Cryptocurrency Mining

02
Dec
2021

Bitcoin Market And Other Cryptocurrencies

The cryptocurrency market exceeded two trillion dollars. It is a capitalization that even those who frantically supported the investment in Bitcoin and other similar digital assets did not hope for.

Bitcoin: Part of a market of over two trillion dollars

To better understand how many zeros, the cryptocurrency market has now reached a market capitalization of $ 2trillion. It’s a huge value. Bitcoin drove the growth which remained at a market capitalization of $ 1trillion for a week. Bitcoin rose 1.4% to $ 59,045.

Many analysts call for caution

The market is extremely volatile. There are many who do not shy away from talking about a speculative bubble. Behind these cryptocurrencies is nothing more than trust. If it disappears, then everything collapses.

Posted by Lyndsey Annabel in Cryptocurrency Mining
17
Nov
2021

A Great Way To Diversify Cryptocurrencies

Cryptocurrencies are a form of electronic money. It only exists in virtual form. So there are no coins or notes. You can pay with its cash, but digitally without the need for a bank or other third party. Bitcoins and other cryptocurrencies such as Ethereum, Dash, Ripple, Litecoin, and Monero do not have 1 owner but are owned by everyone who uses them. The underlying, secure technology that makes all of this possible is called Blockchain. If you are interested visit this site ()

Success Stories

So you can pay with cryptocurrency, but most stories in the media are about people who have invested in it. To illustrate: anyone who bought Bitcoins for $50 in 2009 – the year they were first offered – is now a multimillionaire. But even those who ‘only’ started at the beginning of 2017 will have a profit of almost 2000% (!) in the digital wallet a year later.

‘Anti-government, anti-regulation

Proponents of Bitcoin like to draw the comparison with gold. That too has no social benefit and no economic basis. It is only worth a lot because of its scarcity. Cryptocurrencies are hot. ‘Investors feel smart. They understand things that no one else understands,” said leading economist Robert Shiller. “The Bitcoin is anti-government, anti-regulation. It’s a beautiful story.’

Cryptocurrency Risks

It is therefore not surprising that more and more people are becoming nervous, especially now that it is no longer possible to earn dry bread with savings. Of course, investing always involves risks, but with cryptocurrency, this risk is quite large. For example, if you buy a share, you purchase a part of the underlying company. Cryptocurrency lacks such intrinsic value. The value is determined only by the demand of speculators. If you step out, it can be over in no time. In addition, your wallets can be hacked online or the digital key can be lost. Then you lose all Bitcoins, or you can’t get to them anymore. After all, no banks also mean no supervisor you can turn to.

AFM advises against investing

That is why in the past both the Netherlands Authority for the Financial Markets (AFM) and De Nederlandsche Bank (DNB) warned about the risks of ‘the umpteenth new Bitcoin’. According to financial regulators, these are vulnerable to deception, fraud, and manipulation. The AFM even advises consumers not to invest in new cryptocurrencies that are not under its supervision. Pieter Hasekamp, ​​director of the Central Planning Bureau, goes one step further. In an article in Het Financieele Dagblad (June 11, 2021), Hasekamp argued that the Netherlands should ban bitcoin as soon as possible.

Similarities with the stock market crash

Also, 2 former winners of the Nobel Prize in economics spoke out against Bitcoin. According to Joseph Stiglitz, the digital payment method is only popular because of the possibilities for money laundering and does not serve any social benefit. The aforementioned Robert Shiller sees similarities with the situation before the stock market crash of 1929. ‘The value is rising. Just like the stock markets in the 1920s. In the end, 1929 is reached. Then the coin comes down. Not to zero, but he will fall for sure,” Shiller predicts.

Politics tightens the reins

Cryptocurrencies are also not well on the Dutch political scene. This is evident from a bill from Minister Hoekstra (Finance) from 2019. It states, among other things: ‘The anonymity of virtual currencies also makes it possible to abuse them for criminal purposes, such as laundering criminally obtained income.’ Both the House of Representatives and the Senate have approved this bill. Companies that offer services for exchanging between virtual money (cryptos) and ‘ordinary’ money have therefore come under the Money Laundering and Terrorist Financing Act (Wwft) since 21 May 2020. That also applies to companies that offer crypto custodial wallets. This means that:

Bad for the Environment

Another argument against Bitcoins is that ‘mining’ costs a lot of electricity. Worldwide at least 40 TWh. That is as much as Hungary uses in a year. To be profitable, the special mining computers have to run permanently, which is bad for the environment.

Advice Consumers’ Association

We are not necessarily anti-cryptocurrency. But only put in money that you can afford to lose. This is no different from other forms of investment. And make sure you spread your risks. So never invest more than 10% of the assets that you have available for investments.

Posted by Lyndsey Annabel in Block Chain Crypto, Crypto, Cryptocurrency Mining
29
Mar
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