Heading into winter, save money on heat with Bitcoin

@Shoutout to cryptocoinsnews.com giving me my first byline and picked up piece :D - https://www.cryptocoinsnews.com/mine-bitcoin-save-money-heating/

Here in NY, heat is a big thing in the winter. It can get bitterly cold, and heating costs add up. Let's do some back of the envelope math to see if we can save money on heating those NY apartments. In a typically NY apartment we're talking 500-1500 sq/ft of living space. So for the purposes of this demonstration, let's use 1000 sq/ft as the magic number. Given that New York is a pretty cold climate, we're going to need about 4,000,000 BTUs per month of heat to keep that apartment warm. Here are the current rates for the common energy sources:

Electricty - $.20/kWh Oil - $3.60/gal Natural Gas -  $15/MCF

This gives us a very approximate cost per million BTU as follows:

Electricity - $60 Oil - $34.60 Natural Gas - $18.75

Which shows natural gas as the clear winner for heating our apartment at approximate cost of  $75/month during the coldest months. But what if electricity is our only option? (There have been several times where I have rented and the only available heating source was electricity. )

In that case it's a clear home run for the next contender: the bitcoin ASIC.

Bitfury ASIC

I won't go into too much detail, but essential it's a machine capable of producing bitcoins for the cost of electricity. The initial purchasing price of the device is also a factor.

From my own personal experience, it takes a gen I 100gh/s Avalon miner (600-1000w PSU) to heat that 1000 sq/ft apartment. It uses 14.4kWh of electricity per day - giving us a monthly cost of ~$86.4. This is without using optimization like thermostats to keep a consistent temperature. My method was to adjust the openness of my window.

Surely $86.4 can't compare to the $60 cost of electricity alone? Surely. But that's not all. The ASIC producing 100gh/s would have bestowed upon us some BTC during that month period. At the current price ($380) we're talking $15/month. It starts to get interesting.

On top of which, that gen 1 100gh/s ASIC is somewhat outdated. We can find used Avalons  on ebay that output 200gh/s for the same amount of electricity or less.  On top of this, there are or shortly will be chips on the market capable of 1W/Gh - which would offset the cost of heating entirely and then some (beating oil and natural gas.)

I believe we're now in the territory of ASIC heat being more efficient than traditional electric heating elements from a cost/btu standpoint. Play this out for a few years and we see the cloud moving to our baseboard heaters.

If you pay for your heat in NY - it probably pays to buy some ASICs. The value of bitcoin will go up or down, the hashrate similarly, but so does oil / gas. Right now it makes sense to heat with ASICs.

Bitcoin: after the beginning...

In my last post on this subject, I wrote about Bitcoin being the beginning of an extreme shift in culture. I anticipate that the shift could take 10-20 years to be realized, but there’s a lot of work that can be done to shorten it to 3 years.

The shift I imagine can primarily be described as decentralized voting, trustless identity/finance pairing, transparent government/public corporations/non-profits, DAOs, granularly controlled privacy for those who want it, and an overall reduction in crime, bureaucracy, and oppression. Additionally, the standard of living, especially in the developing work, will be dramatically much higher.

People in sub-saharan Africa and Latam (where reduction in poverty is vital) will have access to financial services, communication, organization and self-governance. There will be methods for the developed world to efficiently and effectively donate to causes where it is badly needed. Causes like mesh networks to facilitate communication, and food / clean water so that time can be spent on social infrastructure. Funding can go directly to those causes without being pilfered, and results can be more easily monitored for efficacy.


The first feature I was excited about with Bitcoin was its use as currency, value transfer, and value storage. For those who bank branchlessly - this technology alone is life changing. But decentralized ledger systems give us much more than that.

Decentralized voting is huge. Decentralized storage of information, identity, communication, law, business, and much more are all possible and real in the near future.

What most excites me is the ability to quantize the analog world we live in. By decentralizing these metrics in a publicly stored system, we can do some very cool data analysis. We can see if the aid given to Burundi can be categorized by source and destination. We can then see what works and what doesn’t.

