Former ‘Cryptoqueen’ is now one of 10 most-wanted fugitives

Block Chain: Every transaction is recorded as a block added to a chain. It is added to the chain in such a way that if anyone tried to modify the block it would become immediately apparent. The chain is stored on every computer involved in any of the transactions on that chain. So if there are thousands of transactions between thousands of users, then that will require millions of blocks to be stored on various computers. Imagine if block chain technology really takes off and there are billions of transactions between billions of users.

Mining: Miners typically have warehouses filled with processors optimized for solving an algorithm. The first miner to solve the next algorithm gets the next bitcoin. But also, in order for a block to be added to the block chain an algorithm has to be solved. These warehouses filled with processors use lots of energy. If bitcoin, or even some more worthwhile enterprise were to ramp up usage of the block chain, imagine how much mining would have to go on and how much electricity would be required.

Bitcoin value: As time goes on the Bitcoin algorithms are set up to be harder and harder to crack, so the supply of Bitcoin enters the market at a logarithmic pace. I also believe that Bitcoin has said there will be only so many Bitcoins ever mined. This would suggest that the value of each Bitcoin will forever increase in value, as there will only be so many coins chasing after a larger and larger set of goods. After that miners will only get money in the form of transaction fees. They will solve an algorithm, which will allow a block to be added to the chain, and the parties involved in the transaction will pay a fee part of which will go to the miner.

Bitcoin is supposed to be decentralized, however because of the demands required to mine new coins, most coins are being mined by a relatively few large outfits which in some cases are run or managed by state enterprises. So the idea that Bitcoin is eliminating government middlemen is a joke.

Also, as more people transact coins, there are times when there are fewer blocks being created than are demanded. The way this is sorted out tends to be that those who already have the most Bitcoins get first shot at new blocks as they are created. Since Bitcoin value fluctuates so much, if you are a lowly Bitcoin trader, then by the time your transaction block arrives, the value of Bitcoin could have changed so much that either you or your transaction partner get screwed. Meanwhile the guys who got in early or were able to mine lots of coins are now larger "stakeholders" and get immediate transactions. Imagine if you are a Bitcoin whale and have a good idea of what direction Bitcoin is trending and also know that you can make trades much faster than a bunch of Bitcoin noobs. Pump and dump anyone?

Also, there are transaction fees which make using Bitcoin to buy a pizza or a café latte at Starbucks a joke.

And as far as security: you can either store your Bitcoin on an exchange or on your computer. Exchanges have been hacked and emptied of their coins. Computers have died, been lost or accidentally thrown away, or hacked. People have forgotten the passwords to their Bitcoin wallets, and some wallets are set so that if you provide too many bad guesses the wallet closes up forever.

One last thing I just thought of. Miners have invested in warehouses filled with processors. If they can't make money mining Bitcoin, then they could use these processors to perform brute force attacks on Bitcoin exchanges and individual computers to guess at passwords and empty wallets.

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