Cryptocurrency, and Bitcoin in particular, is always in the news nowadays and is becoming a significant factor in modern financial markets. Unsurprisingly, the subject of regulating cryptocurrency in one form or another has become an important concern. China is alreadyrestrictingits use. Central banks around the world are looking at decentralized cryptocurrencies to assess their potential impact on financial stability, or to even issue their own digital currencies. Securities and Exchange Commission Chair Gary GenslerGary GenslerCryptocurrency makes the climate crisis worse SEC ups disclosure requirements for Chinese companies seeking US IPOs: report Crypto industry seeks to build momentum after losing Senate fight MORE described crypto trading as theWild Westrecently calling for Congress to create a protection regime for crypto investors. A major impasse for the critical infrastructure bill was the issue of taxing crypto transactions. Others have proposed that stablecoins beregulated like banks.

Unsurprisingly, the crypto industry has developed a formidable lobbying force to ward off further regulation. Regulation is totally antithetical to the very idea of decentralized cryptocurrency.

Yet, little focus has gone to the environmental dangers of cryptocurrency. Yes, Elon MuskElon Reeve MuskHillicon Valley: Tech groups pledge action on cybersecurity Cryptocurrency makes the climate crisis worse The Hill's Morning Report - Presented by Facebook - Biden continues to grapple with Afghanistan chaos MORE attracted the usual hype when he first announced that Tesla would accept Bitcoin and then stated (rather belatedly given thescience) that since he learned of the environmental damage inflicted by cryptocurrencies he would reverse that decision.

Cryptocurrencys impact on the environment is indeed very serious possibly the single most important policy factor against its growth.

Cryptocurrencies, Bitcoin and Ethereum in particular, are so damaging to the environment that they threaten to reverse any gains achieved through the transition to electric vehicles and the reduction in fossil fuels use. Much of this consumption and output derives from the energy and processing intensive mining of Bitcoin and proofs of work. Even now the total Bitcoin carbon footprint exceeds the total emission reductions of electric vehicles. According to the Cambridge Bitcoin Electricity ConsumptionIndex, Bitcoin already consumesmore energythan the whole of Argentina (pop. 45 million).

Digiconomists Bitcoin Energy Consumption Indexestimates that Bitcoin and Ethereum together consume the same amount of power as Ukraine and Israel, totaling 52 million people. The carbon footprint of asingleBitcoin transactions equates to nearly 2millionVisa transactions, or 135,229 hours of watching YouTube! A single Ethereum transaction consumes the equivalent power used by an average U.S. household over 4.55 days. Furthermore, the energy and carbon footprints of both these and other cryptocurrencies are projected to grow exponentially in volume as speculation, hype and criminality continue to drive volume. Already, total crypto energy consumption is roughly comparable to the carbon emissions produced by the metropolitan area ofLondon, according to The Gaurdian.

Apart from these staggering energy consumption statistics, crypto is alsointensifying competition for chips, for which there is already a global shortage impeding the manufacture of alternative energy devices, including EVs. Crypto has already grown exponentially. Further growth will only broaden its carbon footprint.

Given thedaunting targetsfor carbon reduction that we face in the U.S. and globally, this development should concern everyone. If there were offsetting gains with crypto, one might justify it on a cost-benefit basis, as we do with EVs (which inflict some damage but less overall than combustion engines). Yet, there are no real gains.

There are many classes of crypto adventurers: libertarian idealists who dream of freedom from sovereign monetary control; hardware and software players mining the stuff for reward; traders who derive revenue from crypto transactions; speculators who ride the wild volatility of crypto; crypto wallet raiders; and criminals who exploit the relative degree of anonymity crypto offers as ransomware. Despite grand statements about reducing transaction costs and liberation from fiat money, none of the legitimate players have made a case for crypto contributions to general welfare. Beyond rhetoric they have not even seriously attempted to. Instead, they have relied on the naivete of lawmakers, regulators and journalists.