Recently a representative from a global charity (one of the largest, with over $4.2bn in contributions in 2013) came to our office. He told us that one of the major issues in giving financial aid is that when it doesn’t go to the matron of the household - funds get spent by the males on alcohol and drugs. It is difficult to keep the men from stealing the funding, so the charities don't give financial aid to those households. If the money can be given directly to the women of the household, there is an overwhelming probability that she will make her family escape from the relative poverty.

There are many clear applications for where Bitcoin - and the more important underlying technology - can greatly benefit the world. Most of the applications we have considered closely parallel systems with which we are already familiar. The financial aid problem could potentially be solved with Bitcoin wallets for the women in need of financial aid. That’s not to presume that it’s a silver bullet, but it would create a very big difference in solving the problem. This example closely parallels some of the financial aid systems we currently use, but the distribution chain length and cost would be dramatically reduced. It is a more efficient version of what we already have. In many cases, efficiency to the point of being effective where it otherwise wouldn’t work. Reducing the distribution chain by 20 points of contact - to get to a family in need - is what it takes to be worthwhile.

As far as the example with Burundi of A/B testing methods of aid, there is not much like that available to us. Most people have almost no experience crowd-auditing what works because there simply is not enough high-quality data. This may be bordering on the spooky for most people, but that’s because we’ve been conditioned. Our conditioning has told us that centralized organizations control the information, our privacy is under attack and not theirs. We now have the tool to flip that scenario. We can responsibly shine more light on the structural inefficiencies of the world, the corruption, violence, poverty, and attempts at sweeping this stuff under the rug. At the same time we can reduce the need for reductions in personal privacies.

I’m hoping we can work together on this, I guarantee that if you’re reading this -- you can help.

How Many Eyes Are on the Books?

Echoing the sentiment of Ryan Straus (Ridell Williams); the overarching issue at the forefront of Bitcoinland is that Bitcoiners place a lot of trust in individuals and organizations. That’s not to say placing trust in people and institutions is always a bad thing, but that trust needs to come with safeguards. The recent events at Mt. Gox are an articulate illustration of those challenges. For years, Mt. Gox was a mainstay of Bitcoin. Gox allowed many people to get involved in digital currency with ease and relative security. We can thank Gox for much of the early adoption and infrastructure of the community. Ultimately the trust was betrayed. We saw technical glitches, a lack of communication, and wild levels of volatility.

Most of this could have been prevented with solid tech, transparency, and outreach. Still, I subscribe to the idea that Mt. Gox has given us a great gift. We can learn from their shortcomings and reference their successes for the next level of Bitcoin infrastructure.

Having developed software for a while, my greatest lessons draws from moments of failure. There have been amazing tools developed purely from breakdowns in software. These tools help us prevent, detect, resolve, and communicate about technical issues which naturally and inevitably evolve. I believe 2014 is a year where we can build some of those tools for Bitcoin.

The tools the community most needs to focus on are:

Triple-entry accounting: While this term is somewhat vague, I envision it as a method for reconciling a company’s books. In essence, you could assign a Bitcoin address as the holder of funds for the traditional double-entry accounting verticals. Operating expenses, accounts receivable, salary, investments, etc. could have dedicated Bitcoin addresses for the inflow and outflow of funds. This would make it much easier to visualize funds flow both internally and from the perspective of an outside auditor.

Ledger transparency: This piggybacks off of the idea of triple-entry accounting. I half-jokingly tweeted that managers of the future will be able to crowdsource peer-review of their records. For many organizations, like non-profits and publicly traded companies, stakeholders want transparency but the presentation methods are fairly analog. The idea is to digitize all of an organization’s fund flows, and make it available on something like the blockchain - so that people who know the correspondent Bitcoin addresses could verify that financial statements are accurate.

The implications of this are far-reaching, and an understanding of how it would play out practically are to be determined. Many people would prefer to invest or donate to an organization where the financial representations were accurate. The existence of ledger transparency is inevitable simply due to the competitive advantage. The upside for the organization is increased efficiency and reduced cost for auditing, as well as a lower risk of financial inaccuracy. People want to know “How many eyes are on the books?” The answer could soon be “Everyone’s.”

