This is the story of crazy money flying too close to the sun…and…
There are times in life when a moment stands out so clearly in my mind that, at least for me, there are more and more times when I can predict when that latest “hot topic” is about to jump the shark.
My father is a smart businessman and a long-time investor who knows a lot about things, but he’s not a guy who knows everything that’s new and different. A few months ago, he pulled me aside and apparently secretly shared something of great value. he said almost in a whisper. “They’re going to stop using paper money pretty soon. Maybe it’s about time they start moving some of their dollars into that cryptocurrency.”
At that exact moment, I realized that if my father knew about cryptocurrencies, that investment bubble would soon burst. Thanks for the tip, Dad. Using reverse logic, you had money to spare. Admittedly, I’m not a savvy investor. I have been saving steadily and investing on the more conservative side of the money market, such as CDs, municipal bonds, blue chip stocks, and even real estate. I’ve mostly been put off by the risks of electronic cryptocurrencies, but I’ll also admit that I don’t fully understand the concept.
An infinite string of coding, mostly 0s and 1s, progressing towards infinity. It is still being mined and manufactured daily in data centers around the world, although perhaps in limited supply. There is little international regulation, the market is so new that the federal government is still considering it, and extensive passcodes that can be lost even allow complex access to one’s crypto holdings. Still, this is a strong enough “free market” that Trump’s sons have created a new cryptocurrency, already increasing the family’s fortune by billions of dollars.
Cryptocurrency miners run computers on racks in large warehouses at top speed 24/7, consuming large amounts of electricity and water to keep the computers cool. These collective data farms currently equal the energy consumption of Norway. One data center uses about the same amount of energy as 250,000 U.S. households.
Not all electricity comes from sustainable sources, which means the electricity industry is also a net polluter. And whether your cryptocurrency of choice is Bitcoin, Luna, Ethereum, or a lesser-known digital currency, they all have something in common at the moment. After reaching their price peak in 2021, their values ​​have all fallen significantly. Several smaller cryptocurrencies have ceased operations, leaving investors holding the bag. In fact, only electronic currency exchanges remain profitable in the electronic currency industry. They each pay a small fee whether the price goes up or down.
Additionally, the Federal Trade Commission (FTC) reports that more than 46,000 Americans have been victims of crypto fraud since January 2021, as many continue to believe in the myth of rapid wealth that far exceeds current market trends. And of course, crypto boosters teach us that all markets are cyclical and that prices and values ​​recover. For all you cryptocurrency cheerleaders out there, here are five words for you to ponder. It’s an electromagnetic pulse and a blackout.
Domestically, the most recent green energy bill was signed into law during the Biden administration and was aimed at spurring large-scale market changes (now repealed by the Trump administration) that were aggressively pushed toward an increase in electric vehicles and the use of more sustainable energy sources. These are worthy goals, but these “green” energy sources are typically unable to provide the same high-demand baseload as coal, natural gas, or nuclear power, as we have seen with power outages and outages globally and nationally during this record-hot summer. Additionally, our power grid is not designed to accommodate the growing number of electric vehicles in every home garage, and many urban areas will not be able to meet their basic summer electricity production needs unless we deploy new, larger nuclear reactor fleets soon. And our home state of Georgia is also a “project hub” for a new data center.
Yes, more reliable cryptocurrencies and data mining farms have on-site backup generators, but even fail-safes can fail. Who would have guessed that the cause of the cryptocurrency’s soaring price could be a combination of green energy policies and sporadic and unpredictable power outages? Innovation can save and redirect any industry that seems headed for rapid exit or decline. Again, I’m no expert, but I’d probably append an infinite string of XXX to all of those 0’s and 1’s. These certainly seem to have worked out very well for the porn industry.
