How Power Needs and Millennial Interest are Driving the Bitcoin and Cryptocurrency Sector (OTCQB: $INTV) (NASDAQ: $MARA) (OTCQX: $HVBTF) (OTCQX: $GBTC)
Point Roberts, WA and Delta, BC - April 11, 2019 (Investorideas.com Newswire) Investorideas.com, a global investor news source covering blockchain and cryptocurrency issues a special edition of the Crypto Corner looking at recent news and developments in the cryptocurrency sector.
Cryptocurrencies are experiencing a rise in price again, with Bitcoin reaching its 400 Millionth transaction recently. From a recent Independent article; "Around 350,000 transactions take place every day across its (meaning Bitcoin's) decentralised blockchain, with many of these transactions currently passing through China where the majority of bitcoin mining operations are located, however this may soon be about to change. The country's economic planning agency announced this week that it is considering a ban on bitcoin mining - the process of generating new units of the cryptocurrency by providing the computing power needed to confirm transactions. If implemented, the ban would have a significant impact on the bitcoin network and potentially even the price of bitcoin, with analysts suggesting it could cause further price rises."
"It's more likely to push bitcoin prices up than down," market analyst Mati Greenspan told The Independent this week. "The loss of cheap Chinese electricity would raise the mining cost, which is net positive on price."
This is good news for cryptocurrencies like Bitcoin and Ethereum, as well the US crypto-mining companies looking to fill the void China will leave. Integrated Ventures Inc. (OTCQB: INTV), a company engaged in digital currency mining operations, (both manufacturing equipment and selling mining rigs) as well as developing blockchain software, recently announced the execution of a Letter of Intent to acquire a fully permitted and currently idled, 80 MW natural gas-fired combined heat and power plant, located in Pennsylvania.
The Company intends to complete the restart of the Power Plant and to launch cryptocurrency operations within 4-5 months. The Company operations will focus on (i) mining using the Company's owned mining rigs, (ii) hosting third-party mining rigs and (iii) operating a mining pool.
Steve Rubakh, CEO commented, "Cogeneration is a proven technology that produces 3 cents power, up to 75% increase in efficiency, delivers up to 70% in energy savings, up to 50% reduction in GHG emissions, eliminates reliance on local utilities, and thus provides a stable and reliable access to electricity. The Power Plant will generate electricity, at below market cost, which turns 100% of rigs that mine BTC, ETH and LTC profitable. Due to Power Plant's generation capacity of 80 MW, the Company will have an unmatched ability to grow the revenue streams by gradually scaling mining and hosting operations and by establishing synergistic partnerships with companies operating in the same space."
HIVE Blockchain Technologies Ltd. (TSX.V:HIVE) (OTCQX:HVBTF), who recently announced its results for the third quarter ended December 31, 2018, is also looking to fill the infrastructure gap in this industry as discussed in their financial results.
"The cryptocurrency ecosystem continues to undergo significant volatility amid continually evolving regulatory review and fluctuations in price," said Frank Holmes, Interim Executive Chairman of HIVE. "However, HIVE has remained committed to deploying infrastructure assets and diversifying our business mix to commence mining of new coins. We continue to accumulate Ethereum and Ethereum Classic and in the third quarter began adding Bitcoin to our coin inventory. In the quarter we more than doubled our mining capacity, negotiated improved financial terms with our largest partner and added an additional 100 Petahashes ("PH") of capacity at a significantly lower cost than prior deployments."
A recent Bloomberg article discussed how bitcoin's latest gains have helped boost the market, including Marathon Patent Group, Inc. (NASDAQ: MARA), a digital asset technology company that mines cryptocurrencies with a focus on the blockchain ecosystem and the generation of digital assets, and is currently operating one mining facility in Quebec.
Marathon recently announced a four-for-one reverse stock split of its outstanding common stock, intended to bring the Company into compliance with the minimum average closing share price requirement for maintaining its listing on the Nasdaq Capital Market.
According to a recent survey from eToro US, growing interest from millenials is also helping drive the price of crypto. "We're seeing the beginning of a generational shift in trust from traditional stock exchanges to crypto exchanges," says Guy Hirsch, Managing Director of eToro US. "Younger investors' experience with the stock market has seen a great deal of loss of trust, with the fall of Lehman Brothers because of irresponsible practices followed by the worst recession since the Great Depression. As more investors become educated in the benefits of the blockchain, we'll continue to see this trend play out."
Grayscale Investments, LLC, a global leader in digital currency asset management released its 2018 Grayscale Digital Asset Investment Report, a comprehensive report that highlights investment activity across the Grayscale family of products in 2018, which very much aligned with the eToro survey results. Grayscale raised $359.5 million into its single-asset and diversified investment products, marking the strongest fundraising year in Grayscale's history and nearly three times more capital than was raised in 2017.
Bitcoin continued to be the most dominant digital currency for Grayscale investors. In the fourth quarter, 88% of all capital inflows went into Grayscale Bitcoin Trust™ (OTCQX: GBTC). Notably, institutional investors accounted for 66% of all new investment dollars in 2018, despite the broad-based price reduction across digital currencies.
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