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Why Stablecoins are the Only Cryptocurrency That Matters

Because of the media, Bitcoin has become a pretty common term nowadays, and while it may be the most popular cryptocurrency, many are nervous to invest due to its extremely high volatility. That’s why folks are now turning towards stablecoins for a much more consistent and safe alternative.

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What is a stablecoin?

Stablecoins attempt to bridge the gap between fiat currency and cryptocurrency. They have the benefits of cryptocurrency, such as decentralization, fast settlement, and less regulatory hurdles, while also possessing the stability of a dollar or other fiat currency. Generally, one token of a stablecoin is meant to be worth $1. This can obviously fluctuate with the market, but typically they are meant to hover around that amount.

Aditya Worah at Cryptoground explains it like this:

“Consider this scenario: you bought BTC at $5,000 – it then surged to $10,000 but the markets have begun to collapse again. If you keep holding your BTC, there’s a good chance you may end up with a lesser amount. To ensure that your value in USD remains stable, you can invest in stablecoins – which offer little to no fluctuation in price. You can then trade your $10,000 worth BTC to purchase $10,000 worth of stablecoins – and no matter what happens to the price of BTC after that, your $10,000 will remain safe.”

How do stablecoins work?

“The frequent spikes and crashes, as well as day-to-day fluctuations, have many concerned about actually using cryptocurrencies in everyday transactions, such as buying goods or services. No longer do people have to worry about the daily fluctuations of their cryptocurrency when deciding to make a purchase.” – MakerDao

There are two types of stablecoins: fully backed and algorithmic.

For fully backed stablecoins, the intent is to have $1 in the bank for every $1 stablecoin that exists. This is what Tether or TrueUSD does, and they hold actual dollars in reserve that are redeemable for the token.

Algorithmic stable coins, on the other hand, change the price of the currency using a market mechanism that follows the price of one US dollar.

Source: Coindesk

Stablecoins may be the basis for a global currency. A stable and decentralized currency could allow people in countries with unstable monetary systems to keep their money secure. It also allows for more equalized cross-border transactions, which can help transform industries like supply chain, exchanges, shipping, and more.

What are the benefits to stablecoins?

The most important reason to invest in stablecoins is that they are meant to be safe from the volatility that plagues other cryptocurrencies. As many have noticed over recent months, the market has risen and collapsed repeatedly; however, stablecoins like Tether (USDT) have been helping traders stay afloat and provide a safe haven for traders until they are ready to reinvest in the market.

Secondly, stablecoins act as a “store of value.” This is no different from most cryptocurrencies, but stablecoins can easily be paid to traders for goods and services. Its standardized value keeps it attractive in the marketplace.   

Stablecoins’ consistent value can act as a standard for other currencies. In a market that is affected daily by changing variables, stablecoins provide a measured unit. According to Cryptoground, stablecoins have also found good use in countries where governments are hostile towards cryptocurrencies. In india, the central banking authority banned transactions with crypto exchange and stablecoins provided a safe conversion to save one’s holding instead of withdrawing it.

What are the risks?

Stablecoins like Tether have been stable for a long time and are the best example of a modern working stablecoin. With how volatile the crypto market has been, some stable coins seem to act as an exception. That being said, AML/KYC laws, socialization of accounts, government actions, or centralization could still destabilize the whole thing. Stablecoins can be just as susceptible to risks as any other cryptocurrency, and there really is no data on long-term investing.

Tying a stablecoin to a fiat currency is difficult because inflation can disrupt the fiat currency, which in turn affects the stablecoin. Tying to a fiat-based currency is safer than tying to another cryptocurrency because for the time being, the USD is still a safe currency.

What are examples of stablecoins?

 

 

 

 

Should I invest?

Short-term investing in proven stablecoins may be beneficial. If you’re looking for the ability to redeem stablecoins quickly and easily and trust the issuer, this could be the right move for you. It can be a lot more practical in nature, but just like all forms of cryptocurrency, is not invincible. As it stands currently, stablecoins are the safest and least volatile cryptocurrency and can provide your investments protection in an ever-changing market.

