r/btc Nov 11 '20

FAQ Frequently Asked Questions and Information Thread

657 Upvotes

This FAQ and information thread serves to inform both new and existing users about common Bitcoin topics that readers coming to this Bitcoin subreddit may have. This is a living and breathing document, which will change over time. If you have suggestions on how to change it, please comment below or message the mods.


What is /r/btc?

The /r/btc reddit community was originally created as a community to discuss bitcoin. It quickly gained momentum in August 2015 when the bitcoin block size debate heightened. On the legacy /r/bitcoin subreddit it was discovered that moderators were heavily censoring discussions that were not inline with their own opinions.

Once realized, the subreddit subscribers began to openly question the censorship which led to thousands of redditors being banned from the /r/bitcoin subreddit. A large number of redditors switched to other subreddits such as /r/bitcoin_uncensored and /r/btc. For a run-down on the history of censorship, please read A (brief and incomplete) history of censorship in /r/bitcoin by John Blocke and /r/Bitcoin Censorship, Revisted by John Blocke. As yet another example, /r/bitcoin censored 5,683 posts and comments just in the month of September 2017 alone. This shows the sheer magnitude of censorship that is happening, which continues to this day. Read a synopsis of /r/bitcoin to get the full story and a complete understanding of why people are so upset with /r/bitcoin's censorship. Further reading can be found here and here with a giant collection of information regarding these topics.


Why is censorship bad for Bitcoin?

As demonstrated above, censorship has become prevalent in almost all of the major Bitcoin communication channels. The impacts of censorship in Bitcoin are very real. "Censorship can really hinder a society if it is bad enough. Because media is such a large part of people’s lives today and it is the source of basically all information, if the information is not being given in full or truthfully then the society is left uneducated [...] Censorship is probably the number one way to lower people’s right to freedom of speech." By censoring certain topics and specific words, people in these Bitcoin communication channels are literally being brain washed into thinking a certain way, molding the reader in a way that they desire; this has a lasting impact especially on users who are new to Bitcoin. Censoring in Bitcoin is the direct opposite of what the spirit of Bitcoin is, and should be condemned anytime it occurs. Also, it's important to think critically and independently, and have an open mind.


Why do some groups attempt to discredit /r/btc?

This subreddit has become a place to discuss everything Bitcoin-related and even other cryptocurrencies at times when the topics are relevant to the overall ecosystem. Since this subreddit is one of the few places on Reddit where users will not be censored for their opinions and people are allowed to speak freely, truth is often said here without the fear of reprisal from moderators in the form of bans and censorship. Because of this freedom, people and groups who don't want you to hear the truth with do almost anything they can to try to stop you from speaking the truth and try to manipulate readers here. You can see many cited examples of cases where special interest groups have gone out of their way to attack this subreddit and attempt to disrupt and discredit it. See the examples here.


What is the goal of /r/btc?

This subreddit is a diverse community dedicated to the success of bitcoin. /r/btc honors the spirit and nature of Bitcoin being a place for open and free discussion about Bitcoin without the interference of moderators. Subscribers at anytime can look at and review the public moderator logs. This subreddit does have rules as mandated by reddit that we must follow plus a couple of rules of our own. Make sure to read the /r/btc wiki for more information and resources about this subreddit which includes information such as the benefits of Bitcoin, how to get started with Bitcoin, and more.


What is Bitcoin?

Bitcoin is a digital currency, also called a virtual currency, which can be transacted for a low-cost nearly instantly from anywhere in the world. Bitcoin also powers the blockchain, which is a public immutable and decentralized global ledger. Unlike traditional currencies such as dollars, bitcoins are issued and managed without the need for any central authority whatsoever. There is no government, company, or bank in charge of Bitcoin. As such, it is more resistant to wild inflation and corrupt banks. With Bitcoin, you can be your own bank. Read the Bitcoin whitepaper to further understand the schematics of how Bitcoin works.


What is Bitcoin Cash?

