Often we speak of digital currencies, crypto, bitcoin and stablecoins. But how do they compare? For now we focus on bitcoin and stablecoins. While both are key players, they serve completely different purposes.

To get insights on the difference between stablecoins and bitcoin, I spoke with bitcoiner and nostr expert Jordi Llonch Esteve for a true bitcoiner perspective on the topic.

What Are Stablecoins?

Stablecoins are digital tokens pegged to the value of fiat currencies, like the US dollar or Euro. Think of them as casino chips; representations of real money that are easier to use in certain environments. Their goal is to provide stability in a volatile crypto market. They are useful for quick transactions or as a bridge between traditional finance and digital assets. However, they rely on third-party issuers and reserves, which introduces layers of trust and risk.

But here’s the catch: stablecoins aren’t truly “stable.” They’re only stable relative to the fiat currency they’re pegged to, which itself can lose value over time due to inflation. So, while $1 might always equal 1 USDT (a popular stablecoin), the purchasing power of that dollar can decrease.

That’s why I don’t like the term stablecoin. They are pegged-coins; tokens that live on a private network.

Bitcoin: The Scarce Digital Asset

Bitcoin, on the other hand, is fundamentally different. It’s not just another currency. It’s a decentralized form of money with a fixed supply of 21 million coins. Unlike fiat or stablecoins, Bitcoin isn’t controlled by any government or company. Its scarcity and decentralized nature make it a unique store of value.

Some say that Bitcoin is real money because it’s immune to inflation and free from the risks associated with centralized control. However, its price volatility and steep learning curve can make it intimidating for newcomers.

Do Stablecoins Compete with Bitcoin?

Not really. Comparing Bitcoin to stablecoins is like comparing apples to buildings. Each of them serve different purposes. Stablecoins are more like credit or tokens for short-term transactions, while Bitcoin is designed to be a long-term store of value and a hedge against inflation.

Can stablecoins slow Bitcoin’s adoption?

In the short term, yes. People often go to what feels familiar, and stablecoins resemble traditional money. But as more people learn about Bitcoin’s unique properties, like its ability to preserve value over time, they may start to see its advantages.

The Risks of Stablecoins

One major downside of stablecoins is their reliance on trust. You have to trust the issuer to actually hold reserves and maintain the peg to fiat currency. Plus, there are multiple layers involved. From the company issuing the token to the central bank managing the underlying fiat currency. Each layer introduces potential points of failure.

Final Thoughts

Both Bitcoin and stablecoins have their place in today’s economy. Stablecoins offer convenience for transactions, especially in underbanked regions. But if you’re looking for a way to preserve value over time without relying on third parties, Bitcoin is in a league of its own.

Understanding these differences is key to making informed decisions in the world of digital assets. Want to dive deeper? Jordi recommends checking out books like Broken Money by Lyn Alden or exploring the work of Professor Richard Werner. They’re excellent resources for understanding the history of money.

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This blog post is strictly educational and for general information only. Readers are encouraged to conduct their own research and consult a professional before making any investment decisions.

Disclaimer: This blog post is authored by Marilyn as a continuance of her education and passion ignited during the Bitcoin Talents Program at Frankfurt School of Finance & Management. The insights and opinions shared here aim to inform and engage the public.

On Sunday September 14th the Brunch & Bitcoin for ladies took place in Asunción. It was a side event to Acelerando Bitcoin, the first bitcoin conference organised in Paraguay.

For this ladies brunch, Talk Satoshi to Me was part of the organising team. Having helped organise events in Europe, there is also quite a difference in organising events in South America, more on that another time.

Earlier in 2025, at a different conference, Jan Kotas shared about the Acelerando Bitcoin event in Paraguay. As he was one of the co-organisers of the main event, it was great that he could share some insights and answer the following 3 questions.

What is the main idea ( vision/mission and target audience) of Acelerando Bitcoin?

The mission of the Acelerando Bitcoin conference is to showcase Paraguay’s incredible potential for Bitcoin adoption and highlight how “signal” our local community is. Paraguay offers immense energy resources that could be harnessed for Bitcoin mining. Moreover our Bitcoin Paraguay community, established just 16 months ago, has already grown into one of the largest and most successful Bitcoin communities worldwide. The conference targets Bitcoin enthusiasts, miners, developers, investors, and global community members eager to connect, learn, and explore Paraguay’s unique role in the Bitcoin ecosystem.

Why is now, sept 2025, the best time to have such an event in Paraguay?

The timing of September 2025 was chosen for several key reasons. First, it marks the end of winter in Paraguay and the start of spring, offering pleasant weather ideal for hosting an event. Second, we carefully selected a date that avoids conflicts with other major global Bitcoin conferences to maximize our chances of attracting top international speakers. Finally, the availability of our preferred conference venue played a crucial role in securing this date.

Can you share a little bit about the organising team behind this event, how did you get together to organise Acelerando Bitcoin?

The event was organized by Lorena Almada, Bruno Vaccott and myself, and the event agency Puken. As experienced Bitcoiners, we focused on securing high-profile speakers, preparing the agenda, and approaching sponsors. Puken handled the infrastructure, logistics, and operations during the event. We also owe a huge thanks to the Bitcoin Paraguay community, particularly volunteers like Juan Pessolani and John James, who dedicated significant time to advising, connecting us with companies and individuals, and supporting the event’s success.

The idea for  Brunch & Bitcoin for ladies was to share experiences, learn and strengthen the presence of women in the Bitcoin space. The event venue, ConfiteríaHoney, had prepared amazingly delicious food. The ladies arrived at the brunch and everyone introduced themselves and shared some nice introductions. Everyone had the opportunity to eat and mingle. 

Sofi, the panel moderator, mentioned: “I think education is of importance, especially for women. We don’t want to stay behind and there is also a lot of misinformation. Events like this are important to meet with like-minded people that inspire us to keep trying and growing. It’s about sharing and connecting in person.”

Clarissa, an attendee of the event mentioned: "Bitcoin is not only a men’s thing. These meetups are important for women to learn and explore possibilities”.

The ladies were quite excited and happy they attended the brunch and are looking forward to meeting again.