Full-Reserve Bitcoin Banking: We have the technology to prevent fractional reserve of our assets. This is the cutting edge of Bitcoin security. It’s shiny, it works, and not enough people / organizations are using it. Existence and placement of assets can be cryptographically proven and movement can be restricted with extremely granular configurations (multi-sig.)

Insurance: When all else fails, there is insurance. A Bitcoin depository institution could have an extremely secure system of storage. Risk could then be calculated and deposits insured.

Modularization: In the financial industry, there is a great deal of modularization. It is imprudent to have a single entity act as a depository institution, clearinghouse, order-matching exchange, and auditor all at once. These tasks can be separated for increased efficiency, reduced risk, and greater scope-precision. This is important for three reasons:

  1. It is easier for business operators to build smaller-scope products.
  2. When one of those competing products fails, the entire system doesn’t halt - it is swiftly replaced.
  3. Maintenance of a module does not require system-wide downtime.

Granted, the financial community has had several hundred years to evolve to the point of efficient compartmentalization. Fortunately for Bitcoin, most of the work has been done and we simply have to parallel many of the models that exist. We can even step it up a notch with transparency and decentralization of trust.

It is important that we remember the spectrum of what we like in principle and what is possible today, this week, this year, etc. It is going to take some time to revolutionize finance with the power of cryptography. We are still waiting for sweeping changes to happen overnight. It’s been 5 years, and we’ve resigned to working on what is practically achievable in experience-based timeframes. The items discussed above are our goals for 2014. Our focus is on the option of transparency, importance of choice, and the obsoletion of coercive trust.

(1) “If I own several pounds of gold, I may not want to keep all of it in my home.” (2) CoinApex.com has taken initiative to implement TE accounting for one of their companies as a proof of concept. Research is ongoing and results will be shared by year-end.

Syndicated from http://hub.playerauctions.com/alex_waters-bitcoin-eyes-on-the-books - on March 7th, 2014

Bitcoin is just the beginning

4:50am Saturday June 7th 2014

It’s been about 5 years since I first heard about Bitcoin. I was recently asked how I fell into Bitcoin, and I thought for a moment - can I remember?

It was vivid. I read the white paper, sat for a few moments and read it again. After finishing the second time, I paused. Because I had realized the simplicity and sheer power of a new concept. A concept where I was surprised for humans having not invented it earlier.

Here is - in my opinion - the entire premise of Bitcoin:

  • Pretend a town has one cart that people borrow to move things.
  • There is a piece of paper in the middle of town where the last person to have the cart has to write down who they give it to.
  • The piece of paper serves as a record of who possessed the cart at a given point of time, who they received it from, and who they gave it to. It also shows the creator of the cart, and the last person to hold it.

This allows the town to keep track of the cart, so that if it goes missing, or a piece is broken, there is a record of who is responsible.

With Bitcoin, we can facilitate this piece of paper on the internet. Except that the town is the world, the cart is a representation of all things which have value, and the person is everyone who wants to participate (including, maybe, the robots.)

We have explored the power of this concept over the past 5 years, and it has led to an 8.5 billion dollar ecosystem.


What’s remarkable is that the ‘Bitcoin’ people are familiar with (the one we hear about on the news) is just the first experiment. It’s the first interesting thing we tried doing with the above simple but powerful concept.

There’s a great deal more to come... instead of the cart representing cash, it could represents votes. It could represent identity, data, friendship, cars, pickles, vaccines, ideas…

At any time anyone with internet access could see how their government was spending taxes. They could see this without giving away their personal privacy. People could vote and it would matter. They can vote to require governments and corporations to reveal themselves perhaps without individuals needing to do so. They will enforce those votes because the natural course of this new system is to give control back to distributed consensus.

Digital currency allows me to purchase yogurt from an autonomous yogurt shop. The yogurt shop has no one owning it, it is a piece of code. It can buy supplies, repairs, ingredients, and pay its taxes without human involvement. It can buy additional property and replicate itself if it is profitable.

What if this future is inevitable and it is our generation's job to reduce the amount of time it takes to reach fruition.

