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Endangered plan to reduce emissions. According to the study, bitcoin mining threatens the fulfillment of China’s climate goals

Bitcoin mining in China is so demanding on carbon dioxide emissions that it could jeopardize the country’s plan to reduce emissions. This is according to the latest study by academics from Chinese, American and British universities, which was pointed out by the BBC server. China currently accounts for more than 75 percent of global bitcoin mining.
Some rural areas in China are popular with bitcoin miners, mainly due to low electricity prices and the offer of vacant land for server locations. The country also has a relatively easy connection to specialized hardware manufacturers.

Bitcoin mining requires the enormous power of computers, which have to calculate complex mathematical problems, for which the miner receives a share of coins. And these computers need a lot of electricity.
Worldwide, 128.84 terrawatt-hours (TWh) of energy is currently consumed annually to extract bitcoins. This is more than the consumption of countries such as Ukraine or Argentina.

The study was prepared by academics from the University of the Chinese Academy of Sciences, the Qinghua University in Beijing, Cornell University in the United States and the British University of Surrey. It was published in the journal Nature Communications.
Looking to the future

If the state does not intervene, according to the study, electricity consumption for the bitcoin industry in China should peak in 2024, when it will be 296.59 TWh. This is more than the total consumption of countries such as Italy and Saudi Arabia in 2016.

That is, countries that finished in 12th place in the ranking of the largest consumers of electricity. This electricity consumption corresponds to emissions of 130.5 million tonnes of carbon per year. This is more than the production of greenhouse gases in 2016 in the Czech Republic and Qatar.

China’s Inner Mongolia region said last month that it plans to ban new cryptocurrency mining projects and halt current activities to reduce energy consumption. The region is located in the north of the country and in 2019 did not meet the energy consumption target set by the central government, for which Beijing reprimanded it.
A possible solution

In response, the region presented plans to reduce energy consumption, which include the completion of existing cryptocurrency projects by April this year and the non-approval of others, CNBC reported.

Interest in bitcoin mining is aroused by their attractive price. Last April, the value of bitcoin was about 7,000 USD, while this year in March it was already 60,000 USD. However, the price is very volatile and subject to significant fluctuations.

US dollar could collapse 35 percent according to Stephen Roach’s forecast

The US dollar is considered a symbol of reliability, security and economic prosperity. He has held an undeniable dominant position in the international financial system since the mid-20th century and comes across as an invincible titanium. However, the era of the dollar’s dominance as the world’s primary reserve currency is slowly coming to an end. The largest banks predict a sharp decline next year, and the famous economist Stephen Roach is confident that the American currency may depreciate by a third. The reasons for the collapse will be the decline in personal savings, the growth of US government debt and the strengthening of China. The decline of the dollar diktat – in the material “Lenta.ru”.

Exorbitant privileges

The success of the American economy in the 20th century was largely due to the dominant role of the dollar. In turn, the achievement of this role was the result of the political and military superiority that the United States acquired after the First World War. Until now, the position of the dollar in the world of finance represents the main foundation of US prosperity. However, in 2002 there was a long-term tendency towards the weakening of the American currency, which is observed to this day.

Indeed, the dollar has not been doing very well lately. In particular, July turned out to be a very difficult month for the American currency, which renewed multi-month, and in some cases, multi-year lows. In just a month, the dollar lost six percent against the pound, five percent against the euro, and four percent against the Swiss franc and the Australian dollar. In addition, foreign exchange analysts are fully aware that July could be the worst month for the dollar in terms of monthly dynamics over the past ten years.

“The US economy has long suffered from a significant macroeconomic imbalance, namely, a very low level of domestic savings and a chronic current account deficit,” said Stephen roach, former Chairman of Morgan Stanley Asia, a senior research fellow at Yale University, in an interview with CNBC. “The dollar will fall very, very sharply.”

Its forecast calls for a 35% drop against other major currencies.

“These problems will grow stronger and stronger as we reduce the budget deficit in the coming years,” roach said.

The us dollar currency index has risen more than one percent over the past two weeks and remains relatively unchanged this year. But roach believes this is not the time for complacency.

“The national savings rate is likely to go deeper into negative territory than at any time in the US or any other leading economy in economic history,” he said.

Roach claims that other forces are also playing their roles here.

“At the same time, America is moving away from globalization and focused on separating itself from the rest of the world,” roach pointed out.

The big question is: will this happen quickly or gradually?

According to the expert’s rough estimates – within the next year or two. However, roach suggests that a crash in the dollar is almost inevitable, and this is a risk that investors should not ignore.

“As a rule, this has a negative impact on US financial assets,” he added. “This indicates the likelihood of higher inflation, as we import more expensive foreign goods from abroad, and this has a negative impact on interest rates.”

He is concerned that the situation could trigger a stagflation crisis like in the late 1970s, when prices rose sharply and economic growth was suppressed.

According to roach, even a change of power in Washington in November will not help significantly change the situation – especially when lawmakers are trying to combat the economic impact of the coronavirus crisis with unprecedented stimulus measures.

“Governing bodies in their lifetime have never had to deal with anything close to this,” roach said.

The main events of next week: the unemployment rate in Britain and Australia, the change in Japan’s GDP, the change in industrial production in China, the consumer price index in Britain, the US and the Eurozone, the change in retail trade in Britain and the US

On Monday, the volume of statistics will be minimal. At 06:00 GMT Japan will announce a change in the volume of orders for equipment for October. At 21:45 GMT New Zealand will report on changes in the prices of food in October.

Tuesday will be a very informative day of the week. At 00:30 GMT Australia will present the nab business confidence index for October. At 07:00 GMT Germany will release the consumer price index for October. At 07: 45 GMT France will announce a change in the number of employees in the private sector of the economy for the 3rd quarter. At 08:15 GMT Switzerland will publish producer and import price index for October. At 09: 30 GMT Britain will announce a change in the number of applications for unemployment benefits for October, as well as changes in the unemployment rate and average earnings for September. At 10:00 GMT, Germany and the Eurozone will present the ZEW Institute’s business sentiment index for November. At 19:00 GMT in the US will publish a performance report for October. At 23:30 GMT Australia will present the consumer confidence index from Westpac for November. At 23:50 GMT, Japan will announce a change in GDP for the 3rd quarter.

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Correlation of currency pairs: definition, calculation, application

The effectiveness of a trader depends on many factors, but one of the most significant determining his professionalism is the ability to calculate and analyze statistical indicators. For example, correlation of currency pairs helps to determine how sensitive your overall trading portfolio is to changes in the market at the moment. If it turns out that any surge will lead to a rapid decline in profitability, measures should be taken immediately. And without knowledge of the indicators hiding under the term Forex correlation, it will not be possible to correct the behavior without errors. Knowledge of trends in the relationship between currencies provides reliable protection of the trading portfolio risks.

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