Drawing from my logistics background and experiences at several women's and general events, I think about how future women's events can be shaped. What strategies can be implemented to balance connection, sharing, and learning while maintaining quality and an enjoyable and social environment?

Brunch and Bitcoin for ladies Asuncion edition

This is "Brunch and Bitcoin for ladies Asuncion edition" by UsershareswU on Vimeo, the home for high quality videos and the people who love them.

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This blog post is strictly educational and for general information only. Readers are encouraged to conduct their own research and consult a professional before making any investment decisions.

Disclaimer: This blog post is authored as a continuance of the education and passion ignited during the Bitcoin Talents Program at Frankfurt School of Finance & Management. The insights and opinions shared here aim to inform and engage the public.

Over the years, bitcoin mining has evolved. It grew from a niche activity into a green energy innovation. Pieter Voogt, a Bitcoiner, Entrepreneur and the Chief Marketing Officer (CMO) of Pantheon Mining, shared insights on the future potential of Bitcoin mining.

Pieter's journey into Bitcoin started  during the ICO boom. His interest in cryptocurrency was triggered by developers colleagues at his company. 

Eventually due to his curiosity, Pieter started to focus on Bitcoin only.  He learned about its unique attributes compared to regular cryptocurrencies. Over time, he became more involved in the Bitcoin ecosystem. He founded the Crypto Golf Tour events with a focus to connect Bitcoin enthusiasts and expand their networks. His path crossed with Pantheon Mining which led him to take on the role of Chief Marketing Officer (CMO). 

Pantheon Mining is a Dutch company that offers mining as a service. They strategically select locations where energy is affordable and abundant. Mining in the Netherlands is expensive due to high energy prices. Therefore Pantheon chose to set up facilities in Dubai and is exploring  Romania, Nigeria, and the United States. The choice for these locations is based on cost-effectiveness and access to cheap and mostly renewable energy sources such as solar, wind, and nuclear power.

Pieter highlights how Bitcoin mining can drive environmental benefits with innovative use cases like methane flaring. Methane is 80 times more harmful than CO2 but can be converted into energy for Bitcoin mining which makes the process carbon-negative. This approach reduces harmful emissions and also contributes to a cleaner atmosphere.

Another use case is Bitcoin mining with renewable energy development. In regions where the energy grid is saturated, Bitcoin miners can make use of electricity generated by wind or solar farms. This ensures that renewable energy projects can proceed without waiting for grid capacity. In remote areas in Africa, Bitcoin mining helps fund hydroelectric power stations and  provides electricity to communities.

Next to the sustainability factor, Bitcoin mining also has economic benefits. It creates local jobs for electricians, contractors, and maintenance personnel in the construction and operation of mining sites. Pieter mentioned examples from both Dubai and the United States where mining facilities have boosted local economies.

Though there are concerns about halving events reducing block subsidies, he thinks that Bitcoin mining remains an attractive investment for high-net-worth individuals and family offices. Pieter explains that rising Bitcoin prices typically offset these reductions. He emphasises that success in mining depends on low-cost energy and an efficient infrastructure.

Pieter also addresses skepticism around Bitcoin’s future. He truly believes that there is no middle ground; Bitcoin will either fail completely or reach unprecedented heights. With growing global adoption and regulations being set up, the chance that Bitcoin fails is possibly unlikely.

According to Pieter, Bitcoin mining can play an important role in global sustainability efforts. It can support renewable energy initiatives, reduce emissions and bring economic growth in underserved regions. Mining is able to make a lasting impact. Governments and energy companies should focus on the potential of mining to align financial incentives with environmental goals.

In conclusion, Bitcoin mining is much more than the creation of a digital currency. It’s a driving force for innovation and sustainability. As Pieter noted, "Every government that truly values sustainability should focus on the topic of Bitcoin mining."

Share some love and support! Donate some sats to keep the research and education going! https://pay.blink.sv/paymenow/print

This blog post is strictly educational and for general information only. Readers are encouraged to conduct their own research and consult a professional before making any investment decisions.

Disclaimer: This blog post is authored by Marilyn as a continuance of her education and passion ignited during the Bitcoin Talents Program at Frankfurt School of Finance & Management. The insights and opinions shared here aim to inform and engage the public.

Disclaimer: This blog post was co-authored by Marilyn and Suriyaa Sundararuban as part of the Bitcoin Talents Program at Frankfurt School of Finance & Management. The insights and opinions shared here are intended to inform and engage the public.

This blog post does not constitute financial advice. Readers are encouraged to conduct their own research before making any investment decisions.

Bitcoin mining has long been a lightning rod for debates about energy consumption and environmental impact. The process, which involves solving complex cryptographic puzzles to validate transactions and secure the blockchain, requires substantial computational power—and with it, vast amounts of electricity. At times, Bitcoin’s total energy consumption has been compared to that of entire countries, sparking concerns about carbon emissions and the sustainability of the network.

However, this narrative is evolving. The mining industry is increasingly aware of its environmental responsibilities and the economic advantages of cleaner energy sources. A growing number of miners are shifting away from fossil fuels, which have traditionally powered many mining operations, toward renewable energy like solar, wind, and hydropower. This transition is not only driven by environmental concerns but also by the economics of energy costs and regulatory pressures.

Regions such as Iceland, Canada, and Texas have become hotspots for renewable-powered mining. Iceland benefits from abundant geothermal and hydropower resources, offering miners a near-zero carbon footprint. In Canada, hydroelectric power supplies clean and affordable energy, while Texas leverages its wind farms and solar installations to support mining operations. Estimates suggest that between 40% and 75% of Bitcoin mining is now powered by renewables, and this percentage continues to rise as renewable technologies become more efficient and cost-effective.

This shift has significant implications. By embracing renewables, miners reduce their carbon footprint and contribute to the broader decarbonization of the energy sector. Moreover, renewable energy can be more stable and less subject to price volatility than fossil fuels, providing miners with predictable operational costs and a competitive advantage.

Yet, challenges remain. Not all mining operations have equal access to renewable resources, and some regions still rely heavily on coal or natural gas. Additionally, the rapid growth of mining capacity risks outpacing the development of clean energy infrastructure if not carefully managed. Policymakers, industry leaders, and communities must collaborate to ensure that Bitcoin mining supports, rather than undermines, global sustainability goals.