The decentralized public ledger solves one of the ancient problems. The problem of how a community organizes itself past a size of ~150 individuals.  Keep an open mind, we may have just solved it. And don’t worry, it’s not some orwellian or huxley future. It’s not terminator 2 with us vs. the robots. It’s a force which decimates centralization through competitive advantage and redistributes value to the masses. It’s math, it’s beautiful, and I’m up until 5am writing about it.

Check out getkelvin.com
My Twitter: https://twitter.com/watersNYC
Ethereum: https://www.ethereum.org
Bitcoin Reddit: http://www.reddit.com/r/Bitcoin


A reflection on the small part I play in the movement towards a type 1 civilization

This is an exciting moment in human history. The Internet has provided humankind the ability to communicate over great distances and access to information and collaboration that’s unprecedented. The result is a great push in the advancement of our species. As a part of this technological wave of improvement, I have taken a moment to reflect on what that means now and for our future and how we can each contribute to the advancement of our civilization. The Internet is really, really cool. Anyone in the world can communicate with anyone else in the world in a split second, as long as they’re connected to the Internet. This is a huge deal.

I rank the Internet as the third greatest technological achievement in human history (behind only fire and electricity). It provides us a global communication system that accelerates advancements in every other field of human study: Medicine, mathematics, physics, law...you name it. With the Internet, we can perhaps achieve more in the coming 50 years than mankind has accomplished in the past one thousand.

With the Internet, Socrates’ famous words have never rung truer: “I am not an Athenian or a Greek, but a citizen of the world.” We are no longer a tribal species; we are a global species. Today, we can easily send information, currency, physical goods, and communications around the world in trivial amounts of time. If we follow the natural path that these advancements present, we can truly achieve a global culture, global governance, and hopefully global peace.

It is easy to see that education has the power to change some of the bad stuff in the world. Technologies and infrastructure like those offered by Wikipedia, Google, Twitter, Facebook, Amazon, Reddit, PayPal, and Bitcoin are enabling communication and the sharing of knowledge and information which is progressing us towards a global civilization. Anyone with access to the Internet can connect to sites like Carnegie Mellon, Stanford University, or the Khan Academy to take high-quality courses for free. They can then share what they’ve learned with people around the world on sites like Reddit, Tumblr, Stack Exchange, and Wordpress. This type of access to information and interaction is unprecedented. People from all walks of life and cultures are collaborating - thinking, learning and problem-solving together. I love it. This system, with all its benefits, is empowering individuals, but it also feeds “Big Brother.”

The concept of a global government is frightening. George Orwell opened many people’s eyes to the idea that one-way transparency is a bad thing. We are seeing real manifestations of his fictional “1984” in the news lately. Governments are definitely spying on their citizens. In the US, every word written and spoken has a good shot at being recorded and stored somewhere in Utah. Even still, I'm willing to wager that technology and freedom of information will overcome the rise of tyranny.

There are many who say “if I’m not doing anything wrong, what do I care if they watch me.” The problem is that you may think you’re not doing anything wrong, but the government may think otherwise. Many countries censor the politically outspoken, even torturing and killing those who do not support the party in power. The constitution and the bill of rights in the US argue for the freedom of speech, due process, checks and balances, and the right to not self-incriminate - but it is becoming clear that the US no-longer plays by its own rules.

The potential for corruption and using new technologies to go after law-abiding citizens is eye-opening. Fortunately, the transparency cuts both ways - leaking information and whistleblowing are easier than ever.

We are on the precipice of a global renaissance, and very few of us even realize it. The idea of contributing a single line of code, or a single blog post that brings us closer to capturing a type I civilization motivates me to write that code. It is why I am so passionate about technology.

As we’re in the midst of these exciting times, ask yourself this: how would you react if electricity was just invented? Would you behave like the majority of people who scoffed at it as a parlor trick?

There’s a good story about a man who thought that electricity could change the world. His own father thought that he was a fool. Now, JP Morgan stands as one of the most respected and visionary business men of all time. If only we could all reflect on this moment in history, it might teach us to respect each innovation for having the potential to change the world.

When a decentralized communication system (the internet), a decentralized currency (Bitcoin), and a decentralized voting system (TBD) come knocking at the door - will you jump on board?

