Crypto Brief
Coinbase's bitcoin cash trading rollout cost investors $5 million, lawsuit says
Coinbase's botched roll-out of bitcoin cash trading cost investors more than $5 million, a lawsuit alleges.
Coinbase is the leading U.S. marketplace for buying major cryptocurrencies such as bitcoin. After the cryptocurrency split into bitcoin and bitcoin cash last summer, Coinbase said it would make the offshoot coin available on its site by Jan. 1.
Then the company surprised everyone by trying unsuccessfully to launch bitcoin cash trading earlier, on Dec. 19. As bitcoin cash prices soared that day, many outside investors speculated that Coinbase employees had been tipped off to the early start of trading.
On Thursday, lawyers filed a lawsuit seeking class action status in the Northern District of California on behalf of customers who say they were damaged by "negligence in the handling of the launch."
The San Francisco-based company said it would not comment on the case.
"Our priority has always been, and remains, maintaining our customers' trust," Coinbase said in a statement. "We go to great lengths to provide comprehensive information needed to make investment decisions and to safeguard the integrity of our platform, and we hold ourselves to the highest standards of conduct." Full article here.
Bitcoin's Dip Below $11K Puts Bulls on Shaky Ground
Having failed to scale a major resistance level on Monday, bitcoin (BTC) fell below the $11,000 mark soon before press time.
CoinDesk's Bitcoin Price Index (BPI) rose to an intraday high of $11,660 yesterday, yet closed the day (as per UTC) below the inverse head-and-shoulders neckline resistance of $11,600. The failure to hold above the critical resistance has not gone down well with the market as the cryptocurrency fell to a low of $10,890 today.
The rejection at the inverse head-and-shoulders neckline resistance and today's break below $11,000 look to have weakened the bull case on the technical charts, and a major positive move looks increasingly unlikely in the short-term. Full article here.
Here’s how much it costs to mine a single bitcoin in your country
So-called bitcoin mining is a hot topic of in the cryptocurrency world.
That’s chiefly because of the rising electricity costs associated with creating new digital coins.
Lately, miners have flocked to Iceland, known for its relatively moderate climate and the abundance of hydropower. In fact, bitcoin mining energy consumption is set to exceed private consumption, an energy expert told the BBC. And according to the Bitcoin Energy Consumption Index, global energy usage of all bitcoin mining already is equivalent to the power uptake of the country of Denmark, with a population of 5.7 million, and will eventually approach Bangladesh, a country of 163 million people.
In search of cost savings, cryptocurrency miners traverse the globe to take advantage of cheaper energy. Those virtual miners perform a crucial function within the blockchain, or the decentralized ledger technology that underpins most cryptocurrencies, by solving complex problems to validate transactions on the network, In exchange for this function, which powers miners are rewarded with bitcoins.
However, because bitcoin’s protocol operates on a proof-of-work basis—meaning it requires an expenditure of computing power—both the power and difficulty of problems increase as miners approach the maximum number of bitcoin’s meant to exist at 21 million. Currently, there are about 16.9 million bitcoins in existence. Full article here.
Where Will Bitcoin Be in a Decade? $100 Is More Likely Than $100,000, Says Harvard Economist
A decade from now, will one Bitcoin be worth $100 or $100,000? According to Harvard professor and economist Kenneth Rogoff, the former is way more likely.
Rogoff, the International Monetary Fund’s (IMF) former chief economist, told CNBC that Bitcoin’s “actual uses as a transaction vehicle are very small”—certainly when compared with its utility for money-laundering and tax evasion, which regulators around the world are trying to suppress.
“I think Bitcoin will be worth a tiny fraction of what it is now if we’re headed out 10 years from now,” he said. “I would see $100 as being a lot more likely than $100,000.”
It’s fair to say that Rogoff does not share the sentiment of some in the cryptocurrency community, who think Bitcoin will head “to the moon.” Full article here.
A Small American Town Wants to Put a Moratorium on Bitcoin Mining
In Plattsburgh, a town of 20,000 people in New York state, an old paper mill in the city recently flipped into a Bitcoin mining operation—a sign of the times on par with Walmarts transitioning into online shopping fulfillment centers.
Now, Plattsburgh could become the first municipality in the US to put a moratorium on Bitcoin mining. According to a proposed law tabled by the mayor on March 1, the city is seeking to put an 18-month moratorium on any new Bitcoin mining operations while new regulations around zoning and electricity use are drafted. A public meeting to discuss the proposal is planned for March 15.
The main impetus for the proposed moratorium is electricity use. Bitcoin mining secures the public ledger at the heart of the system and involves dozens—or hundreds, or thousands—of computers crunching math problems in a race to find a particular value. These machines need to run 24/7, they run hot, and they eat up a ton of electricity. This has frustrated environmental advocates, and with the proposed law in Plattsburgh on the table, the electricity debate about virtual currency is about to get very real. Full article here.
GMO Has Mined Millions of Dollars in Bitcoin Already
The cryptocurrency mine launched by Japanese IT firm GMO Internet has generated more than $3 million in revenue over the past three months.
According to a mining report released on March 5, the publicly-traded company disclosed that it had generated 23 BTC, 93 BTC and 124 BTC in December, January and February, respectively. All told, those coins are worth approximately $2.67 million as of press time according to CoinDesk's Bitcoin Price Index.
In addition, the firm further reported a total mining income of 525 bitcoin cash during the same period, an amount valued at $654,000 at current prices. All told, GMO's mining venture brought in a little over $3.3 million in revenue within months since its start.
That said, the data provided by GMO doesn't offer a complete picture of the mine's financial status, including the cost at which those coins came. It's unclear whether the number of cryptocurrencies brought in exceeded operating expenses at any point during the three-month period.
GMO's report also detailed its growth in processing capacity.
With a most-recent hashrate of 108 petahashes per second (PH/s) by the end of February, GMO has set a goal of achieving 3,000 PH/s within this year. Currently, the bitcoin network boasts a hashrate of 22,125 PH/s, based on data published by Blockchain. Full article here.