Are cryptocurrencies safe still in 2022?
Nowadays, many people are wondering what to invest their money in to move its value over time. One of the most common choices in recent months has been cryptocurrencies due to their widely known advantages. However, it’s worth knowing what their prospects look like in the years to come, and whether it will continue to be a safe option.
Why are cryptocurrencies so popular?
These technologies gained notoriety after the value of Bitcoin jumped to several thousand dollars. At the time, many experts claimed that it was simply a speculative bubble that would burst after a few years. However, nothing of the sort happened, and although many technologies are far from their ATH, coins can still cost serious money.
After the price of BTC shot up, it pulled other technologies along with it. Today, two of them are responsible for the largest share of the market capitalization. These are Bitcoin and Ethereum. New technologies are being created all the time, with greater or lesser success. Unfortunately, cryptocurrencies have also become a tool for creating financial pyramids and scam. For this reason, smaller projects that are created by people who cannot be verified in any way are better avoided by a wide margin if you are looking for reasonably reliable investment opportunities.
What is the future of cryptocurrencies?
This is a serious question that is pondered by anyone who has been following the market for a long time. As is well known, a very large amount of electricity is required to operate the network. Particularly high demand is associated with mining software, which is used to obtain currency. In order to mine coins efficiently, it is necessary to run a digger that uses several graphics cards simultaneously. This makes cryptocurrencies have a great number of opponents, who are primarily concerned with reducing pollution and the greenhouse effect. High energy consumption is related to pollution; which has a very serious impact on the quality of life of people all over the planet.
At the same time, it is a very big challenge that many technologies may not be able to cope with seeing the coming energy crisis. The war in Ukraine has greatly contributed to highlighting how much of its consumed by people every day and how fragile the energy system is. Seeking to save money, it is possible that there could be blackouts of several hours in many countries; which will have a direct impact on economies. At the same time, shutdowns can shake the functioning of many cryptocurrency networks which will prevent the digging of new coins. Hence, developers need to know how to respond to the coming changes, and one example is Ethereum’s introduction of Proof-of-Stake. This will significantly reduce the energy consumption that will be so crucial for the world in the years to come.
In conclusion, seeing the upcoming changes around the world, people should consider whether cryptocurrencies are still a safe financial haven. Mainly because of how much energy needed to power the network and to mine individual coins. One of the positive changes of this technology can be the transition from the POW model to POS what Ethereum has just done and abandon the use of mining os. By reducing power consumption in this way; you can prevent global problems that may arise in the world due to the energy crisis. For this reason, it is worth considering whether investing in cryptocurrencies for the next few months will be a good option; knowing that the world is facing very strong turbulence.
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