Myth of Money: New York Mining Ban, Arts DAO Mint and the latest in Crypto News
Welcome to this week’s edition of Myth of Money, a weekly newsletter on the digital asset markets read by 12,000+ investors.
Disclaimer: The following is not intended as investment advice. Do your own research.
Dear Investors,
On Friday, lawmakers in New York passed a bill to ban certain bitcoin mining operations that run on carbon-based power sources.
According to CNBC:
The New York bill, which previously passed the State Assembly in late April before heading to the State Senate, calls for a two-year moratorium on certain cryptocurrency mining operations which use proof-of-work authentication methods to validate blockchain transactions. Proof-of-work mining, which requires sophisticated gear and a whole lot of electricity, is used to create bitcoin. Ethereum is switching to a less energy-intensive process, but will still use this method for at least for another few months.
The bill awaits approval from Governor Kathy Hochul who either signs it into law or veto it. If this bill is signed, it could hamper the growth of the blockchain technology infrastructure. The domino effect of this bill could mean the end of United States-based bitcoin miners who currently account for 38% of the world’s mining efforts.
Lawmakers backing the bill are looking to curb New York’s carbon footprint by cracking down on mines that use electricity from power plants that burn fossil fuel. If this bill passes, bitcoin and other “proof of work” miners will be required to use 100% renewable energy.
What is Bitcoin Mining?
Bitcoin mining is the process of authenticating transactions on the Bitcoin network, with new coins being minted and given to miners for their efforts. This entices them to keep solving the transaction-related algorithms, supporting the overall system. The ratio of coins awarded per block decreases approximately every 4 years, a process known as the “halvening”.
The estimated cost to mine one Bitcoin is $7,000-$11,000, although some miners have quoted as high as $34,000 as their breakeven point.
How does bitcoin mining work?
"Mining" is performed using sophisticated hardware that solves an extremely complex computational math problem. The first computer to find the solution to the problem receives the next block of bitcoins and the process begins again.
The hashing process is designed to make solving these algorithms require increasingly more computing resources. Originally, bitcoin mining could be done by individuals on a single computer, however, with the increasing difficulty level in solving transaction-related algorithms, individual computers are highly unlikely to be able to mine bitcoin. Instead, most bitcoin miners use application-specific integrated circuits (ASICS) and other methods to mine bitcoin.
What are the environmental risks of bitcoin mining?
According to various reports, Bitcoin accounts for a range of 22 to 95 megatons of carbon dioxide emissions annually, as a result of processing power and electricity required. Bitcoin mining farms are usually located in areas with cheap energy tariffs or a cooler climate (which reduces cooling costs).
China was a previously popular hub for Bitcoin miners. After the ban in China, we saw the collective computing power of bitcoin miners drop 50% worldwide. The U.S. has since become a popular second choice for miners, now accounting for almost 17% of the world’s mining efforts.
This Week By the Numbers 📈
Top Stories 🗞️
Bitcoin Lightning Network capacity crosses 3900 BTC marking a new ATH
Unwithered by the ongoing bear market, Bitcoin’s (BTC) underlying architecture continues to outperform itself — further securing, decentralizing and speeding up the impenetrable peer-to-peer (P2P) network. The same holds true for the Bitcoin Lightning Network (LN). The Bitcoin Lightning Network capacity attained an all-time high of 3915.776 BTC, as evidenced by data from Bitcoin Visuals, displaying a commitment to the cause of improving BTC transaction speeds and reducing fees over the layer-2 protocol.
South Korean authorities reportedly probe staff behind Terra
The South Korean government continues to investigate Terraform Labs, the firm behind the Terra Network as well as Luna Classic (LUNC), previously known as Terra (LUNA), and TerraUSD (UST) tokens, by reportedly summoning subpoenas to employees. South Korean authorities have reportedly summoned all employees at Terraform Labs as part of a full-scale investigation of the collapse of UST and LUNC, the local news agency JTBC reported on Saturday. According to the report, the probe is conducted by the joint financial and securities crime investigation team of the Seoul Southern District Prosecutors Office. The authorities are looking into the case to check for signs of intentional price manipulation and whether the tokens went through proper listing procedures. The investigators also reportedly alleged that the Terra token’s mechanism was faulty in the first place, as stablecoin UST is not pegged to a stable collateral or profit model. “At a certain point in time, there is no other way but to collapse because it cannot handle interest payments and fluctuations in value,” the authorities reportedly said.
