- Bitcoin (BTCUSD on xStation5) drops 5%, other digital currencies follow
- Bitcoin is the most energy-consuming cryptocurrency according to ING
- Litecoin (LTCUSD) approaches a crucial support line being a potential opportunity to enter a long
It seems that after a period without heightened volatility across major digital currencies things are changing with all on them falling today. Bitcoin is already down more than 5% and it’s hovering around $5300. Let’s notice that BTC failed to establish its new all-time high above $5800 so a corrective move appears to be natural. A quick look at the snapshot below illustrates that investors are interested in cashing in on their recent longs.
Moving on, it’s nothing new that the cryptocurrency industry is strongly energy-consuming which trims profitability of mining virtual currencies. However, it’s important to know how Bitcoin and Ethereum (ETHUSD), being the most famous digital currencies, stack up against one of the most common electronic payments’ provider Visa. According to ING Bitcoin’s energy costs stand in stark contrast to payment systems that have the luxury of working with, trusted counter-parties e.g. Visa takes about 0.01kWh (10Wh) per transaction which is 20000 times less energy than Bitcoin uses (200kWh). In order to catch a reference point the bank suggested that “200 kWh is enough to run over 200 washing cycles and it’s enough to run a entire home over four weeks, which consumes about 45 kWh per week costing €39 of electricity (the Dutch price)”.
As a result we may assume that Ethereum could be used more broadly in electronic payments as it needs much less energy to make a transaction done, it’s still much above the level demanded by Vista though. Hence, while Bitcoin has been the most famous cryptocurrency so far, one could draw conclusions that Ethereum could offer decisively less energy-consuming method of payments which could bode for the price in the aftermath.
Litecoin (LTCUSD) retreats from above $60 and could near an upward trend line which in turn could offer a buying opportunity, however a bullish candlestick would have to be drawn before entering a long. Source: xStation5