Renewable Energy

Learn more: Read Marilyn Bakboord’s original blog post here.

Renewable energy is transforming Bitcoin mining from an energy-intensive activity into a driver of sustainable innovation and economic opportunity. The declining costs and increasing availability of solar, wind, and hydropower are reshaping the energy landscape, creating new possibilities for miners and energy producers alike.

One of the most compelling advantages of renewable energy is cost. Solar and wind power have become some of the cheapest sources of electricity worldwide, especially in resource-rich regions. For Bitcoin miners, this translates into significantly lower operational expenses compared to reliance on fossil fuels, which are subject to price fluctuations and supply constraints. Hydropower, in particular, offers a stable and reliable energy source in many parts of the world, making it ideal for continuous mining operations.

Moreover, renewable energy provides energy independence and resilience. Miners located near renewable installations can avoid transmission losses and reduce dependence on centralized grids, which may be vulnerable to outages or price spikes. This localized approach also supports grid decentralization, a key factor in modernizing energy systems.

The environmental benefits are equally important. By using clean energy, miners reduce greenhouse gas emissions and air pollution, aligning their operations with global climate targets. This alignment opens doors to partnerships with governments and corporations focused on sustainability, as well as access to green financing and incentives.

Real-world examples illustrate this transformation. In Texas, wind-powered mining farms are helping to stabilize the grid by absorbing excess energy during peak production periods, reducing curtailment, and supporting grid reliability. Iceland’s geothermal and hydropower-powered mining operations showcase how abundant renewable resources can power large-scale mining with minimal environmental impact. Canada’s hydroelectric-powered mining clusters demonstrate the economic viability of combining clean energy with digital infrastructure.

The synergy between renewables and mining also encourages further investment in green infrastructure. As miners create demand for clean energy, energy producers are incentivized to expand capacity, innovate in energy storage, and improve grid integration. This virtuous cycle accelerates the transition to a low-carbon energy future.

However, maximizing these benefits requires thoughtful planning. Infrastructure development, regulatory frameworks, and technological innovation must align to support the integration of mining with renewable energy. Energy storage solutions, demand response mechanisms, and smart grid technologies will play crucial roles in optimizing energy use and minimizing environmental impact.

Grid Stability

Learn more: Read Suriyaa Sundararuban’s original blog post here.

One of the most exciting and underappreciated aspects of Bitcoin mining is its potential to enhance grid stability and facilitate the integration of renewable energy sources. Unlike many industrial processes, Bitcoin mining is highly flexible in its energy consumption, able to ramp up or down quickly in response to grid conditions. This flexibility makes mining a valuable “shock absorber” for modern electricity grids, which increasingly rely on variable renewable energy generation.

Renewable energy sources like solar and wind are intermittent by nature—they produce electricity only when the sun shines or the wind blows. This intermittency creates challenges for grid operators, who must balance supply and demand in real time to maintain reliability. Excess energy during peak renewable production can lead to curtailment, where clean energy is wasted because it cannot be stored or transmitted efficiently.

Bitcoin mining offers an elegant solution. Mining farms can absorb surplus electricity during periods of high renewable output, converting it into Bitcoin rather than letting it go to waste. When demand on the grid rises or renewable output falls, miners can reduce their consumption, freeing up power for other uses. This dynamic load balancing helps smooth out fluctuations, reduces strain on grid infrastructure, and improves overall system efficiency.

Several regions are already demonstrating this model in action. Texas, with its large wind and solar capacity, has seen mining operations partner with grid operators to provide demand response services. By adjusting their energy use in real time, miners help prevent blackouts and reduce the need for expensive peaker plants that run on fossil fuels. In Iceland and Canada, mining farms located near renewable resources contribute to grid stability while supporting local economies.

This symbiosis benefits both miners and energy providers. Miners gain access to low-cost electricity and can monetize their flexibility through grid services, while utilities improve grid reliability and integrate more renewables without costly infrastructure upgrades. It also encourages investment in energy storage and smart grid technologies, further enhancing the resilience and sustainability of the power system.

Moreover, this relationship can help accelerate the global energy transition. By providing a reliable demand sink for renewable energy, Bitcoin mining reduces the economic risks associated with renewable projects, making them more attractive to investors. This can lead to faster deployment of clean energy capacity, benefiting the broader energy ecosystem.

However, realizing this potential requires collaboration and innovation. Regulators need to create market frameworks that reward flexible demand and grid services. Miners must invest in smart controls and energy management systems to respond effectively to grid signals. Energy providers and miners should work together to identify optimal locations and develop integrated infrastructure.

Future Use Cases and Potential

As Bitcoin mining embraces sustainability and grid integration, its future potential extends far beyond its traditional role of securing the blockchain. Emerging use cases and innovations are positioning mining as a multifaceted technology with broad implications for energy systems, digital infrastructure, and environmental stewardship.

Smart Grid Integration and Automated Demand Response

Energy Crisis in Europe (Source: baba-blog.com)

The future of mining lies in deep integration with smart grids. Advanced algorithms and real-time data analytics will enable mining farms to automatically adjust their energy consumption based on grid conditions, electricity prices, and renewable output forecasts. This automated demand response can optimize energy use, maximize profits, and provide valuable grid services such as frequency regulation and load balancing.

Monetizing Stranded and Wasted Energy

Bitcoin in El Salvador (Source: digitaltokens.io)

Mining can unlock value from stranded or wasted energy resources worldwide. Remote renewable projects often face transmission bottlenecks or lack local demand, leading to curtailment. Deploying modular, mobile mining units near these sites allows excess energy to be converted into Bitcoin, generating revenue that supports further renewable development and infrastructure investment.

Methane and Flaring Gas Utilization

Innovative mining operations are capturing methane and flared gases from oil fields—potent greenhouse gases that would otherwise be released into the atmosphere—and using them to power mining rigs. This approach reduces emissions while creating economic incentives to reduce waste gas flaring, contributing to climate mitigation efforts.