Binance gets approval to operate in Italy, will open office in Milan
One of the world’s biggest cryptocurrency exchanges, Binance, strengthened its European presence by obtaining registration and regulatory approval in Italy. A Binance company had previously registered to operate in France at the beginning of May. On Friday, the exchange’s official blog reported that Binance Italy has received regulatory approval in the country through registration as a Cryptocurrency Service Provider with Organismo Agenti e Mediatori (OAM), as required by Italian legislation. The registration allows Binance to offer crypto products to its customers in Italy in compliance with local regulations as well as to open offices and expand the local team.
Argentina turn to Bitcoin amid inflation worries
Since 2016, Argentina has been engaged in a war against inflation. Caused by multiple factors, like a lack of trust in the central bank or government overspending, the depreciation of the Argentinean peso has negatively impacted citizens' purchasing power. This has brought 37.3% of the population under the poverty line, and many others have had their savings vanish into thin air. Against this backdrop, many Argentines have turned to Bitcoin (BTC) and crypto as a way to hedge against 60% inflation, despite the market being in the red for several months and the central bank forbidding financial institutions from operating with digital assets. In an Americas Market Intelligence report cited by Reuters, it was found that “crypto penetration” in Argentina had reached 12%, double that of Peru, Mexico and other countries in the region.
MoneyGram to open transfer platform with Stellar, eyes wallet deal in El Salvador
MoneyGram International, one of the world’s largest cross-border transfer services, is partnering with the Stellar blockchain to create a stablecoin-based platform for money transfers. The new service will allow Stellar wallet users to send Circle’s USD Coin (USDC) to recipients, who will be able to cash them out for fiat currency through the MoneyGram network. “We’re trying to be a bridge from the crypto world to the fiat world,” MoneyGram CEO Alex Holmes said in an interview. Holmes also said MoneyGram is in talks with third-party companies that provide digital wallets in El Salvador alongside the government-backed Chivo wallets, which were introduced when the country made Bitcoin (BTC) legal tender last year. Through a deal with one of those companies, MoneyGram would be able to compete for BTC transfers as well.
Mint of the Week - Arts DAO - Minting Today!
This week, I’m sharing a project by fellow friends in Dubai!
Arts DAO is a social and investment DAO (i.e. a decentralised autonomous organisation) representing the largest Web3 Community in the Middle East. Arts DAO is launching the Ethernal Gates NFT, a collection of 2000 NFTs by award-winning artist Kristel Bechara, which grants members an allocation in the DAO and access to Arts DAO’s social events in real life.
Arts DAO will collect and invest into a portfolio of blue chip NFTs (e.g. BAYC, Doodles, CloneX etc), but also seed Web3 founders and invest into other DAOs / NFT funds to obtain a combination of balanced exposure to top-tier NFT projects as well as emerging and desirable NFT drops for the benefit of the community with a goal of increasing overall value of the treasury.
Arts DAO has previously hosted IRL events in Dubai with the Doodles Community (with Poopie!) the RTFKT / CloneX Community and Gary Vee. Owning an Ethernal Gates NFT grants you exposure in the Arts DAO treasury, and as the portfolio grows, profits taken will be redistributed back to holders.
The founders are fully doxxed - they include @ananasbrb @thecryptosheikh and @rahim_mahtab and have entrepreneurial, legal, and branding backgrounds working with major crypto exchanges like Binance and FTX, as well as building other start-ups.
Project Overview
Project Information
Total Supply: 2000
Mint Date: June 5th, 2022
Mint Price: 0.49 for WL / 0.59 for public
Official Links
White Paper: https://whitepaper.super.site/
Discord: https://discord.gg/artsdao
Twitter: https://twitter.com/arts_dao
Website: https://artsdao.io/
Minting page: ethernalgates.io
Thank you for reading this week’s edition of the Myth of Money.🚀
Until next week,
Tatiana Koffman
By Tatiana Koffman
Hi there and thanks for reading. If you stumble upon my newsletter, you will notice that I write about money, economics and technology. I hold a JD/MBA and spent my career in Capital Markets working across Mergers & Acquisitions, Derivatives, Venture Capital and Cryptocurrencies. I believe in empowerment through closing the financial education gap and creating equality of opportunity for the next generation. I have invested in 20+ companies and funds. Check out my portfolio here.
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