Category Archives: Bitcoin

If you have fallen far enough down the rabbit hole, you know that bitcoin's supply schedule currently rewards 6.25 new bitcoin every 10 minutes, on average, to miners as a reward for successfully finding a valid nonce and committing a new block of transactions to the blockchain. This distribution schedule, the "block subsidy," is Satoshi Nakamoto's solution to the problem, or question, of "how do we fairly distribute this new currency into the hands of new users?" There was no premine (looking at you, Vitalik), and the genesis block that Satoshi mined before publishing the code had a block reward that was not spendable. The block subsidy started at 50 bitcoin and programmatically cuts in half every 210,000 blocks, roughly every four years. The current reward is 6.25 bitcoin per block. This means that currently, every 10 minutes, 6.25 new bitcoin are minted and added to the total number of bitcoin. When people talk about bitcoin's hard cap of 21 million, it is a function of the initial 50 bitcoin block reward and subsequent halving schedule. Said differently, 21 million just happens to be the asymptote of the below function.

The number is arbitrary. It could be five or 5 trillion. What matters is the fact that this supply schedule is known in advance and cannot be manipulated by a centralized authority.

When thinking about the future purchasing power of bitcoin in today's dollars, there are many useful frameworks to consider: stock to flow, fixed income market cap, market cap of global real estate, market cap of gold, silver, etc. Each of these approaches has their merits and valid criticisms.

With 6.25 new bitcoin minted every 10 minutes, on average currently, that's 675,000 bitcoin over the next 25 months, before the next halving. That feels like a lot. I've been thinking about different ways to estimate the long-term purchasing power of bitcoin in the future, and I think the following framework is an interesting approach using data on the M2SL money supply metric as reported by the Federal Reserve.

M2SL money supply on January 3, 2009: $8.27 trillion.

M2SL money supply on October 10, 2021: $21.19 trillion.

The M2SL money supply has increased by $12.92 trillion over the last 12 and a half years. This works out to roughly $19.54 million every 10 minutes for the last 10 years. As of block height 630,000, the bitcoin block reward subsidy is 6.25 bitcoin. So for each bitcoin being minted in the current subsidy epoch, $3.13 million is being added to the money supply. This approach assumes that the money printer has been running at a consistent rate for the last 12 and a half years. This is a very conservative approach given the parabolic increase in money printing that the unelected bureaucrats at the Federal Reserve have applied to the rate of money printing, as well as the consistent scheduled reductions in bitcoin's inflation schedule.

One bitcoin should be worth $3.13 million today.

Consider the following adjustments to this valuation framework for each subsidy epoch in the bitcoin supply schedule.

On the date the genesis block was mined, January 3, 2009, when the block reward was set at 50 bitcoin, M2SL money supply was $8.27 trillion.

On the date of the first halving, November 29, 2012, when the block reward was reduced from 50 bitcoin to 25 bitcoin, M2SL money supply was $10.45 trillion.

The M2SL money supply increased by $2.18 trillion between the genesis block and the first halving, the 50 bitcoin block subsidy reward epoch. This works out to roughly $10.74 million every 10 minutes from January 2009 to November 2012. So, for each bitcoin minted from the genesis block to the first halving, $215,000 was added to the money supply.

One bitcoin should have been worth $215,000 in 2012.

On the date of the first halving, November 29, 2012, when the block reward reduced from 50 bitcoin to 25 bitcoin, M2SL money supply was $10.45 trillion.

On the date of the second halving, July 10, 2016, when the block reward reduced from 25 bitcoin to 12.5 bitcoin, M2SL money supply was $12.89 trillion.

The M2SL money supply increased by $2.44 trillion between the first and second halving, the 25 bitcoin block subsidy reward epoch. This works out to roughly $13.12 million every 10 minutes from November 2012 to July 2016. So, for each bitcoin minted from the first halving to the second halving, $525,000 was added to the money supply.

One bitcoin should have been worth $525,000 in 2016.

On the date of the second halving, July 10, 2016, when the block reward reduced from 25 bitcoin to 12.5 bitcoin, M2SL money supply was $12.89 trillion.

On the date of the third halving, May 11, 2020, when the block reward reduced from 12.5 bitcoin to 6.25 bitcoin, M2SL money supply was $17.89 trillion.

The M2SL money supply increased by $5.00 trillion between the second and third halving, the 12.5 bitcoin block subsidy reward epoch. This works out to roughly $25.16 million every 10 minutes from July 2016 to May 2020. So, for each bitcoin minted from the second halving to the third halving, $2.01 million was added to the money supply.

One bitcoin should have been worth $2.01 million in 2020.

On the date of the third halving, May 11, 2020, when the block reward reduced from 12.5 bitcoin to 6.25 bitcoin, M2SL money supply was $17.89 trillion.

On the date of writing this article, December 4, 2021, M2SL money supply was $21.19 trillion.

The M2SL money supply increased by $3.30 trillion between the third halving and today. This works out to roughly $44.91 million every 10 minutes from May 2020 to December 2021. So, for each bitcoin minted from the third halving to today, $7.18 million was added to the money supply.

One bitcoin should be worth $7.18 million today.

Obviously, bitcoin has sorely underperformed this valuation framework historically. It is noteworthy though, that the price of bitcoin has consistently closed the gap between this valuation framework and reality. In November 2012, bitcoin was around $13, or 0.006% of the $215,000 price target. In July 2016, bitcoin was around $587, or 0.112% of the $525,000 price target. In May 2020, bitcoin was around $9,671, or 0.480% of the $2.01 million price target. As of writing this article, bitcoin is around $49,257, or 0.686% of the $7.18 million price target.

