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This week in our Chain Reaction podcast, Anita and I chat with Sequoia Capital's Sean Maguire about why gamers are skeptical of NFTs and where decentralization really matters. More details below.Last week we had our inaugural newsletter and we talked in detail about the changes Twitter can make to expand its crypto business. At the time, I — like many others — was operating under the impression that a Musk Twitter deal was ultimately doomed, but less and behold we've got a deal. Everything is approved at this point, but I can't get over the feeling that something at the eleventh hour is going to end the deal. If that happens, the board of Twitter or Musk will be on the hook for a $1 billion fine for walking away from the deal, but I guess we'll see… this week, I'll be working my way up a controversial bitcoin mining ban. I am working from What a New York regulator and a bill like it could mean for the political reputation of crypto's #1 coin.


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Crypto's biggest skeptics see plenty of reason to criticize the industry, but generally at the center of most complaints is the belief that crypto is contributing little to society while burning large amounts of energy.


While believers of crypto could quibble over the former point until they are out of the blue, the latter is a little harder to disprove. Bitcoin uses an estimated 204.50 terawatt-hours (TWh) of electricity per year at current rates, a number comparable to Thailand's electricity consumption, according to an often cited tracker produced by Digiconomist. Meanwhile Ethereum's energy footprint is half the size but still on par with Kazakhstan's electricity consumption. In 2018 the United States reported total electricity consumption of 4,222.5 TWh.


For some legislators, those numbers are hard to swallow. This week, the New York State Assembly passed a bill that arms Team Crypto. The bill prevents the formation of crypto mining firms in the state that rely on non-renewable electricity. This does not specifically apply to existing facilities. A related bill is currently making its way through the Democrat-controlled state Senate.It's tempting for a whole bunch of reasons.


For one, crypto is fast becoming a partisan topic. Republicans are generally wary of regulating unregulated industries and thus many prominent figures in the party have given their full support behind crypto with some concessions. This includes potential future party leaders such as the governors of Texas and Florida. Meanwhile, crypto's most ardent critics seem to be Democrats, but that doesn't mean it's a party-line issue. President Biden's recent crypto executive order was generally considered too favorable for the space by industry insiders. Energy use appears to be the most prominent sticking point for many regulators looking at broader restrictions.






The second reason it's interesting is that the bill actually affects only a few major crypto networks, but includes the two biggest ones - Bitcoin and Ethereum.


These networks use something called a proof-of-work mechanism to secure their network. The work in this case is mining which involves computers working round the clock to essentially solve math problems that are protecting the integrity of the blockchain, making it easier for hackers to conduct unauthorized transactions and steal tokens from the network. Overwhelming becomes extremely costly and technically challenging. Crypto is generally moving away from proof-of-work, in particular, Ethereum is deep in the process of shifting its network towards a less energy-intensive consensus method. But bitcoin is unlikely to make its transition, suggesting that regulatory maneuvers, like the New York bills, are likely to be particularly increasingly hostile to bitcoin (and some smaller networks).


This could lead to an interesting scenario where the crypto industry increasingly finds mainstream tolerance among its current critics but bitcoin finds itself more and more politically isolated.

Bitcoin already broadcasts its liberal leanings slightly more prominently than other blockchains. At recent industry events, it is becoming clear that the philosophy of the bitcoin network infrastructure is increasingly its most cohesive element, amid a growing developer ecosystem for blockchains such as Ethereum and Solana. Continued resistance to criticism of bitcoin and calls for change may only encourage its supporters, but criticism surrounding the network's power consumption is going nowhere and further adoption could make it a more visible target for aggressive regulation. Is.


Some politicians may grow to love crypto but equally hate bitcoin.


Hey you all, it's Anita here. Our second episode of the weekly Chain Reaction podcast just dropped, and this week, we're so immersed in Elon Musk/Twitter news that we thought we'd tackle the first two other topics to take our mind off the bird app. another.


I wrote earlier this week about how Fidelity, the largest retirement planning provider in the United States, announced its plan to bring bitcoin to 401(k) plans, which are administered to 23,000 companies. It's a bold move from this traditional designation as it legalizes crypto as a long-term investment just a month after regulators tried to discourage retirement plan providers from doing so. We did the podcast back and forth with some enthusiasts to see who would benefit from Fidelity's move, especially if it turns out to be a bigger trend. Personally, I think this news is great for non-billionaires - you can read why in my latest for TC+ here


How To Secure Bitcoin And Other Crypto Wallet ?




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