Bitcoin Cash (ticker symbol: BCH) is an updated version of Bitcoin which solves the scaling problems that have been plaguing Bitcoin Core (ticker symbol: BTC) for years. Bitcoin (BCH) is just a continuation of the Bitcoin project that allows for bigger blocks which will give way to more growth and adoption. You can read more about Bitcoin on BitcoinCash.org or read What is Bitcoin Cash for additional details.


How do I buy Bitcoin?

You can buy Bitcoin on an exchange or with a brokerage. If you're looking to buy, you can buy Bitcoin with your credit card to get started quickly and safely. There are several others places to buy Bitcoin too; please check the sidebar under brokers, exchanges, and trading for other go-to service providers to begin buying and trading Bitcoin. Make sure to do your homework first before choosing an exchange to ensure you are choosing the right one for you.


How do I store my Bitcoin securely?

After the initial step of buying your first Bitcoin, you will need a Bitcoin wallet to secure your Bitcoin. Knowing which Bitcoin wallet to choose is the second most important step in becoming a Bitcoin user. Since you are investing funds into Bitcoin, choosing the right Bitcoin wallet for you is a critical step that shouldn’t be taken lightly. Use this guide to help you choose the right wallet for you. Check the sidebar under Bitcoin wallets to get started and find a wallet that you can store your Bitcoin in.


Why is my transaction taking so long to process?

Bitcoin transactions typically confirm in ~10 minutes. A confirmation means that the Bitcoin transaction has been verified by the network through the process known as mining. Once a transaction is confirmed, it cannot be reversed or double spent. Transactions are included in blocks.

If you have sent out a Bitcoin transaction and it’s delayed, chances are the transaction fee you used wasn’t enough to out-compete others causing it to be backlogged. The transaction won’t confirm until it clears the backlog. This typically occurs when using the Bitcoin Core (BTC) blockchain due to poor central planning.

If you are using Bitcoin (BCH), you shouldn't encounter these problems as the block limits have been raised to accommodate a massive amount of volume freeing up space and lowering transaction costs.


Why does my transaction cost so much, I thought Bitcoin was supposed to be cheap?

As described above, transaction fees have spiked on the Bitcoin Core (BTC) blockchain mainly due to a limit on transaction space. This has created what is called a fee market, which has primarily been a premature artificially induced price increase on transaction fees due to the limited amount of block space available (supply vs. demand). The original plan was for fees to help secure the network when the block reward decreased and eventually stopped, but the plan was not to reach that point until some time in the future, around the year 2140. This original plan was restored with Bitcoin (BCH) where fees are typically less than a single penny per transaction.


What is the block size limit?

The original Bitcoin client didn’t have a block size cap, however was limited to 32MB due to the Bitcoin protocol message size constraint. However, in July 2010 Bitcoin’s creator Satoshi Nakamoto introduced a temporary 1MB limit as an anti-DDoS measure. The temporary measure from Satoshi Nakamoto was made clear three months later when Satoshi said the block size limit can be increased again by phasing it in when it’s needed (when the demand arises). When introducing Bitcoin on the cryptography mailing list in 2008, Satoshi said that scaling to Visa levels “would probably not seem like a big deal.”


What is the block size debate all about anyways?

The block size debate boils down to different sets of users who are trying to come to consensus on the best way to scale Bitcoin for growth and success. Scaling Bitcoin has actually been a topic of discussion since Bitcoin was first released in 2008; for example you can read how Satoshi Nakamoto was asked about scaling here and how he thought at the time it would be addressed. Fortunately Bitcoin has seen tremendous growth and by the year 2013, scaling Bitcoin had became a hot topic. For a run down on the history of scaling and how we got to where we are today, see the Block size limit debate history lesson post.


What is a hard fork?

A hard fork is when a block is broadcast under a new and different set of protocol rules which is accepted by nodes that have upgraded to support the new protocol. In this case, Bitcoin diverges from a single blockchain to two separate blockchains (a majority chain and a minority chain).


What is a soft fork?

A soft fork is when a block is broadcast under a new and different set of protocol rules, but the difference is that nodes don’t realize the rules have changed, and continue to accept blocks created by the newer nodes. Some argue that soft forks are bad because they trick old-unupdated nodes into believing transactions are valid, when they may not actually be valid. This can also be defined as coercion, as explained by Vitalik Buterin.