Well-informed commentators have described crypto as agiant bubble. Yet, regulators continue to display timidity in addressing the subject. While the Biden administration urges the auto industry to transition to 50 percent EVs by 2030, we recklessly allow crypto to escalate at huge current and potential cost to our carbon footprint.

China has at least taken one step in the direction of connecting crypto to climate change concerns: It hasbannedcrypto mining. This activity will only move elsewhere. Legislators and policymakers should inform themselves now and act soon to stop the counterproductive growth of this industry, no matter how potent their lobbying forces have become. If they do not, even as the threat posed by global warming enters code red according to the Intergovernmental Panel on Climate Change we will find ourselves in yet another situation where an entrenched industry prevents us from advancing the common good and tackling climate change.

LawrenceG.Baxteris the David T. Zhang professor of the practice of law at Duke University where he also directs the Global Financial Markets Center.

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Cryptocurrency makes the climate crisis worse | TheHill - The Hill

Bitcoin fell back below $50,000 on Monday after reclaiming that threshold over the weekend.

The cryptocurrency traded at roughly $49,400 by the afternoon session, still shy of its all-time high above $64,000 set in April.

The space has seen a boost in the past week on increasing adoption. PayPal said Monday it would open its platform in the U.K. to crypto buying and selling, and Coinbase said last week that it would buy $500 million in cryptocurrency on its balance sheet.

Bill Baruch, president of Blue Line Capital, is a bitcoin bull but remains wary of jumping in right here.

"I think it needs to be in your portfolio, but is $50,000 the place to be buying it? I wouldn't chase it," Baruch told CNBC's "Trading Nation" on Monday.

Bitcoin fell below $30,000 during a summer sell-off. Weakness in recent months was largely tied to a regulatory crackdown in China wherein some mining operations were forced to close. Since a June low of $28,600, it has rallied 73%.

In a separate email to CNBC, Baruch said he owns bitcoin but began to trim his holdings once it bounced back to $45,000 roughly the same level as its 200-day moving average and a 50% retracement level measured from its April peak and its June low. He said that level could prove a good entry point if bitcoin falls back to it.

"Again, I think it's a great space to be in, but don't chase it just because you see $50,000 in the headlines. Pick your spots and stick to your game plan," he said.

John Petrides, portfolio manager at Tocqueville Asset Management, said there are more ways to play the bitcoin bounce than just through the asset itself.

"If you put your long-term investment hat on, there are two ways to look at this space one is cryptocurrency the asset class and then the second one is an investment in the blockchain. For our team specifically, from a long-term theme perspective, we think that blockchain has a lot of value to it," Petrides said during the same interview.

He plays the space specifically through the ETHE Grayscale Ethereum Trust, which solely invests in ethereum open source blockchain, and mirrors the value of the ethereum held by the trust. It has risen 105% this year.

"As the world moves to more non-fungible tokens, NFTs, as we see more big players like PayPal and Visa and others start moving and converging in this space, we think that's going to lead to more activity on the blockchain, and ethereum is the largest open source blockchain out there," Petrides said.

Disclosure: Blue Line Capital holds bitcoin. Petrides holds ETHE.

Disclaimer

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Bitcoin at $50,000: Traders on how to play the space after cryptocurrency briefly reclaims marker - CNBC

The cryptocurrency industry is getting so big and enabling so much risk-taking that governments around the globe are taking notice.

Bitcoin traded above $50,000 Monday; its total value now exceeds $900 billion, more than all but a handful of companies. Digital currencies called stablecoins grease ever more trading and issuance. Giant crypto exchanges in Asia offer 100-to-1 bets, often serving traders in countries where their products arent legal.

After years of relative inattention, regulators and lawmakers are scrambling to catch upbut it wont be easy. They aim to rein in a rebellious industry that has adopted the tech worlds blueprint for aggressively deploying new products to quickly amass userswhile often leaving regulatory compliance as an afterthought.