Diversification into High-Performance Computing and AI

Mining companies are leveraging their expertise in data center management and energy procurement to expand into adjacent sectors like high-performance computing (HPC) and artificial intelligence (AI) infrastructure hosting. This diversification enhances operational resilience and positions miners as critical players in the digital economy.

Blockchain for Energy Transparency and Certification

The blockchain itself can be used to verify and certify the renewable origin of energy used in mining. Transparent, on-chain ESG reporting and certification protocols enable investors, regulators, and consumers to identify truly green mining operations, fostering trust and encouraging sustainable practices industry-wide.

Supporting Rural Electrification and Economic Development

Bitcoin in Africa (Source: cointelegraph.com)

Mining operations located in rural or underserved areas can act as anchor tenants for new renewable projects and microgrids, stimulating local economies, creating jobs, and improving energy access. This model is gaining traction in regions across Africa, Latin America, and North America.

Circular Economy and Hardware Lifecycle Management

The industry is advancing toward a circular economy by refurbishing, recycling, and repurposing mining hardware. Innovations in hardware efficiency and lifecycle management reduce electronic waste and environmental impact, contributing to sustainable resource use.

Conclusion

Bitcoin mining is undergoing a profound transformation—from an energy-intensive activity often criticized for its environmental impact to a catalyst for renewable energy adoption, grid modernization, and technological innovation. By harnessing renewable energy, integrating with smart grids, and exploring new use cases, the mining industry can contribute meaningfully to a sustainable energy future.

The road ahead requires collaboration among miners, energy providers, policymakers, and communities to align incentives, develop supportive regulations, and foster innovation. With continued progress, Bitcoin mining can become a powerful force for good—securing blockchain networks while advancing clean energy, economic development, and environmental stewardship.

Together, we can unlock the full potential of Bitcoin mining to build a greener, more resilient, and more equitable future for both the crypto ecosystem and the planet.

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Many often criticize bitcoin mining for its high energy consumption. In 2023, the bitcoin network consumed an estimated 127 terawatt-hours (TWh) of energy annually. This is similar to the energy usage of countries such as Argentina, Egypt, and Israel. It highlights the importance of sustainable and energy-efficient solutions to reduce environmental impact while also maintaining the network's integrity.

To address these issues, miners are increasingly adopting sustainable practices. They use renewable energy sources, improve the hardware efficiency and optimise mining operations. Many miners also join mining pools to share resources and reduce energy waste, ensuring a more collaborative and efficient approach. By focusing on energy-efficient solutions, bitcoin mining can keep supporting the decentralized network and also minimise its ecological footprint.

But how much energy does bitcoin actually consume?

In the visual below the energy consumption of bitcoin mining is compared to Ethereum and several nations with data from  Cambridge Centre for Alternative Finance.

This visual on biggest bitcoin mining nations globally, highlights the key players in the bitcoin mining industry.

The Cambridge Digital Mining Industry Report shares about the current state and the future of digital asset mining. It highlights key trends, challenges and opportunities in the sector. The Cambridge Digital Mining Industry Report shows that 52.4% of the energy used for bitcoin mining comes from sustainable sources. This includes 9.8% from nuclear energy and 42.6% from renewables like hydropower and wind, compared to a 2022 estimate of 37.6% for overall sustainable energy use. The report also highlights a shift in energy sources, with natural gas now accounting for 38.2% of Bitcoin mining energy, replacing coal, which has decreased to 8.9% from 36.6% in 2022. The study covers 48% of global mining activity and estimates bitcoin's annual electricity consumption at 138 terawatt-hours. This is roughly 0.5% of global usage, with network emissions at 39.8 megatonnes of CO2 equivalent. The data underscores North America's significant role in the digital mining sector, with the US leading at 75.4% of reported activity, followed by Canada at 7.1%.

Renewable energy sources like solar, wind, and hydropower are becoming more common in bitcoin mining and offer great advantages. Renewable energy sources also help bitcoin miners rely less on traditional power grids, making them less vulnerable to energy price changes and improving operational stability.

The green energy market in bitcoin mining is a win-win opportunity. It helps reduce the environmental footprint and also aligns with global energy transition goals, which could boost the industry’s reputation and encourage wider adoption. For investors, putting money into renewable energy solutions is both eco-friendly and a smart business move. As traditional energy costs are climbing, renewables can cut costs and improve efficiency. With renewable tech advances and regulations pushing for sustainable mining practices, exciting times ahead can be expected.

To get a good perspective of bitcoin mining and how it’s increasing a greener footprint, I spoke with Dušan Matuška. He is the co-founder of AmityAge, offering bitcoin mining as a service.

How does bitcoin mining work and what role do miners play in the Bitcoin network?  

Miners are essential for maintaining the security and order of the Bitcoin network. Bitcoin relies on miners to validate and record transactions. They act as the "security guards" of the network, ensuring its integrity by solving complex mathematical problems. Every 10 minutes, a computer somewhere in the world wins the chance to validate and add new transactions to the blockchain. Miners compete to solve a cryptographic puzzle, and the winner is rewarded with bitcoin. This process ensures fairness and eliminates the need for central authorities.

What is hash rate, and why is it important?

Hash rate measures how quickly a mining machine can perform calculations. Advanced machines can perform trillions of calculations per second. A higher hash rate increases the chances of solving the cryptographic puzzle and securing the network.

What types of machines are used for bitcoin mining?

Initially, mining was done using CPUs (regular computer processors) and later GPUs (graphics processing units). Today, specialized machines called ASICs (Application-Specific Integrated Circuits) are used. These machines are designed solely for mining bitcoin using the SHA-256 algorithm.

They are highly efficient and powerful but can only perform mining tasks. While they are effective, they would become useless if bitcoin mining ceases.

Does bitcoin mining consume too much energy ?

While bitcoin mining is energy-intensive, it often utilizes renewable energy sources. Miners frequently set up operations near hydroelectric dams or in remote areas with excess renewable energy that would otherwise go unused.

How does bitcoin mining support renewable energy initiatives?

Bitcoin miners act as "consumers of last resort," utilizing surplus energy from renewable sources in remote locations. By converting this energy into bitcoin, miners effectively create a virtual battery that makes renewable energy more economically viable.