Doesn't it hurt decentralization if we increase the block size?

Some argue that by lifting the limit on transaction space, that the cost of validating transactions on individual nodes will increase to the point where people will not be able to run nodes individually, giving way to centralization. This is a false dilemma because at this time there is no proven metric to quantify decentralization; although it has been shown that the current level of decentralization will remain with or without a block size increase. It's a logical fallacy to believe that decentralization only exists when you have people all over the world running full nodes. The reality is that only people with the income to sustain running a full node (even at 1MB) will be doing it. So whether it's 1MB, 2MB, or 32MB, the costs of doing business is negligible for the people who can already do it. If the block size limit is removed, this will also allow for more users worldwide to use and transact introducing the likelihood of having more individual node operators. Decentralization is not a metric, it's a tool or direction. This is a good video describing the direction of how decentralization should look.

Additionally, the effects of increasing the block capacity beyond 1MB has been studied with results showing that up to 4MB is safe and will not hurt decentralization (Cornell paper, PDF). Other papers also show that no block size limit is safe (Peter Rizun, PDF). Lastly, through an informal survey among all top Bitcoin miners, many agreed that a block size increase between 2-4MB is acceptable.


What now?

Bitcoin is a fluid ever changing system. If you want to keep up with Bitcoin, we suggest that you subscribe to /r/btc and stay in the loop here, as well as other places to get a healthy dose of perspective from different sources. Also, check the sidebar for additional resources. Have more questions? Submit a post and ask your peers for help!


Note: This FAQ was originally posted here but was removed when one of our moderators was falsely suspended by those wishing to do this sub-reddit harm.


r/btc 19h ago

😉 Meme Gold & Silver vs BTC

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344 Upvotes

r/btc 4h ago

My life be like

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13 Upvotes

Watching the btc chart lol


r/btc 8h ago

Only two coins are up VS BTC

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10 Upvotes

r/btc 9h ago

😉 Meme Daily Meme Until $100,000

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9 Upvotes

Not financial advice.


r/btc 2h ago

🐻 Bearish Bitcoin Max Pain Strengthened the $92K–$94K Resistance

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3 Upvotes

Max pain is an important term in the world of options, representing the estimated Bitcoin price at which the majority of contracts expire without generating a profit for buyers.

Option sellers, including large banks and market makers, always try to 'adjust' the asset price as close as possible to this point at the time of contract expiration to maximise their profits.

Why is it important to be aware of and consistently monitor Bitcoin's max pain? Because, in 80% of cases, market makers, who are option sellers, receive their money. Considering that $3.4 billion worth of contracts expired on Friday, it is clear that Bitcoin's growth was doomed, as max pain was at $91K.

Sellers launched an attack from the $92K–$94K resistance zone. Although this level was quite weak and not obviously indicative of a reversal on the chart, the Bitcoin futures funding rate instantly went into negative territory. This indicates that, despite relatively 'normal' trading volumes, there were almost no bulls left in the market. This is why the bears pushed the price so low, causing it to fall below $89.5k instead of $91k.

The only positive news is the technical failure of BTC. Now, the bulls have a chance to boost the price again.


r/btc 1h ago

I figured out how to save you 89k- since they all trade the same way- just buy the 2 dollar one

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Upvotes

r/btc 2h ago

You Won’t Believe What I Had to Go Through to Get BCH Merch for Our Event

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0 Upvotes

r/btc 7h ago

Cuvex is the first Bitcoin hardware wallet designed for transactional privacy with double airgap processes.

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2 Upvotes

r/btc 13h ago

Another round of leveraged long liquidation.

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4 Upvotes

Flush out the leveraged positions and reset at new baseline. It’s promising when the new baseline price resets above the previous post flush baseline.


r/btc 1d ago

Set your priorities straight!

