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How to solve the Bitcoin energy consumption problem

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How to solve the Bitcoin energy consumption problem

By NISCHAL SHETTY

Blockchain technology is redesigning the world order via its interlinked network of blocks, simplifying monetary transfers and transforming the financial space.

But its pros may be weighed down by the huge environmental cost that cryptocurrency mining incurs each year. Currently, Bitcoin mining alone is responsible for more than 0.5% of global energy consumption.

Bill Gates, in early March, criticized Bitcoin for being the most energy-consuming transaction method known ever to mankind. Since then the Twitterati have been abuzz about how cryptocurrency mining has been hogging down energy from the already limited available resources. Down from their reputation of being a panacea for every malady, Bitcoin and its accompanying blockchain technology are earning notoriety as NFTs (non-fungible tokens) powered by blockchain are steadily gaining traction in the digital scene. 

Recently, an NFT artwork by the digital artist Beeple was sold for US$69 million by Christie’s auction house as an NFT. Around the same time, French sculptor cum environmentalist Joanie Lemercier was horrified to learn that the sale of just six of his NFT artworks consumed energy equivalent to a total of two-year energy consumption of his studio.

Excessive energy consumption: hype or problem area?

Cryptocurrencies are created — or mined, in blockchain terminology — over a decentralized network of computers that validates payments between users and maintains a historical log of transactions. Almost all the cryptocurrencies use a proof-of-work consensus mechanism that requires the miners to solve difficult computational problems, thus consuming a lot of electricity. There are hundreds of thousands of such computers that mine such cryptocurrencies actively, and only 39% of them use renewable energy resources, according to a University of Cambridge report.

The environmental cost of the digital revolution far supersedes the current stats that convict Bitcoin and blockchain as the sole culprits of degrading environment. A single swipe of your debit card initiates a rally of transactions over a humongous but buried network of systems. Though the frequency of transactions in banks and financial institutions (500 billion per year)  is incomparable to that of the Bitcoin network (100 million), cryptocurrency mining isn’t inherently prone to leave a carbon footprint. 

We ought to know how climate change is a huge environmental issue being realized today by businesses and the masses alike. A 2019 study by Harvard Business Review found that the market for sustainable products was touted to grow 5.6 times faster than the other not such responsible products. Another study found 79% of the customers preferring socially and environmentally responsible products. With changing customer preference towards environment-friendly products, the crypto industry has to work towards more sustainable energy solutions as it nears mainstream adoption. Let us look at the solutions available to tame the cryptocurrency industry’s carbon footprint and excessive energy consumption.

Solutions within and without

Changing the way coins are mined

The proof-of-work consensus mechanism is averse to saving energy due to its insatiable and unending consumption issues. It is, therefore, pertinent to change the way coins are mined. Easier said than done. Attempts have been made to bring in more energy-efficient consensus mechanisms, like the proof of stake and proof of authority.

Proof of stake is a low-energy consuming consensus mechanism as it leverages the efficacy of coins itself in the network. A user who has locked his tokens can verify blocks; therefore, the need for intensive mining is eliminated. Ethereum founder Vitalik Buterin strongly believes that blockchains sharding based on proof-of-stake is “thousands of times more efficient.” 

A group of hackers created an eco-friendly network based on the same called the PIVX network. The network’s energy requirements can be sufficed by a single wind turbine alone!

A proof-of-authority consensus mechanism leverages the identity of the people being a reputation-based consensus system. It is one of the most efficient and eco-friendly consensuses that could replace the proof of work.

Finding alternative energy sources

Bitcoin mining currently consumes 69.85 TWh per year, which ismore than the energy consumed by Austria in a year. There is an urgent need to shift to alternative resources to cut on the carbon footprint. The shift to environmentally fit energy solutions is already visible. Some mining nodes now use hydropower Some mining businesses rely on gas leaks captured from oil fields. Others are increasingly exploring solar-powered machines to fuel their mining operations.

Countries that have a surplus of renewable energy sources can encourage miners by allowing subsidized rates and other such allowances. Companies can work on a more efficient and robust mining and grid infrastructure that can help miners store and channel energy flows.

