April 5, 2018
Mining cryptocurrencies has been a easy and profitable business or pastime for many people – but that may be changing now.
For those in the know, mining cryptocurrencies, like Bitcoin, demands a lot of processing power from your computer, and will also very quickly rack up your electricity bill.
Students are ‘dropping out’
For this reason, university students in the US have been at an advantage, because their electricity bill is often included in the rent for their dorm rooms.
This hasn’t changed, but what has changed is the increase in mining costs, combined with a fall in many of the cryptocurrencies being mined.
Crypto-miners are not alone in facing these issues – it affects avid gamers too. The rising cost is linked to the graphics cards used in computers, and these graphic cards alone can easily cost as much as the average person spends on a whole laptop.
Is mining still feasible?
Whereas university students were making quite a lot of money off of mining in the past, these days it can yield as little as $100 per month – which, if they paid for the electricity themselves, would not be a feasible business for the students.
One student reported that he last year managed to mine .00027 Bitcoins daily, but that it cost him 24 kilowatt of electricity to mine. With the soaring price in Bitcoin back then, it seemed like a great idea – these days, it’s a less attractive option.
The simple reason why crypto-mining is becoming more expensive is due to the fact that currencies like Bitcoin are inflation-proof: the system is set up in a way that there is a limit to how many Bitcoins can be in circulation at any one time.
This means that mining Bitcoin, for example, becomes more difficult as time passes. The equation computers need to solve to yield Bitcoins become harder the more Bitcoins are in circulation.
As the amount of Bitcoins comes closer to the limit, mining will only be possible for those with the most sophisticated computers – and those who can afford the incredibly expensive energy bill.
Mining costs around the world
The price of mining Bitcoins varies depending on where you are in the world. In South Korea, for example, the price of mining a Bitcoin is double of what Bitcoins are currently worth. Anyone mining in South Korea would therefore have to be very confident that the value of Bitcoin will go up.
In Venezuela, conversely, the government subsidizes the energy, and so the price for mining one Bitcoin is only around $500 – around 1/20th of the current value of Bitcoins.
The US falls somewhere in the middle – depending on which state you’re in, mining a Bitcoin will cost you around $3,000-4,000. So for the US citizens, mining is still a profitable business.
For those considering to begin mining Bitcoins, there are some good news on the horizon, however. Intel is currently working on a solution that will lower the power consumption of computers used for mining.
Have you been affected by the rising cost in mining? Leave your comments below!
April 4, 2018
There are many ways to describe the market for cryptocurrencies and blockchain, but “stable” is not one of them. One only needs to glance over any news relating to the popular currencies to see that the coin values go up and down, round and round.
New types of cryptos constantly emerge, and some only last a few months before they fade back into obscurity. Investors bite their fingernails and tear their hair out, as they watch their once-promising investments plummet in a split second – just before they rise in value again.
No, the market for cryptocurrencies is anything but stable.
Why many are still reluctant about investing
Compared to traditional markets, the market for cryptocurrencies is extremely volatile. On the stock exchange, you can maybe see stocks move up or down one percent. On the cryptocurrency market, that number is five times as high.
This alone is one of the reasons why many are still choosing to stay far away from cryptocurrencies. Players in traditional markets know better: the bigger you are, the harder you fall. Investing in a market as unstable as cryptocurrencies means taking too many risks, at too high a cost.
Another reason many stay away is that cryptocurrencies are not tied to anything physical, anything tangible, outside the digital world.
Is Stablecoin the solution?
Enter Stablecoin. A cryptocurrency that comes with the promise of solving this issue. Two of the main players in this space are DAI and Tether. The latter of the two, for example, is tied to the US dollar. That means that every Tether coin is, in effect, worth around $1.
Tether supports this by having one actual real dollar for every Tether coin issued. This concept is much more palatable for those who are used to having the reassurance that they stocks can be redeemed for something physical, that there is a guarantee their currencies will be worth something down the line.
But tying cryptocurrencies to a national currency is far from the only option on offer when it comes to stablecoin. Others are offering, or will be offering in the near future, cryptocurrencies tied to traditional assets like gold and oil.
What this also means is that it is possible to exploit the volatility of cryptocurrencies that are not tied to anything. So if you sell a coin like Ripple (worth $100, for example) for 100 Tethers, and Ripple then falls to $20, you can buy five Ripples back. In this way, many investors are making big bucks.
But is Stablecoin safe?
However, not everyone are equally optimistic about stablecoin. Tether as a company has been the subject of some controversy, and many claim there is a conflict of interest between Tether and Bitfenix– they have the same founder.
Doubt has also started to spread as to whether there are any actual US dollars to backup the enormous amount of Tether coins being issued.
Finally, Tether has, as a company, been reluctant to release their accounts, which has raised further suspicion about their legitimacy as a company.
What do you think about Stablecoin? Are they the solution or just another scam? Leave your thoughts in the comments below!
March 26, 2018
According to emerging news, on 14th March 2017, the U.S. House of Representatives Committee of Finance Subcommittee on Capital Markets, Securities and investments initiated a process of formulating regulations for the Cryptocurrencies and ICO Markets. Official reports confirm that this is the first among a series of hearings that the U.S. is holding to deliberate on policy formulation to regulate, reorient and realign the market that is taking the world by storm from October 2017.