Paraguay and Ethiopia are notable examples. Both countries rely heavily on hydroelectric power, making them ideal locations for renewable energy-powered mining. In Ethiopia, for instance, miners operate near hydropower plants

In Finland, miners are being used to heat homes by repurposing the heat generated during mining operations. This innovative approach reduces energy waste and lowers costs for both miners and homeowners.

It is often said that Europe is less favorable for Bitcoin mining, why is that?

Europe has stricter regulations and limited surplus energy compared to regions like Africa or South America. Miners in Europe face higher electricity costs and regulatory challenges, making it less attractive for large-scale operations.

Are there other examples of renewable energy sources used in mining?

Besides hydropower, wind and solar energy can also support mining operations. However, these sources are less abundant in some regions compared to others. For instance, wind energy could potentially be utilized in countries like the Netherlands.

How do miners contribute to energy efficiency in regions with excess supply?

Miners help balance electricity grids by consuming surplus power during low-demand periods. This prevents energy wastage and supports grid stability, especially in areas with renewable energy projects.

Bitcoin mining continues to evolve, integrate innovative technologies and renewable energy solutions to address environmental concerns while securing the network.

Key Takeaways

• Bitcoin mining is criticized for its high energy consumption

• To address these issues, miners use renewable energy sources, improve the hardware efficiency and optimise mining operations

• The Cambridge Digital Mining Industry Report reveals that 52.4% of the energy used for bitcoin mining comes from sustainable sources.

• Renewable energy sources like solar, wind, and hydropower are becoming more common in bitcoin mining and offer great advantages

• As traditional energy costs are climbing, renewables can cut costs and improve efficiency.

• Europe has stricter regulations and limited surplus energy compared to regions like Africa or South America

Important note:

This article is strictly educational and for general information purposes. Consult a professional for financial advice tailored to your situation.

This article is part of my final assignment for the Bitcoin Talents Program by the Frankfurt School Blockchain Center

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If you’re a beginner to bitcoin and based in Europe you might already know that MiCA, which stands for Markets in Crypto-Assets, is Europe’s regulatory framework. Though MiCA has a focus on all cryptocurrencies, for this interview, we mainly focus our thoughts and questions on bitcoin.

To get a better understanding of MiCA, I reached out to Iulianna Romanchyshyna, Dr. iur. She’s an EU Policy Expert with extensive knowledge on crypto regulation. In an interview she shared her answers and insights regarding the questions I had.

What is MiCA about?

The Markets in Crypto-Assets (MiCA) regulation is a framework designed to oversee cryptocurrencies within Europe. You pronounce it as “Mie-Kah”. MiCA has two key parts: one focuses on stablecoin regulation, and the other on regulating crypto service providers. Crypto service providers are a wide array of entities, including exchanges, wallets, custodians, and advisors. The goal of MiCA is to give businesses a sense of regulatory certainty, enabling them to operate under clear and consistent rules.

One of the features of MiCA that stands out is the concept of "passporting." This allows entities licensed in one EU member state to offer their services across all member states. The aim is to simplify operations and remove the complexities caused by varying national regulations.

For investors MiCA increases protection by setting strict standards around cybersecurity, consumer rights, and transparency. Its goal is creating a safe and trustworthy atmosphere for interacting with cryptocurrencies.

What is the impact of MiCA on Bitcoin?

MiCA doesn’t directly regulate bitcoin itself. It does have an effect on the bitcoin market because it’s setting rules for crypto asset service providers, like exchanges and wallets. These services are essential for buying and managing bitcoin, so even though the regulation doesn’t focus on bitcoin directly, it influences the infrastructure and services that support its use.

Say Bitcoin is purchased peer-to-peer, does MiCA play a role there?

Transactions that happen peer-to-peer or through decentralized exchanges aren’t directly regulated by MiCA. The same goes for unhosted wallets managed via smart contracts, where users keep control of their private keys; these also fall outside MiCA's regulatory reach. However, there are some nuances and specific situations that might come into play depending on the context.

How does MiCA help beginners new to the crypto market?

It’s important for users to know that MiCA is all about transparency, especially when it comes to on-ramping and off-ramping. This transparency will bring trust and accountability throughout the ecosystem.

MiCA wants to protect investors by tackling risks like financial mismanagement in exchanges and other crypto service providers. Service providers must have a license, to ensure they meet specific standards. This brings transparency and accountability, as users are informed about potential risks. MiCA also enforces complaint handling structures to address user concerns effectively. Measures are in place to prevent market abuse and guarantee that client funds remain separate from operational funds, for increased investor protection.

The FTX situation, for example, highlighted that the risks of mismanagement and lack of oversight can severely impact consumers. Regulations like MiCA will address these concerns and take steps to improve consumer trust and security.

Is there a link between MiCA and taxation?

MiCA itself doesn’t impose new tax obligations; taxation remains under the jurisdiction of individual national authorities within the EU. However, MiCA aims to standardize crypto-related terminology and enforce robust reporting and record-keeping by service providers. This could help tax authorities access necessary information more easily. Eventually tax policies could possibly be streamlined in the long term.

Additionally, the EU's DAC8 directive mandates the exchange of information on crypto holdings and transactions to further enhance clarity and compliance. All these measures should eventually create a more transparent and accountable framework for crypto assets in the EU.

Bitcoin transactions are public and transparent and it has a decentralised nature, it’s not controlled by an authority. MiCA on the other hand is about providing transparency through a centralised authority. Will MiCA make bitcoin investments safer or riskier?

It’s interesting to talk about the balance between decentralisation and regulation. Bitcoin remains decentralised, as its infrastructure isn’t controlled by any central authority. The MiCA regulation doesn’t focus on bitcoin or its decentralised nature — its focus is on centralised entities like exchanges and custodial wallets. Both are important for on-ramps and off-ramps, where users interact with fiat currencies or crypto assets. Without proper oversight, these centralised services could be a risk to investors. For example through mismanagement or lack of transparency. MiCA wants to combine trust and accountability without undermining the core principles of decentralisation. In fact, MiCA explicitly excludes "fully decentralised" activities from its scope. There is a bit of uncertainty as to what "fully decentralised" means, so further guidance would be needed.