Some of the largest crypto firms are under increasing pressure. In recent weeks, Binance, the worlds biggest crypto exchange, was barred from or warned about offering certain crypto investments in the U.K., Italy, Germany, the Netherlands, Japan and Hong Kong. It said Friday that all new users would have to provide an identification document and photo of themselves to verify their identity. BitMEX, another large exchange, paid $100 million to settle a U.S. regulatory investigation related to claims of illegally selling derivatives and lackluster anti-money-laundering compliance.

Yet few industry participants expect the crypto world, emboldened by a surge over the past 18 months in the value of and interest in their products, to suddenly change its ways. Regulators are scrutinizing the industry as never before, but so far coordination appears limited and key jurisdictions are pursuing widely divergent approaches.

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Cryptocurrencys Surge Leaves Global Watchdogs Trying to Catch Up - The Wall Street Journal

After the London Hard Fork update, the burning of Ethereum tokens had become the talk of the town among crypto lovers. Here is a look at what it means to burn a coin.

What is coin burning?It is the act of sending cryptocurrency tokens to a wallet that has no access key. Without the private key, these tokens cannot be accessed by anyone and are lost forever.

Recently, Vitalik Buterin, the co-founder of Ethereum, burned more than 90 per cent of his Shiba Inu tokens. After the London Hard Fork update, close to $0.5 million worth of Ethereum is being burned every hour.

Which coins can be burned?All cryptocurrency coins can be burnt. The decision to burn tokens is usually vested in the developer team of the coin. Sometimes, coin burns can be initiated by the core community also.

How is a coin burnt?The portion of the coins that is being burnt can be verified on the blockchain. These coins are sent to a wallet to which no one has access. "It can be done in several ways, most commonly by sending the coins to a so-called eater address. Its current balance is publicly visible on the blockchain, but access to the contents is unavailable to anyone," said Bathija.

What is the need to burn a coin?There are different reasons to burn cryptocurrency coins. It is known to directly incentivise and reward a projects investor base. Coin burns directly affect the dynamics of supply and demand. The most notable objective is to create a deflationary effect. By reducing the overall number of tokens in circulation, these events make tokens scarce and boost the cryptocurrencys valuation.

"It drives the coin price higher. It makes existing investors pretty happy as the value of their investments move northwards," added Patel of Mudrex. "Miners of certain cryptocurrencies such as Bitcoin also become happy as the value of reward for their labour would have now increased."

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Explained: What is coin burning in the cryptocurrency universe? - Economic Times

Cryptocurrencies have a potential future and even though they have fluctuating values, these digital assets might find a way to become an effective means of payment, Raghuram Rajan, former Reserve Bank of India governor, told the Reuters Global Markets Forum.

The former chief economist for the International Monetary Fund (IMF) was more positive on well-regulated stablecoins. At the same time, he called for quick appropriate regulations for stablecoins.

A stablecoin is a digital currency that is linked to an underlying asset, such as a national currency like the US dollar or a precious metal like gold.

According to the Reuters report, Rajan was, however, not clear on the fundamentals that were driving the valuations of cryptocurrencies.

Right now, in this heady environment with asset prices really picking up, many cryptos are also being valued not so much as a means of payments but as assets in their own right," Rajan, who is professor of finance at the University of Chicago Booth School of Business, told Reuters.

Even in India, crypto currency exchanges are urging the government to define cryptocurrencies as digital assets and not as currency. As per industry experts, this would help the government address all its legitimate concerns with regards to financial risks associated with crypto.

Meanwhile, finance minister Nirmala Sitharaman said that the legislation on cryptocurrencies is awaiting Cabinet approval.

Rajan in his interaction with Reuters opined that some cryptocurrencies might find a way to become an effective means of payment despite their fluctuating values.

Cross border payments are one area which is wide open, because of the huge transaction costs of making cross border payments," he said.

In India, growth-wise, the crypto industry has grown from four-five million people in 2018 to 15-20 million investors now with more than $1.5 billion invested. This has in part been driven by the superlative returns given by cryptocurrencies such as bitcoin, ether and dogecoin over the past three years.