Consider the following two facts:

1) The bitcoin block reward subsidy is unchangeable, and its scheduled reduction is a certainty.

2) The rate of money printing from central banks around the world will increase at an increasing rate.

A reasonable conclusion given these two facts is that the bitcoin price in U.S. dollars will continue to converge with the valuation framework laid out above, with the actual price as a percentage of the price target trending toward 100% as the U.S. dollar money supply continues to expand while the bitcoin money supply grows at a smaller and smaller rate.

If you arent paying attention, you probably should be.

This is a guest post by Scott Marmoll. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

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What If All The Money Being Printed Went Straight To Bitcoin? - Bitcoin Magazine

Newport, a seaside city in Wales, is famous for its docks and industrial heritage and for allegedly having half a billion dollars worth of Bitcoin buried in its local landfill.

Former IT worker James Howell mined the cryptocurrency back in 2013, well before its value skyrocketed. In a mix-up, he accidentally threw away the hard drive its access key was stored on.

"I found a blank 20GB hard drive in my drawer instead of thousands of Bitcoin," Howell told CBS News.

Since then, he's been lobbying the local government to allow him to excavate tons of trash in the landfill as part of an attempt to find it. But local officials are refusing to let him.

"There are companies out there that dig at the bottom of the ocean for treasure. Digging a landfill is a damn sight bit easier than digging at the bottom of the ocean," said Howell.

He said he's contacted experts from around the world as part of his attempt to recover his huge Bitcoin fortune. Despite offering Newport City Council a cut of the coins if he were to find them, it continues to refuse the proposal citing environmental damage it could cause and that the council's "duty is to provide services to our residents" something it said Howell's plan would get in the way of.

Still, Howell is determined to keep trying to find the hard drive.

"I'm not gonna to give up on it, because it's you know, like I said, it's a lost lottery ticket," he said. " A lottery ticket would disintegrate but a hard drive doesn't. It's not going anywhere."

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What happened

Following a day of sell-offs on Friday, the cryptocurrency market is posting some recovery momentum on Saturday. As of 10 a.m. ET, Bitcoin (CRYPTO:BTC) was up roughly 3.3% from the stock market's closing bell on Friday. Meanwhile, Ethereum (CRYPTO:ETH) and Dogecoin's (CRYPTO:DOGE) tokens were up roughly 6.4% and 6%, respectively, over the same period.

Crypto prices began soaring in October and continued to gain ground until momentum started reversing in mid-November. The overall cryptocurrency market has continued to move lower in December as investors have weighed regulatory risk factors and the possibility that valuations for digital tokens may be trending toward a more prolonged bearish cycle. That being said, the cryptocurrency market actually looks relatively calm at the moment.

Image source: Getty Images.

Bitcoin hit a lifetime high of $68,990.90 per token last month, but the token dropped below the $50,000 per token mark early in December's trading and now trades at roughly $46,300 per coin. The cryptocurrency is down roughly 23% over the last month and approximately 33% from its high.

Bitcoin has posted a strong performance this year and is still the largest cryptocurrency by far, but there are signs that the market is shifting toward a different category of token. While Bitcoin can be used as a currency or a speculative investment vehicle, most of the excitement in the market appears to be building around tokens that are connected to service-and-development-focused blockchain networks and applications.

In dollar terms, Ethereum has been leading the charge on the crypto market's rotation into application-backed cryptocurrencies. The price for the network's ether token has surged amid increasing adoption for the network's smart-contract and application-building features, and some investors and analysts see this momentum leading to "the flippening" -- the moment when Ethereum's market cap surpasses Bitcoin's. Ether's loss of just 8% over the last month of bearish crypto momentum suggests that the token is gaining strength relative to Bitcoin.

Meanwhile, Dogecoin is down roughly 29% over the last month and roughly 75% from its high mark. Dogecoin's price per token peaked at roughly $0.69 back in May, but it quickly lost ground as investors took profits on the heels of explosive gains. The token has struggled to regain ground as investors have generally become more risk-averse and attention has shifted to other meme tokens.

Even with dramatic pricing volatility, 2021 has been a year of fantastic returns for the broader cryptocurrency market.

Bitcoin Price data by YCharts

Despite lagging other cryptocurrencies that posted even stronger gains this year, Bitcoin has managed to put up strong gains across 2021's trading, and it remains the top cryptocurrency. The token currently has a market cap of roughly $892 billion, while Ethereum's ether token has a market cap of roughly $472 billion. Dogecoin's even more incredible gains have helped it reach a market cap of $23 billion, and it currently ranks as the 11th largest cryptocurrency.

As we move through the end of 2021, investors are trying to parse how to weigh risks and find emerging opportunities with digital tokens and blockchain-based projects.While Federal Reserve policy, government stimulus, and other economic factors are generally thought to have a much greater impact on the pricing of stocks and real estate, these factors also appear to be having a significant impact on the cryptocurrency market.

Just as the ability to secure low-interest loans has filtered through to push equity prices higher, it's likely also played a significant role in the strong bull market phase in the crypto market over the last year. With the Fed potentially raising interest rates three times next year and easing off stimulus spending, it's possible that crypto valuations could face bearish pressures if investors generally become more risk-averse. For investors looking for exposure to the cryptocurrency space, sell-offs could present worthwhile buying opportunities, but dollar-cost averaging may be less risky than making large investments all at once.

This article represents the opinion of the writer, who may disagree with the official recommendation position of a Motley Fool premium advisory service. Were motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Why Bitcoin, Ethereum, and Dogecoin Are Gaining Today - The Motley Fool

Starting in 2022, the Internal Revenue Service (IRS) is expected to shut down a longtime tax loophole that allows cryptocurrency investors to harvest their losses to offset their tax burden.

