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Explained: How does crypto coin burning work

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Crypto burning is a very transparent process. Anyone can verify the burning process on the blockchain. But for it to begin, a miner has to decide how many coins they want to take out of circulation. 

Coin burning is a process where cryptocurrency miners and developers remove a specific portion of coins from circulation to control their price.

The biggest ever coin burn was conducted by Ethereum founder Vitalik Buterin when he burned 90 percent of his Shiba Inu holdings. Recently, Indian cryptocurrency exchange, WazirX conducted a coin burning exercise in which it removed 7.3 million WazirX coins (WRX) from circulation.

How does coin burning work

Crypto burning is a very transparent process. Anyone can verify the burning process on the blockchain. But for it to begin, a miner has to decide how many coins they want to take out of circulation.

The burning process removes that particular amount of coins from the market. Basically, the miner sends those tokens to an address with no private key. Without any private key, no one can access the coins. This results in the effective removal of the coins.

Also Read | Key things to know about WazirX’s 5th coin burn, and coin burning in general 

For more information, check out our infographic on which explains the entire process in detail:

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Key things to know about WazirX’s 5th coin burn, and coin burning in general 

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

WazirX has pledged to burn WRX tokens based on the trading volume on the exchange’s crypto-to-crypto platform until it destroys 10 percent of WRX.

Cryptocurrency exchange WazirX on July 30 undertook the 5th Coin Burn for its token WRX, a process through which it removed 7.33 million tokens from circulation.

Below are some key facts about the event, and coin burning in general. 

Coin burning is an activity conducted by developers or miners to remove tokens of any cryptocurrency from circulation. The decrease in market circulation of a token can increase the price of the rest of the coins in circulation. Coin burning also protects against spam or DDoS attacks, and it helps to destroy unsold ICO tokens. 

The coin burn is done by “sending a portion of the coins to an ‘eater address’, which is often referred to as a ‘black hole’ since the private keys to that address are not obtainable by anyone.

Therefore, any coins sent to an eater address are unrecoverable and cannot be used again. “These coins are effectively taken out of circulation and are publicly recorded and verifiable on the blockchain,” says a WazirX blog post. 

WazirX has been undertaking coin burns at the end of every quarter for five quarters now. For the most recent coin burn, the value of the 7.33 million tokens removed stood at Rs 61 crore, or $8.2 million. From the first through to the fourth coin burns, WazirX has burnt a total of 21.7 million coins worth $24.4 million, or Rs 183 crore. 

As per the whitepaper behind WRX, WazirX has pledged to burn WRX tokens based on the trading volume on the exchange’s crypto-to-crypto platform until it destroys 10 percent of WRX. “We’ll eventually burn 100 million WRX tokens,” the whitepaper says, meaning the exchange is one-fifth of the way with its coin burning exercise. 

During the April-June quarter, WazirX also crossed over $14.04 billion in trading volume, compared to $6.1 billion in the previous quarter, the highest ever by a crypto exchange in India. 

WazirX’s parent Binance also undertakes regular coin burning for its Binance Coin. In its most recent exercise, Binance burnt 1.2 million coins, worth $393 million. 

It is not just exchanges that burn coins. Ethereum Co-Founder Vitalik Buterin recently burned Shiba Inu coins worth $6.7 billion, or 90 percent of his holdings in the token, saying he did not want to be a “locus of power”.  

In April 2018, mining pool Antpool announced that it would burn 12 percent of Bitcoin Cash tokens it had received as part of its mining fees. This caused a spike in Bitcoin Cash price. However, not all coin burning exercises result in an immediate spike in the price of a token. 

Coin burning is comparable to the practice of publicly traded companies buying back stock. Some companies will buy shares of common stock to reduce the total outstanding shares, increasing its earnings-per-share, which could help drive up the share price. 

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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WazirX completes 5th quarterly WRX coin burn

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Cryptocurrency exchange WazirX removed 7.3 million token WRX from circulation in its 5th quarterly coin burning exercise.

