7 days from the world of Blockchain

7 days from the world of Blockchain

The maelstrom of events in the world of Blockchain and cryptocurrencies can be viewed as a blockbuster with an unpredictable plot, not to mention the finale. A series of events, which in some cases has global consequences. And so, let’s take a look at the most interesting and significant of them.

  • And Elon Musk wants to buy Twitter and integrate Dogecoin

Indirect criticism of Twitter by Elon Musk has been growing for several weeks. The businessman considers the platform deeply undemocratic. He is not alone in this opinion. This is also proved by the survey he started on this topic on Twitter.

The problem, according to him, is the violation of the principle of freedom of speech. When Musk asked his followers what they should do in this situation, the answers were very different. Musk’s own proposal has become especially popular: to create a new platform that will solve serious problems.

Similar aspirations have already developed in various circles and have led to the emergence of several new short message services, such as Gab, Gettr or Truth Social, created by Donald Trump.

However, so far none of these platforms has been able to truly replace Twitter, so Musk came up with another idea. He just wants to take the place of the main face of Twitter. To this end, he recently acquired 9.1 percent of the company’s shares.

The $2.89 billion investment makes Musk the largest shareholder, but playing no role in the company. Three days ago, he wanted to change this, and came up with a proposal for a complete takeover of Twitter.

For a price of $43 billion, Musk now wants to acquire 100 percent of the company’s shares. Currently, the stock price is $45.08.

To make Twitter the way Elon Musk wants it to be, some changes need to happen. Musk wants to reveal the source code of Twitter, and integrate payments with Dogecoin. This measure can help restore trust in the platform.

According to Musk, the possible acquisition of Twitter will serve as an investment in a free society, while, according to his own statement, it will not bring any monetary benefit.

Many in the global community believe that an agreement between Twitter and Musk will not be reached.

Therefore, the founder of Cardano, Charles Hoskinson, came up with a proposal to create a decentralized alternative to Twitter. This will prevent government interference in the activities of such a company once and for all.

  • Mastercard is developing a cryptocurrency credit card together with Nexo and DiPocket

The Mastercard credit card company cooperates with two crypto companies. The trio is developing a cryptocurrency credit card together. This brings a completely new feature to the market.

1Users will not only be able to use their own cryptocurrencies to pay via credit card.  They will be able to deposit their cryptocurrencies as collateral for a loan.

The new product is available in both physical and virtual form and has already been launched in 29 European countries. Visa and Mastercard have been in the race to adopt cryptocurrencies for some time.

While Visa has recently achieved faster development, Mastercard has now managed to gain an advantage in new functionality. The company wants to accelerate its developments in this industry.

  • Brazil to launch pilot project with CBDC by 20221

While interest in CBDC is growing in many countries, Brazil has already announced the launch of its own CBDC. The digital rial will be linked to the country’s fiat currency and will be available to the public by the end of 2022.

The South American country will then launch a pilot project, which is expected to be followed by full CBDC integration. Sweden is also already implementing a pilot project with an electronic crown. Although the authorities recognize many of its advantages, the introduction of a currency requires a lot of money. The question of whether the benefits are big enough is still being debated.

Japan is also working on creating a CBDC. The digital yen successfully passed the testing stage on March 22. Another stage of testing will begin in April. It expands the project, including additional functions, and is designed to find and eliminate flaws and errors.

Although central bank digital money is extremely popular in many states, it is seen as a tool to strengthen supervision and suppression by the authorities. For example, CBDCs can be used to introduce negative interest rates effortlessly.

However, the Japanese central bank denies that it will ever pursue this goal. The public will perceive such an idea too negatively.

This assumption is not accidental. Most recently, the Japanese central bank warned about the dangers of cryptocurrencies and called on the G7 to react quickly to prevent the cancellation of the current fiat system.

  • The cryptocurrency market in mid-April

For the last seven days, according to Coinmarketrate.com , the Bitcoin exchange rate has dropped from over $43,000 to just under $40,400. The Ethereum price movement is almost identical. Currently, the cost of ETH is about 3,040 US dollars.

The Bitcoin exchange rate is from April 10 to April 17. Source: Coinmarketrate.com
The Bitcoin exchange rate is from April 10 to April 17. Source: Coinmarketrate.com

Some cryptocurrencies sooner or later managed to separate themselves from the slightly negative price of bitcoin. These include Shiba Inu, Bitcoin Cash, Monero, Apecoin and EOS.

The clear winner of the week was the Cyber Network, a DeFi trading platform on which you can also earn passive income by providing liquidity or owning your own KNC cryptocurrency. Over the past seven days, KNC shares have risen 25 percent.

Audius also showed good results, gaining 10.7 percent over the same period and entering the top 100 cryptocurrencies by market capitalization.

  • Bitcoin mining growth, despite a decrease in activity on the chain

Current data obtained from the blockchain analytics provider Glassnode shows that the number of transactions in the Bitcoin blockchain is declining, but competition among miners is growing, and mining is becoming more expensive and time-consuming than ever. A contradiction that is not so easy to explain.

In addition to a noticeable decrease in the number of transactions, the fall in the value of BTC is also clearly visible. Shortly after the asset overcame the important resistance threshold of $45,000, the price began to decline, and the value returned to the $40,000 mark.

Of course, this drop can be explained to a certain extent by profit-taking, which quite a few investors realized after overcoming the threshold of 45,000.

However, much more dangerous than these revenues are low transactions – only 225,000 per day and the accompanying low commission income, which has fallen to a historic low since May 2021.

In the current market, it would be necessary to observe a significant increase in the number of users and, accordingly, transactions, but this does not happen with a Chunk. There are no signs of recovery here, let alone any signs of growth.

But, despite the current drop in the price of BTC and a record low level of commission income, competition between miners does not weaken. In fact, a drop in prices and a decrease in demand, as well as a decrease in revenue from fees, should be followed by a decrease in activity in the mining industry, but this is not the case at all.

To unravel the current blocks of the BTC, it currently requires about 122.78 Zetta hashes, which is an incredibly high value. Or, as Glassnode vividly explains in its report, all the people currently living on Earth, that is, 7.938 billion people, would have to spend ten minutes guessing 15.5 trillion out of 256 hashes. Experienced mathematicians can handle five of them in ten minutes.

If we look purely from the point of view of costs, about 1,173 kilowatt-hours are currently spent on solving one Bitcoin block. Considering that household electricity prices are currently around 45 cents per kilowatt hour, this amounts to more than $500. In addition, the cost of computer equipment is several tens of thousands of dollars.

Of course, on the other hand, there is a reward of 6.25 BTC for the first one to calculate a new block. And if you calculate even its low cost – 35,000 US dollars multiplied by 6.25 BTC, then you still get a profitable business for miners.

This explains why neither the fall in the value of Bitcoin, nor the low level of transactions and low commission income could slow down mining activity. On the contrary, the competition between miners continues to grow.

The net electricity consumption that currently has to be used to unravel Bitcoin blocks is about 125 terawatt hours per year, which is about 0.6% of global electricity consumption. This is more than some branches of heavy industry consume and more than entire industrialized countries consume in a year.

In some countries, the electricity consumption of Bitcoin miners is so high that the entire power supply system partially fails. In this regard, Iran, among others, has completely banned the mining of cryptocurrencies.