Bitcoin at the gold level
The 630,000 blocks were mined on May 11, 2020, and the third halving was initiated. This is the third artificial shortage in the history of this cryptocurrency. The reward for each block mined was reduced by 50% from 12.5 to 6.2 Bitcoin per block. Bitcoin is as rare as gold in its history. Since the invention in 2007, halving has always been practiced when there is a threat of inflation. Because Bitcoin is a deflationary system that is limited to 21 million. About 18.3 million have been produced so far. 1,800 bitcoins are still being spent per day. In half a year there will only be 900 due to the recently practiced Bitcoin halving. After every halving, most recently in 2012 and 2016, there was an immense increase in value.
How are bitcoins created?
Everyone who makes cryptocurrency available via their computers and servers and thus takes care of the infrastructure will receive a reward in the form of Bitcoin for each block chain made available. In this way, new virtual coins come onto the market every 10 minutes, most of which are resold directly. At the beginning of the currency, there was still a whopping 50 Bitcoin as a reward. After the third halving, there is only 6.25 Bitcoin. This reduces the annual inflation from 3.8 to 1.8 percent and the number of coins issued daily. The closer we get to the maximum number, i.e. 21 million Bitcoins, the more popular the cryptocurrency becomes. The current value, as of today, is € 8,893.46 per Bitcoin.
When does the Bitcoin rocket rise to the moon, the question with “when moon? “Of the Bitcoin fans. If you want to invest in Bitcoin, you should show perseverance. In the past, it took an average of 3.9 years for the Bitcoin price to increase. 6 to 12 months after the halving, Bitcoin has always shot up. So getting rich overnight doesn’t work. The Bitcoin Code has been working like clockwork for 11 years. The more block chains come into the system, the more stable this currency becomes.
Linear vs. exponentially
Paper money currencies have lost massively in value in recent years. Since central banks can theoretically provide an unlimited amount of money through lending (money out of nowhere), the money in cryptocurrencies, like limited gold, is created through mining. The compound interest effect in the central banking system, on the other hand, ensures exponential growth in money and debt and always leads to a crash at some point. By using limited cryptography, digital currencies are more difficult to manipulate and trading is also transparent and almost protected from corruption.
68 percent of computing power in Asia
As of November 2018, the scientists determined an annual electricity consumption of around 46 terawatt-hours. What CO2 emissions does the generation of this energy cause? The research team did not want to rely on estimates for this question either. Therefore, the crucial question was: In which countries are the miners located?
Once again, the team was helped by live statistics from “Mining Pools”. In the groups, miners have pooled their computing power in order to be able to find a way to solve the mathematic tasks more rapidly, explains Stoll. The IP addresses in the statistics for the two largest pools showed that most miners join a pool in or near their home country. The team was able to localize 68 percent of the computing power of the Bitcoin network in Asian countries, 17 percent in European countries, and 15 percent in North America. The researchers checked this result with a second method by localizing the IP addresses of individual miners with an Internet of Things search engine. Combining mining farms with the manufacture of renewable energy.
The result of the study:
The Bitcoin system causes between 22 and 22.9 megatons of carbon dioxide per year. That leaves a similarly large CO2 footprint as Hamburg, Vienna, or Las Vegas.
If there are more chief dynamics for climate change, CO2 footprint is so hefty that it serves as the sole reason to discuss the regulation of crypto mining at locations with CO2-intensive electricity production, says Christian Stoll. To improve the ecological equilibrium, it would be possible, for example, to a duo more ‘mining farms’ with the supplementary group of renewable energy.