Leading cryptocurrency exchange WazirX on June 30 completed the quarterly coin burning exercise for its token WRX, as part of which it removed 7.3 million WRX from circulation. The tokens were worth Rs 61.2 crore or $8.2 million. After the removal of the coins, WRX’s total supply stands at 317.5 million.

The coin-burning exercise is the fifth time WazirX removed tokens from circulation. In the previous four quarters, WazirX removed 3.7 million, 6.5 million, 3.3 million and 8.3 million tokens from circulation.

Highlights of WRX 5th quarter coin burn event

·  In terms of the number of coins burnt, this quarter’s exercise saw 95 percent more coins burnt compared to the previous quarter.

·  In terms of value, this is the second-largest coin-burning exercise.

·  With the latest coin burn event successfully completed, 21.7 million WRX coins worth $24.4 million have been removed from circulation so far.

What is coin burn?

Coins are removed from circulation by sending them to an ‘eater address’, often referred to as a ‘black hole’ since the private keys to that address are not obtainable by anyone, according to a blog post on WazirX’s website.

“Therefore, any coins sent to an eater address are unrecoverable and cannot be used again. These coins are effectively taken out of circulation,” the post says, adding that this transaction is verifiable on the blockchain.

Coin burns are conducted with a view to strengthening the price of existing coins.

The coin burning exercise is similar to share buybacks undertaken by companies, where they repurchase shares from existing investors before extinguishing them. This reduces the number of outstanding shares, increasing the company’s earnings-per-share and reducing its price-to-earnings ratio. Generally, buybacks are also positive for the share price.

How coin-burns benefits WazirX and WRX investors

The coin burning exercise is not simply a means to give a short-term boost to the token’s price. Coin burning is “an effective tool to signal a firm commitment by a cryptocurrency project. The goal of any project is to add significant value to coin holders,” WazirX says. Since one of the promises of cryptocurrencies is that its supply will be limited and hence will control inflation, coin burning presents one of the ways to meet the promise.

Following the fourth quarter coin burn, the trading volume of WazirX soared to a record high of $14.04 billion from $6.1 billion in the previous quarter.

WazirX plans to conduct WRX coin burns in proportion to the growth of the crypto exchange.

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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WazirX founder Nischal Shetty’s #IndiaWantsCrypto campaign completes 1,000 days amid hopes of conducive regulatory oversight

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

The #IndiaWantsCrypto was started on November 1, 2018, following the 10th anniversary of the publishing of the Bitcoin whitepaper. As part of the campaign, Nischal Shetty put out at least one tweet a day, talking about interesting facts.

The #IndiaWantsCrypto campaign, started by cryptocurrency exchange WazirX’s Founder Nischal Shetty to create awareness about cryptocurrencies, today completed 1,000 days. 

The campaign was started on November 1, 2018, following the 10th anniversary of the publishing of the Bitcoin whitepaper. The paper was published by its pseudonymous founder Satoshi Nakamoto on October 31, 2008.

It also came in the wake of the Reserve Bank of India’s April 2018 ban on cryptocurrency dealings in India.

As part of the campaign, Shetty put out at least one tweet a day, talking about interesting facts about cryptocurrencies and outlining his take on various aspects pertaining to the industry.

“There had been a growing misunderstanding of crypto as a safe haven for bad actors, or a threat to fiat currency. These myths led people to fear crypto investments, while the thought of addressing these fears drove me to launch #IndiaWantsCrypto campaign on Twitter in November 2018,” Shetty said. 

“We needed to educate people on the basic classifications of crypto to debunk their fears and showcase how we can truly make a huge difference by empowering our citizens with critical tools for their financial freedom. Citizens could embrace cryptocurrency investments and ride the growth of the blockchain revolution in India. The vision has been to stay persistent in educating the community on the critical takeaways from this truly transformative technology,” the WazirX Founder added.

In fact, an RTI query revealed that even the RBI did not undertake any research before effectively banning cryptocurrencies in India.

Over the past 1,000 days, the campaign has garnered lakhs of likes and retweets, and helped generate a conversation that culminated in the government saying that it is considering bringing in a bill to regulate cryptocurrency and will likely not ban it altogether, as some media reports speculated.

