Bitcoin's energy consumption has always been a point of contention, with its vast network of miners demanding substantial computational power. Recent trends suggest that Bitcoin's power usage may be on the rise, not just due to mining, but also from increased network activity. Bitcoin's blockchain bandwidth usage recently surpassed 90% for the first time since its halving event in April. This surge is mainly attributed to the adoption of new token standards like Runes and BRC-20, which have triggered a huge number of transactions.
While the rise in Bitcoin's network activity shows its growing adoption, it also raises concerns about its environmental impact. Bitcoin mining already consumes a considerable amount of energy, and increased network activity could worsen this issue. Interestingly, back in 2018, there were dire predictions about Bitcoin's energy consumption exceeding that of the entire world by 2021. However, these predictions have failed to materialize. This is largely due to the evolution of mining equipment towards greater efficiency and the increasing adoption of renewable energy sources in mining operations, proving that the initial forecasts were overly pessimistic and failed to account for technological advancements and shifts in energy sources within the industry. Exploring more energy-efficient mining practices and developing solutions to optimize network activity helps the long-term sustainability of Bitcoin.
Meanwhile, during the past few days Bitcoin's price dropped below $64,000, triggering a wave of liquidations in the crypto market. Over $27 million worth of Bitcoin long positions were liquidated within 24 hours, with the total liquidations across the cryptocurrency market exceeding $132 million. This sharp price correction has sparked a debate among investors about the future direction of Bitcoin. Bearish analysts point to on-chain data suggesting that some large Bitcoin holders have been liquidating their positions, signaling a potential downward trend. However, bullish investors argue that the current dip is a healthy correction before Bitcoin potentially targets the $100,000 mark. All price speculations have to be taken with a pinch of salt, as I heard all sort of wild numbers being thrown around over the past few years.
What seems certain is that the interest in Bitcoin has not faded, on the opposite, the traditional finance seems more and more eager to get "a slice of the cake". VanEck, a global asset manager, recently listed Australia's first Bitcoin ETF (VBTC) on the Australian Stock Exchange (ASX), growing the demand for cryptocurrency investments in the Asia-Pacific region. This launch follows the rollout of six Bitcoin and Ethereum ETFs in Hong Kong in April, further solidifying the region's embrace of digital assets.
The interest in Bitcoin ETFs in Australia is evident, with VanEck's survey revealing that three-quarters of financial advisors in the country have received inquiries about Bitcoin from their clients. Additionally, a third of these advisors are considering adding Bitcoin ETFs to their clients' portfolios if they become available on the ASX.
On its debut trading day, the VBTC ETF traded 96,476 shares, generating a trading volume of $1.3 million (A$1.9 million). While this is much lower than the debut trading volumes of spot Bitcoin ETFs in the United States, VanEck remains optimistic about the ETF's potential for growth in Australia, citing strong interest from both retail and professional investors.
The enthusiasm for crypto ETFs is not limited to Australia. Hong Kong, for instance, became the first Asian jurisdiction to launch spot ETFs for both Bitcoin and Ether in April. While the initial market response to these ETFs was lukewarm, it's important to note that the Hong Kong market is considerably smaller than the US market, where Bitcoin ETFs have seen large inflows.
While Singapore maintains a cautious stance on crypto ETFs, other countries in the region are gradually opening up to these investment vehicles. Thailand, for example, recently approved its first Bitcoin ETF, which is exclusively available to institutional and wealthy investors. Malaysia, although not yet offering spot ETFs, has also entered the digital asset investment space with a fund targeting Bitcoin, Ether, and blockchain companies.
Disclaimer: The information provided in this article should not be considered financial advice. The cryptocurrency market remains dynamic and carries risks. It's essential to conduct your own thorough research and consult with qualified professionals before making any investment decisions.
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