This meeting was a culmination of the summit held in early March 2018. James Sullivan, the Deputy President Department of Commerce and International Trade Administration portfolio was the presenter at the summit. He had called for concerted efforts from all quotas in policy formulation to regulate and streamline the already robust ICO Markets and the cryptocurrencies growing popularity. The sitting aims to formulate a set of laws and regulations dubbed “The ICO White Paper.” The white paper will address the following issues affecting the cryptocurrencies and the ICO Markets:
• Current regulatory frameworks that regulate these ventures
• Economic efficiencies of ICO Markets as a source of capital for startups
• Approaches to protecting investors’ interests in ICO ventures.
Submissions To The Session
The sitting received testimonial submissions from various experts on economic and financial matters. These professionals are advising the session on factors to consider in managing the cryptocurrency and ICOs markets.
Chris Brummer testimonial. He is a professor of securities law and international trade regulation at Georgetown University Law Centre. The professor of the law pointed out fraud and misrepresentation as the main shortcoming bedeviling the ICO markets. The solution to this problem is disclosure. The professor presented a list of resolutions to curb non-disclosure and align the ICO and Cryptocurrency markets into law-abiding and financially secure investment ventures. According to him, these disclosures have to focus on:
•Promoter’s Location and Contact Information
• Industry Risk Factors
• Problem and Proposed
• Description of Token Technology Solution
• Problem and Proposed Description of Token
• Qualifications of Technical Team
• Promoter’s Location and Contact Information
The professor, further recommends that it should be mandatory for firms offering ICOs to file all the disclosure with the SEC
Mike Lempress testimonial. He is the Chief Legal and Risk officer at Coinbase Inc. His testimonial acknowledged the importance of the cryptocurrencies and ICOs market on the U.S. economy and the world at large. Mike testified that the Federal government has institutions in place that could streamline the errant markets. The testimonial pointed out disharmony among the federal regulatory institutions as the primary challenge following the exercise. According to the affidavit, the U.S. was advised to support this artistic innovation as a new investment tool in the capital markets. Summarily, this testimonial called for the SEC, CFTC, IRS, and FinCEN regulatory bodies to harmonize their approach towards ICOs markets and provide clear regulations.
Peter Van Valkenburg, a director at Coin base, presented a testimonial from a public policy and research on blockchains perspective. This testimonial called for a change of attitude on the policymakers’ part of emerging technologies. According to the findings of his work, the issue at hand has everything to do with the federal regulators applying old laws and assumptions on entirely new technology. The testimonial encouraged the regulators to remodify the understanding of ICO markets and Blockchains to eliminate the confusion in the markets.
March 16, 2018
The dominant Cryptocurrency, Bitcoin, registered signs of improvement in the financial markets on Thursday’s, 15th March 2018, afternoon trading session. Interestingly, this improvement is not precipitated by Google or Facebook withdrawing their ban notices on ICO trades: They have not withdrawn the ban. As Thursday’s trade session nears closure, the Bitcoin is trading at $8,241.52 having achieved a high of $8,788.00 and a low of $7,682.00 in the second half session. Other Cryptocurrencies such as Ether, Bitcoin, Zcash, Dash, Litecoin, Monero, etc. just to mention a few are following suit and registering improvements in the second session: Having shed-off value in the morning session following damaging publicity earlier this week.
What This Means For Initial Coin Offerings
From the Investors perspective, 15th March 2018 afternoon trading session recovery is a promising indicator of future surges in Cryptocurrency coins and token prices. Appreciation of Cryptocurrency values signals investors to participate in ICO trade in financial markets, as the value of tokens/coins will increase leading to higher returns on investment.
Firms who are offering initial coin offering are skeptical about the future of their biddings. With the growing descent from quotas criticizing all Cryptocurrency related activities and many governments deliberating on the way forward in regards to policy formulation, the market is likely to experience more shocks. However, the resilience of the market is quite evident and more firms will consider this factor. Firms like Basic attention, Aragon, and Status Um have raised around $35 million; $30 million and 270 million in record times will inspire more firms to seek funds on ICOs. Most notably, FileCoin, a startup company raised $200 million through an ICO and similar success stores will encourage most forms to issue ICOs.
Additionally, the markets will experience more significant precautionary measure as investors become more aggressive in interrogating the firms’ business ventures to determine their viability. Investors will not only be attracted to the possibilities of Cryptocurrency price surges in the future but also the businesses’ structures. Internal organization, goals, mission, vision, budgets, location, targeted markets, and legal factors will complement the expectations in interest payouts as a factor to consider when investing in ICOs.
The firms will streamline their mode of operations to appeal to prospective investors. Just like the firms that bid their stocks in stock exchanges, these firms offering ICOs will formulate a code of conduct for themselves in anticipation of enactment of regulation laws by governments. These firms will be readily accessible to the public, and they will adopt a culture of openness.
What This Price Increase Means To Regulation Authorities, Google, Facebook, And The Service Industry
The matter of fact is that Google and Facebook services are dominant across regions and have billions of users globally subscribing to them. ICO market analysts had allayed fears that with the damaging bans, the prices of the crypto coins would crash leading to the collapse of ICOs. Investors, Business entities, business developers and financial analyst can now conclude that it is only the policymakers in governments who can directly determine the performance of ICOs in the coming days. Pundits purport that it is difficult to foresee the level of increase in trade volumes in ICO Markets, following intense public outcry for regulations, but one outcome is expected-increased activities albeit depressed.