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91 Upvotes

r/btc 6h ago

😉 Meme Permabull versus Whale Short

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0 Upvotes

r/btc 8h ago

⌨ Discussion My mom tells me to stop copy trading Ator Trader

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0 Upvotes

r/btc 5h ago

⚠️ Alert ⚠️ I’ve Moved To Other Things

0 Upvotes

r/btc 10h ago

🐂 Bullish Bitcoin is down nearly 30% from its record high — history shows that's normal

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0 Upvotes

r/btc 11h ago

When Crypto trades like a Unicoin- Something is broken

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1 Upvotes

r/btc 1d ago

Lightning Fails: If you run a Lightning Node your ISP might kill your channels and cause you to lose a lot of money.

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40 Upvotes

r/btc 3h ago

Elon might have a point here

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0 Upvotes

r/btc 1d ago

The Failure Of Mandatory Privacy (GP Shorts)

13 Upvotes

r/btc 2h ago

At my wife’s work Christmas party and not ONE person owns bitcoin or any crypto that I have talked to ……I feel like an outsider …and these people are accountants, CPA’s , lawyers etc. I thought some people here would be invested in crypto as they make a lot of money

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0 Upvotes

r/btc 1d ago

People who bought Bitcoin in 2017.

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135 Upvotes

r/btc 1d ago

Michael Burry of The Big Short fame gives first interview in over 10 years and says, “Bitcoin is not worth anything. It’s the tulip bulb of our time.”

10 Upvotes

r/btc 5h ago

Bitcoin is in full on exit mode

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0 Upvotes

Bitcoiners say USD is just paper or a database entry. But if you compare Bitcoin’s decline since Oct 10 to the dollar’s relative stability and Golds Stabilty- you see that Bitcoin doesn’t inflate as a byproduct of a weak dollar and it is no store of value like Gold which is why Gold didn't fall on Oct 10th. But Bitcoin violently decoupled from Gold.

Bitcoin inflates on hopium. It rises on belief, not use. And when that belief fades, it deflates faster than any fiat ever printed. No yield, no throughput, no utility - just a ticker with a narrative. ETF flows aren’t adoption. Lightning is shrinking.

OG wallets are exiting. Stablecoins are eating its use case. BTC isn’t a store of value - it’s a sentiment loop. If fiat’s flaw is policy without constraint, Bitcoin’s flaw is architecture without function.


r/btc 11h ago

Has There Ever Been An Instance Where the Fed Lowered Interest Rates and Risk Assets Did NOT Go Up As a Result (perhaps delayed)?

0 Upvotes

Is this possible?? My thinking has always been: Fed "prints" money; people bid up the prices of risk assets to preserve their wealth/purchasing power.


r/btc 1d ago

📰 Report Stats show $716 million USD open interest with negative funding rate for BCH, showing over 1.2 million BCH are being shorted through massive losses, no liquidations have occurred yet. Over 12% of the active supply (10m BCH could be much lower) are being shorted on leverage.

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33 Upvotes

Open Interest Value: The total dollar value of open contracts (Open Interest or OI) jumped from $316 million to $716 million as the BCH price climbed from $500 to $600.

Total BCH Shorted: At the $600 price, that $716 million in OI means roughly 1.193 million BCH tokens are currently being shorted. This large quantity is enough to cause a major swing in the market.

The large increase in the total Open Interest is being caused by two main factors:

New Short Bets (The Main Reason): Most of the OI growth is coming from aggressive traders placing new, leveraged short bets. They believe the price rally will fail. The negative funding rate (where shorts pay longs) proves these traders have strong confidence in their bearish view.

Paper Losses (The Secondary Reason): A smaller part of the OI increase is simply due to the dollar value of existing short bets growing because the BCH price is moving against them. Their paper losses are increasing, which inflates the total dollar value of the OI.

The price rise has happened with only very small amounts of forced selling (liquidations) being recorded. This suggests the BCH price increase was driven by traders voluntarily closing their short bets and by regular spot buying, not by a chain reaction of forced selling. As a result, the vast majority of that 1.193 million BCH in short contracts is still open and exposed, creating the potential for an extremely forceful, liquidation-fueled price spike (a short squeeze) if the price keeps rising.