent on the demand, not the cost of production. If/as demand goes down, the cost of production will go down commensurately. There's always a fixed supply of coins entering the market every day. It does not matter how many people are mining, or at what price those people are mining.
Also, it's 'stolen'/'subsidized' energy that is being leveraged. Not computing time.
The whole rant around 21's "bitcoin computer", reminds me of this:
https://youtu.be/ojtMtIyD6dM?t=40
- the product barely went on pre-sale and look how much buzz (albeit negative) it already generated.
Does anyone have an approximate btc/kwh (and thus $) this generates? Why don't I just convert money into btc much more efficiently and store it in my wallet?
[+] [-] zettahash|10 years ago|reply
My understanding is that 21 has created a board that fits on top of a Raspberry Pi 2 to offer a miner, full bitcoin node, wallet, some fancy hardware acceleration, and several development tools for engineers who are new to bitcoin and want to experiment with building products on top of it.
It's only been an hour since all this news is coming out but so far I think they're completely missing their target audience by dumbing down their marketing material and selling preorders through Amazon.
[+] [-] tvladeck|10 years ago|reply
If one did, they didn't do a great job defining the purpose of this device. They didn't talk - or if they did, they didn't listen - to potential customers about what pain point this could solve. They didn't define a positioning for this product. Etc.
Sell goods for BTC? What about Stripe / Braintree?
Buy goods w/ BTC? What about buying BTC on Coinbase?
Mine BTC? There are more economical ways.
[+] [-] vajrapani666|10 years ago|reply
It was a multiple-choice test on HackerRank. It was all pretty simple stuff related to general linux/bash/html/sql knowledge tons of questions about bitcoin protocol. Having spent a few hack days in the past on it, i did extremely well and went on to interview with the CEO.
It started to get funny, the CEO would only interview a candidate at 10pm on a Thursday. "pretty busy during the daytime" they said.
Despite the red flag, I did it. We talked about bitcoin for about 40 minutes straight and why I was into it. I got the impression from them that they were onto something really huge, or that they think they are onto something really huge that is going to massively flop. At the end of the call, I asked for any hint into what the product I'm interviewing for does and was told it had to do with hardware.
I feel like I got off the call pretty bewildered.
Glad this cleared things up!
[+] [-] powera|10 years ago|reply
You can already use APIs in half a dozen programming languages to do every one of the things they mention in this blog post, and you can do them for less than 5 cents per hour on EC2 (which is $400/year [compared to $400 upfront + electricity], but if you're running it for a year straight you can get it cheaper at places other than EC2).
If this didn't have the magic buzzword of "Bitcoin" in the name and a smorgasbord of people cross-promoting it for reasons I don't pretend to understand, everyone would see that it's just an overpriced, under-powered computer.
[+] [-] dang|10 years ago|reply
https://news.ycombinator.com/newsguidelines.html
[+] [-] STRML|10 years ago|reply
There's nothing I see that can be done by this "Bitcoin Computer" that couldn't be done by a raspi + a few hundred thousand satoshis bought from an exchange for a dollar or two. But this solution has more buzzwords.
Is this the result of "Valley Economics" optimizing for investment, not revenue?
[+] [-] markkat|10 years ago|reply
In other words, this is intended to be a solution to the microtransaction problem.
[+] [-] pkinsky|10 years ago|reply
[+] [-] Vexs|10 years ago|reply
[+] [-] logicallee|10 years ago|reply
[1] Though editors in all media are slowly moving away from title case, especially in newspapers (I mean as opposed to films and books) - the NYT and WSJ are both still on title case, but not the USA Today, Boston Globe, SF Chronicle, or, for that matter, FT.
HN is mixed: for example, out of the 30 articles currently on the front page, 22 are in title case, but 8 aren't. (There are no ambiguous ones currently, such as a single word or a single word and then only numbers or prepositions.)
Reddit has completely moved to sentence case.
EDIT: I missed one, "Netflix Lemur" is ambiguous. Here's my sample/dataset: http://pastie.org/10436384*
[+] [-] evincarofautumn|10 years ago|reply
[+] [-] kingbathtub|10 years ago|reply
https://bitcoin.org/en/faq#wont-the-finite-amount-of-bitcoin...
[+] [-] minimaxir|10 years ago|reply
This seems dishonest. How much $USD worth of Bitcoin could you realistically produce in a day with a pocket-sized computer, net of the cost of electricity used to mine it?
[+] [-] nerevarthelame|10 years ago|reply
"Can you make a profit with the 21 Bitcoin Computer after accounting for energy costs?
Yes, you can indeed make a profit with the 21 Bitcoin Computer. However, you would do so not by directly selling bitcoin, but by selling digital goods for bitcoin. That is, you are not going to get rich by immediately selling the bitcoin mined by the device for offline currency, but you can potentially do very well by selling digital goods and services to others for their bitcoin." [https://www.21.co/faq/]
[+] [-] Sambdala|10 years ago|reply
[+] [-] saiko-chriskun|10 years ago|reply
[+] [-] dchuk|10 years ago|reply
"With this pocket-sized device, if you are an entrepreneur or developer, you can now instantly buy or sell digital goods and services at the command line using Bitcoin." Isn't that already all possible with just bitcoin itself? Why would I buy this thing?
[+] [-] jboggan|10 years ago|reply
2) Spend 80-90% of that to buy Bitcoin
3) Do things to drive adoption and popularize Bitcoin
4) Profit!
