Bitcoin reached the milestone of a $1 trillion market cap last week
Bitcoin fell as much as 11% on Thursday after a report from BitMEX Research suggested that a critical flaw called "double spend" had occurred in the Bitcoin blockchain.
Bitcoin reached the milestone of a $1 trillion market cap last week. It appears, however, that a tweet
from Tesla CEO Elon Musk, some words of caution from Treasury Secretary Janet Yellen and comments from
Microsoft co-founder Bill Gates are making its value drop fast.
The popular cryptocurrency fell to slightly over $47,000 on Tuesday, after breaking the $58,000 mark Sunday
afternoon. Musk tweeted Saturday that “BTC & ETH do seem high lol,” referring to Bitcoin and the digital coin
Ethereum. Musk’s tweet was part of a reply to a tweet from Peter Schiff, chief market strategist for brokerage firm
Euro Pacific Capital, about the value of Bitcoin versus gold-backed currency.
In an interview with Bloomberg, Gates gave his thoughts on Bitcoin and the idea that it can be affected so dramatically by a tweet from Musk.
“I’m not bullish on Bitcoin” he said. “If you have less money than Elon, you should probably watch out.”
Gates also expressed concern about Bitcoin’s massive use of energy, similar to a point Yellen made during the
DealBook conference on Monday. She remarked about how the amount of energy used for the transactions is “staggering.”
“I don’t think that Bitcoin … is widely used as a transaction mechanism,” she said, according to CNBC. “To the
extent it is used I fear it’s often for illicit finance. It’s an extremely inefficient way of conducting transactions, and
the amount of energy that’s consumed in processing those transactions is staggering.”
Bitcoin and other crypto coins such as Dogecoin require a lot of computing power in order for people to conduct
transactions. These heavy computer calculations, also known as mining, need a huge amount of power — more than the country of Argentina.
Bitcoin reached the milestone of a $1 trillion market cap last week…For most of 2020, Bitcoin rallied from its low of just shy of $5,000 in April to jump past $29,000 by the end of the year.
a debunked report from BitMEX Research on Wednesday suggested that a critical flaw called “double spend” had
occurred in the Bitcoin blockchain.
Double spend is when someone is able to spend the same bitcoin twice. It is a feared and dire scenario for the
digital asset, and the blockchain was thought to have solved the issue when Satoshi Nakamoto published the Bitcoin white paper in 2009.
Early attempts to launch a digital cash system were ultimately halted by vulnerabilities that could have enabled
double spending and undermined faith in the system.
BitMEX Research tweeted that “it appears as if a small double spend of around 0.00062063 BTC ($21) was detected.”
BitMEX later said it appeared that the double spend was actually an RBF transaction , which is when an
unconfirmed bitcoin transaction is replaced with a new transfer paying a higher fee. But BitMEX’s Fork Monitor
said that “no (RBF) fee bumps have been detected.”
BitMEX said in another tweet : “A transaction in the losing chain sent 0.00062063 BTC to the address
1D6aebVY5DbS1v7rNTnX2xeYcfWM3os1va, and a transaction in the winning chain which spent the same inputs
only sent 0.00014499 BTC to this address.”
Ultimately, the double-spend event did not occur, according to Bitfinex CTO Paolo Ardoino. In an e-mail to
Insider, Ardoino explained, “In fact, what happened is that two blocks were mined simultaneously. As a
consequence, there was a chain reorganization, which did not result in double-spending.”
Meanwhile, institutional investors continue to gain exposure to bitcoin. Filings with the Securities and Exchange
Commission on Wednesday said BlackRock had enabled two of its mutual funds to invest in the cryptocurrency.
Bitcoin reached the milestone of a $1 trillion market cap last week.