Rajan believes that for cryptocurrency prices to keep on rising, these digital assets will need to find a proper use case.

I think the value of cryptos has to be seen more in terms of are they going to be useful in the system going forward. Yes, some of them have value because they have value, and maybe that will persist. I'm not going to say that bitcoin is going to implode tomorrow. But I will say that I would be much more confident about the value of these cryptos once they find proper use cases, and the technology is evolving to make that happen," he said.

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Cryptocurrencies have a future, may become effective means of payment: Rajan - Mint

New Delhi: Ethereum's latest London Hard Fork update has led to a sharp rally in the second largest cryptocurrency. This had given a left behind feeling to investors of Bitcoin. But now Bitcoin is flexing its muscles again.

The price of the numero uno digital token by market cap has once again hit the $50,000 mark, delivering more than 70 per cent returns from its recent lows of $29,000. Ethereum has risen about 80 per cent to $3,300 from $1,850.

This strong tussle between the two has again started off a debate among investors over which one is more valuable. Despite a sharp rise in altcoins, the fancy over crypto behemoths has not fizzled out completely.

Siddharth Menon, COO of WazirX, said Ethereum may outperform Bitcoin in returns but not in market cap. "Bitcoin will still hold the largest share and will remain dominant," he added.

Ethereum is now getting a scarcity premium as the London Hard Fork update has led to deflation. On the contrary, the oldest cryptocurrency, Bitcoin, has limited supply; not more than 21 million Bitcoins can be mined.

Menon of Wazir X did not give any personal advice.

Supply shock has been aiding the upward movement in Bitcoin historically, and that may now push Ethereum prices higher. However, analysts can not pick one over the other, thanks to strong fundamentals, well-defined useage and outperformance over the years. They are bullish on both the tokens. "This is a positive market recovery and also crypto market cap has broken $2.1 trillion. This should show a positive signal to the rest of the market," he added.

Nair of CoinSwitch Kuber said: While Bitcoin has been in the game longer and has gained widespread recognition, Ethereum offers more opportunities to grow over time. Both have different use cases.

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Bitcoin vs Ether: Which cryptocurrency has an edge? - Economic Times

WINK NEWS

Cryptocurrency, which some see as the currency of the future, has had a rough ride lately.

After reaching an all-time high in April, it tanked. Still, many wonder if this form of digital currency might replace the almighty dollar.

Justin Verleys phone doubles as a wallet. His cards are attached to the back and he doesnt carry cash because its all inside his phone.

If theres ever a chance to use cryptocurrency over the dollar, Im going to prefer cryptocurrency. Just for speed reasons, for security reasons, for moral reasons, and because I trust it, he said.

Verley started using crypto over cash in college. He paid for necessities like school supplies and groceries.

Think about it like tokens at an arcade. You exchange a certain amount of dollars for an equivalent amount of tokens. These tokens have a fixed amount when youre looking to play Skee-Ball. With Bitcoin having a fixed amount, the value fluctuates like stocks.

I would liken Bitcoin more to a store of value like gold, more like digital gold than a currency, but that doesnt mean you cant spend it. Its very spendable. Its widely accepted around the world and its becoming more widely accepted, Verley said.

The appeal and danger of this form of money are that its decentralized, not controlled by a government or bank, which opens the door for illegal activity.

The Colonial Pipeline hackers demanded more than $2 million in cryptocurrency, which they were paid, but to the surprise of many, the FBI recovered it.

In this pandemic world, were seeing the monetary policy of printing money to help stimulate the economy. Bitcoin, one of its most unique value propositions is that as a fixed supply there will never be more than 21 million Bitcoin. So, people are going to it as an alternative investment as a safe store of value, said Neil Bergquist, CEO of Coinme, a company that exchanges cash for crypto.

More and more places are accepting Bitcoin, like Whole Foods, Starbucks and Home Depot.