Digital coins, already under heavy selling pressure as the holidays approach, are getting hit by wealthy investors fearing a tighter tax regime next year. The shrinking loophole could be making matters worse.

Following a "relief rally" after the Federal Reserve's policy decision, cryptocurrencies have been hammered along with stocks, as Omicron variant fears grip markets again. While short-term volatility has come to define crypto trading, year-end tax positioning may also be playing a role.

Buying high and selling low isnt an ideal investing strategy, but with crypto there is a silver lining. Savvy investors can reap advantages on their tax returns by selling their crypto at a loss, then buying it back shortly thereafter.

The "wash sale" rule is used to tax capital gains on stocks, bonds and other financial securities but not cryptocurrencies. That loophole is one of several positions that might get closed by the Build Back Better bill pending in Congress.

Jordan Bass, a certified public accountant (CPA) and tax lawyer, explained to Yahoo Finance the 30-day wash sale rule hasn't ever applied to crypto assets that aren't distinctly classified as securities.

That has allowed savvy investors to sell their underwater positions, use the loss to offset income or other capital gains taxes, then buy back into the position at a lower cost basis within a short period of time.

For example, if an individual takes a $10,000 position in a crypto asset then the price of that crypto asset plummets by 75% to $2,500, that person can sell their asset at a loss of $7,500 and use the loss to offset their total tax liability.

Since the market for cryptocurrencies is very volatile, investors can quickly buy back into the coin of their choice at the $2,500 price at a more favorable tax rate, and occasionally recover their full position.

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Once executed, they can use their capital loss to offset other gains or taxable income per year up to $3,000 according to the rules. The remainder can be carried forward for future taxable years indefinitely. For large investment portfolios, the outcome can make a staggering difference. The tactic is a well-worn strategy for billionaires.

According to Bass, a number of his clients have harvested crypto losses for tax purposes, especially during the start of the asset class' previous bear market in 2018.

Investors can do that in crypto at least for the rest of the month. They cant do that in the securities realm. Brokerage accounts track this information and report it in 1099s with adjustments based on the wash sale rule, Bass explained.

The attorney also admitted harvesting tax losses is less ideal during booming times such as most of 2021, at least for "blue chip" crypto units like Bitcoin (BTC-USD) and Ethereum (ETH-USD). However, even those cryptocurrencies experienced major, albeit temporary, down swings through out the year.

The strategy proves especially useful for day traders who accumulate far more taxable events than a standard buy-and-hold investor. Bass admitted some clients newer to the cryptocurrency markets actually ended up owing more taxable income than the value of their total crypto holdings come tax day.

Though investors can attempt tax loss harvesting all year long, it's often considered and executed at the end of the year, according to Andrew Gordon, an attorney and CPA with Gordon Law.

He told Yahoo Finance that a number of his firms clients have used the method this year, especially with their non-fungible token (NFT) holdings. And the method isn't for the faint at heart, as many investors often miss or misunderstand the rules, Gordon explained.

The IRS economic substance doctrine explicitly prohibits a tax filer from reporting a loss that has no economic impact. That means investors can't just sell their crypto, then buy it back at the same price and write it off as a loss. Also, they cannot do this with an NFT, whose selling point is its uniqueness (hence the 'nonfungible' in NFT).

For Bitcoin or Ethereum which are fungible, it doesnt matter which piece you have, it's all the same. Thats not true for NFTs. You typically cant sell and buy back the same one and if you are, then, perhaps, the entire sale is a sham, said Gordon.

"We've had people 'sell' to their friends then buy it back or they very immediately buy it back in the same instant," Gordon said. "That's not going to be accepted by the IRS."

While the 30-day wash sale rule applies next year, Gordon pointed out that investors can always recognize losses from poor performing crypto assets, scams, or "rug pulls" since they hopefully won't ever buy back those same assets.

On the other hand, the opposite maneuver "gain tax harvesting," often favored by high net worth investors, also contributes to selling pressure around crypto and other assets like stocks, according to Gordon.

He said many of his clients with substantial holdings are also selling their gains now before a tighter tax regime in the U.S. takes hold next year.

David Hollerith covers cryptocurrency for Yahoo Finance. Follow him @dshollers.

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Why tax season may be adding to the rout in Bitcoin, cryptocurrencies - Yahoo Finance

Coming every Saturday, Hodlers Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more a week on Cointelegraph in one link.

A recent report shows that Russia could potentially see a countrywide ban on cryptocurrency. Alternatively, its possible that crypto trading via regulated exchanges may continue under strict oversight.

On the one hand, Russias central bank is said to be behind a potential move to make crypto illegal in the country, according to Reuters. On the other hand, Anatoly Aksakov, who heads the Russian parliaments Committee on Financial Markets, publicly disclosed that the industry may continue to operate under regulations that would ensure greater tax compliance. However, Aksakov left open the possibility of an outright ban.

The Commodity Futures Trading Commission (CFTC) now has a permanent chairman following approvals by the United States Senate. On Thursday, Rostin Behnam, who had been serving as acting chairman, was given the permanent position. The CFTC is one of three U.S. governing bodies responsible for crypto industry regulatory oversight.

Behnam has previously commented on the crypto space, noting that the CFTC should focus more on the sector. He noted in October: Given the size, the scope and the scale of this emerging market, how its interfacing and affecting retail customers, and with the scale of the growth being so rapid, potential financial stability risks in the future, I think its critically important to have a primary cop on the beat.

