Via Steve Laniel, this entertaining harangue against modern web development is a must-read for all web developers.
April 2, 2014 1 Comment
Update: Based on some helpful comments on /r/bitcoin, I edited my original post to clarify that Bitcoin derives its value, only in part, from the costs required to produce it. However, without that it would be valueless, even if there are other things that contribute to its value. Not sufficient, but necessary.
Some fellow engineers I work with have been mining and trading Bitcoin since well before the mainstream hype of the last few months, and in talking to them I’ve become increasingly interested in it as well. It is one of the more elegant technological ideas to come along in a long time, and its greater economic, sociological, and political implications are also fascinating to me.
But when I first heard about it, I was hesitant to treat it seriously based on one fundamental doubt: how could a bunch of numbers spit out by a computer have intrinsic value in the same way that gold can? I understood how Bitcoin could have extrinsic value, based on things like trust and hype, but if that were all it were based on, why would Bitcoin be worth more than any other arbitrary currency one could create out of thin air?
And then I spent some time learning exactly how Bitcoin mining works, and discovered that there is, in fact, intrinsic value to the currency. (Funny how ignorance can lead you to dismiss things like that!) In order for Bitcoins to be created, a computer must solve a difficult math problem by guessing a number by brute force. This requires a running computer (these days, a powerful computer specifically built for this type of math problem), which in turn requires electricity, which was probably made with a fossil fuel or nuclear generator. So, in a way, you could say that the value of Bitcoins is at least partially derived from the fuel used to create the energy needed to power the computers that mine them.
But, you ask, what happens as computers get more and more powerful and energy efficient? Shouldn’t Bitcoins get easier and easier to mine, dropping the amount of energy required to mine them, thereby decreasing their intrinsic value? Turns out that part of the ingenious and elegant design of Bitcoin prevents this from happening. The difficulty of the math problem that the mining machines have to solve changes dynamically over time. The system as a whole aims to stabilize the difficulty such that these math problems can only be solved roughly once every 10 minutes. If the computers start to solve the problems faster, the difficulty across the system is increased. If the computers start solving the problems slower, the difficulty is decreased.
To be sure, there are other factors that contribute to Bitcoin’s value other than trust and hype. It shares many common characteristics with gold: durability, divisibility, combinability, homogeneity, and scarcity. All of these things factor together, along with the sociological stuff, to give Bitcoin its total value. But if it were possible to mine Bitcoins without expending resources, I believe their value would fall to zero. (There is another stopgap against this built into the technology: the total number of Bitcoins is capped at 21 million, so even if down the road it were theoretically possible to mine Bitcoins for free, only up to 21 million total could be harvested. That hard cap also contributes to Bitcoin’s scarcity, and therefore its value.)
And so, it is this fixed degree of difficulty, inherent in every single Bitcoin that will ever be mined, that ensures that there will always be some level of effort required, and therefore some baseline value in the coins. Without this fixed difficulty, computers would be able to simply pluck Bitcoins out of thin air, and despite all the other valuable characteristics of the currency, it would in all likelihood be worth nothing.
December 14, 2013 6 Comments
July 29, 2013 4 Comments
I was sick of having to click two times to answer this question, so I made this.
July 24, 2013 No Comments
ECHELON is a code word for an automated global interception system operated by the intelligence agencies of the United States, the United Kingdom, Canada, Australia, and New Zealand, and led by the National Security Agency (NSA). I’ve seen estimates that ECHELON intercepts as 3 billion communications every day, including phone calls, e-mail messages, Internet downloads, satellite transmissions, and so on. The system gathers all of these transmissions indiscriminately, then sorts and distills the information through artificial intelligence programs.
Bruce Schneier, Secrets and Lies,2004, 2nd ed.
July 15, 2013 No Comments
Drew Crawford, in a long but well-researched essay on mobile app performance:
July 10, 2013 No Comments
About a year ago, my friend and colleague Michael McWatters tweeted, “Oh no, if I die at this moment, my last tweet will have been about Andrew Breitbart…must think of something else. Beauty, science, altruism!” I replied, “@mmcwatters That would be an interesting site to make: the last tweets of famous people.”
In the weeks and months that ensued, we made good on our promise and built the site, which Michael brilliantly named, “The Tweet Hereafter.” As our lives become increasingly transparent on sites like Twitter and Facebook, we leave indelible marks on the Internet that can’t be erased once we die.