Reducing crypto mining’s carbon footprint

Exploring the uses cases of blockchain further, Canadian business consultant, Magdalena Gronowska says: “Miners can provide grid balancing and flexible demand-response services and improve renewables integration.” Miners can support the community rather than draining it. The mining firms can take up reforestation programs and other sequestration programs to help improve the air quality. 

Mining rigs can utilize the heat from their units to warm houses in cold temperatures. Hotmine in Siberia is a fine example of the above application. Places like Iceland offer natural cooling to the Bitcoin mining rigs and also harvest hydropower and geothermal energy that further help make Bitcoin mining more green and clean.  

Environmental regulations

Government and policymakers around the world can put into force regulators and categorical bans for cryptocurrencies that flout the prescribed limits of CO2 emissions. For instance, Quebec has introduced a moratorium on new currency mining. The crypto industry, like other industries, could be brought within the ambit of corporate social responsibility (CSR) regulations that are becoming increasingly mandatory for business enterprises today. 

Development and environment protection have and will always be at loggerheads. What is essential is to find the middle path. Making mining more energy-efficient and switching to alternate modes of energy can go a long way in making it a carbon-neutral technology.

What is required to be told and understood is that Blockchain tech has been testing its limits ever since its inception. The crypto community is self-aware and thinking about how to tackle the energy consumption issue. Being a disruptor tech still in its nascent phase, it possesses the potential to rethink, revise and rework on its shortcomings. As the DigiEconomist founder Alex de Vries says, “Ideally, change comes from within.” The alternative currency and tech are sure to find an alternate solution soon. 

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
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Source: https://www.fintechnews.org/how-to-solve-the-bitcoin-energy-consumption-problem/

Blockchain

Most US Crypto Investors Prefer Hodling

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Over Short-Term Profit

HODL is a phrase used by cryptocurrency investors who refuse to sell their coins regardless of price fluctuations. It’s more common during a bear market when people refuse to sell their currency. According to a study by Bakkt, the majority of cryptocurrency investors in the United States prefer hodling over taking short term-profits from the market. 

The survey which was fielded in July 2021 gathered data from over 2,000 Americans who had either started exploring or investing in cryptocurrencies in the last six months. It also included those who plan to invest in the next six months. 

The findings shed light on how people like to use digital assets in their daily lives, and also the attitudes that drive their cryptocurrency habits. 

Findings

Notably, the majority of US residents who own cryptocurrency – 66% – are 44 years and under. People between the ages of 18 and 29 own more cryptocurrencies at 40% while those from 30 to 44 come next at 29%. This shows that young people are a lot more enlightened about cryptocurrency than others.

Interestingly, those between the ages of 30 to 44 own the most cryptocurrency in value. At least 30% of the 29% own cryptocurrencies worth more than $500. Nevertheless, the majority of all cryptocurrency investors in the US limit their investments to $100 or less. 

From the overall results, most participants plan on long-term investments while others own cryptocurrency to make online purchases, make in-person purchases, and others. Breaking it down:

  • 28% own cryptocurrency for long-term investment (hodling)
  • 16% use cryptocurrency as it attracts low fees 
  • 14% use cryptocurrency because it’s easy to access
  • 14% own cryptocurrency for fear of missing out (FOMO)
  • 14% own cryptocurrency because it’s not controlled by the government 
  • 14% own cryptocurrency for other reasons 

Whereas long-term return is crucial to all age groups, 18-29 also value ease of access, while 30-44 value the lack of centralized control. Low fees are second to long-term returns for 30-44-year-olds. The report did not state whether surveyed people invested in Bitcoin, Ethereum or other altcoins. No matter which, according to CoinCodex, the price of two leading coins by market capitalizations; Bitcoin and Ethereum are now at $45 000 and $3139 respectively.

Challenges

Most investors prefer hodl over short-term gains but it doesn’t go without the challenges. The volatility of the crypto market and lack of information on how to start investing are the two largest participants’ concerns. 

The former is a major concern for the men while the latter is a major concern for the women. Notably, no age group is significantly bothered about the price of cryptocurrencies.

