Bitcoin price has gone up by 8.8 percent on May 25th after the push for ‘greener’ bitcoins supported the market sentiment- Tesla has been proactive in pushing the idea of Green Mining for bitcoins and Tesla’s Micheal Shayer led Bitcoin Mining Council for North America is successful in creating the curiosity and stability among Bitcoin traders.
In context of these recent development in the world of Bitcoin trading and investment, questions like What is Green Mining Bitcoins?, Is it the right time to invest in Bitcoins? will soon start popping out on the internet. So, time for us to dive into the world of cryptocurrencies and see if there is an actual investment opportunity for retail investors who are waiting to get into crypto currencies speculation game.
What is Green Mining Bitcoin?
Bitcoin turned out to be the greatest Investment opportunity in the human history, making people who invested as low as 10,000 dollars at the beginning of the wave into millionaires. All of this is possible because of the underlying blockchain technology, the only way one could acquire a bitcoin is to buy an already mined bitcoin or by actually mining for a bitcoin.
Bitcoin mining is a multi-billion dollar industry with relatively high power consumption. Bitcoin mining companies invest in huge server infrastructure for their blockchain mining operations. These infrastructure power consumption requirements are catered with cheap power from low-grade coal to maintain high profitability in Bitcoin (Blockchain) mining.
Green Mining Bitcoins is an environmental approach in mining bitcoins by relying on renewable energy instead of cheaper coal based power for their server operations. Bitcoin Mining is still one of the very highly profitable (hyper profitable) business, with more companies and countries accepting bitcoins and cryptocurrencies in general.
The idea of green mining might be for a noble environment cause, but in terms of money and investments the recent push for green mining bitcoin feels like a desperate attempt to revive the free fall of Bitcoin prices and build pseudo confidence among traders. In the long term Bitcoin mining would eventually become less and less profitable, as more and more Bitcoins are mined everyday. At some point, all these companies have to revert back to cheaper power to keep their businesses running. This idea of green mining stands merit when we are capable of making the renewable energy cheaper, maybe Tesla will take strides in this direction in near future. But as of now, it simply doesn’t hold any merit to support bitcoin prices in the long run.
Is it the Right Time to Invest in Bitcoins?
As discussed above, the rise in Bitcoin prices after the Elon Musk led Green Mining Bitcoin push should be more or less ignored. Bitcoin is currently trading in uncharted territories and we simply don’t have a way ti understand the price moves, everything involving Bitcoin prices and trades is purely speculative and driven by news flow and tweets from Elon Musk. In countries like India where we are seeing increasing cryptocurrency traders with desi cryptocurrency trading platforms. These platforms are yet in their nascent stage and not fully capable of bigger price moves like the recent free fall, this adds to the uncertainty around the cryptocurrency trading. While big investors and trading companies ca afford to go for these highly speculative trades, caution is strongly advised for retail investors against trading and investing in bitcoins under present circumstances.
Stay tuned for more updates from the world of Cryptocurrencies by Thought scroll.