Recap

The Markets in Crypto-Assets (MiCA) regulation introduces a unified framework for cryptocurrency operations within the EU. Once licensed in one member state, businesses can operate across all EU states, fostering cross-border opportunities. However, this primarily applies to businesses, not individual transactions, as crypto remains inherently borderless.

So just as we can send money across the globe, bitcoin transactions are borderless too. What is MiCA’s take on transactions from within the EU to outside the EU?

A key point of MiCA is its stance on foreign service providers. If a non-EU provider actively solicits EU clients, they must obtain a MiCA license. On the other hand, if an EU user independently seeks services from such a provider without solicitation, a MiCA license may not be necessary. This ensures consumer protection while limiting unregulated foreign actors' access to the EU crypto market.

In terms of transparency and accountability the crypto space is evolving in resemblance with traditional banking. While smaller transactions probably won’t face scrutiny, larger amounts—like 100.000 euros—are more likely to require disclosure of sources, especially for tax purposes. This makes it harder to move funds anonymously compared to years ago and aligns the crypto world more closely with established financial systems.

Will the transparency MiCA is aiming for have an effect on the price of BTC?

MiCA’s transparency is able to shape the crypto market by building trust and stability. Trying to predict bitcoin's price movements, on the other hand, is quite a challenge. The bitcoin price depends on a variety of factors. Elements like U.S. policies, economic changes, geopolitical tensions, and technological advancements all play significant roles in the price's volatility.

Would a business accepting Bitcoin as a means of payment require a MiCA license?

If a business only accepts crypto (e.g., bitcoin) as payment and doesn’t actively provide crypto-related services (like processing payments or operating an exchange), then obtaining a license is probably not necessary. Instead, the focus would move to tax compliance and accounting practices. Businesses would need to handle aspects like reflecting the fair value of bitcoin on their balance sheets and managing its volatility.

From December 30, 2024 the MiCA regulations fully applied to crypto-assets and crypto-asset service providers (CASPs); is the implementation complete?

Implementing MiCA comes with varying transition periods across EU countries where the previous national regime remains in force (so-called grandfathering). There are still some issues with the national authority's application of MiCA provisions. Eventually, all member states are expected to fully align with MiCA.

While the MiCA regulation is still in its early stages, the stakes for non-compliance are high. Enforcement of MiCA falls under the jurisdiction of national authorities. The consequences to non-compliance could range from suspension of activities to a ban on providing services. Financial penalties are substantial, they can even be a certain percentage of a company's total annual turnover. That’s why businesses are strongly encouraged to comply with MiCA requirements and obtain the necessary licenses to avoid these repercussions.

Explanations

Passporting means that a crypto-asset service provider (CASP) authorized in one EU member state can operate across the entire EU

Unhosted wallets are self custody wallets where users possess their private keys

Grandfathering is the transitional period that allows crypto-asset service providers (CASPs) operating under national laws to comply accordingly with MiCA

Important note

This article is strictly educational and for general information purposes. Consult a professional for financial advice tailored to your situation.

Sources

https://www.esma.europa.eu/esmas-activities/digital-finance-and-innovation/markets-crypto-assets-regulation-mica

https://gfmag.com/economics-policy-regulation/el-salvador-drops-bitcoin-legal-tender/

https://cleartax.in/s/cryptocurrency-taxation-guide

https://www.greaterzuricharea.com/en/news/businesses-lugano-accepting-crypto-currencies https://bitcoinsuisse.com/news/city-of-lugano-accepts-crypto-payments

https://crystalintelligence.com/crypto-regulations/the-travel-rule-hosted-vs-unhosted-crypto-wallets/

https://secuxtech.com/blogs/blog/hosted-vs-unhosted-crypto-wallets

Last December, we saw bitcoin reaching a new all time high of 100.000 USD. In 2024 we’ve seen the approval of the Spot Bitcoin ETF. Rumble, a video sharing platform, decided to diversify their corporate treasury strategy with bitcoin. As Amazon and Microsoft have considered holding bitcoin on the balance sheet, who else will follow their lead?

Some prominent leaders are sharing about their support of bitcoin too. Michael Saylor claims that bitcoin is the ultimate asset to hold for preserving a company's future. BlackRock calls bitcoin a unique portfolio diversifier. Bitcoin rewards for gaming are a way to earn and learn about it. The Czech Republic rewards hodlers with capital gains tax exemption when holding their assets for over 3 years. Allegedly El Salvador, on the other hand, has discussed with the IMF to change their policy on bitcoin.

These milestones show that there is much going on. The overview below shows how bitcoin stands apart from two mainstream asset classes: gold and fiat (Fig.1). Bitcoin is steadily carving out it’s role as a significant player in the DeFi (decentralized finance) ecosystem and related projects have already secured a value of about US$ 1.07 billion by September 2024. This evolution signals a shift in the financial landscape, highlighting the growing importance of understanding Bitcoin and its applications.

Why? It might be that this will have a possible impact on our job, our investments and our financial life. Having a better understanding may open up new opportunities and help us with better decision making. Before getting into advanced topics, getting insights from a bitcoin educator and business owner is a great way to familiarize ourselves with the basics.

Fig 1: Using traits of money to compare bitcoin, gold and fiat money. https://news.bitcoin.com/bitcoins-role-in-defi-evolves-cmc-research-and-footprint-analytics-report/

To get more insights on the topic, I reached out to Dušan Matuška. Dušan is the co-founder of AmityAge, a bitcoin education and mining company. He shared his experience and tips on getting started with bitcoin.

“They got to you as well with this scam?”

In 2017, 2 years after Dušan first learned about bitcoin, a friend brought up the topic. “Oh my God, Peter, they got you as well to this scam”, was his initial reaction. His friend kept on explaining and shared about banking the unbanked with bitcoin. He was so inspired that he immediately took some days off to study bitcoin. A couple of months later he gave his first bitcoin presentation and also did free consultations. He didn’t have all the answers but researched and replied to the people. This jump started his bitcoin journey. Combining his background in teaching and his newfound knowledge it made sense to be a Bitcoin educator.