The CFTCs overall brass is also changing. In the coming months, four CFTC commissioner spots must be filled, which is a large number given that the regulatory body typically carries five commissioners.

New York Digital Investment Group (NYDIG) is now worth roughly $7 billion after the company successfully raised $1 billion from WestCap and other venture investors. Led by co-founder and CEO Robert Robby Gutmann, NYDIG is a company dedicated to providing access to investment opportunities centered around Bitcoin (BTC).

NYDIG plays a unique role in the industry, empowering companies of all types to incorporate Bitcoin in a secure and compliant way, WestCap partner Scott Ganeles said in a public statement announcing NYDIGs additional capital achievement. We are proud to partner with Robby and his outstanding NYDIG team as they forge new paths to accessibility and further accelerate Bitcoin adoption.

Sports apparel company Nike officially joined the Metaverse this week by acquiring virtual sneakers and collectibles brand RTFKT.

Prior to the move, Nike expressed strong interest in this emerging market by pursuing Metaverse-specific patent and trademark filings for its logo. The company also publicized a job search for people with specific Metaverse expertise.

Our plan is to invest in the RTFKT brand, serve and grow their innovative and creative community and extend Nikes digital footprint and capabilities, Nikes CEO and president John Donahoe said.

The U.S. Securities and Exchange Commission (SEC) has decided to delay a verdict on two physically-backed Bitcoin exchange-traded funds (ETFs) until February 2022. The Commission published its decision on Wednesday.

The two ETF applications were filed by Bitwise Asset Management and Grayscale. Whereas Bitwise aimed to introduce an entirely new spot Bitcoin ETF, Grayscale intended to create a spot offering by repurposing its current Grayscale Bitcoin Trust product.

The SEC has turned down multiple Bitcoin spot ETF applications in 2021. The Commission delayed one such product from WisdomTree earlier in 2021, only to deny it in December.

At the end of the week, Bitcoin (BTC) is at $46,292, Ether (ETH) at $3,852 and XRP at $0.79. The total market cap is at $2.16 trillion, according to CoinMarketCap.

Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are yearn.finance (YFI) at 52.51%, OKB (OKB) at 31.83% and Avalanche (AVAX) at 29.75%.

The top three altcoin losers of the week are Decred (DCR) at -22.85%, Theta Fuel (TFUEL) at -17.98% and BitTorrent (BTT) at -17.65%.

For more info on crypto prices, make sure to read Cointelegraphs market analysis.

DeFi is the most dangerous part of the crypto world. This is where the regulation is effectively absent, and no surprise its where the scammers and the cheats and the swindlers mix among part-time investors and first-time crypto traders. In DeFi, someone cant even tell if theyre dealing with a terrorist.

Elizabeth Warren, U.S. senator

I argue that we are winning [the digital currency] race because of the sum of free-market activity taking place inside the U.S. regulatory perimeter with digital currencies and blockchain-based financial services. The sum of these activities are advancing broad U.S. economic competitiveness and national security interests.

Dante Disparte, head of global policy and chief strategy officer at Circle

Stablecoins can certainly be a useful, efficient, consumer-serving part of the financial system if theyre properly regulated. Right now, they arent. They have the potential to scale, particularly if they were to be associated with one of the very large tech networks that exist.

Jerome Powell, U.S. Federal Reserve chair

Bitcoin is not a good substitute for transactional currency. Even though it was created as a silly joke, Dogecoin is better suited for transactions. The total transaction flow that you do with Dogecoin, like transactions per day, has much higher potential than Bitcoin.

Elon Musk, CEO of Tesla

[Crypto] companies have the cash and have been bidding away very senior talent who only have one or two years of crypto experience with offers that they cannot turn down.

Adrianna Huehnergarth, engagement manager for Heidrick & Struggles

The beauty of crypto is that you can be based anywhere. There is this community approach regardless of where you kick-start a flywheel from.

Matt Zhang, founder of Hivemind Capital Partners

Cryptocurrencies cannot become a means of payment.

Sethaput Suthiwartnarueput, governor for the Bank of Thailand

Bitcoins price has been on a rollercoaster the past week. The coin saw prices as high as almost $51,000, while also visiting levels below $46,000, based on Cointelegraphs BTC price index.

According to a report from Delphi Digital, Bitcoins price could finish out the year trading relatively sideways. The firm noted the recent spike in stablecoin transactions as reason to be cautious. Much like the May 2021 price crash, current market conditions are defined by much higher than normal stablecoin volumes, presumably as investors exit BTC positions and enter into stablecoins.

The most likely path forward for BTC in the short term is choppy or sideways action, Delphi Digital stated. However, any major risk-off event in the broader market could negatively impact the leading digital currency.

Indian Prime Minister Narendra Modi suffered a Twitter account hack on Dec. 12. Although the nefarious party only had control of the account for a short period of time, they were able to send out a scam tweet from the account, proclaiming false news.

The hackers tweeted that India had picked up Bitcoin as an official currency a sizable lie considering the headlines El Salvador made in the lead-up to actually adopting BTC as legal tender in September 2021. The tweet sent out by the hackers included a lie about India purchasing hundreds of BTC, as well as an external link.

Modi also suffered a Twitter account hack in September 2020.

Hackers recently siphoned nearly $80 million in digital assets from crypto trading platform AscendEX. Estimates from analytics outfit PeckShield put the total number of stolen crypto assets at $77.7 million. The sum consists of $8.5 million worth of Polygon-based tokens, $9.2 million of Binance Smart Chain-based tokens and $60 million worth of Ethereum-based tokens.