Having an identity online is hard and the fear of being exposed is in your head.

TLDR; I give my experience with online identity and ideas as to where it is headed. Over the years I have held several monikers on the Internet. Not only is it easy to conceal an identity but it is seemingly encouraged by various registration forms. The simple absence of Your full name: as a hard requirement panders to people's creative expression.

Until recently, the masked Internet was thriving and mainstream. I say until recently with reluctance. There is still a thriving anonymous community but the majority of people (on Facebook, Twitter, Google) are using their real names to identify themselves.

People going by their real names online used to be rare, especially in online social interaction. The concept of using your real name online wasn't bad - it just wasn't necessary.

For many of the pre-social network internet inhabitants (irc, aol, usenet, hackers, 3l33t, etc.), having an identity online tied to 'real-life' was an offense. When social networks embraced and required the use of real names, there was somewhat of an outcry.  It was an affront on one of the core positives of the Internet; the freedom to express oneself.

Having a username like th3j35t3r or TimBL up to 2004 almost guaranteed anonymity. It was fairly easy to sterilize one's online identity from the day-to-day family and social life. If you said something controversial online, it didn't echo out into reality.

The computer was essentially a black box where anyone could be and say whatever they wanted, with no consequence. A passionate secret for the technically inclined and a preservation of self. For many it was 1984's hidden notebook.

That snapshot has changed, and online identity is now a complex and mysterious subject.

For the majority of people, having an anonymous identity is emotionally rewarding. It isn't a serious security precaution or a preventative measure arising from paranoia. It's a luxury pair of sunglasses and not a Kevlar vest.

I wear those sunglasses and occasionally I see people wearing the vest. (I have also tried to wear that vest but the weight of it is annoying when I know my head's still exposed.)

Having a purely anonymous identity online is harder because tracking people is easier. A relatively inexperienced geek can find out who someone is without writing a single line of code. Root passwords to secure systems can be obtained via social engineering. Cookies, analytics, cross-site tracking, persistent multi-site sessions, etc. have made it incredibly difficult to have any control over who you are online. It sounds pretty bad for securing information, let alone identities.

Being anonymous was great, until I wanted to do some online banking...

This isn't a doomsday manifesto. Today, being controversial or outspoken is fortunately passé. Facebook has made us all a little more accepting of everyone else's crazy.

As much as we're losing anonymous, we're gaining acceptance of transparency.

So there you have it, a glimpse into my conscience - online and transparent. Fortunately for me, no one reads it - so I don't fear being judged. (I track my readership with Google analytics)

As for the people that wore Kevlar vests: they've just had to spend a lot more time building better vests. They now build and sell the vests. My point is that if you want your  pseudo-identity to be really secure these days; you had better devote your career to it or pay someone that has.

We could also accept that there is no such thing as an unbreakable safe and that most people don't care to read our diary anyway. We're too busy reading Aldous Huxley's wiki.

How to: Dropbox

So I just uploaded a video to show people how to download and install Dropbox:

I just wanted to add a post to my blog to cover some additional information that people might find useful. So here are some key points I wanted to make:

-It's free to use and easy to install. -Dropbox can be used to share and sync files between two or more computers. -Files can be added to the Dropbox/public folder to make them public. Right clicking on the file, and selecting Dropbox->Copy public link will give you a link to the file (which you can give to anyone wanting to download the file.) -It's supported on Linux, Windows, Mac OSX, Android, and iPhone/iPad.

So this is my first software how-to video, and I plan to do many more. I'm going to try to knock off the easy ones first. This way my video editing/voice over techniques will be up to snuff by the time I do the advanced videos.

Here is a selection of some of the videos I am planning (there are many more in my lists):

Software -How to: Sync your keepass across multiple computers -How to: Install virtual box with Ubuntu natty -How to: use Google Analytics -How to: use Google Plus -How to: use Git

Hardware -How to: install RAM -How to: apply thermal paste to a GPU -How to: replace a hard drive in a laptop

If you have recommendations for additional how-to videos, please feel free to comment here or on my YouTube.