After my first purchase I was like: “I’m just done with this bitcoin thing”. Luckily I didn’t stick to that idea.

For his first transaction, Dušan bought about 200 EUR worth of bitcoin and ended up losing 150 EUR to transaction fees. There was a button mentioning to use the remaining funds as a mining fee, it was not the smartest thing to do.

This mistake discouraged him and for a while he was done with bitcoin again. Eventually he changed his mind.

He suggests treating bitcoin as a form of savings rather than a speculative investment for short term profit. Much like money, it’s good to allocate wisely; some for long-term holding and some for daily needs. As his entire salary is in bitcoin he has learned to manage it responsibly. Dušan believes in encouraging others to view bitcoin as a long-term savings option. Holding it for 10, 20 years or more can provide security for the future, using it only when truly necessary. This mindset can help people better understand and utilize bitcoin’s potential.

Things to consider when purchasing your first amount of bitcoin

It's true that using centralized exchanges often requires sharing personal information, which could pose risks if the platform is compromised. Though some centralized exchanges offer extremely low fees. Exploring decentralized exchanges or peer-to-peer transactions as alternatives are a way to protect your privacy. Tools like Bisq Network, Vexl, or even bitcoin ATMs provide great options for avoiding KYC requirements. It's important for everyone to weigh the trade-offs between convenience and privacy when it comes to crypto transactions.

Benefits of using the Lightning Network

The Lightning Network is a fascinating solution to bitcoin's scalability issues. By acting as a second layer, it enables faster and cheaper transactions compared to on-chain bitcoin transactions, which are limited to about seven per second. With Lightning, transactions are settled instantly and are irreversible, functioning like digital cash. The concept is similar to opening a bar tab; multiple transactions occur within the tab without settling each one individually until the tab is closed. This reduces fees and increases efficiency.

Furthermore, the Lightning Network can theoretically scale to hundreds of thousands of transactions per second, limited only by internet speed. However, it does come with trade-offs, such as potential scaling challenges and technical complexities. Despite this, it's a groundbreaking system that enhances bitcoin's usability for everyday transactions while maintaining decentralization.

The Lightning Network brings a win-win for both customers and merchants. Customers enjoy low fees and super-fast transactions, while merchants benefit from instant settlements, ensuring they get their money without the risk of chargebacks or fraud. It's a game-changer compared to traditional card payments.

Everyone's journey is different, so take your time to learn and choose what works best for you.

Getting started with bitcoin can feel overwhelming, but it's simpler than it seems. Dušan recommends setting up a lightning wallet first. It's an easy way to get familiar with Bitcoin. To make it fun, you can receive a small amount, like 2 to 5 euros, to see how it works in real-time. Once you're intrigued, explore resources tailored to your preferences. If you enjoy reading, books like Inventing Bitcoin, The Bullish Case for Bitcoin, or The Little Bitcoin Book are excellent starting points. For courses, platforms like, Mi Primer Bitcoin, Plan B Network or Looking Glass are great options.

When you're ready to buy bitcoin, consider your priorities. If convenience is key and privacy isn’t a concern, platforms like Coinbase are user-friendly. However, if privacy matters, consider bitcoin ATMs or decentralized exchanges like Bisq or Vexl. Everyone's journey is different, so take your time to learn and choose what works best for you.

Educating the World About Bitcoin through AmityAge

Together with Gabriel, Dušan is the co-founder of AmityAge. Their company has a mission to welcome 100 million people into the world of bitcoin. The primary focus is education, targeting both individuals and educators. By training educators at their Bitcoin Educators Academy to teach effectively, AmityAge aims to expand bitcoin knowledge and adoption globally. The company funds its initiatives through bitcoin mining, with mining operations currently in Paraguay and Ethiopia.

The name "AmityAge" reflects the company's vision. Gabriel and Dušan were inspired by the word "amity," which means harmony, peace, friendship, and fellowship. They view bitcoin as a tool to foster freedom, cooperation, and a more peaceful world. By adopting a bitcoin standard, they believe societies can reduce reliance on war-financed economies and promote efficient collaboration.

Their logo features "Amity Nakamoto," a symbolic character imagined as the granddaughter of bitcoin’s creator, Satoshi Nakamoto. Amity serves as a guide, spreading knowledge about Bitcoin and inspiring others to explore its potential.

The mining system forms the backbone of bitcoin’s revolutionary model

Bitcoin mining is the process of validating and ordering transactions within the decentralized bitcoin network. Since there’s no central authority managing these transactions, miners compete every 10 minutes to win the privilege of organizing transactions into a block and adding it to the blockchain.

This process is much like a digital lottery, where miners use computational power and energy to solve mathematical problems. The winner secures the network by verifying transactions and also earns bitcoin rewards as an incentive for their participation.

As more miners join, the network adjusts the difficulty to maintain a consistent 10-minute block creation time. The whole process keeps the network secure and ensures new bitcoins are released at a steady pace. The final part of bitcoin is expected to be mined in 2140.

This transparent and decentralized monetary system is in contrast with traditional banking, where monetary policies can change unpredictably. Miners are basically the security team for one of the most secure databases in the world, all while earning some bitcoin for their efforts. This dynamic system balances incentives, security, and transparency. It forms the backbone of bitcoin’s revolutionary financial model.

Dušan’s golden tip: learning about the history of money will make you appreciate bitcoin.

Understanding bitcoin starts with understanding the history of money. The more you explore how money has evolved and the challenges it has faced throughout history, the more you’ll appreciate why bitcoin exists. Stories from places like Cyprus, where bank accounts were frozen, and financial crises hit hard, highlight the need for an alternative like bitcoin.

If you're new to bitcoin, start by learning its purpose and the problems it aims to solve. Once you understand its benefits, you can dive deeper into the technical aspects, such as privacy features or using different wallets. The foundation is understanding why bitcoin matters in the first place. A good book suggestion on the topic is Layered Money by Nik Bhatia.

Visit www.amityage.com to learn more about the impact Dušan and his business partner Gabriel are making.

Important note:

This article is strictly educational and for general information purposes. Consult a professional for financial advice tailored to your situation.