The pillage affected the platforms hot wallet but not its cold storage amounts, as per a tweet from the crypto platform on Dec. 11. AscendEX also noted in the same tweet that customers who lost funds would be covered by the platform.

Coinbase, Kraken and several other crypto-involved companies received backlash from the United Kingdoms Advertising Standards Authority (ASA) for certain advertisements. The ASA claimed the ads did not adequately provide viewers with proper risk warnings, and that they preyed on viewers who lacked crypto expertise.

One ad from Coinbase Europe noted the large profit outcome an early Bitcoin investment would have yielded if held until 2021. The ASA pushed back on the ad, essentially saying it made it look like the future would hold similar profit potential. The ASA also pointed out that the ad lacked an explanation that the future does not promise the same rewards reaped in the past.

NFTs are here to stay and the arrival of the Metaverse is only set to make their appeal and use even more popular.

Because the crypto space is largely a challenge to central banks, at least in a lot of peoples minds, then anything that happens in banking and finance is interesting to us.

When it was finally time to take off the mask and get on the plane home, it was weird.

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SEC delays spot Bitcoin ETF decisions, Nike throws its hat into Metaverse arena, and a crypto exchange gets hacked: Hodler's Digest, Dec. 12-18 -...

Crypto-enthusiasts believe the digital currency could become closely interwoven with the energy industry of the future, improving ageing infrastructure downfalls as well as helping to reduce carbon emissions. So how will the magical virtual money help the fossil fuel and renewables sector in the coming years?

Texas, the home of many crypto start-ups, is seeing several new companies seek partnerships with Big Oil and state energy actors to integrate their operations into energy strategies for the next decade. The Bitcoin mining community believes that adding another electricity consumer to the already oversaturated system could help, maybe somewhat surprisingly.

Right now, the existing grid system Electric Reliability Council of Texas, aka ERCOT, provides electricity to around 90 percent of the state of Texas. But it is temperamental as it requires a careful equilibrium between supply and demand to function well. Its for this reason that crypto companies are suggesting that additional buyers in the system, that can take whatever amount of power is delivered to them at any time of day, will help maintain this balance.

Bitcoin miners could benefit from greater access to electricity, and the grid would benefit from the almost immediate responsiveness of the user. This is thanks to the ability of bitcoin machinery to turn on in a matter of seconds. Therefore, energy can be taken from and sent back to the grid as needed.

Senator Ted Cruz explained, If you have a moment where you have a power shortage or a power crisis, whether its a freeze or some other natural disaster where power generation capacity goes down, that creates the capacity to instantaneously shift that energy to put it back on the grid.

Innovations like these have arisen in response to dramatic failures in ageing U.S. infrastructure. Earlier this year, we saw the Texas electricity grid fail in response to a severe winter storm. At the same time, gas and water supplies were stalled, leading to significant energy shortages and, ultimately, in the loss of several lives. Although President Biden is currently pursuing a trillion-dollar infrastructure bill, this will only fix some of the problems and could take years to carry out. So, alternative solutions from start-ups seem increasingly appealing when looking at the alternative.

But this is not the first intervention we have seen from crypto start-ups in the energy sector. Tech companies in Houston, a digital currency hub, are recommending the construction of huge crypto-mines to run on renewable energy. It is estimated that digital currency mining uses around 0.5% of all electricity consumed worldwide or 7 times as much as Google. Therefore, switching away from fossil fuels to renewables would mean a dramatic reduction in the carbon footprint of Bitcoin and other currencies.

Tech company, Lancium, announced plans in November to construct Bitcoin mines in Texas, worth $150 million, to run on wind and solar power. As West Texas is part of the countrys wind belt and the state has good sun quality on average, it makes it the perfect location for this type of project. In fact, the region is expecting to double its sun and wind energy output within the next five years, encouraging greater interest in tech and energy partnerships.

Crypto-energy projects are already up and running in some parts of the country. In Wyoming, for example, the company JAI mines Bitcoin for itself and energy investors who want a piece of the action, running power mining rigs from electricity converted from gas flares. Gas that would typically be released into the atmosphere is, instead, captured and reused. The company, like many others, is now hoping to expand operations to Texas and other states.

At present, gas flaring contributes around 1 percent of global carbon emissions. As governments push for net-zero and companies strive to decarbonise their operations, a crypto-energy partnership could be just what the doctor ordered. A by-product of fracked shale, gas is flared because it is seen as unprofitable. But with increasing international pressure for Big Oil to reduce its carbon footprint, digital currency companies quickly came up with a way to reuse this gas to run their mines.

As investment figures in digital currencies are climbing, the worldwide electricity use associated with this mining system will continue to rise. Contributing a significant proportion of the worlds energy use, it seems only logical that crypto companies join forces with oil, gas, and renewables firms.

Whether running off waste gas and reducing emissions or contributing to the construction of major green energy projects, it seems that the two sectors will continue to cross paths so long as digital currencies maintain their recent appeal. However, the volatility of these types of currencies could deter energy companies from investing until their future becomes more certain.

By Felicity Bradstock for Oilprice.com

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Why Ted Cruz Wants Bitcoin Miners In The Lone Star State - OilPrice.com

I type d that tyitle twice because I knew it was wrong the first time. Still wrong. w/e.

Eight years ago today, in a now infamous, whiskey-soaked Bitcointalk post, a meme was born.

so ive had some whisky

actually on the bottle its spelled whisky

w/e

sue me

(but only if its payable in BTC)

Starting 2013 at around $15, the bitcoin price had just risen to an all-time high over $1,100 when the message was posted, and little did its author, GameKyuubi, know that while his then-current condition would prevent him from spelling correctly, the energy and passion behind his mindset would inspire millions of people across the planet to treat their satoshis like the precious assets they are.