Shetty began the campaign by tagging Prime Minister Narendra Modi and the then Finance Minister, Late Arun Jaitley. The campaign met with no formal acknowledgement by the government initially. On Day 303, BJP MP Rajeev Chandrashekhar asked the WazirX founder to reach out to him with his views.

The campaign got a fillip after the Supreme Court lifted the RBI’s banking ban on cryptocurrencies in March 2020. The lifting of the ban coincided with a vertical take-off in the price of cryptocurrencies after the pandemic hit.

Shetty, however, continued his campaign even as WazirX saw interest in cryptocurrencies go through the roof. In April 2021, Shetty tweeted that customer sign-ups in the first six days of the month were more than the sign-ups in the first six months of 2020.

“We’re confident of our success so far, and about the road ahead. The market has begun to truly understand how we see this as a silver lining to promote the growth of the Indian crypto community and ensure we keep motivating the entrepreneurs, blockchain experts and investors invested in this space. With the government and community backing us, we can bring in the regulations and awareness we need to build the foundation of what we now call Internet 2.0 and stay ahead of the curve,” Shetty said. 

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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#IndiaWantsCrypto: Key highlights from the 1,000-day campaign

bitcoin, crypto
On November 1, 2018, WazirX CEO Nischal Shetty began a campaign on Twitter called #IndiaWantsCrypto. Under this campaign, Nischal began posting one tweet every day, ranging from interesting facts to unique insights about cryptocurrencies. The idea: create awareness about the industry and impress upon policymakers to regulate the industry, which generates thousands of jobs, not to mention vast amounts of monetary value. 
Day 1: Shetty tagged then Finance Minister Arun Jaitley and the Prime Minister’s Office on Twitter, urging the government to bring about positive regulation for cryptocurrency. “The youth of India have found a new way to make wealth & this is especially important when there are not enough jobs for everyone”. Shetty also urged his followers to tag ministers, media persons, crypto investors and anyone else who would be able to help. “We need to tweet till we get a response”, he wrote.
Day 100: The hashtag #IndiaWantsCrypto had recorded 1.5 million impressions. “This is day 100. We need to tweet to our minister every day till we get a reply. The more we tweet, the more chances of our voice being heard & crypto getting a positive regulation in India,” Shetty wrote.
Day 200: Even as the campaign continued to garner strength, there was no word from the government on whether it was planning to outline its policy stance. “We are yet to hear from our ministers,” Shetty wrote on Day 200 on May 20, 2019, around the time the NDA government was voted back into power. Soon it was Day 300 and there were yet no responses from any lawmaker.
Day 303: Rajeev Chandrashekhar, who was later appointed Union Minister of State for Skill Development and Entrepreneurship, and Electronics and Information Technology, asked Shetty to reach out to him through direct message.
Day 365: November 1, 2019, the campaign had garnered over 1 lakh retweets and likes. “We have met a few entrepreneurs but we’re yet to hear from our PM and FM,” Shetty tweeted. At the same time, the Supreme Court was hearing a case on the legality of the RBI’s effective banning of cryptocurrencies in India.
Day 489: On March 4, 2020, the Supreme Court (SC) of India set aside the RBI circular of 2018, allowing cryptocurrency transactions in India. The SC ruling was underpinned by the fact that there was no law on cryptocurrencies in India. The Supreme Court also urged the government to bring a law on cryptocurrencies, which would help stakeholders more clarity on how to deal with the space. A crypto investor, Shrikar Parashar, posed in front of the RBI office with a poster that had the hashtag #IndiaWantsCrypto and the text ‘We Won’.
Day 822: Feb 1, 2021 – the day of the Budget. The government tabled a bill named ‘The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021’, which sought to introduce a central bank digital currency and “prohibit all private cryptocurrencies in India” barring certain exceptions “to promote the underlying technology of cryptocurrency and its uses”. The announcement led to some panic in the crypto space even as supporters trended the hashtag #IndiaWantsCrypto.
Day 856, March 5, 2021: The campaign, which was started with am of getting a positive response from lawmakers, meets with its biggest success. At the CNBC-TV18 India Business Leader Awards, Finance Minister Nirmala Sitharaman said the government will take a very “calibrated position” on cryptocurrencies. “The world is moving fast with technology, we cannot pretend that we don’t want it. We want to make sure that there is a window available for all kinds of experiments taking place in the crypto world,” the FM said. 
Day 995: RBI Deputy Governor T Rabi Shankar announced the central bank’s plans to launch Central Bank Digital Currency (CBDC) in a phased manner, beginning with wholesale and retail segments. The RBI move recognizes the benefits of digital currency but falls short of according a legitimate space to “private cryptocurrencies.” Nonetheless, Shetty, who has always tweeted in favour of a CBDC, tweeted the decision would help spread awareness and understanding of cryptocurrencies in India. 

