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Dear Readers,
We were quoted in two articles this weekend. Once in Crainâs Cleveland and the other in the Financial Times. We thought weâd share them with you.
âBitcoin Jesusâ Is Having a Hard Time Winning Over True Believers
Whatâs the Story? Roger Ver is having a hard time convincing people to convert from Bitcoin to Bitcoin Cash.
Why Itâs Important? Last August, a group of developers led by Roger Ver split Bitcoin Cash from Bitcoin. The group promised faster transaction speeds and a more decentralized currency. That promise has resulted in little traction as commercial use of Bitcoin Cash is down more than 60% since May. Chainalysis also reported that 67 wallets control 56% of Bitcoin Cash. Bitcoin Cash will be in even more trouble when BitMain goes public. Itâs expected that Bitmain will sell a significant amount of their Bitcoin Cash. One thing is for certain; Roger Ver will need to find some Bitcoin Cash believers and find them fast. Otherwise, expect Bitcoin Cash to go into oblivion.
After the Bitcoin Boom: Hard Lessons for Cryptocurrency Investors
Whatâs the Story? NY Times profiles a few cryptocurrency investors that lost a lot of money.
Why Itâs Important? Many early-investors in cryptocurrency complain about accredited investor laws. Itâs a form of paternalism by the government. If you want to invest in something, the government shouldnât prevent you. This article is a good illustration of why these laws do exist. We are personally against accredited investor laws, but we always think itâs important to look at the other side of that argument. Itâs sad to see people go into debt after poor investments in cryptocurrency. Rule #1 of investing is donât invest more than you can lose.
Bitcoinâs energy usage is hugeâââwe canât afford to ignore it
Whatâs the Story? Title is self-explanatory.
Why Itâs Important? Bitcoin electricity usage is massive. It is currently on pace to use over 42TWh of electricity this year. For comparison, that is roughly the amount of energy used by the entire country of New Zealand, and more than that of Ireland. At current electricity and bitcoin prices, maximum power draw can be around 100TWh for the community of miners to still break even. However, concerns of those worried about energy consumption are that the price of bitcoin slowly begins to rise, allowing for a higher energy consumption break-even point. For example, should bitcoin reach $50,000, the new break-even point would be almost 1,000TWh. According to the author, banks do not view Bitcoin as ever reaching this price point, due to competition from other cryptocurrencies. We do not believe this the case. Bitcoin will likely become a digital store of value (similar to gold), while the majority of other cryptos will ultimately fail. The only difference is that, unlike gold, it can be used as purchasing power. It is clear the writer of this article is not a proponent of bitcoin. He repeatedly refers to the mining process as âwasting as much energy as possible.â While it is true that mining requires an incredible amount of energy, the Bitcoin community has been working effortlessly to make mining a more efficient process. It is also important to note that Bitcoin stands for something far more significant than energy consumption. It is the first generation of blockchain technology that will likely revolutionize the worldâs transaction processes. There will always be pain points with the introduction of new technology.
What We Read This Morning
- The Store of Value Thesis: Qiao Wang and Dan McArdle of Messari explain how cryptoasset valuation boils down to how likely it will acquire and maintain properties of Store of Value.
- Does Satoshi have a million bitcoin?: BitMex Research attempts to validate if Satoshi has mined over one million Bitcoin.
- An evolving market: Kelly Loeffler of Bakkt explains how Bakkt will increase price transparency in the cryptocurrency markets.
Did you like what you read? Subscribe below to receive daily analysis of the blockchain and cryptocurrency spaceâââsign up here.Originally published at pop.substack.com.
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Don't Invest All Your Money in One Place was originally published in Hacker Noon on Medium, where people are continuing the conversation by highlighting and responding to this story.
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.