The HODL meme is both as innocuous as it is powerful, and the sentiment behind the post is as true in 2013 as it is today in 2021. No, it is not an acronym for hold on (for) dear life, but indirectly it has taught us the most practical and overall most successful method for how to handle your bitcoin exposure. Presidents, senators, CEOs, congressional members and plebs alike all have signaled their ideal money financial strategy with these four little letters.

But what does it mean to HODL (or hodl), and why has it captured such a huge network of public figures praising and utilizing its name? In a surprisingly flawless use of spelling, capitalization and the English language, GameKyuubi finished the meat of his post by writing, In a zero-sum game such as this, traders can only take your money if you sell.

Within 10 minutes of the post going live, multiple responses to this newfound camaraderie appeared, culminating in a I AM HODLING! meme from 300 (the 2006 film) by user Piramida. Things move fast in the Bitcoin space, and by the turn of the hour, over 20 posts from Bitcointalk users referenced the misspelling, including a handful of posts prophetically shedding light on the memeability of HODLING.

It all just goes to show you that signal is signal, regardless of whatever temporary motor skill impairment might be occurring in the individual responsible for dispensing said truth.

WHY AM I HOLDING? I'LL TELL YOU WHY. It's because I'm a bad trader and I KNOW I'M A BAD TRADER

The liquid-encouraged humility of GameKyuubi is something we can probably all stand to relate to a bit more. Trading is hard, and the retrospective glances at historical charts can bring a very false sense of ease for the emerging retail day trader.

Blow-off tops and generational bottoms are easy to spot after the fact, and despite all of the loving warnings from experienced HODLers to first-cycle traders, at every inflection point, high and low margin traders alike get their liquidation emails or simply get stuck buying high and selling low. Again, trading is hard, and the very wonderful qualities that make bitcoin a decentralized market of true price discovery also make it susceptible for experienced market makers to sweep lows and find your stops, while also baiting the inexperienced to buy their exit liquidity with moon price predictions and other bull-trapping techniques.

The best strategy, as outlined by GameKyuubi, is just to simply hold your bitcoin, stack humbly and not worry yourself with the tax implications and the economic risks of attempting to time the selling of tops and try and catch knives on bitcoin's inevitable and iconic merry-go-round of volatility.

As it currently stands, bitcoin is regulated as a commodity, much like a typical security or stock option, and with each conversion between satoshis and dollar-denominated stablecoins comes a taxable event. By HODLing, not only do you not put your digitally-scarce bearer asset in the hands of the bigger-fish traders, you get to keep your bitcoin from ending up in the gullet of the two biggest market manipulating fish of them all; the IRS and the extended United States budget committee.

Limiting your exposure to stop-loss hunts and removing your bitcoin from centralized exchanges is not just good financial advice, it is an ethical and game theory necessity to avoid the pitfalls and disadvantages of legacy markets.

There was no option to remove your stock from the CME, NYSE or precious metal markets such as COMEX and actually physically hold the tokenized representation of ownership, and thus little to no ability to take responsibility for your assets in a self-custodial way, nor to perform an audit on actual circulating share supply. These technological issues have come up many times, with JPMorgan paying a $1 billion dollar fine, the largest financial fine in history, for spoofing silver markets, and of course, the now infamous naked short selling of $GME by Citadel, the hedge-fund behind the pay-to-order, zero-fee trading books of the Robin Hood brokerage app.

Of course, when GameKyuubi channeled their inner Nostradamus, the trading vehicles for bitcoin were vastly underrepresented compared to now, but the few that did exist were highly unregulated and even more prone to wild liquidation events in BTC-denominated volume, despite far less volume in USD terms.

Now, with meaty institutional interest and corresponding exchange-traded funds live across the world, the opportunity for veteran traders to get a piece of your economic activity has never been more ample. To HODL is to limit your exposure to not only the compounding, lossy inflation vampire of fiat central banking, but also to humbly sit on your hands and self custody your liquidity away from centralized failsafes and the exposed attack vector that is trying to trade on a public book.

...but you know what? I'm not part of that group. When the traders buy back in I'm already part of the market capital...

HODLing is not just a good idea for avoiding capital gains taxes, but also a fantastic method of keeping your mental health intact as we surf the waves of true price discovery.

Bitcoin is a free market that allows its users a unique but double-edged outlet from the madness of market opens and closes, un-auditable share supplies and exchange circuit breakers, for the price of a different beast; a 24-hour, we never close market. The opportunity costs of simply ignoring the real-time fluctuations and HODLings may not be transparently clear on your PnLs, but perhaps stunningly apparent in your quality of life.

For some, this is a revolution, for others, simply savings, but to all, Bitcoin should be viewed as a means to whatever end. And what better end than a head out of the Ichimoku clouds and far away from one-minute candlesticks?

Many of the economic benefits to the Bitcoin protocol simply are not being utilized until you take personal responsibility for your wealth. But wealth is health, and the simplicity of the HODL strategy is to find the perfect balance between exposure to healthy volatility, with the price historically trending up, without letting your satoshis out of your personal sovereignty.

To know that, no matter what decisions elected (or unelected) officials make overnight, that your share of the network is mathematically secure this is to know a financial nirvana not before available to humanity. Take advantage of the orange-colored lifeline and get off the ride of the fiat rat race. If you find the nausea of the ride exhilarating, by all means, trade away, but never, ever, let your main bitcoin leave your HODLing grasp.

To paraphrase a man who took his alias from this very meme, American Hodl, ...HODLing bitcoin is very simple, but it's not easy, it's f----ing difficult.