To see how the barriers towards investing are lowered, for example, as there is no need to be an accredited investor to buy, hold, sell, trade, lend, or borrow cryptocurrency. Mostly when explaining blockchain, bitcoin is also mentioned. Join me on my journey to explore and get insights from genuine bitcoin enthusiasts through a series of interviews.

Bitcoin is the first decentralized cryptocurrency allowing peer to peer transactions on the internet. It is a medium of exchange and a store of value. Its total supply is 21 million bitcoin.

A good conversation about bitcoin is intertwined with discussing the history of money. For newbies to the topic, comparisons with more conventional financial options can be beneficial. Just as you would research the background of a stock before investing, it’s worth taking a closer look at bitcoin as well.

Visual Capitalist shared a Bitcoin Sharpe ratio vs Major Asset Classes overview by Bloomberg via Franklin Templeton Digital Assets, 2024. It’s mentioned that, by Sharpe Ratio, bitcoin has been the best performing asset for the last 10 years.

Wondering if traditional finance service providers have started offering bitcoin? Coincub shared a chart showing integration of cryptocurrency into the traditional banking system. While not all banks currently offer these services, it’s a start. After researching bitcoin, is it advisable to invest in it? And if so, should it be purchased through a bank? To kickstart my bitcoin learning journey, I reached out to Nicole Nowak for an interview.

Nicole is a bitcoin educator, and a mentor. She also works for Les Femmes Orange. She has her own podcast in German called bitcoin kurz erklärt with a focus on non-tech people. The majority of the listeners are women, but this went organically. She shared her insights on the importance of bitcoin education in this interview.

“The Bitcoin Standard by Saifedean Ammous changed my view on money and finance. Knowing about money and inflation is important for women”

Around 2021 there was much going on about DogeCoin and Elon Musk. Her younger brother suggested investing in DogeCoin, which prompted her to research it and also learn about bitcoin. She then dove into the crypto rabbit hole. A former colleague recommended a book titled “The Bitcoin Standard” by Saifedean Ammous. After reading it, her perspective on money and finance completely changed.

“The key message in bitcoin education is to create a fair society with new options and honest interactions. Bitcoin has the potential to transform the way we interact and the way we transport value”

Nicole wants to encourage women to dare to get educated in bitcoin. She strongly believes that it’s not only about investing, it’s about creating a fair society with new options. Bitcoin is a tool that can help do all that and that is the key message.

“Fix the money, fix the world”

She mentions that when studying bitcoin the focus should be on tech possibilities, on financial freedom and learning about how the world operates. About the pro’s and con’s of the current system. The current system is not fitting any more, it’s broken. It’s like a child that outgrew his clothes and is in need of new ones. Money is the foundation of how we interact globally. If the money is broken, everything is broken and everything becomes inefficient.

It’s often said to fix the money is to fix the world. By separating the power of money and the power of politics, we can change things for the better. Nicole envisions a future with honest interaction and an end to false narratives. She believes that bitcoin can help to transform the way we interact and transport value.

“Mass adoption will come gradually and naturally”

According to Nicole everyone should act according to their own capabilities. There is no right or wrong choice in deciding to hold or spend your bitcoin. There are many good reasons to believe that the price of bitcoin will go up. So seeing it as a store of value is super clear.

Idealists, on the other hand, argue that bitcoin adoption increases when people spend it. She strongly believes that mass adoption will come gradually and naturally.

“It can be expected that things won’t be easy from a regulatory perspective and it will be quite exciting to find solutions”

She mentions that there is the assumption that wallets such as the wallets of satoshi & other lightning wallets will disappear. Probably they will no longer be offered by app stores. She is optimistic that, in case this should happen, bitcoiners will find solutions to make lightning accessible again. That will be quite exciting as it will expectedly not be easy from a regulatory perspective. However, with institutions like Blackrock using bitcoin, it’s only a matter of time before bitcoin evolves. At that stage, it will become impossible to ignore.

“Collect experiences with lightning apps like wallet of Satoshi or Phoenix and buy a coffee or a beer with bitcoin; it’s often an eyeopener”

To get educated on bitcoin Nicole shared some tips:

1. Attend a bitcoin meetup. Try to pay with bitcoin at the location where the meeting is held. This way you gain firsthand experience in how bitcoin payments work.

2. See how fast lightning transactions go. Try to collect experiences with lightning apps like Wallet of Satoshi or other wallets like Phoenix. At events by Les Femmes Orange attendees are encouraged to buy coffee and beer with bitcoin. It’s often an eyeopener.

3. Read books on bitcoin like for example the Bitcoin Standard by Saifedean Ammous and Mastering Bitcoin by Andreas Antonopoulos. By reading books we can learn how interesting and brilliant bitcoin is.

4. A special tip for females who are new to bitcoin, reach out to other females in the bitcoin community.

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   Sources:

[1] “De-crypting Bitcoin.” An educational flyer on bitcoin by Franklin Templeton. Jan 10th, 2024. Link: https://franklintempletonprod.widen.net/s/vmv65lqrrs/btc_fl_1223

[2] “Ranked: Bitcoin Returns vs. Major Asset Classes” by Alan Kennedy. For Visual Capitalist. Source Bloomberg via Franklin Templeton digital Assets, 2024. July 19th, 2024. Link: https://www.visualcapitalist.com/sp/ft01-bitcoin-returns/

[3] “The Evolution of Crypto Banking: A Surprising Surge in Services and Global Leadership.” A Medium article by Coincub. May 20th, 2024. Link:https://coincub.medium.com/the-evolution-of-crypto-banking-a-surprising-surge-in-services-and-global-leadership-8c8f6bb7b81d

With the DLT Talents Program the Frankfurt School Blockchain Center guides the way for female leadership in the blockchain space. Through education and mentorship they facilitate women to become entrepreneurs, technologists, regulators, investors, and/or multiplicators in the blockchain, crypto, web3 space. https://web3-talents.io/dlt-talents/

Important note: This article is strictly educational and for general information purposes. Consult a professional for financial advice tailored to your situation.

Through the following links you can learn more on Nicole’s bitcoin education:

https://linktr.ee/bitcoinkurz

https://nicoleenowak.medium.com/