 

Key learnings about cryptocurrencies from Nischal Shetty’s #IndiaWantsCrypto campaign

Below are some facts and insights gleaned from Shetty’s tweets as part of his #IndiaWantsCrypto campaign.
Bitcoin’s stupendous rise from a few cents a little over a decade ago to about $37,000 now has often left many experts in disbelief. Shetty’s argument over why Bitcoin has risen so far is simple: “It is more accessible than any other asset class (only mobile + Internet needed); 2. It is digital; 3. It has no geographic boundaries; 4. No country or person runs it; 5. Everyone talks about it”
Still, while the concept of Bitcoin looks promising in theory, investors have often wondered how to value Bitcoin, given that it does not have cash flows like stocks or bonds. According to Shetty, Bitcoin derives its value from its user network of over 100 million. “The Internet has 4.73 billion people. Bitcoin is accessible to every one of them,” he tweeted. “Crypto valuations of today are based on the fact that crypto has only 3 percent of the Internet population,” he wrote in another tweet. There’s a massive number of people yet to enter.” 
While prices of cryptocurrencies such as Bitcoin have grown rapidly over the past decade, they are also known to witness sharp downswings from time to time. Shetty exhorts investors to look past the price swings and look at the overall interest in cryptocurrencies. “The market cap growth of any cryptocurrency is determined by four major factors. Number of participants, number of projects, capital investment and positive interest by the nation,” he said. “There has been a rise in all four factors in the past year.”  (Image: CNBC-TV18, YouTube)
bitcoin falls, bitcoin rally, bitcoin news, cryptocurrency, US markets, wall street, global markets, us presidential elections, second wave of pandemic,
Shetty is extremely optimistic about the promise of non-fungible tokens (NFTs), saying that it would help cryptocurrency technology adoption go from 120 million currently to 1 billion. “Millions of artists will bring in hundreds of millions of people into crypto. NFTs will go from ‘good to have to ‘must have’,” he tweeted.  (Image: Reuters)
Some cryptocurrency investors believe that a central bank digital currency (CBDC) would spell trouble for decentralized cryptocurrencies such as Bitcoin but Shetty believes the opposite. “CBDC for India would help onboard millions of Indians into the digital economy. RBI should definitely proceed. The misconception is that CBDC would mean the death of another crypto. That’s the same as saying government websites would mean the death of other websites,” Shetty said. (Image: Shutterstock)
Shetty has often exhorted the government to bring about regulations for cryptocurrencies through the campaign. He believes that regulation would help kickstart growth. “Regulation is going to be the next big buzzword in crypto. Countries around the world will start regulating. The first wave of regulations will be on centralised entities. Overall, regulations bring clarity and that helps grow the industry faster,” Shetty tweeted. In another tweet, Shetty made an interesting point, saying regulations always come after innovation. “If entrepreneurs in India waited for regulations before starting Internet companies, then we would not have had any Indian startups. Regulation needs an ecosystem to regulate. Indian entrepreneurs need to startup in crypto to help build the ecosystem.”  (Image: Company website)
The Ministry of Corporate Affairs’ decision to ask companies to disclose their cryptocurrency earnings is a positive step, according to Shetty. “This increases confidence in people & corporates that are dealing with Crypto in India,” he tweeted, adding in another tweet: “Corporates around the world are gaining crypto exposure. This is helpful: As a hedge for their investment; To build the skill set in this new tech; To remain competitive”. (Image: Reuters)
Shetty also highlighted that the increased adoption of Bitcoin as a payment mechanism by mainstream companies such as Visa is a great development for Bitcoin and that other banks should consider the same. “This was bound to happen considering the fact that it makes payment settlement instant,” he wrote. In another tweet, he added: “Banks in India are still undecided on what direction to take. The sooner they integrate crypto technology, the faster they’ll be able to compete”.
Shetty outlined another interesting use case for cryptocurrencies – for startups. “Traditional VC firms take weeks & months to close a deal & send capital for a startup they want to invest in,” he wrote. “ICO/IDO has made this entire process open and faster. Crypto entrepreneurs can now raise money from anyone, anywhere and in record time.” 
 5 Minutes Read