Also, 35% of respondents indicate they don’t know anything about blockchain and majority of them are women. Nevertheless, 30% of respondents are relatively confident that they’ll get a good return from their investments. 34% are neutral in that regard.

Why Is HODL Popular?

Most people that buy cryptocurrencies for short term aren’t much concerned with utility; instead, they focus on price history. For instance, they will prefer to buy an altcoin like Dogecoin, which, in comparison to other cryptocurrencies like Bitcoin, offers no significant advantage. 

They acquire such coins when the price is in an upward trend in hopes of making quick profits. This approach can generate profit for investors, but it is advisable to buy and hodl your crypto. 

Hodl investors have more protection since they don’t deal with the short-term price volatility. It reduces the risk of purchasing high and selling low. Furthermore, it’s ideal for those getting into the market for the first time. 

With short-term investment, you have to be conversant with day trading which can be technical and consumes time. Hodling has no steep learning curve. You can simply buy coins and forget about them; you don’t have to invest time.

The HODL Disadvantage 

A major disadvantage is the hodler’s reluctance to leverage cryptocurrency’s volatility. Short-term trading doesn’t rely on the promise of a major spike in the price. Also, hodling implies crypto aren’t being used for their original purpose. When Satoshi Nakomoto developed Bitcoin and implemented the first blockchain in 2009, the original purpose was as a form of payment. 

Since the majority of people don’t use it as a means of payment, the number of businesses that accept crypto are progressing slowly. In other words, hodling crypto creates roadblocks that affect global adoption.

Takeaway

The crypto market is notoriously unstable, creating as many millionaires as it destroys. That should give you a good understanding of the level of risk involved in entering the cryptocurrency industry. Intuition and expertise are the only tools that can help you succeed in any investment. It’s no different with the crypto market. 

For hodl investments, it’s ideal to stick to the leading crypto assets by market capitalization. This includes coins like BTC, XRP, and ETH. It can be tempting to invest in new crypto assets gaining massive value, but the cryptocoins can fall just as quickly. 

Finally, investing large sums in cryptocurrency might be appealing, but can be devastating for hodlers. Only invest as much as you can comfortably lose.

Source: Plato Data Intelligence

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Blockchain

TrustToken acquires EthWorks. Doubling Team Size for TrueFi Scale

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After recently raising +$12.5 million, the world’s leading collateral-free lending platform is joining forces with a globally recognized team of Web3 engineers and designers.

San Francisco, California, September 2021TrustToken, the team responsible for launching TrueFi, the leading unsecured lending protocol, and maker of popular stablecoins including TrueUSD, announces the acquisition of EthWorks, a leading

Web3 development company with a deep portfolio of successful blockchain projects. The acquisition doubles TrustToken’s team size, quadruples the company’s technical talent, and brings in senior technical and design leadership to take TrustToken’s mission to the next level.

Recognized as one of the world’s top Web3 engineering firms, EthWorks has been a TrustToken partner for over a year, and contributed to the development of many of the most widely adopted Layer 1 blockchains and DeFi protocols. EthWorks has worked with the Ethereum Foundation, Bitcoin.org, Maker DAO, Polkadot, Dharma, and many more. The EthWorks team will fully integrate into TrustToken’s staff and join the technical, design, and operational roadmap across all products and services, with a special focus on scaling the TrueFi protocol.

In onboarding the EthWorks team, the TrustToken team is growing to over 100 members and significantly expands the company’s engineering, design, and cybersecurity capabilities. This new talent is expected to substantially accelerate TrustToken’s development schedule, user experience and protocol security across the company’s various products and services. TrustToken will also maintain and expand EthWorks’ open-source projects including Waffle and useDApp which are used by Ethereum developers globally.

EthWorks’ industry-recognized engineering and design leadership join TrustToken in senior positions, guiding the company’s development and branding efforts. The senior leadership team will see Marek Kirejczyk, Founder and CEO of EthWorks, become Chief Technical Officer (CTO) of TrustToken. EthWorks’ Head of Design, Natalia Kirejczyk, rises to become TrustToken’s VP of Design, while EthWorks’ CTO Krzysztof Jelski will become TrustToken’s VP of Engineering. With this investment in senior talent, Poland is set to become TrustToken’s primary engineering hub.

