*Translation from Guardian
Cryptocurrencies, argue the most staunch and staunch advocates, will be an alternative to nearly every currency today. At the same time, it also plays an important role in ending central banks’ control over the money supply in many countries around the world.
With cryptocurrency, individuals can transact with each other in a decentralized digital financial ecosystem. They believe this is a positive thing, especially when technology is developing at such a breakneck pace today. Avid crypto fans even paint scenarios where technology acts as an alternative to political and social institutions.
However, technology can never replace social and political behaviour, but simply affects the rules and norms we follow. To make it easier to imagine, let’s just look at the case of Terra Luna, the most talked about cryptocurrency in the past week. At times, it dropped more than 98% of its value in just one day (even down to 99.999999% at the worst times), blowing away huge amounts of money from many investors around the world. gender.
Bitcoin and Ethereum, although not falling into such a “downfall”, are not much better. In addition, the development of blockchain technology once created a craze for NFT, a type of digital asset present on a digital chain, and also created a new situation of theft and fraud related to this type. . NFTs may not be so eye-catching, but they can sell for up to $91.8 million. And when the value is higher, the scams and appropriation of NFTs are increasing day by day. Late last month, Bored Ape Yacht Club’s Instagram account was hacked, and the perpetrator easily stole $3 million worth of NFTs by directing followers to a scam website.
When an NFT work is stolen, all the great claims of blockchain’s decentralized power will evaporate, even as victims implore some crypto exchanges to block the sale. Their stolen NFT. The underlying technology and its tokens may be decentralized, but where you can actually buy, use, and sell these things is extremely limited. Like it or not, crypto enthusiasts and supporters must also admit one fact: Currencies and contracts have value or can only be used when recognized as legal. Blockchain technology, while very interesting indeed, does not change this fact.
Meanwhile, a number of states and organizations in the US have begun to view cryptocurrencies as an unstable geopolitical force, forcing them to limit and tax the tremendous amount of energy that cryptocurrency mines consume. consume.
Some countries have even had to ban blockchain and related technologies. For example, in 2021, China, once the largest Bitcoin miner in the world, accounting for 75% of the global Bitcoin volume (as of September 2019), banned the “mining” and use of cryptocurrencies for a period of time. very strict manner.
The reason they put this ban is to limit the electricity consumption of cryptocurrency mines, protect citizens from scams, and control the flow of money in the country and with China’s trading partners. Country. So far, China is the only country that has taken an active step in eliminating this trend.
Russia had to go through a similar situation in the first few months of 2022. Since January, several crypto miners have built “mining” headquarters near Kazakhstan, after being kicked out of China. Their mining servers took a heavy toll on the Central Asian nation’s electricity grid, using up 8% of its total energy capacity and making it the second-largest cryptocurrency miner after the United States. . Despite efforts to control it through an energy tax, people in Kazakhstan are still revolting because of high fuel prices and unreliable electricity. The militaries of Russia and neighboring countries had to quell the violence there in late January, even as much of their attention was focused on tensions in Ukraine.
Russia itself is also a “player” in the field of cryptocurrency, accounting for 11% of Bitcoin mining capacity worldwide. This past February, instead of issuing a ban, the Russian government adopted a legal framework to regulate cryptocurrencies, introduce them into the financial system, and ensure that digital assets are not used. to finance criminal activities.
That inadvertently put crypto exchanges under pressure to ban Russians from their platforms. There has been much debate about whether this goes against the whole idea of blockchain technology. But here’s the bottom line: Cryptocurrencies are not bringing about a financial revolution, it’s just providing scammers a fresher and more sophisticated playing field.
This is just the beginning. The indiscriminate use of energy to mine cryptocurrencies is contributing to an ever-worsening global warming, leading to the worst drought in more than 1000 years in Japan. California, or the intensifying monsoon seasons in India. All that is beautiful and beautiful related to cryptocurrency is an illusion to obscure the fact that it is made up of millions of tons of coal, copper, rare metals and plastic only.
According to TheGuardians