Elon Musk is not the answer to whether cryptocurrencies work. He shouldn’t even be the question

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

No person in recent history has captured as much mindspace because of their views on a particular asset class as Elon Musk has for his statements on Bitcoin. His tweets which have ranged from positive to cautious, have resulted in wild swings in the price of the cryptocurrency.

Cryptocurrencies have been around for roughly a little over a decade but never have they captured the public’s popular imagination as they have in 2021, thanks to the spectacular rise in their prices led by Bitcoin, which at some point recently had risen more than 500 percent in five months.

The wider public interest in Bitcoin and other cryptocurrencies has also given rise to other phenomena, such as the rise of various prophets (and doomsayers) who keep their audiences hooked by preaching their beliefs (or disbelief) in the asset class and outlining their views on its outlook.

But no person in recent history has captured as much mindspace because of their views on a particular asset class as Elon Musk has for his statements on Bitcoin.

The famed entrepreneur, who rose to briefly become the world’s richest man a few months ago thanks to a Bitcoin-like rally in the share price of Tesla, has caused a wild swing in the price of cryptocurrencies by tweeting his, alternatingly, positive and cautious views on Bitcoin. This has resulted in much elation and despair for investors in Bitcoin and other cryptocurrencies.

But investors should realise that Elon Musk’s beliefs shouldn’t be held up as the answer to questions about the potential (or risks) of cryptocurrencies.

ALSO READ: Bitcoin mining in India: A profitable venture?

When the pseudonymous Satoshi Nakamoto, the mysterious creator of Bitcoin, first revealed the idea behind the cryptocurrency, it promised to change the way money worked.

To many, Bitcoin was the third big change in the history of the monetary system after the switch from barter and gold to gold-backed paper currency centuries ago and the abolition of the gold standard following World War Two.

Bitcoin offered the potential to remove transnational barriers across, allow for secure transactions and guaranteed settlements, and a semblance of privacy to its users, besides a check on inflation thanks to its finite nature and lack of a central authority overseeing its supply.

ALSO READ: Goldman Sachs plans to expand crypto options, to allow trading in Ether

And for several years, the Bitcoin investor community pored over these discussion points, weighing the virtual currency’s merits versus its potential downsides such as the high energy consumption required to mine, or settle, transactions.

All that was till the cryptocurrency shot through the roof this year, with excitement over Bitcoin’s potential giving way to mania as a vast swathe of new users hopped on to the bandwagon thinking of the virtual currency as a get-rich-quick scheme.

It is for many of these users that Elon Musk appeared as a prophet, first tomtomming the benefits of the virtual currency, even announcing that not only Tesla would accept car purchases in Bitcoin, the automaker had purchased the virtual currency worth about USD 1.5 billion.

Cut to a few weeks later, and Musk backtracked on his comments, saying that he was still optimistic but expressed concern about the high energy usage of Bitcoin.

Musk pronouncements caused wild gyrations in the price of Bitcoin, underscoring to investors the risks of hitching your ride to the wagon of superstar investors.

