Funny to see that Crypto Currency is everywhere in the news. What makes money real? Honestly, it is the acceptance of currency. With Elon Musk talking about Bitcoin and Dogecoin we have seen the growth of these two currencies jump through the roof. This shows the weight of a brand when it comes to marketing. With just a mention of cryptocurrency Bitcoin has doubled in value. If I spoke of cryptocurrency the boost to value would not of been seen. Being an social influencer shows how a campaign can be swung for personal gain.
Scientists from the University of Cambridge built a tool to calculate the energy costs of bitcoin. Using their energy model they found that bitcoin mining uses more energy each year than the entire country of Argentina. Cryptocurrency is the use of computing power to decrypt an algorithm. With enough computing power the more currency you can unlock. To me, this is not surprising.
The shortage of hardware has also been seen in the gaming world. In the gaming world high-end graphics cards are sought out to give the gamer a leg up from the competition. These cards have been sought out by miners due to their high processing abilities. In the world of Supply and Demand we can assume why searching for this hardware has brought the costs to an all time high. Others in the industry are saying that the energy usage for crypto such as bitcoin is a waste. As bitcoin has become less and less obtainable it has become the new lottery.
With the wider and wider acceptance of cryptocurrency will the energy consumption offset the value? There will be a day that cryptocurrency will become standard across countries. The value of this currency is not tied to any countries GDP or liabilities. Does this make it more valuable? With any investing there is a set of risks, for me I will hang onto my Dogecoin and wish that I invested in Bitcoin years ago.
Invest wisely!
JT