0 - https://www.crunchbase.com/organization/21e6
[+] [-] wmf|10 years ago|reply
[+] [-] natrius|10 years ago|reply
[+] [-] minimaxir|10 years ago|reply
In this case, there is an alternative to the 21 computer known as money.
[+] [-] akhilcacharya|10 years ago|reply
[+] [-] miles|10 years ago|reply
"So it's an overpriced SHA256 ASIC attached to a Raspberry Pi? For $400?" [2]
"I'd rather just buy $399.99 worth of Bitcoin..." [3]
EDIT: Its first-listed "feature" on Amazon [4] seems disingenuous at best:
"Buy digital goods with the constant stream of bitcoin mined by a 21 Bitcoin Chip"
especially since the makers themselves refute this in their FAQ [5]:
"Yes, you can indeed make a profit with the 21 Bitcoin Computer. However, you would do so not by directly selling bitcoin, but by selling digital goods _for_ bitcoin. That is, you are not going to get rich by immediately selling the bitcoin mined by the device for offline currency, but you can potentially do very well by selling digital goods and services to others for their bitcoin."
In other words, there will hardly be a significant "constant stream of bitcoin mined" as the tech specs [6] make clear:
"the 21 Bitcoin Chip has an efficiency of approximately 0.16 Joules per Gigahash and can calculate 50-125 Gigahashes per second"
At the current difficulty, that would produce somewhere between 0.01289890 and 0.03224725 bitcoins per month [7]. Even if the difficulty remained constant, it would take many years to recoup the initial $400 investment.
[1] https://www.reddit.com/r/Bitcoin/comments/3lucwl/21co_websit...
[2] https://www.reddit.com/r/Bitcoin/comments/3lucwl/21co_websit...
[3] https://www.reddit.com/r/Bitcoin/comments/3lucwl/21co_websit...
[4] http://www.amazon.com/gp/product/B014RD021C
[5] https://21.co/faq/#making-a-profit
[6] https://21.co/faq/#technical-specifications
[7] https://alloscomp.com/bitcoin/calculator
[+] [-] Phlarp|10 years ago|reply
These guys deserve an award for sleaziest PR spin.
[+] [-] trg2|10 years ago|reply
[+] [-] tlrobinson|10 years ago|reply
[+] [-] undefined0|10 years ago|reply
> This means you can now write programs that connect to the Bitcoin network just as easily as they connect to the Internet.
It sounds like the mining is intended to create a constant supply of bitcoins so you don't have to "top up" your wallet. Then the bitcoins are used to process things (putting information in the blockchain) and you're also selling access to run sandboxed code on your machine - presumably code which interacts with the blockchain.
They've phrased this terribly by saying you're selling "digital goods and services", overly broad and meaningless words.
[+] [-] airza|10 years ago|reply
[+] [-] andrewla|10 years ago|reply
If bitcoin mining were competing for the market for stolen computing time, then the "pwner" of each zombie would make an economic decision as to whether to use the machine for other tasks (spamming, password cracking, etc.) based on the relative value of those tasks in bitcoin vs. the amount of bitcoin produced by the machine. As the price/hashrate ratio increases, more zombies would switch to mining; as it decreased, the flow would go in the other direction. The price of electricity is irrelevant to the "pwner" of the machine as regards this decision; for them electricity is free.
In terms of how this were to affect price, that's a more complex relationship, even in theory. As the difficulty increases, it gets more expensive to attack the network (and thus artificially expand supply), so the price will presumably face upward pressure to keep the relationship of difficulty to inverse price constant (assuming price/hashrate as the function is disingenuous, but is probably reasonable for local price and difficulty changes).
That said, it is unlikely that the antecedent holds -- it is extremely doubtful that stolen computing time (or even total CPU + GPU mining) is a reasonable component of the current hash power.
[+] [-] placeybordeaux|10 years ago|reply
[+] [-] VLM|10 years ago|reply
Note that if you mine your own coins its very hard to track where they came from, what with there being no paper trail of you purchasing them from anyone. If you buy coins from someone then that someone can be strong armed by a .gov or .com into telling them who they sold coins to, assuming they don't have a direct data feed right to the DEA or whatever. So in the stereotypical bleating tabloid form of "buy weed online with BTC" if "they" have a list of BTC buyers as 0.001% of the population and give it to customs as a filter on packages coming in from Amsterdam... On the other hand if you're not on a list of BTC buyers because you mined your own... Of course WRT paranoia, being on a list of known custom ASIC owners is about as bad as being on a list of weed grow light purchasers, so I'm not sure this product fixes anything.
[+] [-] TD-Linux|10 years ago|reply
[+] [-] natrius|10 years ago|reply
[+] [-] brighton36|10 years ago|reply
Also, it's 'stolen'/'subsidized' energy that is being leveraged. Not computing time.
[+] [-] sp332|10 years ago|reply
[+] [-] cschep|10 years ago|reply
[+] [-] unknown|10 years ago|reply
[deleted]
[+] [-] sigma2015|10 years ago|reply
As a matter of fact even with a GPU rack it will take a hundred years or so given what you are up against by now.
https://www.youtube.com/watch?v=jXerV3f5jN8
[+] [-] minerb50|10 years ago|reply
[+] [-] comrh|10 years ago|reply
[+] [-] TimWolla|10 years ago|reply
[+] [-] Sanddancer|10 years ago|reply
[+] [-] Mahn|10 years ago|reply
[+] [-] spullara|10 years ago|reply