ALSO READ: Billionaire investor Paul Tudor Jones backs Bitcoin as hedge against inflation ahead of FOMC meet

In December last year, Musk first tweeted about Bitcoin when its price was about $28,000. More vociferous tweets followed this year followed when Musk added #Bitcoin to his Twitter bio. This, along with Tesla’s announcement, triggered a superb rally from $38,000 to about $64,000. Musk then reversed his stance, causing the cryptocurrency to halve within days to about $32,000. The latest? Last night, Musk announced: “When there’s confirmation of reasonable (~50 percent) clean energy usage by miners with the positive future trend, Tesla will resume allowing Bitcoin transactions”. The price of Bitcoin rose to about $39,000 following the latest announcement.

The takeaway from the brouhaha is this. If you have invested, or are thinking of investing, in Bitcoin, remember that the thing with superstar investors is: you are not familiar with their thinking or their agenda and that they can change their stance at will.

The legendary investor Warren Buffett once said: do not invest in what you don’t understand.

Existing and potential investors in cryptocurrencies would do well to remember that advice. That much of their time should be spent trying to understand the promise of Bitcoin and the risks to that hypothesis.

Anything else is speculation and should be dealt with according to the rules of speculation. Which is that risk management is important, such as understanding the capital you are risking and potential losses you could face. And if you’re in for the price action, make sure you understand it well through tools such as technical analysis.

Nazim Khan keeps an eagle eye on developing trends in financial markets and in the technology space. On economic ideology, he recently switched allegiance from Ayn Rand to Thomas Piketty after failing to spot the invisible hand despite looking hard

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Bitcoin mining in India: A profitable venture?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Bitcoin mining may sound like a lucrative activity but it’s not for everyone. Be sure to do your research before you dive in.

The COVID-19 pandemic and resulting lockdowns have changed the way the world works in many ways, including accelerating a digital revolution that has, among other things, shone the light on cryptocurrencies, such as Bitcoin and Ethereum.

A parabolic increase in the price of Bitcoin over the past year has also renewed focus on the concept of Bitcoin mining. (Throughout this article, we will refer to Bitcoin mining even though the concept applies to mining other cryptocurrencies as well.)

What is Bitcoin mining?

Suppose a person you are doing business with sends you Rs 100 through a bank transfer. At what point are you assured that the transaction has concluded? It is when the bank sends you a message or when you can check in your statement/passbook that you have received the amount. Your bank here acts as a settlement agent and once it confirms the amount is credited to your account, you can walk into your bank and withdraw the money.

Unlike the conventional monetary system, Bitcoin has no central clearing or settlement agent. Instead, users play the role of the bank in verifying transactions through a process called Bitcoin mining. As an incentive, miners are rewarded with the cryptocurrencies they mined for effectively working as an auditor of sorts.

The Bitcoin mining process is fairly technical and arduous. Though there is good news: Miners do not need any technical know-how — one can install Bitcoin mining software.

Having said that, there’s also bad news: Hardware required to mine cryptocurrencies can be expensive to install and running it can also incur steep electricity costs.

Besides, the difficulty required to solve the problems required to settle transactions always increases as one goes along, meaning the same set of hardware will be able to earn less in future.

So, on average, is Bitcoin mining in India a profitable venture? Here’s a guide.

Bitcoin mining hardware and software requirements in India

Mining is a hardware-intensive process and requires the installation of expensive computing machines, also called ‘mining rigs’. Here is a list of software and hardware you will need to mine.

The hardware element in mining can be a GPU or an ASIC (application-specific integrated circuit). As opposed to CPUs in normal computers, ASICs and GPUs are faster at solving complex calculations required to settle transactions. The more powerful the unit, the faster it will solve problems. The price of a decent ASIC unit, such as the Antminer S9, will be about Rs 1.5 lakh.

You also need mining software to mine and set up a digital wallet, to store the reward you will earn. There are several free mining software available online.

Is Bitcoin mining profitable?

The answer to whether Bitcoin mining is profitable is not cut and dry. Though as a thumb rule, you must know cryptocurrency mining is generally profitable only for those who can invest in powerful hardware.

