Citigroup: by 2022 Bitcoin mining can become unprofitable

According to the Citigroup research, by 2022 Bitcoin mining will be profitable only with BTC price above $300 000
10 November 2017   5066

In five years, the bitcoin mining will become absolutely unprofitable because of the too rapid growth in the prime cost of the first cryptocurrency. This conclusion was reached by analysts of financial conglomerate Citigroup, reports Bloomberg.

According to the analyst of the company Christopher Chapman, by 2022, mining will be cost-effective only with a bitcoin cost above $ 300,000. By the same time, the total electricity consumption for bitcoin production will be equal to the consumption of all Japan and will be limited to the governments.

We don’t think that those levels of mining can be reached, and that governments will regulate/tax miners as a way of reducing the power consumption.
 

Christopher Chapman
Analyst, Citigroup

Bitcoin Bulls
Bitcoin Bulls 

It is noteworthy that the expert also believes that the cryptocurrency community will have to change the earnings model and switch to the Proof-of-Stake algorithm. In this case, the winners will be participants, who initially had more cryptocurrency.

As the current arms race is not in the interests of established miners we think that the BTC network may move to a proof-of-stake model; particularly if such a change is implemented by major rival ethereum. Such a move would not be uncontentious, but may be necessary for the survival of the currency.
 

Christopher Chapman
Analyst, Citigroup

 

PBoC to Continue Anti-Crypto Propaganda

The regulator published a warning in its WeChat account called “Protection of the rights and interests of consumers of financial services”
23 March 2020   311

The People's Bank of China has returned to criticism of cryptocurrencies amid a worsening economic situation in the world.

On March 22, the regulator published a large-scale warning in its WeChat account under the heading “Protection of the rights and interests of consumers of financial services”. It describes three ways in which cryptocurrency service providers can mislead consumers.

First of all, the amount of fraud transactions with bots is serious. The average turnover rate of the top three overseas crypto currency exchanges is much higher than that of foreign licensed exchanges. Second, market manipulation exists in these exchanges where forced leveraged trading eventually causes the exchanges to explode. Third, money laundering is a big issue.

 

People's Bank of China

In addition, the Chinese Central Bank calls the opinion that Bitcoin may serve as a protective asset, erroneous. The regulator indicates its high volatility and recommends that citizens not follow the example of other investors and refuse to participate in cryptocurrency trading.