“As TrustToken matures and expands, we need to make sure our products and services are among the most robust, safe, and accessible in the blockchain industry,” says Rafael Cosman, CEO of TrustToken. “The acquisition of EthWorks and its world-class team of engineers and designers is crucial for the future of TrueFi, helping us scale the speed, security, and experience of the protocol, while creating the greatest possible opportunities for our lenders, borrowers, and token holders.”

“We’re very excited to now be part of TrustToken’s story,” says Marek Kirejczyk, Founder of EthWorks. “TrueFi is the fastest growing uncollateralized lending protocol in DeFi. Our joining forces creates an unique opportunity to accelerate growth and create an outstanding impact in the DeFi space – and soon, in the world of institutional finance.”

About TrustToken
TrustToken frees money. TrustToken’s TrueFi platform, powered by the world’s first on-chain credit model, brings uncollateralized lending to DeFi, offering lenders competitive, transparent returns, and borrowers maximum capital efficiency. TrueFi is host to +$1 billion in total value locked, has originated over $500m in collateral-free loans in less than a year, and enjoys a 100% repayment rate across its dozens of vetted borrowers. TrueFi’s governance token, TRU, is trading on top exchanges like Coinbase, Binance, FTX, as well as DEXs like Uniswap and Sushiswap.

TrustToken’s TrueCurrencies are the world’s first on-chain, independently-verified, fully collateralized stablecoins, generating billions in monthly trade volume across +100 exchange and OTC partners. TrueCurrency users enjoy lightning-fast transactions, the lowest transaction costs of any stablecoin, easy exchange to and from fiat currency, and obsessive customer service.

Start using TrueFi at https://truefi.io, or learn more about TrustToken products at https://trusttoken.com

 About EthWorks
EthWorks is a blockchain-oriented smart-contract development shop with a full stack engineering team utilizing high quality craftsmanship to deliver high quality coding. The company has been involved in the development of popular open-source projects including Waffle and useDApp. EthWorks practices test driven development, continuous delivery, rigorous code reviews, and pair programming. Successful clients include Ethereum Foundation, Polkadot, Dharma, and Status.

For more information and to explore EthWorks services, visit https://ethworks.io/index.html

Source: Plato Data Intelligence

 

 

 

 

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Blockchain

Will Cardano Price Be Affected by Elrond Upgrades? ELGD Price Set to Hit $500!

elrond (1)

The post Will Cardano Price Be Affected by Elrond Upgrades? ELGD Price Set to Hit $500! appeared first on Coinpedia – Fintech & Cryptocurreny News Media| Crypto Guide

The crypto space is undergoing extreme volatility as the market lost nearly $150 billion. And the total liquidations recorded were more than $500 million in 24 hours soon after the economic turmoil from China’s real-estate giant Evergrande on 20th September. A huge crash has shaken Bitcoin price but Cardano (ADA) price and Elrond (ELRD) stood …

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The crypto space is undergoing extreme volatility as the market lost nearly $150 billion. And the total liquidations recorded were more than $500 million in 24 hours soon after the economic turmoil from China’s real-estate giant Evergrande on 20th September. A huge crash has shaken Bitcoin price but Cardano (ADA) price and Elrond (ELRD) stood out and regained the momentum quickly.

What’s Big on the Cards of Cardano and Elrond?

Despite the market crash, Cardano price holds tight to its support zone between $1.9 to $2.40. The network is making new headlines every day prior to the Cardano summit on 25th and 26th September. Just a few days before the summit exciting news is in! In regards to its new partnerships and funding.

SundaeSwap labs Decentralised exchange built on Cardano received $1.3 million funding from cFund.vc. This funding will give a huge boost to SundaeSwap to further proceed with the development of the DEX and enhance the user experience.

Officials say this is just the beginning and Cardano will come up with industry-defining announcements at the biggest blockchain event happening on the 25th and 26th of September.