The profitability of this endeavour will depend on four primary factors:

 

Hash rate: This refers to the number of complex calculations mining hardware can do. For instance, the ASIC referred to above has a hash rate of 13.5 TH/s.

Electricity cost: A mining rig consumes a lot of power as it has several other components besides the core computational hardware such as cooling mechanisms etc. A basic ASIC itself will consume about 1500 watts, or 1.5 hW of electricity per hour. On average, electricity rates in India tend to be about Rs 7 per kW.

Mining pool fees: A mining pool is a collection of miners who pool their hardware resources to increase the number of calculations. The synergy created by pooled hardware will always be more powerful than a single device. The rewards will also be divvied up with all the miners in the pool. This could decrease your profit though.

Price of the cryptocurrency: This is the most important factor when it comes to mining. The cost of cryptocurrency is highly volatile. And over the last year, the price has fluctuated dramatically.

Bitcoin Mining Calculator

Several calculators on the Internet allow you to enter key inputs such as hashing power, power consumption, electricity cost and pool fee. Based on inputs, the Mining Calculator will show the number of Bitcoins you can hope to earn through your activity. It will also tell you whether this amount will be enough to recover your electricity costs, besides your initial investment.

For instance, Nicehash.com, one such calculator, shows with the AntMiner S9, you can hope to earn Bitcoins worth Rs 8,607 per month while spending Rs 5,867 on electricity costs. Your final profit will be Rs 2,739 in this case. At this rate, it could take several years to break even on your initial investment.

These calculations are indicative and depend on the current price of Bitcoin and the kind of hardware you deploy — having more powerful rigs improve the chances of profitability.

Bottomline

Bitcoin mining may sound like a lucrative activity but it’s not for everyone. Be sure to do your research before you dive in.

— Nazim Khan keeps an eagle eye on developing trends in financial markets and in the technology space. On economic ideology, he recently switched allegiance from Ayn Rand to Thomas Piketty after failing to spot the invisible hand despite looking hard

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

 Daily Newsletter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Ratabari Election Result 2021 LIVE: How to check Ratabari assembly (Vidhan Sabha) election winners, losers, vote margin, news updates

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Ratabari Election Result 2021 LIVE Updates: Get latest and updated election counting result of Ratabari constituency of Assam including leads, election results, candidates, vote margin news.

Ratabari is an Assembly constituency in the Karimganj district, in the Barak Valley region of Assam.

The Ratabari constituency went to polls on April 1, 2021.

The assembly seat is reserved for the Scheduled Caste category.

Check out Ratabari latest election update live on this page.

In the 2016 Assembly elections, Ratabari was won by Kripanath Mallah of BJP.

Before that, in the 2011 elections, the seat was held by Kripanath Mallah of INC.

In the 2016 assembly polls, Kripanath Mallah garnered 53975 votes, securing over 47.93 percent of the vote share, and winning the seat by a margin of 24526 votes.

In percentage terms, the victory margin was 21.78 percent.

The constituency polled 112649 votes in the 2016 Assam assembly polls with a voter turnout of 75.98 percent.

The Ratabari constituency has a literacy level of 79.72 percent.

A total of 15 candidates stood in the 2016 elections.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

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today's market

index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Meet Ehraz Ahmed, the white hat hacker who is helping Facebook, Google and Airtel stay secure

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

 Listen to the Article (6 Minutes)

Summary

Twenty-four-year old Ehraz Ahmed is among India’s most well-known ethical hackers, a place he reached through sheer determination.

In 2006, Ehraz Ahmed was a geeky 10-year-old who loved to hang out at cyber cafes in his hometown in Mysuru, Karnataka, with his web developer brother.

His tryst with the Internet began with Orkut, the then wildly popular social network, but he soon realised that something else gave him more excitement than even social media: popping the hood of websites and looking into how they were made — their source codes.

He then decided he would learn coding. While his brother was there to guide him, Ahmed also found another source always ready to help: Google.

