The week of 11/01 at a glance – News about Bitcoin and crypto-currencies is in constant turmoil. It can happen that crucial information gets lost in the daily news flow and you miss the important points.
This format is here to help. We look back on last week’s news in Crypto Weekly to keep you informed about the current state of cryptomoney.
The unmistakable of the corner
For this week’s must-read, we find Thomas with an article on Bitcoin and more specifically the production cost of a BTC. A bit of math in perspective, but nothing insurmountable to understand the theory behind the production of the crypto queen.
Adam Hayes’ model
Proof-of-work assets require significant investments in computing power to participate in network maintenance and money creation. This activity is remunerated by the payment of newly created cryptoactives units. This is the reward per mined block.
Adam Hayes developed a model to estimate the value of the mining process through its energy cost. In a competitive and efficient market, the monetary value of an asset should derive from the cost of mining at that point in time.
Energy cost and CTB
In fact, a rational economic agent would have to suspend its mining activity if the market price of the mined asset was significantly below its cost of production. The production cost of a bitcoin is therefore obtained by dividing the energy cost of mining (expressed in kWh) by the number of units of bitcoin mined in one day. Before determining this cost of production, the number of Bitcoins mined per day must be established.
Initially, the reward was 50 Bitcoins per mined block and was programmed to decrease approximately every 4 years, being divided by 2 in a programmed event: halving. At the beginning of 2020, the reward per block was 12.5 Bitcoins. It increased to 6.25 Bitcoins per block following the halving in May.
Read the full article for more details on the cost of production model: The 21 Million Dollar Question – How much does one Bitcoin mined?
News in brief
▶ Due to the rise in the price of Bitcoin, PayPal’s service is overwhelmed with users. For example, it recorded $242 million in volumes on January 11.
▶ The hardware wallet giant Ledger hit by a new loophole. This time it was the data of 270,000 users that leaked, following a flaw in the service provider Shopify.
▶ The first results of the European crypto-euro survey have come in. Thus, 42% of the respondents believe that privacy is of utmost importance in the creation of this crypto-euro.
▶ The giant GrayScale is terminating its XRP Trust fund. This news comes in the wake of the SEC’s lawsuit against Ripple Labs.
▶ Christine Lagarde is back in the spotlight and is going after Bitcoin. She describes the asset as too often linked to money laundering and the black market.
▶ New week, and new video for Mr. TK! In the latter, he presents the optimal hardware for undermining cryptomoney in 2021.
📊 The 4 metrics of the week
➤ -25% is the drop in the EOS share price following the announcement of Dan Larimer’s resignation from Blcok.one and EOS. Despite this resignation, Larimer does not leave the world of cryptomoney.
➤ 12 years old is the age of the very first Bitcoin transaction. Made between Satoshi Nakamoto and Hal Finney, it was the first of a long series of transactions that made Bitcoin the network we know it is today.
➤ 78,465 is the number of validators present on the Ethereum 2.0 network. In total they have staked 2.5 million ETH since the launch of the deposit contract.
➤ 100 million is the total number of COMBO tokens that will be issued. As a reminder, the COMBO is the governance token of the DeFi Furucombo project.
✉️ Tweet of the Week
This week’s tweet goes to our favorite Bitcoin Maxi, @JohnOnChain and its tutorial on Samurai Wallet.
Have a great week on the Corner Diary! 🙂