Turning physical cash into a digital representation really has a lot of technological benefits in terms of payments and as a store of value and really bringing money or store value into a digital era, Bergquist said.

And its easily accessible. You can now buy Bitcoin at your local Winn-Dixie store through a Coinstar machine. (See locations below.)

Our expansion in Florida provides that access where that access may not have been there before. So simple things like being able to buy it with cash is a key piece of infrastructure for overall adoption, Bergquist said.

Its even likely that crypto will become a widely accepted form of payment, like debit or credit cards.

The concept of greater inclusion of virtual currency into our payment systems and processes is kind of inevitable, said Russell Weigel, commissioner of Floridas Office of Financial Regulation.

Right now, Florida doesnt have a clear definition of cryptocurrency or a policy to regulate it, which worries Weigel given the states history of fraud.

We need to account for that and make sure that any system we build also has as much consumer protection or retail investor protection that we can build into it, he said.

For Verley, even though he lost money in the recent crypto crash, he feels digital currency makes more sense than dollars and cents.

In most places in the world, theres no difference between swiping a credit card and spending your cryptocurrency. I feel like its an option that people are just going to choose rather than holding their money in U.S. dollars.

For those interested in getting into Bitcoin, Verley recommends buying slowly. Remember, as the recent trend shows, Bitcoin is volatile and changes constantly.

A list of Southwest Florida Winn-Dixie stores with Coinstar machines that exchange cash for Bitcoin is below.Note that you will first need to set up a Coinme account. For more information on Coinstar, click here.

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The future of cryptocurrency: Could it replace the US dollar? - Wink News - Wink News

Monitors display Coinbase signage during the company's initial public offering (IPO) at the Nasdaq MarketSite in New York, U.S., on Wednesday, April 14, 2021.

Michael Nagle | Bloomberg | Getty Images

Coinbase's price may fluctuate alongside the value of bitcoin in the short term, but Canaccord is betting on the future of blockchain technology and initiating coverage of the crypto exchange as a buy.

The largest U.S. cryptocurrency exchange's stock, which was trading above $232 on Wednesday morning, made its public debut in mid-April and fell sharply with the price of bitcoin in late May. Bitcoin is currently trading around $39,000 following a roller-coaster month of trading after its price drop almost a month ago.

Coinbase's revenue is largely driven by trading fees, 81% of which come from retail trading and 5% from institutional trading, according to Canaccord. It has the highest trading fees across crypto exchanges, the bank found.

Still, Canaccord said it's confident Coinbase's business will ultimately expand beyond retail trading and into emerging opportunities for the blockchain which could include supporting new protocols beyond bitcoin and ethereum, decentralized finance and cloud solutions and that crypto exchange will be a "super on-ramp" into that new world.

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Buy Coinbase on the dip for a long-term opportunity on the crypto economy, Canaccord says - CNBC

Bitcoin, the world's best known cryptocurrency, has a few flaws and that's triggered other digital currencies to come up with more viable options, according to a professor at Cornell University.

It isn't as anonymous as people think it is, and "mining" bitcoin is bad for the environment, pointed out economics professor Eswar Prasad.It also doesn't work well as a currency, he told CNBC on Thursday.

One interesting aspect is that other cryptocurrencies have come up with solutions to address some of bitcoin's flaws, said Prasad, who was formerly head of the International Monetary Fund's China division.

Bitcoin mining refers to the energy-intensive process required to produce new coins and ensure the payment network is secure and verified.

The electricity used when transactions are validated on the bitcoin blockchain, as well as the mining process, is "certainly not good for the environment," Prasad said.

Tesla CEO Elon Musk said last month that his electric car company will stop accepting bitcoin as a form of payment because of environmental concerns, causing the price of bitcoin to drop 5% in a matter of minutes.

He has since made an about-turn and said in a tweet on Sunday that Tesla will accept bitcoin in transactions if it can confirm "reasonable" and "clean energy usage by miners."

