Mark Weaden
The entire cryptocurrency market falls towards $60,000 as the markets move away from new record highs
Since the start of October, the cryptocurrency markets have enjoyed a huge rise, with major currencies like Bitcoin and Ethereum soaring to new all-time highs. Solana, Shiba Inu, Elrond eGold, and many other currencies have enjoyed an excellent month and will be hopeful the current slump in the markets doesn’t last too long.
The world’s highest digital coin, and one of the biggest assets by market capitalization, has fallen towards $60,000 for the first time in over a month. Bitcoin is hovering around $60,000, where it has a great deal of support. Across the board, the crypto market has seen a near $200 billion dollar loss almost overnight.
What caused the drop in market price?
The news comes after yesterday’s announcement from China about cleaning up the nation’s crypto mining and handing out an expulsion to one of its party members. If it wasn’t clear enough already, China’s state planner, the National Development and Reform Commission, said they intend to clean up virtual currency mining in the country.
While this is speculative, China’s crackdown on Bitcoin mining from earlier in the year had a significant effect on market price. China has cited the amount of energy being used as the reason for banning cryptocurrencies, stating “causes large energy consumption and carbon emission. It has no active impact to lead industry development or scientific progress.”
Having said that, China has been pushing its native currency, the Digital Yuan. So, it’s difficult to know the true motivation behind the ban. Whether it was China or not, something has had a drastic effect on Bitcoin falling to around $60,000 and Ether falling to around $4,200 for the first time this month.
Bitcoin’s energy battle
A report released around the start of the year revealed the high energy usage of mining the Bitcoin cryptocurrency and more broadly speaking the high energy costs of Proof of Work (PoW) blockchain protocols. This has given rise to the fast-growing crypto hub in Texas, which offers excellent green-energy solutions.
Many crypto companies are actively trying to find green solutions, with some migrating from PoW protocols to Proof of Stake (PoS), which provide a far more energy-efficient mining process. The crypto energy question seems to be one of the only remaining issues the industry faces and certainly one that must be tackled as soon as possible.
