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Tag: Mining

  • El Salvador to become the new favorite of BTC coin owners

    El Salvador to become the new favorite of BTC coin owners

    El Salvador becomes the first country in the world to recognize Bitcoin as legal tender. Bitcoin (BTC) now enjoys a powerful position in the country.

    Where on one hand China is going full force with its Bitcoin (BTC) mining crackdown, other countries are realizing the profit potential in the mining industry. Cryptocurrencies are gaining increasing importance in Latin America. The president of El Salvador NayibBukelehad recently proposed a bill to make Bitcoin legal tender in the country. As the president controls a majority in the Legislative Assembly, the bill had been passed.

    Bukele’s Bitcoin bill makes BTC legal tender in the country. Furthermore, the bill also mandates that retailers and businesses accept Bitcoin as a mode of payment unless it is not feasible due to lack of internet access. Bitcoin is also exempted from capital gains tax.

    The bill has given Bitcoin immense power in the country – close to being a currency in El Salvador. With mandatory acceptance and adoption of Bitcoin in the country, prices can also be expressed in terms of Bitcoin.

    NayibBukele is not done yet with the cryptocurrency. Right after the announcement of the passage of the bill, the president moved towards facilitating Bitcoin mining in the country. The president is in talks with the head of the state-owned electricity company – LaGeo – to move towards Bitcoin mining. Bukele is planning to harness the energy from volcanoes to power the BTC mining industry in El Salvador. The geothermal electricity would mean BTC mining would be 100% clean.

    El Salvador has around 20 volcanoes but the country’s electricity needs are not being met by domestic firms. El Salvador imports 25% of its electricity with the lack – or high cost – of electricity being a huge hindrance for industries. Will El Salvador be able to meet the energy requirements for Bitcoin mining? And what would that mean for local businesses? Although the president’s plan seems ambitious, implementation may reveal more loopholes.

  • Chinese provinces banning crypto mining with full force

    Chinese provinces banning crypto mining with full force

    The Chinese government is not a fan of cryptocurrencies – to say the least. The country is responsible for at least 75% of Bitcoin mining or hashrate. The cheap electricity and established supply chains make mining is the country feasible. However, the government has had a strict stance against cryptocurrencies.

    Bitcoin is notoriously known for its high energy consumption. Mining a proof-of-work mechanism cryptocurrency – like Bitcoin – requires high energy. Unless the mining process shifts towards totally renewable sources, it cannot be sustained. China relies heavily on coal for electricity generation and the country has been trying to control its carbon emissions. The process had been hindered by the large Bitcoin mining industry that the country holds.

    In May, the Chinese State Council hinted towards a crackdown on Bitcoin mining in the country in order to facilitate its broader vision of zero net emissions. The vice premier Liu He vocalized that for financial stability in the country, the government will impose a ban on cryptocurrency mining. The news coupled with Elon Musk’s denouncing of Bitcoin as payment for his Tesla cars led to the market crash of cryptocurrency. A number of mining firms halted operations in the country while others stopped their supply of equipment to Chinese miners.

    Now, another province in China – Qinghai – has also imposed a ban on cryptocurrency mining. Qinghai’s Department of Industry and Information Technology has instructed all miners to halt operations and had said that no new miners will be approved. The provincial government will also be conducting random checks in order to ensure compliance with the new regulation.

    The governments of Xinjiang and Inner Mongolia have also ensured similar regulations to curtail cryptocurrency mining. Other provinces can be expected to follow suit – banning cryptocurrency mining. The news does not bode for the cryptocurrency market and a shift of crypto mining to another country seems imminent.

  • Bitcoin Crash: Did The Chinese Cause It?

    Bitcoin Crash: Did The Chinese Cause It?

    The king of cryptocurrencies soared to $64,000 but suffered a massive crash afterwards to around $53,000. At the time of writing, Bitcoin is trading at $57,000 apiece. But what caused the hard crash of the cryptocurrency in the middle of strong bullish momentum? One analyst suggests it was the Chinese!

    Chinese mining hub in Xinjiang had suffered from power outages and on-chain analyst Willy Woo speculates it to be the cause of the fall of Bitcoin’s price. In the aftermath of a flooding accident in a coal mine, blackouts in the region were rampant to facilitate safety inspections.

    Around 25% of the global hashrate can be attributed to Xinjiang and amidst the blackout one of the largest drops in Bitcoin network hash was recorded – from 172 million terahashes per second to 154 TH/s. The analyst Willy Woo has attributed the fall in Bitcoin price to the drop in the hashrate on account of power outages in Xinjiang.

     

    However, not everyone agrees with the analysis. Adam Cochran – a partner at Cinneanhaim Ventures – regarded the idea of the Bitcoin crash due to hashrate fall as nonsense. Cochran further talked about the events merely occurring at the same time while there is no causation or correlation between Bitcoin price and hashrate.

  • Asia’s Love-Hate Affair With Cryptocurrencies

    Asia’s Love-Hate Affair With Cryptocurrencies

    Cryptocurrencies are notoriously known for their high riskiness. The crypto market is savage and unforgiving with losses even surmounting to hundreds of thousands during brutal dips. With more people being enticed by the high rewards of the market, many dip their toes into it without keeping the high risk in mind. The bull run of 2021 has resulted in the market capitalization of cryptocurrencies passing $2 trillion, regulators throughout the world are becoming wary of the situation and what it would mean for economies on a global scale if the cryptocurrency market crashes badly.

    Asian governments have been alarmed by the situation and the government of Thailand and Korea has been vocal about it. Further joining the ranks is the government of Sri Lanka. The Central Bank of Sri Lanka (CBSL) has issued a detailed notice on cryptocurrencies. The notice talks about what cryptocurrencies are and the risks they pose – especially in Sri Lanka because the crypto market is completely unregulated in the country. The monetary authority also warned the masses of the violation of the foreign exchange regulation as cryptocurrencies are assets.

    On the other hand, Vietnam’s cryptocurrency market is suffering from a different kind of problems. Miners in the country are selling off their mining equipment because of a fear of a crash. Computers, graphic cards and other equipment have more sellers than buyers and the situation may propel a bearish downturn.