Top 5 Cryptocurrency News of the Week

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Bitcoin mining difficulty expected to see biggest jump since January

Bitcoin (BTC) mining difficulty is expected to increase this week at the highest rate since January this year after the network hash rate surged over the past 11 days.

According to BTC.com data, the next difficulty adjustment estimate – expected on Wednesday – is +6.63%, from the current 28.35T to 30.23T. This will be the strongest single adjustment to the upside since Jan 21 of this year when the difficulty increased by 9.32%.

The mining difficulty is automatically adjusted approximately every two weeks to ensure that there are 10 minutes between each mined block.

The drastic adjustment comes after the Bitcoin network’s hash rate – or the amount of processing power used to secure the network – has increased dramatically over the past 11 days. From a low of 198.4 hash/sec on August 8, the hash rate on Monday was 231.5 hash/sec (based on a 7-day moving average), BitInfoCharts data shows.

New Bitcoin Ban Call Causes Excitement

In Switzerland, the request to ban bitcoin is currently causing an uproar. This comes from a former crisis manager at Swissgrid, the operator of the Swiss power grid. He is responsible not only for operation, but also for maintenance and expansion.

In an interview with CH Media, Paul Niggli called for a ban on Bitcoin, after all, computers require an incredible amount of power and therefore electricity. According to his calculations, bitcoin consumes twice as much energy as the whole of Switzerland. A single transaction requires the same amount of electricity as a Swiss family in a month and a half.

The consensus and mining mechanism require a lot of energy

This argument is not new, after all, there have been various studies for years attributing energy consumption in an entire country to Bitcoin. The so-called consensus mechanism, which ensures security in the network, is responsible for this. Mining also requires a lot of electricity. This mining of new bitcoins is now said to account for half a percent of global electricity consumption.

If the price of Bitcoin rises again, experts also expect an increase in electricity consumption. Ultimately, this increases the attractiveness of prospecting. But industry representatives find Paul Nigley’s arguments pointless, after all, a large part of exploration only occurs when energy prices are correspondingly low, and thus makes the mining business model profitable.

So you can deduct crypto losses for tax purposes

Huge price drops at times caused huge losses to many investors. However, this only applies if you have decided on hodl, otherwise the book values ​​will be reduced. But anyone who sold their digital assets and thus realized the losses can also deduct them from their taxes in Germany. However, there are some things to consider.

Now anyone who buys cryptocurrency knows that it is subject to strong price swings. This volatility makes the assets of Bitcoin, XRP, Ethereum and Co. More dangerous than traditional products. If you do not want to wait for the recovery and sell off, then you realize real losses. But these can reduce the tax burden.

1 year period applies here

If the period between purchase and sale is not more than one year, the profits of this trade must be taxed in Germany. But losses can also be controlled once they are achieved. So there must be a sale or exchange of another cryptocurrency at a lower price.

If this is the case, the losses can be offset against the potential profits from cryptocurrency trading (if it occurs within a one-year period). Thus, losses reduce the tax burden on profits. Therefore, pure exchange rate fluctuations cannot be included in the tax return.

Paraguay president foils Bitcoin and cryptocurrency mining law with a ‘full veto’

Paraguayan President Mario Abdo Benítez has stunningly toppled a promising bill that would legalize and regulate bitcoin (BTC) and crypto mining in the Latin American country.

As reported, the ambitious bill began as a private bill in the House of Commons and was drafted in collaboration with local miners looking to harness the surplus electric power produced by hydroelectric power stations. Eventually, he assumed the presidency of the Senate, where he was represented by Senator Fernando Silva Fassetti.

The Senate approved the bill, and so did the House of Commons. However, the bill appears to have fallen at the last hurdle as Benítez is unhappy with how energy consumption in crypto mining affects long-term sustainability.

According to Portalo de Bitcoin, Benítez explained that cryptocurrency mining “requires a high level of electricity consumption, which could jeopardize the development and expansion of an inclusive and sustainable national industry.” The decree, which the president says was issued on the advice of the country’s central bank, also points to the fact that mining requires “intensive use of capital and low use of manpower” and “as such does not add value” to the economy it creates.

Ethereum’s Vitalik Buterin has published a selection of his writings

Summer is drawing to a close and fall is fast approaching, a time when booksellers around the world are booming. Ethereum (ETH) co-founder Vitalik Buterin has joined the race for the best-selling cryptocurrency of the year with the upcoming edition of Proof of Stake, a compilation of his writings over the past 10 years.

The title is scheduled to be released on September 27 as a physical and digital book, chirp Buterin. The author said that his entire share of the proceeds from the book will go to support open source commodities through Gitcoin Grants.

Interested readers can obtain a signed digital copy of the Proof of Stake and the corresponding NFT here.

The website reads “Donate any amount of ETH to receive an NFT and a signed book from Vitalik. You will receive a non-transferable NFT and once the book is available you will have access to your signed digital copy.”

For pledges made on the book’s official website, 90% of the funds will go to the Gitcoin Grants Matching Pool and 10% to the title publisher, Seven Press Storiesto support public goods in independent publishing.

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