Tesla and SpaceX founder Elon Musk began developing the cryptocurrency Dogecoin. He is confident in its prospects. On his Twitter, Musk said he did not see a future in bitcoins. Tesla stopped accepting payment for electric cars in bitcoins. Among the main reasons: excessive energy consumption of cryptocurrency. The company wants to develop towards new, much more effective developments. There has been a lot of criticism in the comments that
Musk is advertising his cryptocurrency, Dogecoin. Despite these remarks, the value of bitcoin suddenly dropped to a minimum of $ 45,700. This is the lowest figure since March 1. Cryptocurrencies typically use decentralised control instead of centralised digital currency and central banking systems, but what will happen to bitcoin and the future of the cryptocurrency Musk.
Bitcoin exchange rate for the last day
From meme to cryptocurrency: the way of Dogecoin
2018 – a year of the Dogecoin
The cryptocurrency Dogecoin was created in 2013 and mentioned in a humorous tweet by Ilona Maska. Dogecoin – named after the dog breed Shiba-inu. At the time of publication, the value of this digital currency was $ 0.72. Market capitalisation (total value of all circulating units) reached 92 billion dollars and crypto trading signals show it.
Dogecoin is a cryptocurrency named after a meme. Business Insider reports that one transaction requires 6,000 times less energy. 75% of the deductions take place in China, where most of the energy is produced by coal-fired power plants.
Of course, Ilona Mask’s advertising is important for Dogecoin. In February 2021, the businessman bought several coins for his son. Immediately the price jumped by 25%. Musk called Dogecoin a popular cryptocurrency and compared the logo to the famous “Dog barking at the moon.” On May 8, Dogecoin turned out to be the best investment in the world for the last six months. The cost has increased 260 times.
“We are concerned about the rapid increase in the use of fossil fuels for bitcoin mining and transactions, especially coal, which has the worst emissions of all fuels,” said Maska.
How Dogecoin works
What is fast energy use
Cryptocurrency works through computers. Technology competes for complex mathematical problems and at the same time uses a huge amount of energy.
“Environmental issues are now an extremely sensitive topic, and Tesla’s move could signal a wake-up call for businesses and consumers who use bitcoin who have not yet considered its carbon footprint,” said AJ Bell analyst Leith Khalaf.
Bitcoin uses more energy than Argentina. Transactions in total consume about 121.36 terawatts per year. Bitcoin is one step away from Ukraine, between Norway and Argentina. Norway consumes 122.2 terawatts per year. Information provided by Cambridge University and the International Energy Agency.
National energy use by University of Cambridge Bitcoin Electricity consumption index
However, even if the interest in Dogecoin did not increase due to Mask’s tweet, another situation casts doubt on the strength of PR from the businessman. In the comedy show “Saturday Night Live”, Musk called this cryptocurrency “vanity”. After that, Dogecoin lost more than a third of its price. Then, after another tweet, Mask on improving transactions, Dogecoin rose by 20%.
Bitcoin fell 17% after Mask’s tweet, while Dogecoin rose. The world’s largest cryptocurrency fell by almost 70% during the year, and more than 1000% exceeds its 2020 low – 3850 dollars. Maybe it’s not PR Mask, but the fact that bitcoin is losing relevance?
“I don’t think it’s all sold out just because of this news. It was a straw that broke the camel’s back in terms of increasing the risk of a sell-off,” commented Jeffrey Van. This is the head of the American state of Vancouver Amber Group, a provider of cryptocurrency services.
Binance’s spokeswoman told Bloomberg that the company takes its legal obligations seriously, interacts with regulators, and most importantly in this situation – does not comment on specific requests.
The second-largest cryptocurrency, Ethereum, fell 4%. Record level: 4380.64 dollars.
What is the most important thing to know about cryptocurrency?
Best crypto signals demonstrate that cryptocurrencies operate through an asymmetric encryption mechanism. There are about a thousand of them in the world, but we have told you about the most popular. This type of asset is different from the usual money or other financial assets. No bank or permitting authority is required for storage. Everything is stored in a personal e-wallet. By mid-2011, the bitcoin exchange rate had hardly risen and there was no excitement. When people began to learn about the property of conducting transactions anonymously without intermediaries. At first, it seemed that cryptocurrency was needed for settlements, then for withdrawal of capital and shadow operations. This gave a huge surge: in 2013 – $ 1,000 apiece, in 2017 – $ 20,000.
A Bitcoin comparison
Advantages and disadvantages of Cryptocurrency
- growing acceptance and use;
- decentralisation of the system;
- lack of a coin issuance center;
- wide range;
- low commission;
- poor margin and limited acceptance;
- unregulated and unsupported.
It took several years for global cryptocurrency to be approved. Even the well-known investor Warren Buffett called it all a “bubble” at first: “It doesn’t make sense. This thing is not regulated. It’s not under control. It’s not under the supervision [of] any…United States Federal Reserve or any other central bank. I don’t believe in this whole thing at all. I think it’s going to implode.” As of 2021, the capitalisation of the cryptocurrency market continues to grow rapidly. Citibank CEO Thomas Fitzpatrick predicts incredible growth in cryptocurrency this year. He predicts the price could reach $ 300,000 per unit. Interest in cryptocurrencies is not declining, despite one of the biggest crises in the last 50 years in 2020. Virtual money is only gaining momentum and will soon become part of the world economy at the level of ordinary currencies. The question is not even in the high price but in the speed of cryptocurrency appreciation.
The above information does not constitute any form of advice or recommendation by London Loves Business and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Appropriate independent advice should be obtained before making any such decision.