Whether it’s mistruths, misunderstandings, or plain ignorance, cryptocurrencies have a ton of value. Bitcoin is the most widely known cryptocurrency. Yet, people who are really involved in crypto’s are not just focused on Bitcoin. Instead, savvy investors are focused on other cryptocurrencies that are lesser known to the general public.

If you look at bitcoin, ethereum, and Ripple, for example, it’s really no different than looking at US dollars or the euro. Currencies like the euro and the US dollar, have the same two purposes as cryptocurrencies;  investors use them to speculate and conduct commerce. With millions of people trading foreign exchange, some speculate on the conversion between US dollars and euros using that conversion to profit. Taking their US dollars, speculators exchange them into euros and then exchange them back. Ultimately, these investors are looking to profit on the spread.

Cryptocurrencies are also useful for commerce. Everywhere, companies say “we take Visa, Mastercard, American Express and now bitcoin.” A recent example is OKCupid, who now accepts bitcoin to pay for your monthly membership. Cryptocurrencies are a real currency that can be used in any part of the world, regardless of what country it’s being used in for commerce purposes.

With all the myths dispelled, many thought cryptocurrencies had seen better days. Why did cryptos have a run-up at the end of 2017?  Why did they crash in 2018? What’s going to happen next?

Basic Economics, Artificial Intelligence, and Intermarkets

Supply, demand, and perceived value are going to factor into the price of a particular object. That’s basic economics. Whether it’s a tangible object, a stock, or a currency, there are certain factors that will determine the pricing of something. Just because the value of something decreases, it doesn’t mean that it’s half as good as it was before. It just means that the perceived value is less than it was.

In fact, when something that is actually solid has a 50% retracement in pullback from its previous price, many people might look at that and say, “That’s a negative. It’s not worth what it was.” Other, more experienced  investors will look at that as, “This is a tremendous buying opportunity. It’s like going and buying something for 50% off!” Cryptocurrencies don’t just go up or down for no reason. They’re not insulated from everything in the world. Cryptocurrencies are just like any other currency, with numerous other factors will that also drive and impact them.

Our company pioneered a concept called “Global Intermarket Analysis” where we’re actually using artificial intelligence to analyze different market relationships and how one particular security, like bitcoin, can be impacted by other markets, or intermarkets. We started forecasting cryptocurrencies about a year ago and have adapted our artificial intelligence technology to analyze crypto markets. Our patented technology was able to decipher patterns in data no differently than we’ve been able to do in the stock and foreign currency markets. Our artificial intelligence was able to decipher hidden patterns in data that showed that if the US dollar is going up, that will have an impact on Bitcoin. If the price of gold is going down, that will have an impact on Bitcoin.

Currently, we’re analyzing how 30 other markets, some of them cryptocurrencies, can affect the price of bitcoin. The process is complex and something that a human being could not monitor at once. Our artificial intelligence technology primaries purpose is to mine data, using deep, machine learning, to find patterns in data that a human wouldn’t see, These patterns in that data can provide very valuable clues as to where the cryptocurrency markets are going.

Most recently, around July 13th, our predictive analytics with Vantage Point forecast that bitcoin was going to start going up. Within a week’s time, it jumped over $8,000. Now, if you were just looking at the price action of bitcoin on a chart, you wouldn’t have seen the coming boom. Bitcoin is impacted by other factors other than itself. Being able to identify inter-market factors can help investors better understand the price of cryptocurrencies and the complex pattern of data.

There are tremendous opportunities in the cryptocurrencies now and into the future. I’m very excited by where this will take us. In the meantime, there’s a tremendous opportunity for speculators, traders, and investors to profit from this if they have the right tools, the right information, and if they’re approaching it with the right perspective.

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Once upon a time, a very long time ago – 2009 in fact – there was a brief but interesting controversy about the carbon footprint of a Google search. It was kicked off by a newspaper story reporting a “calculation” of mysterious origin that suggested a single Google search generated 7 grams of CO₂, which is about half of the carbon footprint of boiling a kettle. Irked by this, Google responded with a blogpost saying that this estimate was much too high. “In terms of greenhouse gases,” the company said, “one Google search is equivalent to about 0.2 grams of CO₂. The current EU standard for tailpipe [exhaust] emissions calls for 140 grams of CO₂ per kilometre driven, but most cars don’t reach that level yet. Thus, the average car driven for one kilometre (0.6 miles for those in the US) produces as many greenhouse gases as a thousand Google searches.”

Every service that Google provides is provided via its huge data centres, which consume vast amounts of electricity to power and cool the servers, and are therefore responsible for the emission of significant amounts of CO₂. Since the advent of the modern smartphone in about 2007 our reliance on distant data centres has become total, because everything we do on our phones involves an interaction with the “cloud” and therefore has a carbon footprint.

The size of this footprint has been growing. At the moment, about 7% of the world’s electricity consumption is taken by our digital ecosystem but this is forecast to rise to 12% by 2020 and is expected to grow annually at about 7% through to 2030.

The big internet companies are acutely aware of this. Electricity costs money and they are fanatical about reducing costs. And they are desperate to avoid the PR downsides of being perceived as energy hogs. So they have responded to a challenge issued by the environmental group Greenpeace some years ago – to commit to having all of their activities powered by renewable sources. Facebook, Apple and Google made this “100% renewable” commitment four years ago and have now been joined by nearly 20 other internet companies.

The trouble is that server farms and networks account for only 50% of the electricity consumption of our networked world. The devices we use consume another 34% and the industry that manufactures them takes up the remaining 16%. Making environmental progress on these fronts will be much harder. A desktop PC running eight hours a day, for example, emits 175kg of CO₂ in a year. So you can imagine the carbon footprint of a large city office block that has thousands of desktop PCs running for the whole of a working day. Multiply that by all the office blocks in the centre of London and you get an idea of the environmental impact of even the humble PC.

But the most spectacular illustration of computing’s environmental cost comes not from offices but from the current craze for the cryptocurrency bitcoin. As I write, one bitcoin is worth $8,129 (£6,108). In February 2011, it was worth only a dollar and on its way to its current precipitous level the price has seesawed regularly. But it’s clear that we are now in tulip-mania territory.

How do you get hold of bitcoins? You can either buy them on public exchanges or you can earn them by doing some “bitcoin mining”– that is, participating in the process by which bitcoin transactions are verified and added to the public ledger (the blockchain) and also the means through which new bitcoins are released. Essentially, this means building and running your own server farm (you can buy the kit on Amazon) and, as the price has increased, more and more people appear to be doing this.

The consequences are astonishing but predictable. According to one estimate, bitcoin mining is now consuming more electricity than 159 countries, including Ireland, Bahrain and the Slovak Republic. The same source reckons that it’s currently taking as much electricity as would be required to power 2.7m US households and that it’s responsible for 0.13% of global electricity consumption. If things go on like this, bitcoin mining will require all of Denmark’s electricity consumption by about 2020.

So here’s your starter for 10: is bitcoin a bubble? Answers on the back of a postage stamp, please.

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