And while one must agree it is difficult to find the maturity to HODL, the mechanisms of a proper cold storage solution combined with the eternal wisdom of that time in the market is greater than timing the market continues to drive the simplest solution to the bitcoin game; stay humble, stack sats.

Zoom out and realize that the seemingly many opportunities to find a few percentage points of alpha in properly timing bitcoin's price swings will simply round themselves away over time. We all like to hound the charts and news aggregates for any hint of what comes next, but those who have kept their heads down, dollar-cost averaged and perhaps momentarily increased their savings allocations during red days have come out significantly ahead over the last halvening epoch.

The compounding annual growth rate of bitcoin against the dollar is quite literally unprecedented in historical asset markets since the launch of the Bitcoin network just four years before the HODL meme was born.

It is a simple act of rebellion from our fiat overlords, but the conviction shown from those who HODLed throughout the ebbs and flows of the highs and lows of a free energy market in true price discovery mode should inspire future HODLers of this emerging, disruptive technology.

March 2020 was perhaps our most recent and truest test of resolve, but it will not be the last. The price you pay to get access to such necessary volatility is exposure to moments that remind you that there are no circuit breakers in free markets. The gift you receive for paying that price, however, is the truly decentralized miracle of a digitally-scarce bearer asset that can actually give users ownership of a piece of Satoshi's immaculate conception.

If you have been HODLing along for the past eight years, you surely have felt the life-altering effects of the Bitcoin network. So, raise your whiskey, or actually, according to the bottle mentioned in the original post, your whisky, and toast to the mostly-articulated gospel of GameKyuubi, as our beloved HODL turns eight years old. It has served us all very well thus far; a rallying call for seasoned Bitcoiners to calm the nerves of young coiners.

If Bitcoin continues to grow and attract new users in the explosive ways it has thus far, then truly the best is yet to come for those who HODL.

This is a guest post by Mark Goodwin. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

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Eight Years Since The Meme Was Born, Were Still HODLing Bitcoin - Bitcoin Magazine

In 2021, Bitcoin went mainstream. Wall Street set its eyes on the world of crypto, with hotshot investors like hedge funder Paul Tudor Jones leading the pack; The Economist went from calling the cryptocurrency useless in 2018 to arguing that it belongs in most portfolios; tech CEOs Jack Dorsey and Elon Musk gamely crossed swords about Bitcoins merits at a conference run by an asset management firm. Popular opinion lags a bit: Many people still believe cryptocurrency is a giant, global get-rich-quick scheme. Others simply dismiss the entire thing as a speculation-driven fad in the best case, a criminal enterprise in the worst. But amid the noise, the enthusiasm, and the hype, we might be losing the most important story: the way cryptocurrency is changing lives in the developing world.

Take for example, Cuba, a country where internet penetration went from less than 40 percent in 2015 to an estimated 70 to 80 percent today. Like most people, Cubans want to buy things and sell things onlinebut, unlike most people, they cannot buy anything online using a debit or credit card. Due to US sanctions, ordinary Cubans find themselves cut off from the global financial system: They cannot start a Spotify subscription, buy a domain name, or pay for a website-hosting service using a card. This means that if Cubans wish to partake in online commerce, particularly with another country, they have to use cryptocurrencies. And where there's a need, there's a way. Cubans have found solutions such as Bitrefill, a site that sells gift cards from Spotify and other companies for cryptocurrency. Data from Bitrefill for June 2021 shows that four times as many people buy Cuban digital products (such as Cubacel phone top-ups) using cryptocurrencies as buy similar US products, on a population-adjusted basis. Crypto has deeply penetrated the country to the extent that Cubas Communist Party, a conservative Marxist institution not known for its technological savviness, has instructed the Central Bank of Cuba to regulate the use of cryptocurrencies and to study how they can be used to help the government avoid US sanctions. Paradoxically, officials in the US State Department are rumored to be looking into how cryptocurrencies can be used to set up remittance networks that bypass the hefty taxes extracted by the Cuban government.

While crypto adoption in Cuba has been a bottom-up phenomenon, in El Salvador Bitcoin has been proclaimed legal tender by the countrys controversial president, Nayib Bukele. President Bukele claims that the government-sponsored Bitcoin wallet already has more users than the entire Salvadoran banking system, potentially throwing a lifeline to thousands of unbanked individuals. These Bitcoin wallets operate partly on the Lightning network, a system that allows for cheaper and faster cryptocurrency transactions. You can now pay instantly with Bitcoin in every Salvadoran McDonalds and Starbucks, which certainly sounds futuristic and exciting. Still, Bukele has been accused of performing a reckless maneuver to transform the country into a haven for Bitcoin-rich entrepreneurs or even outright criminals, and polls consistently show a majority of Salvadorans fretting about having their salaries paid in volatile bitcoins. Whether Bukeles crypto gambit will go down in history as the masterstroke of a modernizer or the folly of an autocrat still remains to be seen.

Further south in Venezuela, Bitcoin is slowly becoming an integral part of the economy. Due to currency controls, Venezuelan banks are not connected to the rest of the world, and therefore Bitcoin is used to move value in and out of the country using peer-to-peer markets where people can easily exchange Bitcoin for cash. The impact of these markets was demonstrated by a natural experiment in 2019 when, during a massive electricity outage in Venezuela, the Bitcoin-trading volumes across all of Latin America tumbled significantly. Today peer-to-peer crypto markets have been widely acknowledged as a key component of the Venezuelan foreign exchange market.

