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Jaw-Dropping Energy Difference Between PoS Altcoins and Bitcoin

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How green is crypto, really? Activists accuse the industry of environmentally-hazardous side effects, but how true are these claims? What is the environmental impact of crypto?

A new report from UCL, alongside an exclusive interview, addresses these questions and more.

Mining Costs

The alleged environmental costs of Bitcoin and cryptocurrency are an enduring thorn in the industry’s side. Prominent actors frequently debate controversial claims, but crypto enthusiasts are quick to dispute the harshest assertions.

Studies from reputable scientific agencies have repeatedly claimed that mining harms the environment, and this sentiment translates into political anti-crypto sentiment. However, news coverage frequently ignores the community’s best efforts, and exaggerations run rampant.

How can one make sense of all this? What are the charges of crypto’s environmental impact, and how serious are they?

To help answer some of these questions, BeInCrypto conducted an exclusive interview with Wes Geisenberger, VP of Sustainability and ESG at Hedera, a decentralized public ledger and stablecoin issuer. The firm seeks to stand above its Web3 competitors in terms of carbon footprint and sustainability.

Interestingly, Hedera is a partner of the UCL Centre for Blockchain Technologies, whose new reports on crypto’s environmental impact cast doubt on the proof-of-stake model altogether.

PoW or PoS

The heart of UCL’s new report is on the notion that Proof-of-Stake (PoS) blockchains are uniformly more environmentally friendly than Proof-of-Work (PoW) ones.

PoW protocols like Bitcoin are fully trustless and decentralized, and transactions are validated through a competitive network of miners. These equations solved by miners’ collective computing power update the blockchain and generate new coins, but different miners have an inherently adversarial relationship.

For PoS protocols like Ethereum, however, the blockchain processes transactions differently. Using validators instead of miners, new block creators must “stake” their own tokens rather than computational power, allowing for a more collaborative experience. This, allegedly, makes the mining experience more efficient.

Read more: Proof of Work and Proof of Stake Explained

According to PoW advocates, the main drawback of the latter system is that it is much more prone to centralization. Nonetheless, UCL’s new report seeks to interrogate these claims more closely.

Are all PoS blockchains created equal? If these protocols are greener than PoW, how much greener are they? What are the best ways that the industry can face these challenges head on?

As far as Geisenberger is concerned, the entire space “has a responsibility to understand its impact on the world around us and in particular the environment.” He added that “we need to measure our impacts like the rest of the financial and technology world, built on standards and in an easily comparable way. There’s also a need to extend that to better understand the impact of how technologies, treasuries, and users leverage their resources to achieve positive impact.”

If the crypto ecosystem wants to impact our natural ecosystem, attitudes like this are crucial.

Bitcoin’s Waste

Some of the bitterest arguments over crypto’s ecological impact center around Bitcoin, the first and largest cryptocurrency. The debates over Bitcoin often take place on the same well-trodden territory: what percentage of mining electricity is renewable? Do techniques like flared gas mining constitute green energy or not?

Bitcoin’s biggest advocates are quick to point out all the massive green energy use cases that literally power the industry. Hydroelectric operations can sell excess energy in low-demand periods, productively using clean power that would otherwise go to waste. Flared gas mining is similar, with an inevitable waste product of the petrochemical industry getting a new use.

Aren’t Bitcoin’s critics eager to paint its impact in the most damning light possible? That may or may not be true, but UCL asserts that even the rosiest picture is still pretty grim.

Bitcoin vs Altcoins Energy Waste
Bitcoin vs Altcoins Energy Waste. Source: UCL

As the data shows, Bitcoin stands head-and-shoulders above all PoS blockchains surveyed in terms of electrical consumption. The study concluded that “all of the PoS-based DLTs (Distributed Ledger Tokens) analyzed have an energy consumption that is negligible compared to that of major PoW blockchains. To the extent that energy consumption may be considered problematic, this is not an issue in any PoS design.”

The study lists a number of limitations in its methodology and was not able to nail down a primary cause for these discrepancies. Still, as Geisenberger put it, “task forces across the industry [are] created to answer difficult questions in increased regulatory and voluntary disclosures in carbon accounting.”

A wide range of organizations are tackling these and other questions, and their results contribute to a greater scientific consensus.

Looking Forward

Ultimately, environmental impacts in the industry are a very controversial issue, and bad-faith actors exacerbate it. Both pro- and anti-crypto advocates can twist meanings and misinterpret studies, especially for concrete political ends.

PoW supporters have legitimate concerns besides the environmental, too, further complicating the issue. If PoS blockchains are not truly decentralized, does it matter if their energy consumption is lower? If PoW consumes energy that would otherwise be “wasted,” are its higher costs negated?

The crypto community must grapple with these and other questions for years to come. Luckily, with an innovative spirit and dedicated researchers like those at UCL, we’re sure to meet the challenge.