In March, 2012, conservative blowhard Andrew Breitbart famously sent an apologetic tweet less than an hour before he died of a heart attack. And now, a little less than a year later, beloved Olympian Oscar Pistorius has been arrested on suspicion of murdering his girlfriend Reeva Steenkamp, who just yesterday tweeted excitedly about her plans for Valentine’s Day.
We’ve been collecting tweets like this for over a year and have finally decided to publicize the site. The site is certainly morbid, sometimes interesting, quite often meaningless. But we hope it makes you think a little bit.
February 15, 2013 No Comments
A recent episode of the Planet Money podcast profiled Thomas Peterffy, one of the first people to experiment and be successful with high-frequency trading. They told the story of how he was doing algorithmic trading before any of the stock exchanges supported electronic trading, and before NASDAQ even existed. So how did he do it? That’s the fascinating part.
He made his money building a system that was able to assign a fair market price to stock options. He then compared these values to what the options were actually trading for, and arbitraged the difference. Back in the late 1970s when he first started, he would print out the numbers and bring them to the trading floor in a huge binder. When the stock exchange banned him from bringing the binder, he stuffed the papers into every pocket his suit had.
Then Peterffy got himself a system called Quotron, a computerized service that delivered stock prices to brokers (it was a replacement for the widely-used ticker tape system). If he’d used the system the way it was intended, he would’ve read the quotes as they came in on the Quotron, manually input them into his algorithm, run the numbers, and cashed in. But that wouldn’t have been that much better than just using ticker tape, and the fact that he had a computerized system meant the data was in there somewhere, in digital form. If he could figure out how to retrieve it he could pipe it into his system and save a crucial, time-consuming step.
Nowadays if we wanted to do something similar, we might look into whether the Quotron had an API, and if it did we’d query that for the information. If it didn’t have an API, well, we might look for another system that did.
But Quotron had no such ability. So he did what any hacker worth his salt would do. He broke out his oscilloscope, cut the wires on the Quotron, reverse-engineered the data signal, and patched it into his system. And you think screen-scraping is hard?
When NASDAQ, the first all-electronic stock exchange, came online, he was faced with a similar system. Brokers could trade directly on the exchange via computer. This was no doubt a huge breakthrough, but there was still no way his system could make the trades automatically. So, again, he busted out his oscilloscope and patched his way into NASDAQ.
We developers could learn from Peterffy. The ease of software engineering has made most of us too complacent. When Twitter’s API terms change, we complain about it for a few days, and then change our business models to suit the new rules. But the real innovation, the real interesting stuff, the way we’ll make $5.4 billion like Peterffy did, is by bending the rules and building systems that give us a leg up on the competition, or, better yet, improve people’s lives.
To be sure there are lots of hackers on the fringes of legality doing very interesting things, but the rest of us are somehow content to toe the line. We shouldn’t do anything that’s illegal, but we should get close. Innovation comes out of spurning the status quo, not complying with it. It’s time for people who know how to build things to bend the rules a little, and see what comes out the other side.
(The podcast was based on Peterffy’s story as told in the book Automate This: How Algorithms Came to Rule Our World.)
September 13, 2012 2 Comments
How often have you been on a site where you see an address but no map, and maybe not even a link to a map? I find this very annoying, so I created a little bookmarklet that solves the problem. To you use it, just highlight an address on a page and click the bookmarklet. You’ll be taken directly to Google Maps for that address. Easy enough.
Here’s the bookmarklet. To install it, just drag it up to your bookmarks bar!
May 4, 2012 No Comments
On September 11, 2001, my wife and I were woken at about 9:00 by her mother, who told us to turn on CNN. We were newlyweds, living in a studio apartment on the Lower East Side. As soon as we saw the burning towers on TV, we left our apartment and headed down to the street.
Looking southwest from Grand and Henry, we had a direct view of the World Trade Center. We stood for a while and watched in shared horror as the towers burned, and then fell. Apparently, I had my camera with me and was taking pictures–a fact that the enormity of the events had erased from my memory.
But I recently found the pictures I took that day, buried in a box in my house, and seeing them again took my breath away. Here they are, for posterity. (Click on any image to get the full-sized scan.)
April 21, 2012 2 Comments