But prior to the summit, there comes a challenge by Elrond network, making huge noise across the market with its continued collaborations.

Elrond’s new Collaborations to Outperform Cardano?

EGLD continued to carry its price momentum for the past two months. Elrond is trading at $214.16 at the press time and spiked by 8.87% in the past 24 hours. The EGLD price recently hit new ATH at $280.96 on September 14th. This price gain is followed by series of its collaborations and also with unique service offerings, it seems EGLD might surpass Cardano’s market cap.

Cardano can process 250 to 1000 transactions per second whereas Elrond carries out 15,000 transactions per second.  When it comes to staking rewards Elrond holds the upper hand by providing 19-29% of rewards and ADA offers 5-7% staking rewards. Fees charged by Elrond is 0.006 USD and Cardano charges 0.227 USD per transaction. Elrond blockchain works with the Secure Proof-of-Stake mechanism and supports Adaptive state sharding. Cardano is a Proof-of-Stake blockchain platform. 

Elrond Network Collaborations

  • Elrond network partnered with the Tatum platform, to enable developers to build efficient Elrond dApps to attract newbies.
  • Recently Elrond teamed up with Offsetra to reduce the overall energy consumption. This collaboration aims to maintain Elrond’s carbon-negative energy consumption approach.

Overall,  Cardano’s has a lot more barriers to cross. Elrond is active and is coming up with new partnerships and innovative projects every day. If everything goes in favour of Elrond it might steal the momentum from other prominent crypto assets. Crowd sentiment says that ELRD has the strong potential to surpass $500 in the coming days.

Disclaimer : The opinion expressed here is not investment advice – it is provided for informational purposes only. It does not necessarily reflect the opinion of Coinpedia. Every investment and trading involves risk, so you should always perform your own research prior to making decisions. We do not recommend investing money you cannot afford to lose.

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
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Source: https://coinpedia.org/news/will-cardano-affected-by-the-elrond-upgrades/

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Blockchain

Will Bitcoin Price rally in Q4? Experts and Analysts Say Yes!

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The post Will Bitcoin Price rally in Q4? Experts and Analysts Say Yes! appeared first on Coinpedia – Fintech & Cryptocurreny News Media| Crypto Guide

The crypto market underwent a severe fall in September after a good bull run in the latter month of August. Bitcoin (BTC) has dropped more than 20% from its September high of $52,701 to around $42,000 as of today.  Over the last decade, September has been a month of high volatility, with Bitcoin and the …

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The crypto market underwent a severe fall in September after a good bull run in the latter month of August. Bitcoin (BTC) has dropped more than 20% from its September high of $52,701 to around $42,000 as of today. 

Over the last decade, September has been a month of high volatility, with Bitcoin and the wider crypto ecosystem delivering negative returns. Retail investors, on the other hand, should avoid panic selling. 

Instead, they should be gearing themselves for the fourth-quarter rally. Several industry analysts point out that the crypto market has traditionally been optimistic in the fourth quarter.

According to popular market analyst Lark Davis, we haven’t reached the peak yet, and Q4 will see several crypto billionaires this year. Davis argued in April, when BTC was trading near its all-time high, that the Bitcoin bull run was just halfway through.

Davis adds that the last two bull runs in Bitcoin history, in 2013 and 2017, had sell-offs in July followed by a bull run. Then there was another sell-off in September, followed by a tremendous bull run in the fourth quarter. Bitcoin’s past bull runs have all ended with a parabolic yearly finish. 

Furthermore, on-chain data indicates that Bitcoin’s fundamentals are optimistic. Since the peak in March 2020, BTC supply has been declining across exchanges.

Lark also believes that Ethereum will eventually break through $10,000 and that it is only a matter of time. Speculating that the digital asset will increase by 190 percent will cause it to break through this price barrier. On his YouTube channel, which has over 433K subscribers, the crypto analyst sets out his research. Lark states in the video that this pricing is already “coded in” and that “it’s coming.”

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
Click here to access.

Source: https://coinpedia.org/price-analysis/will-bitcoin-price-rally-in-q4-experts-and-analysts-say-yes/

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