Disclaimer

Following the Trust Project guidelines, this feature article presents opinions and perspectives from industry experts or individuals. BeInCrypto is dedicated to transparent reporting, but the views expressed in this article do not necessarily reflect those of BeInCrypto or its staff. Readers should verify information independently and consult with a professional before making decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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Montana Says No to State Bitcoin Holdings

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Montana lawmakers have rejected House Bill 429 during the House floor session. The bill would have allowed the state to hold Bitcoin (BTC) as a state asset.

This comes after the bill advanced through the Business and Labor Committee with a 12-8 vote last week.

Montana Strategic Bitcoin Reserve Bill Rejected

House Bill 429 also included provisions for investing in precious metals and stablecoins. Meanwhile, Bitcoin was the only digital asset that met the $750 billion market cap requirement.

Representative Curtis Schomer called it “a precious bill for the treasury state.” He emphasized the need to diversify state reserves amid concerns over inflation and federal political shifts.

“The dollar is not as strong as we think, and we should not be putting all of our eggs in one basket,” he said.

Schomer highlighted precious metals as a historical hedge against economic uncertainty and digital assets as a modern investment with long-term growth potential. He stressed that digital assets have the potential for exponential returns.

“Montana will have more control over its economic development and not be susceptible to federal political turmoil,” Schomer added.

He also noted that the bill move would help drive the state’s economic growth.

Nonetheless, the bill was rejected in a 41-59 vote. The proposal faced a largely partisan split. However, many Republicans joined Democrats in opposition.

“HB 429 failed in the House, largely due to fiscal conservative opposition,” Bitcoin Laws posted on X (formerly Twitter).

According to Bitcoin Laws, fiscal conservatives were divided on Bitcoin-related legislation. Some argue that using taxpayer money for Bitcoin investments is too risky and amounts to speculation.

“It’s still taxpayer money, and we’re responsible for it, and we need to protect it,” State Representative Steven Kelly said.

Meanwhile, proponents countered that calculated risks are necessary to grow state assets, particularly amid inflation. They described it as a greater threat to taxpayers. In addition, they framed Bitcoin as a tool to preserve and potentially increase the value of state reserves over time.

Despite an amendment attempt to fund the bill with American Rescue Plan Act (ARPA) interest instead of general funds, lawmakers questioned the legality of such a move, further undermining support. 

With the rejection of HB 429, Montana joined Wyoming, North Dakota, Mississippi, and Pennsylvania, where similar Bitcoin-related legislation has failed. Meanwhile, 20 other states have active proposals under consideration.

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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What It Means for Bitcoin & Crypto

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Crypto markets need to monitor several key US economic data points this week, given the abounding influence of macroeconomic events on Bitcoin (BTC).

Bitcoin is trading near the $95,000 range, with this week’s economic events likely to provoke its next directional bias.

Consumer Confidence

The University of Michigan will report the US consumer confidence on Tuesday, detailing buyer attitudes, buying intentions, vacation plans, expectations for inflation, stock prices, and interest rates.

After the previous consumer confidence index of 104.1, the consensus is a minor retraction to 102.4. This sentiment comes amid President Donald Trump’s policies, with Ark Invest’s Cathie Wood noting the new administration’s impact on spending.

“…today nearly a third of the labor force, and perhaps their families, could be holding back on spending until they see the impact of rapid policy changes. While we believe the changes will be net positive for the economy – perhaps massively so – the short-term uncertainty is palpable,” Wood explained.

Notably, consumer confidence data does not move crypto markets the way a Federal Reserve (Fed) rate hike might. However, it is a signal of how people are feeling about discretionary spending and investment. Crypto and Bitcoin, in particular, largely being a retail-driven market, are sensitive to that vibe.

Initial Jobless Claims

Thursday’s initial jobless claims report is also a key US economic data to watch this week. It measures the number of people filing for unemployment benefits for the first time in a week, serving as a real-time pulse on the labor market and broader economy.

As such, this report’s influence ties to how the data shapes investor sentiment, including expectations about monetary policy. When jobless claims rise unexpectedly, it signals potential economic weakness—think layoffs, slowing growth, or recession risks.

Investors often interpret this as a cue to dial back risk, pulling money from volatile assets like Bitcoin and cryptocurrencies in favor of safer bets like cash or bonds. Conversely, when initial jobless claims drop or come in lower than expected, it is a sign of labor market strength.

This can boost confidence, encouraging investors to invest in riskier assets, including crypto. A strong jobs picture might ease fears of aggressive rate hikes, giving Bitcoin room to climb—especially if it keeps its digital gold allure intact.

According to data from MarketWatch, after a previous reading of 219,000 jobless claims, economists anticipate a rise to 225,000 for the week ending February 22.

GDP

The US GDP report, scheduled for release this Thursday, could also significantly sway Bitcoin and cryptocurrency markets. Like consumer confidence and initial jobless claims, the data could shape investor perceptions of economic health and monetary policy direction.

