Month: March 2020

Why Bitcoin Miners Ceased Operations Amidst Crisis

The Covid-19 crisis and the resulting volatility of the cryptocurrency market prompted many digital asset farms and independent miners to stop operations.

Contrary to expectations that Bitcoin, being the leading digital asset, will surge once stock market investors shift to cryptocurrency investment during the crisis, the opposite happened. Along with the stock market rush that saw many investors unloading their shares, the bitcoin market reacted similarly. The cryptocurrency market also crashed, resulting to daily losses of about 50% that eventually drove the Bitcoin price below the $4,000 threshold, down to as low as $3,600.

Although the crypto-community saw the prices of cryptocurrencies rising, after the government legislated CARES Act was passed by Senate. The increases though were not enough to warrant that the price of bitcoin will not go down below threshold again.

That being the trend, many bitcoin miners and mining farms went ahead with decisions to halt operations, wary that the worsening health crisis will yet again spur sell offs that only spell losses to digital currency miners.

Why Volatility in Prices Affects Crypto Mining Operations

First off, it should be understood that the profitability of crypto mining operations is not the same as what investors could gain when trading their digital currencies.

Cryptomining after all is cost intensive, particularly with bitcoin; being the most transacted of all digital assets. Where some bitcoin investors may realize gains by leveraging their cryptocurrencies during price volatility, the same cannot be held true for coin miners.

If at the end of the day the price of a bitcoin is much lower than the costs incurred in analyzing and solving encryptions bitcoin transactions for the day, bitcoin miners incur losses. Mainly because the bitcoin compensations they will receive will not be enough to cover the corresponding costs of mining.

Underscoring the Significance of Digital Assets in Times of Economic Crisis

One trait that can distinguish digital assets from physical assets is that the uncertainty of cryotocurrency prices creates an advantage in times of real-cash insolvency. There have been bankruptcy proceedings in which the bankruptcy court was unable to pin down digital money as potential payment in satisfying the legal demands of creditors.

The extreme volatility in the price of bitcoins as demonstrated by the recent bitcoin trading activities, makes digital currency an unlikely asset to demand as settlement for a credit obligation.

Let us say a bankruptcy court includes bitcoins without objection by creditors, because at the time of awarding, the digital currency had a value of $6,600.

However, if in the next few days the price of bitcoin drops to $2,300, the creditor can trade or exchange the digital money for real cash at the lowered price, or wait until the price rises. The creditors can no longer demand for more bitcoins, since they took a risk when they agreed to accept digital currency as settlement of the bankrupt person’s obligations.

When looking for a bankruptcy lawyer san diego businesses recommend those who will be able to make the court understand why cryptocurrencies will not work as a reliable, equitable settlement of credit obligations.

Posted by Lucia Kerri in Crypto, Cryptocurrency Mining

Stablecoins – A Payment Alternative To Consider During This Pandemic

With the global crisis that we are in now, billions of people from every corner of the world are in danger of going through this crisis without any salary for a prolonged span of time. This is something that most could manage, seeing that many workers working full-time are living and surviving life from paycheck to paycheck.

Low APR Unsecured Loans to Make Ends Meet

To make ends meet, many individuals look for low apr unsecured loans. An Annual Percentage Rate or APR is the cost or price of credit shown as a yearly charge. Evaluating the APR of loans is a speedy way to identify which type of loan will possibly cost you greater, not including added fees like arrears. Whether your rate of interest is computed yearly, monthly, or daily, the APR presents a standardized manner of comparing and assessing the interest rates on various loans. The Truth in Lending Act necessitates creditors to let consumers know of the APR of your loan deals.

Stablecoins or Cryptocurrencies –An Alternative to Consider

Amidst the trepidation and insecurity of the coronavirus pandemic, the government of the United States is exploring and analyzing ways to assist Americans financially the soonest possible time, even deliberating on the probability of a universal payment of basic income.

People require help, but also have to remain at home to lessen and prevent the risk of picking up and falling victim to the virus. In providing emergency payments, the administration must be aware and mindful of the dangers of asking individuals to collect money at any physical location such as banks and ATMs. It must be delivered in a manner that’s efficient, accessible and most importantly sterile.

For haste and safety, the government must be open to modern approaches to replace the outmoded method of issuing checks through mail. So why not look into the possibility of sending or delivering the stimulus through stablecoins or cryptocurrency as an avenue to validate the transfer of assets? Since stablecoins could be digitally distributed, people would have direct and instant access to their finances, lessening the need for people to go and spend hours in the bank to cash a check and to not break away from the self-imposed quarantine.

Since digital assets are relatively new and unknown beyond the space and community of cryptocurrency, a number of  resistance or criticism to this concept are expected.

A shortage or absence of knowledge and comprehension frequently translates to doubt and distrust. Education must go along with distribution. The government as well as the citizens would have to be properly educated on the workings of crpytocurreny or stablecoins, how crypto users convert them to fiat money, and why they can potentially easily carry out money transfers in the future.

Posted by Alise Bella in Block Chain Crypto, Crypto

Bitcoin Not Immune To Financial Market Crisis

The recent slump may come as a surprise to observers, but it is not only within the scope of what is known from Bitcoin, but is also in harmony with the financial markets. Yesterday even the “crisis currency” had given way to gold, if only by five percent.

What Happens to Bitcoin if Stock Markets Crash into a Bear Market?

However, anyone who has seen Bitcoin as a new “safe haven” in times of crisis in recent months should now be disappointed. In places, Bitcoin was even given the nickname “digital gold”.

Experts stay relaxed

For experts like Kai Kuljurgis, founder of the crypto investment platform Coindex, the recent drop in price is more an effect of the beginning professionalization of the market. A lot of institutional money has flowed into crypto values ​​in recent months. That drove the courses. However, new investors, in particular, would quickly withdraw.

Die-hard Bitcoin supporters do not see the recent price losses as a drama, but rather a good opportunity to buy cheaply.

Posted by Lyndsey Annabel in Crypto