Crypto miners use purpose-built computers to solve complex mathematical equations that effectively enable a coin transaction to go through. The miners are rewarded for their efforts by being paid in the cryptocurrency.

However, the entire process used to create a bitcoin requires a lot of energy and can consume more power than entire countries such as Finland and Switzerland, according to theCambridge Bitcoin Electricity Consumption Index.

On the other hand, Ethereum the second-largest cryptocurrency sometimes viewed as an alternative to bitcoin is coming up with a different method of mining that requires less energy, Prasad pointed out.

Called "proof of stake," it is the underlying mechanism for ethereum that activates so-called "validators" on the network, if they can prove that they hold ether, or a "stake."

Ultimately, it should remove the need for vast amounts of computing power needed to validate transactions and the Ethereum Foundation claims it will use 99.95% less energy than before.

"That is going to be much less energy intensive, and it could deliver a lot of the benefits that bitcoin was supposed to deliver. It could also make transactions much cheaper and quicker," said Prasad.

However, it's not there yet, he added.

Earlier this month, U.S. law enforcement officials said they were able to recover $2.3 million in bitcoin paid to a criminal cybergroup involved in the ransomware attack on Colonial Pipeline in May.

The FBI said its agents were able to identify a virtual currency wallet that the hackers used to collect payment from Colonial Pipeline.

"The main idea of bitcoin was to provide pseudonymity," said Prasad. "But it turns out that if you use bitcoin a lot, and especially if you use Bitcoin to get any real goods and services, then it becomes possible eventually to link your address or your physical identity to your digital identity."

What's interesting, he said, is that there are other cryptocurrencies trying to fix this and offer more anonymity. He highlighted Monero and Zcash as some examples.

Chris Ratcliffe/Bloomberg via Getty Images

"So bitcoin really has set off something of a search for a better alternative and people seem to be on the lookout for a medium of exchange that does not require them to go through a trusted institution like the government or a commercial bank but it's not quite there yet," Prasad said.

In theory, bitcoin was supposed to provide an anonymous and efficient medium of exchange but "it hasn't worked in that respect," said the economics professor.

Rather, it's "slow and cumbersome" to use bitcoin to pay for goods and services, and the market is very volatile, Prasad said.

Bitcoin is prone to wide swings in volatility, as seen by its 30% plunge in a single day last month.

"So you could take a bitcoin to a store and one day, get a cup of coffee and another day, with the same bitcoin, be able to treat yourself to a lavish meal. So that doesn't work well for the medium of exchange," he said.

Bitcoin has become a speculative asset for people who hope it will appreciate in value, rather than because they want to use it as a payment mode, Prasad said.

CNBC's Sam Shead contributed to this report.

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Bitcoin has 3 flaws and that could set the stage for other alternatives, says Cornell economist - CNBC

In 2021, bitcoin and ether have seen huge rallies. In April 2021, the cryptocurrency market topped $2 trillion in value for the first time.

Jaap Arriens | NurPhoto | Getty Images

Cryptocurrency ethereum has outperformed bitcoin so far this year, and Morgan Stanley has given a number of reasons why.

The "alternative" crypto coin is up around 240% this year, while the world's best-known cryptocurrency is up less than 38%.

It's been a volatile few months in the crypto world, with bitcoin's value peaking in April at around $65,000 before falling back to around $30,000, while ether peaked in May at around $4,000 and is now trading around $2,500.

Ether is viewed as an alternative to bitcoin. Fans like it for a number of reasons including the fact it underpins many other cryptocurrencies, but it's yet to be adopted by private institutions in the way that bitcoin has been.

It's important to note that ether's market cap is less than half that of bitcoin's, but trading volumes for the smaller coin surged to $600 billion in May 60% higher than bitcoin volumes, according to Morgan Stanley.

There are some key reasons for the outperformance of ether, according to the investment bank, which updated its views on crypto in a note last week.

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CNBC Ethereum is outperforming bitcoin. Morgan Stanley thinks it knows why 19 hours ago - CNBC