“I began to learn coding through Google or by speaking to my brother or others,” says Ahmed, and before long, the fledgling hobby became a passion and then vocation.

Ahmed also realised early that he had a streak for entrepreneurship.

At age 14, by then an avid gamer, Ahmed began hosting servers for Counterstrike, the popular multiplayer shooting game.

Along the way, Ahmed further polished his computer skills, turning himself into an ethical hacker — a term for computer security experts who find bugs or exploits in websites and bring them to companies’ notice, sometimes for a price of course.

In the first year of his engineering, he dropped out to try and make his mark as a programmer and entrepreneur.

Fame soon followed as Ahmed was able to find weaknesses in websites of companies such as Google and Facebook.

Today, the 24-year-old is among India’s most renowned hackers, having assisted top Indian companies such as Airtel and Justdial protect their users’ personal data.

Ahmed is also listed on the 50 Security Researcher’s Hall of Fame – a title awarded to top programmers who have discovered security flaws in important applications.

He has also fulfilled his dream of being an entrepreneur. Over the past few years, he has started a fintech company and a web security firm.

Also read: Chinese hackers target Indian vaccine makers SII, Bharat Biotech, says security firm

“In 2016, I began Voxy Wealth Management, a fintech company that provides a web platform for financial analysts with research reports and tools to manage their stock portfolios. The year after, I launched my web security firm, Aspirehive, to provide web security to companies,” he says.

Still, he believes that his biggest achievement remains developing his skills without formal training, though he puts that down to dogged perseverance more than anything else and says others can do the same given enough determination.

“One can self-learn technical topics such as coding but they will have to push themselves out of their comfort zone,” he says, adding that today, sites such as Coursera or Khan Academy serve as highly helpful resources.

And there’s of course YouTube and a vast number of blogs on the Internet, which serve as a treasure trove of knowledge.

Ahmed’s journey of learning and self-discovery, however, didn’t come without its share of hardships.

His father suffered a heart attack when he was in the 10th standard, a development that pummelled Ahmed’s middle-class family into a financial crisis.

“It changed my perspective on life. I decided I wanted to do something exceptional,” he says.

In helping firms such as Airtel, Truecaller and Justdial, he was able to do just that, by helping protect the personal data of their nearly billion cumulative users.

Also read: Airline IT provider hacked, frequent flyer data breached

Pop culture, shaped in large part by Hollywood films, tends to portrays computer hacking as glamourous work, with hackers often being able to enter network systems within minutes — work that typically ends with a joyous and forceful hit of the enter button.

In real life, Ahmed says, it is hard work that requires intense focus where breakthroughs are often a result of a lot of troubleshooting and trial and error.

Ahmed says hackers also get affected by the problem often associated with writers: creative blocks.

“Sometimes, you are close to figuring out a security flaw but still don’t seem to able to succeed. At such times, it’s better to take a break and come back later instead of stressing yourself out further,” he says.

Ahmed says cybersecurity as a field has still not fully come of age and many companies and governments have still not upgraded their systems to the levels needed to reasonably safeguard against threats.

“There are a million registered Indian companies but not all have made a smooth digital transformation. Security audits should be made mandatory when they plan to launch their app or websites,” he says.

However, the coronavirus pandemic, he believes, has raised awareness about cyberfrauds among individuals and corporates alike. “I now see an increase in demand for cybersecurity services everywhere.”

Also read: 5 easy tips to safeguard your online transactions

However, Ahmed is not happy with the other pandemic fad: teaching coding to children, sometimes even the ones as young as five. “It is a joke! If a child is genuinely not interested, he or she won’t be able to grasp it. I think children should only start learning coding during or after their high school,” he says.

Reflecting back on his young but successful career, Ahmed says perseverance is his most important asset.

“I am like water in dunes, where even tornado comes; I stay firm and confident to face the problems,” he signs off.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

 Daily Newsletter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Previous Article

Oil Fluctuates as Traders Assess China’s Vow, Unrest in Libya

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today's market

index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
Quiz
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What coins do you think will be valuable over next 3 years?

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Should Elon Musk be able to buy Twitter?