Bitcoin and crypto survive crises – Weekly news 12/2020

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Bitcoin’s price has been swinging back and forth lately, which has also started affecting Bitcoin mining. The difficulty level of mining has fallen, and as a result the network now has little more than half of the computing power compared to its peak. For normal users this causes no harm, since the network still has more than enough computing power and Bitcoin’s security remains excellent.

In other news this week we will look at how Bitcoin and the crypto community shows goodwill by combating the raging COVID-19 pandemic. The Red cross in Italy has started collecting bitcoin donations, while the crisis has forced a chess tournament to turn to blockchain. Despite uncertain economic times even institutes have growing interest for blockchain technology.

We are also happy to present the opportunity for interest accounts in Coinmotion, whereby you can earn interest on loaned cryptocurrencies.

Last week’s news can be found here.

Bitcoin physical coins
Bitcoin thrives despite crises and chaotic times.

Coinmotion offers interest accounts

Coinmotion, Finland’s leading cryptocurrency service, has started providing the chance to earn interest on crypto investments. It is possible to earn interest by loaning cryptocurrencies onward. The interest account service is published in collaboration with Tesseract Investment.

“Cryptocurrency lending markets have been developing rapidly during past two years, and with selected partners and development we want to offer possibility to earn interest on the cryptocurrencies that are otherwise under passive ownership or HODLing. It’s dependent of course on the client risk preferences, if earning interest and bearing the counterparty risk is a suitable choice”, says CEO of Prasos Heidi Hurskainen.

By using the interest account Coinmotion’s customers can earn daily interest on loaned funds. The interest account service supports all Coinmotion’s currencies apart from stellar.

Coinmotion interest account growth
Coinmotion now provides the possibility to earn interest on cryptocurrencies.

Bitcoin’s mining difficulty level plunged

The difficulty level of Bitcoin mining witnessed its second biggest single collapse during its entire history. On 26th March the difficulty level plunged 15.95%, rivaled only by a drop of 18% in October 2011.

The Bitcoin network automatically adjusts the mining difficulty level according to how much computing power the network has. The difficulty level is adjusted so that it on average takes 10 minutes for miners to find the next block regardless of the amount of computing power.

The decreasing difficulty level is probably related to last week’s market chaos, when bitcoin’s price dropped dramatically. Earlier an almost equal crash was seen in December 2018, when bitcoin’s price also declined rapidly.

Despite the decrease in mining difficulty, it practically has no notable effect on the Bitcoin network’s security. Bitcoin continues to be the world’s overwhelmingly biggest system for decentralized computing – and also the safest.

Mining equipment hall
Many mining devices have found other uses than maintaining the Bitcoin blockchain.

A quarter of trading houses use blockchain

Every fourth trading house and institutional trading firm is using blockchain to some extent, reveals analysis firm Acuiti. The survey interviewed 86 leaders of major companies within the trading sector.

26% of companies had some activity related to blockchain. 17% of traditional trading firms used cryptocurrencies in some form, meaning they either exchanged them for customers or owned them directly. A quarter of respondents had a positive stance toward crypto utilities.

The survey also indicated that most companies have interest to start using crypto. 45% of those who had no crypto-related activity planned to reconsider cryptocurrencies within six months. 97% in turn had plans to consider crypto within two years or sooner.

Blockchain blue
The use of blockchain by companies has grown significantly in the past years.

Bitcoin-friendly US senator infected by corona

The Bitcoin-friendly United States senator Rand Paul has been infected by the coronavirus. Paul is particularly remembered by the Bitcoin community for becoming the first notable US politician to accept bitcoin donations in his 2016 presidential campaign.

Paul has earlier vocally supported the smallest possible regulation for cryptocurrencies. While admitting he does not know what the future holds for crypto, he considers them a great idea. He has also criticized fiat currencies, which according to him are just empty paper and won’t last forever.

According to the senator’s office Paul has no symptoms and is feeling fine. The senator was put in quarantine right after confirming the infection. The corona test was done since Paul travels a lot, despite not having confirmed near contact with any other infected party.

Rand Paul
Despite the infection Rand Paul is reportedly in good condition.

The crypto community combats COVID-19

The Red cross in Italy has started accepting bitcoin donations with the intention of acquiring new medical equipment to combat the coronavirus pandemic. The first fundraising set a goal of collecting $10 000 dollars, which was exceeded in only three days.

Following the successful campaign the Red cross has decided to continue accepting bitcoin donations. The goal of the new initiative is to acquire $26 000 dollars worth of necessary equipment for intensive care. At the time of writing over $20 000 dollars worth of bitcoins have already been donated.

Aside the donations the crypto community has also taken other measures in the battle against the pandemic. One example is that many crypto miners have transferred a notable portion of their computing power to the [email protected] project, which uses computing power to solve different medical and mathematical problems in order to find a cure for the virus.

Red cross Italy
The Red cross in Italy is facing problems much like other health organizations in the country.

Blockchain can save a chess tournament

The coronavirus has also affected a major chess tournament in Jekaterinburg, the winner of which was set to meet world champion Magnus Carlsen. Like many other events, the tournament has been postponed without a clear date. Now the tournament’s organizers are considering using blockchain technology to enable it by distance.

”We are working on the anti-cheating engine that may record over one hundred data points for each move — its timestamp, players’ biometrics, chess engine evaluation, etc. Storing this data in the decentralized database would make a lot of sense,” reported Ilja Merenzon, CEO of World Chess.

According to Merenzon the system has already been in development for some months and is likely to be published in the following weeks. World Chess is yet to reveal when the new tournament will be organized, but the world championship game is set to take place in November.

Chess pawns
Blockchain is excellently suited for recording a game like chess.
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