Bitcoin‘s price continues to suffer after one of the most severe price crashes in its history this week, with the wider crypto market finally stabilising.
Ethereum (ether), Cardano (ada) and dogecoin have all remained relatively calm overnight, after Elon Musk once again committed his belief in the latter. It followed the statement – in the form of emoji – that Tesla would not be selling its substantial bitcoin holdings.
The initial crash on Wednesday was prompted by an announcement from regulators in China that cryptocurrency payments would be banned, though individuals in the country will still be permitted to own cryptocurrencies.
The news saw bitcoin fall below $31,000 – less than half the all-time high price that it reached in mid April – before recovering to around $40,000 on Thursday.
Cryptocurrency experts and market analysts appear divided over whether this crash is similar in magnitude to the one seen in 2017/18, or simply a price correction on the way to new record highs in 2021. We’ll have all the latest updates, as well as a Q&A session where you have the chance to ask our experts anything.
Ethereum to change technology underpinning its cryptocurrency to dramatically cut its energy use
Much of the concern over cryptocurrencies’ impact on the environment has been about “proof-of-work” – the technology that requires vast numbers of miners to undertake complex (and pointless) calculations to ensure that the system remains safe, and to get themselves bitcoins.
An alternative is “proof-of-stake”, which does away with that requirement and is vastly more energy-efficient. Switching to that could help stop the significant damage to the environment done by cryptocurrency mining.
Which is exactly what ethereum plans to do. “The Merge”, as it calls the switch, will take it from the energy use of a mid-sized country to that of a small town, according to those behind it.
Andrew Griffin21 May 2021 13:58
Market remains fairly flat
As this grab from CoinMarketCap shows, most coins are somewhere between flat and a little down over the last 24 hours. Bitcoin is up, slightly, though still a long way below where it was before this week’s dramatic crash.
The market as a whole is up 0.43% over the last day, and the trading volume has dropped significantly, down more than 46%.
That counts as relative calm in a week that has been dramatic and wild, even in the frenzied world of cryptocurrencies.
Andrew Griffin21 May 2021 12:25
Crypto experts answer your questions
Is this the end of the great 2020/21 rally? Is it just a dip on the way to new all-time highs? And what impact will it have on the industry in general?
Andrew Griffin21 May 2021 10:03
How bad is bitcoin for the environment really?
There’s been a lot of discussion following that FT article today about how much energy the bitcoin network consumes and what the implications of this are for the environment.
While there are a large concentration of crypto mines in coal-burning regions of China, there are also an increasing number of green solutions that source electricity from renewable sources.
I’ve visited a couple of 100 per cent renewable operations in recent years – one in Iceland and one in Norway – and they are cheaper, greener and more efficient than their fossil fuel-guzzling counterparts.
You can read more about bitcoin’s environmental impact right here:
Anthony Cuthbertson20 May 2021 18:54
Bitcoin whales Tesla and Microstrategy trade memes
The CEOs of the two companies with the largest bitcoin holdings have been exchanging messages on Twitter.
Microstrategy holds more than 92,000 bitcoin in its corporate coffers, while Tesla has roughly 43,200.
The exchange between the two bosses came after Microstrategy CEO Michael Saylor responded to an article in the Financial Times today discussing bitcoin’s “growing energy problems”. Saylor countered the arguments in the story by calling bitcoin the “most efficient technology for converting energy into prosperity we have yet to devise.”
Musk responded, in typical fashion, with a meme of a guy pointing to his reflection in the mirror, with the text: “It’s not the bull market. You really are a genius.”
Anthony Cuthbertson20 May 2021 16:34
Crypto figures share ‘diamond hands’
Elon Musk wasn’t the only high-profile bitcoin investor to share diamond hand emojis.
The symbols, which illustrate the intention of a crypto or stock holder to not sell, have been widely shared by cryptocurrency advocates across social media.
Among them were the Winklevoss twins, who are probably best known for accusing Mark Zuckerberg of stealing their idea for a social network when they were fellow students at Harvard University. They have since gone all-in on cryptocurrency, setting up the Gemini exchange and adding vast amounts of bitcoin to their personal fortunes.
They also both still have laser eyes on their Twitter profile pics, which indicate their belief that bitcoin is heading towards $100,000.
Tyler Winklevoss followed up his tweet with this comment: “Six months ago, $37,000 would have been a dream come true. Perspective is crucial for a HODLer.”
Anthony Cuthbertson20 May 2021 13:37
Crypto analysts unpick bitcoin price crash and broader market chaos
After a chaotic day for all cryptocurrencies on Wednesday, the relative calm on Thursday morning has given market analysts a chance to unpick what just happened.
Vincent Chok, CEO of crypto firm First Digital Trust, says he is “not really…
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