Hello, and welcome to the latest edition of Overbit Weekly Round Up. We kick off today’s Overbit Weekly Round Up with news on the market, this time around focusing on Ethereum’s outperformance of Bitcoin.
On Wednesday, Ether, the native currency of the Ethereum blockchain, approached a new all-time high, while Bitcoin, the world’s largest cryptocurrency, remained about 20% below its all-time high.
Ether’s price jumped about 2% on Wednesday morning compared to the previous day, closing at $4,692 per token, only 3.5 per cent behind the cryptocurrency’s all-time high of $4,858. At the same time, Bitcoin fell more than 1% in the last 24 hours to $57,665 per coin, some 17.5 per cent down from its previous high of $68,778 per coin set last month. According to CoinMarketCap.com, Bitcoin’s market valuation is roughly double that of Ether, at nearly $1.1 trillion, which still makes Ethereum’s road to ‘the flippening’ quite a long one.
The growth in price of the world’s largest cryptocurrency has been perceived as a sign of greater acceptance of the industry in general; therefore, Ether and many other smaller cryptocurrencies have mainly traded in lockstep with Bitcoin.
However, the latest activity has moved Ether’s performance far ahead of Bitcoin’s.
Since December, the value of Ether has increased by 530 per cent, while the value of Bitcoin has doubled.
The rise in popularity of the Ethereum blockchain, which is utilised by thousands of developers to create decentralised apps that fuel anything from the DeFi and Metaverse movements to the selling of non-fungible tokens, may be linked to Ether’s outperformance. Comparatively speaking, the Bitcoin blockchain does not yet offer the same layer of functionality.
We close out today’s story with the latest on the hashrate exodus from China. Still months past the cryptocurrency mining ban in mainland China, territories across the world are still vying for the top slots. The latest to throw their hat into the ring? Wyoming.
According to Bitcoin Magazine, Wyoming hopes to hold 5% of all Bitcoin mining hashrate in the United States by the next halvening in May 2024. This capitalises on Wyoming’s assets and corresponds with the state’s economic development and job creation objectives.
With only six persons per square mile, Wyoming has the lowest population density among the lower 48 states (neighbouring Colorado houses 56 people per square mile). Wyoming also has a hard time keeping fresh grads because their professional goals and salaries don’t necessarily match what the rural Wyoming employment market has to offer, especially when compared to significant areas like Seattle and Denver.
The president of the University of Wyoming, Dr Edward Seidel, has set a goal of matching Montana’s post-graduation retention rate, which would suggest the establishment of 250 high-paying full-time jobs in Wyoming with annual incomes of $75,000 or more. In 2021, the state’s average annual wage is predicted to be slightly more than $50,000. Every 10MW of mining generates one or two direct full-time jobs in the local economy, in addition to supporting jobs in construction, engineering, and manufacturing. Introducing Bitcoin mining to Wyoming may easily undermine the state’s goal of producing 250 new well-paying employment shortly.
“Wyoming is a proud energy producing and exporting state,” says Dr Holly Krutka, executive director of the School of Energy Resources, to Bitcoin Magazine, “and we have the excess energy production capacity and more that we could build. It only makes sense to use our strength as an energy producer to promote other economic development opportunities, such as Bitcoin mining.”
Wyoming energy suppliers (ranging from off-grid natural gas to on-grid wind) have received dozens of inquiries for Bitcoin mining in recent months, forcing utilities to launch proactive “requests for proposal” (RFP) processes.
The state is now in the top ten states for Bitcoin mining in the United States, accounting for 0.7 per cent of the country’s capacity of 400 PH/s. The United States is expected to contribute approximately 35% of the global hash rate. With a global total 7-day average hash rate of approximately 165 EH/s, the United States today mines about 58 EH/s, accounting for approximately 35% of global capacity. If Wyoming fulfilled its goal of 5% of US mining today, it would account for more than 2.88 EH/s of the current world hash rate.
At present hash rates, Wyoming will need to grow tenfold to meet its goal of producing 5% of US hash power by May 2024 and will almost certainly need to grow tenfold to compete with other new projects across the US. (This does not consider the likelihood that the global hash rate may hit 300 EH/s or that the United States will have a higher percentage of hash rate by May 2022.)
Thanks as always for reading Overbit Weekly Round Up – have a great weekend!