Blockchain Bubble or Revolution: The Future of Bitcoin, Blockchains, and Cryptocurrencies

print money and adjust interest rates

Chinese pools control over 80% of the Bitcoin network’s hash rate and thus mine 80% of the world’s bitcoins,

entire blockchain on their devices. Instead, they only store a partial copy of the blockchain on their devices, making them what are known as lightweight nodes. They rely on other people to run full nodes, or computers that store the entire blockchain, to validate transactions and make sure they have the latest blocks on the blockchain.

Another well-known potential solution is called the Lightning Network, which aims to do most transactions “off the blockchain” to avoid the fees and delays of transactions put on the blockchain. Each pair of people tracks their payments to each other on a digital scratchpad; they only “settle” their balances once in a while.

This lines up perfectly with Bitcoin’s hodling epidemic: people hold on to their bitcoins because they know each bitcoin’s value is slowly increasing over time.[165]

Merchants who accept Bitcoin are actually advised to wait for six more blocks to be mined after the transaction goes through to minimize the risk of fraud.

The University of Cambridge estimates that Bitcoin’s annual energy consumption skyrocketed from about 6 terawatt-hours (roughly the annual power consumption of Luxembourg) in 2017 to over 80 terawatt-hours (roughly the annual power consumption of Finland) in 2020.