A stronger-than-expected GDP figure might signal strong economic growth, potentially reducing Bitcoin’s appeal as a hedge against uncertainty. Investors could lean toward traditional assets like stocks, expecting tighter Federal Reserve policies to curb inflation.

This risk-off shift often pressures crypto prices downward, as Bitcoin’s correlation with equities has tightened recently. For instance, if GDP growth exceeds forecasts (above the projected 2.3% for Q4 2024), it might dampen hopes for rate cuts. Such an outcome would prompt a sell-off in speculative assets like crypto.

Conversely, a weaker-than-expected GDP report could fuel a crypto rally. If growth slows significantly, perhaps falling short of the prior quarter, it might stoke recession fears, pushing the Fed toward a more dovish stance with potential rate cuts.

This scenario often boosts Bitcoin’s allure as a digital gold or alternative store of value, especially if investors lose faith in fiat stability amid economic softness.

PCE

Another US economic data point to watch this week is the January PCE (Personal Consumption Expenditures), set for release on Friday. As the Fed’s preferred inflation gauge, this metric will give a fresh read on how price pressures are trending, potentially swaying expectations for interest rates and, by extension, risk assets like crypto.

If the PCE comes in hotter than expected, above the consensus estimate of 0.3% monthly growth for the headline index or 0.2% for the core, it might signal stubborn inflation. This could reduce the odds of near-term rate cuts, possibly spooking investors and dragging Bitcoin down as money flows out of speculative plays and into safer bets like bonds.

On the other hand, a cooler-than-expected PCE, which is closer to or below the Fed’s 2% annual target, could spark a rally.

“The idea of a 2% inflation target was first introduced by the Fed in 2012, when core PCE, the Fed’s preferred measure, was 1.8%. It was just an excuse to justify QE. For the first 99 years of the Fed’s existence, the unofficial target was zero, as the mandate was price stability,” Bitcoin critic Peter Schiff highlighted.

Lower inflation might fuel hopes that the Fed will ease rates sooner, maybe even at the March 19 meeting. This would make cheap money more available and boost the appetite for crypto.

Bitcoin has been sensitive to these macro cues lately, including its recent response to President Trump’s tariffs. Either way, investors should brace for possible volatility amid crypto’s tendency to react to these releases.

“PCE may be a bigger market mover than NVDA this week. Embrace the volatility,” one user on X observed.

BTC Price Performance
BTC Price Performance. Source: BeInCrypto

BeInCrypto data shows Bitcoin was trading for $95,437 as of this writing, down by 1.1% since Monday’s session opened.

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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Bitcoin Coinbase Premium Index Sinks Below Zero Again — Impact On Price?

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The price of BTC could be stuck in consolidation for longer than initially anticipated, as the latest on-chain data shows that the Bitcoin Coinbase Premium Index has dropped back beneath zero. What does this dwindling metric signal for the premier cryptocurrency?

Is The Bitcoin Price At Risk Of Downward Movement?

In a recent post on the X platform, prominent crypto pundit Ali Martinez revealed that the Bitcoin Coinbase Premium Index has been declining, dropping back below a critical zone in recent days. The Coinbase Premium Index is an on-chain metric that tracks the difference between the BTC price on Coinbase (USD pair) and Binance (USDT pair).

This indicator can also provide insights into the difference in the buying and selling behaviors of the investors on the two crypto trading platforms. The Bitcoin Coinbase Premium Index reflects the sentiment of the US institutional entities (the major players on Coinbase) and how it differs from those on global exchanges.

Typically, when the Bitcoin price premium on Coinbase rises or is a positive value, it implies increasing demand from US investors, who are willing to spend more than other global investors to purchase the flagship cryptocurrency. On the other hand, the Coinbase Premium Index slipping beneath the zero mark signals that US investors are buying less compared to the global traders.

Bitcoin

Source: Ali_charts/X

This low buying activity is highlighted by the drab performance of spot BTC exchange-traded funds in recent weeks. The latest market data shows that the US Bitcoin ETF market registered a total outflow of $559 million in the past week.

With institutional and large US investors not accumulating Bitcoin at current prices, the market leader could struggle to build any real bullish momentum. Historically, a sustained decline of the Coinbase Premium Index metric has been associated with a consolidation period or even potential downside risk for the BTC price in the near term.

BTC Whales Offload Assets

In a separate post on X, Martinez observed that a class of Bitcoin investors has been trimming their holdings in recent weeks. Santiment data shows that whales holding between 10,000 and 100,000 coins have sold 30,000 BTC (worth roughly $2.9 billion) in the past 10 days.

This level of selling activity somewhat explains the sluggish price action of Bitcoin in recent weeks. As of this writing, the price of BTC sits just above the $96,500 mark, reflecting a 0.8% increase in the past 24 hours. The premier cryptocurrency is down by 1.1% in the past week, according to data from CoinGceko.

Bitcoin

The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView

Featured image from iStock, chart from TradingView



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