July 2, 2022
  • July 2, 2022

Central banks understand cryptocurrency and they want

By on May 10, 2021 0

Alex Pickard bought his first Bitcoin in 2013. Within a few years, he was on top.

“People were still very skeptical. But I thought I understood that very well,” Pickard said.

In 2017, he quit his finance job in California to mine full-time Bitcoin in Washington state, where electricity costs were cheap. He spent nearly $ 300,000 to set up his own mining center, which required the use of high-powered computers to earn Bitcoins. But less than a year later, he had to go out of business.

“I put so much pressure on the grid that basically ten beefy men from the northwest came to my door and demanded that I turn off all my machines because I was putting pressure on the grid,” he said. Pickard said.

Soon after, the price started to drop, rendering his mining efforts completely unnecessary. He has since returned to his job and has a very different take on Bitcoin today.

“It’s so far removed from what it was originally planned,” Pickard said.

But there are still a lot of people betting big on crypto. One of the reasons could be the effort of central banks to create their own.

“Central bank digital currencies are now possible and we are going to see some of them around the world, and we need to understand if this is something that would be good for the people we serve,” said the president of the Federal Reserve, Jerome Powell. .

It’s not just the Federal Reserve. Central banks in Europe, China and Japan are also exploring their own digital currencies. And in the Bahamas, the Sand Dollar digital currency already exists.

Investors are embracing central bank adoption, seeing it as a natural progression that gives legitimacy to the often misunderstood world of cryptocurrency.

“I think regulation is probably a good thing for the space and inevitable,” said Alex Adelman, founder of Lolli.

But his supporters argue that a bright future is ahead, whether central banks join in or not.

“There are fiat currencies that connect people in a country. Bitcoin connects people who are on the Internet and who are of extreme value,” Adelman said.

Pickard’s take on Bitcoin has changed, but he believes cryptocurrency in general will remain popular – even if it isn’t as decentralized as it once thought.

“It’s an interesting world we’re heading into when it comes to central bank digital currencies and people actually using blockchains for their day-to-day transactions, because it really means every transaction is stored in a database. permanent data, ”Pickard said.

This story was originally reported by Bianca Facchinei on Newsy.com.