But the real leader in Bitcoin trading is not Latin America, but Sub-Saharan Africa. UsefulTulips, a website that tracks peer-to-peer Bitcoin trading across the world, now reports that trading volumes in Sub-Saharan Africa are currently equal to those in North America and will soon exceed them. Observed volumes are on the order of $20 million a day, but the true figures are likely to be multiples higher. In countries such as Nigeria, the government has imposed strict capital controls, and moving value across borders can prove next to impossible. It is not surprising that people in Africa are increasingly using cryptocurrencies for international transactions.

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We All Need to Stop Only Seeing the Dark Side of Crypto - WIRED

For the first time in the history of Cuba, the U.S. Dollar (USD) has lost value to another currency, living entirely on the internet without an army to back it, Bitcoin. The cryptocurrency has been trading at a premium against the United States currency in cash.

Related Reading | Turkish Lira Crashes: Bitcoin Freedom Vs. Fiat Currency Monopoly

As reported by Alex Gladstein, Chief Strategy Officer for the Human Rights Foundation, and Enrique Yecier, a Cuban citizen, via their Twitter accounts, the historic shift in currencies values extend to the main cryptocurrencies, Bitcoin, Ethereum, and stablecoin Tether, a digital currency pegged to the U.S. Dollar.

Due to the political tensions between the U.S. and Cuba, the island has been cut off from the international financial system and its payment rails. At the same time, the North American country has seen one of the biggest migrations from Cuban citizens.

This has created a situation where a lot of Cubans rely on remittances sent by their families abroad, but the national methods to receive or send a U.S. dollar transaction always affect the citizen. Therefore, crypto payments with Bitcoin and other coins, without the intervention of a third party, and more efficient in terms of fees and time.

In addition, Cubans use digital assets to protect themselves against inflation and the depreciation of their national currency. As a result, according to local reports, businesses and merchants have begun accepting Bitcoin and other cryptocurrencies as payment methods.

The Cuban citizen that made the viral report on the value of Bitcoin surpassing the U.S. dollar on the island, Enrique Yecier, claimed the following on this historical phenomenon:

Complaining that in Cuba a dollar in crypto has surpassed the value of 1 dollar in cash, is like complaining that Bitcoin today costs more than 46 thousand dollars when a year ago it cost 23 thousand. If there is someone doing things wrong, it is not BTC.

Cuba seems to be slowly, but surely moving into greater Bitcoin and crypto adoption. Per an AFP report, the national government granted merchants a license to operate with these digital assets back in August.

The measures fall into regulation 215, the report claims, issued by the Central Bank of Cuba. The new rules have been validated since September 15th and are aimed to regulate the use of cryptocurrencies for commercial transactions.

The country is still far from occupying a relevant spot in terms of adoption, as noted by Chainalysis in its 2021 report. The top ten countries with the most Bitcoin and crypto adoption have one thing in common, most are facing a high inflationary economy or a military conflict, as demonstrated by the inclusion of Argentina, Ukraine, Venezuela, Afghanistan, and others.

According to Yecer, Bitcoin its not the most valuable digital asset on the tropical island. This position goes to TRX (around $0,081162) which can go for as much as 8 CUP per token when a fair price should be around 6.15 CUP, the Cuban citizen said. Apparently, a lot of Cubans begin their crypto journey on the TRON ecosystem, thus the premium.

Related Reading | Bitcoin Bearish Signal: Hashrate Drops Over 20% In Last 24 Hours

As of press time, Bitcoin (BTC) trades at $46,797 with sideways movement in the past 24 hours.

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How Bitcoin Became More Valuable Than The US Dollar In Cuba - bitcoinist.com

A Paraguayan bill seeking to regulate the trading and mining of Bitcoin and cryptocurrencies in the country passed the Senate on Thursday. Senator Fernando Silva Facetti, a co-author of the bill, said on Twitter that the legislation now heads to Paraguays Chamber of Deputies, where it will be debated in 2022.

The bill does not make bitcoin a legal tender in Paraguay. In July, Bitcoin Magazine obtained an exclusive look into the draft bill through a conversation with Paraguayan Congressman Carlitos Rejala. The legislation hinted at increased regulatory security from the countrys regulators regarding bitcoin mining and an overarching goal to offer investor protections from businesses offering bitcoin services.

With this we want to welcome the innovation of cryptocurrencies in Paraguay to the world, Rejala told Bitcoin Magazine at the time. This is the result of a very strong and arduous teamwork of many experts in the field, both local and foreign.

However, it isnt clear yet whether the lengthy and complicated Paraguayan bill will welcome Bitcoin and cryptocurrency innovation.

While El Salvadors final bill was just a few pages of text representing easily the most favorable, accommodating Bitcoin legalese ever passed, the early draft of Paraguays legislation set a different tone, Bitcoin Magazine reported in August, highlighting how Paraguay chose to stand in stark contrast to the Central American countrys friendlier legislation.

The bill approved by the Paraguayan Senate states that individuals or companies interested in bitcoin mining will have to request authorization for industrial energy consumption. However, after the approval is granted, the entity would still need to go further and apply for a license to mine bitcoin.

According to the bill, bitcoin miners could enjoy thousands of megawatts that Paraguay currently has as surplus if it comes under the countrys regulations. The text noted that the industry would be jointly regulated by Paraguays Industry and Commerce Secretariat, National Securities Commission, Anti-Money Laundering Office, and National Electricity Administration.

Regarding transactions with crypto assets, the National Securities Commission will establish the registration requirements for intervening agents for negotiation, compensation, custody, and intermediation in the securities market, Silva Facetti said in another tweet.

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Paraguays Bitcoin Bill Passes the Senate - Bitcoin Magazine