 

Most Profitable Cryptocurrencies to Mine in 2018

Right now the digital currency market is going through a period of upheaval, but that has not diminished the lucrativeness and competitiveness of cryptocurrency mining. Nothing but substantial growth is expected from it in the coming years, offering real profit opportunities to real people.

The recent drop in the value of cryptocurrency was expected to affect the hash rate. There has, however, been no negative impact. Instead of declining, the hash rate for Bitcoin has increased.  Bloomberg reported the increasing hash rate indicated that, “mining is still profitable for many players to stay put.”

Cryptocurrency mining is a process that creates new digital coins, validates transactions, and protects the system. The process involves computers competing to solve complex math puzzles to find cryptocurrencies, the demand for which is expected to grow in the years ahead.  

Transparency Market Research’s (TMR) report predicted the global cryptocurrency market would surge to US$6,702.1 million by the end of 2025. Once the adoption of cryptocurrencies rises again, it is likely the mining will also see explosive growth.  

Two Bitcoins and two Ethereum digital coins can be seen in the image.
Bitcoin and Ethereum, the two most valued digital currencies of last year have seen a major dip in their values in 2018.

 

In 2017, Ethereum and Bitcoin were almost unstoppable, with their values hitting record highs. Flash forward to 2018, both the cryptocurrencies have been on a wild roller coaster ride, and their values continue to hit a new low. Are they still profitable to mine? The short answer is yes, but surprisingly, there are more profitable coins out there.

Let’s take a look at a few.

Litecoin (LTC)

  •    Launched: 2011
  •    Available/Total Supply: 58.2 million / 84 million

Litecoin is almost a clone of Bitcoin. Founder Charlie Lee says his alt-coin “complements” and “not competes” with Bitcoin. Although Litecoin is based on Bitcoin, some striking features set it apart. One of them is its faster transaction time.

In Bitcoin, the time taken to generate a block is 10 minutes. In comparison, Litecoin is much faster, as it takes 2.5 minutes to generate a block, making confirmations and transactions quicker. The two also use different algorithms. Litecoin uses Scrypt algorithm, while Bitcoin uses SHA-25. First-time miners will find Litecoin more accessible and less complicated.  

As of September 11, 2018, Litecoin has a market cap of $2.98 billion.

Monero (XMR)

  •    Launched: 2014
  •    Available/Total Supply: 16.4 million / 18.4 million

Monero is a popular alt-coin in the privacy coin space. It is a secure and untraceable digital currency, as your transaction details never appear in the public record of transactions. Whether you send or receive, the system will not disclose your identity.

Ring signature technique is used for “transaction mixing,” which guarantees no one can guess the actual source of the transactions. When someone sends funds, several other users’ funds also appear in the transaction as sources that might have sent the funds. Features like stealth addresses and ring confidential transactions (RingCT) also help keep the information secure. Monero’s mining process is egalitarian, which means everyone is equal and therefore, deserves equal opportunities.   

As of September 11, 2018, Monero has a market cap of $1.70 billion.

Zcash (ZEC)

  •    Launched: 2016
  •    Available/Total Supply: 4.78 million / 21 million

Zcash, a fork of Bitcoin protocol, supports nearly all the transactions Bitcoin supports. However, when it comes to privacy, it is more like Monero, which keeps the identities of its users and their transactions private. Zcash provides anonymity to its users by leveraging a form of zero-knowledge cryptography.

The zero-knowledge proof is called zk-SNARKs, an acronym for “zero-knowledge succinct non-interactive arguments of knowledge.” It allows two parties involved in a transaction to verify the kind of specific information they have without revealing what that information is.

As of September 11, 2018, Zcash has a market cap of $532.28 million.

Dash (DASH)

  •    Launched: 2014
  •    Available/Total Supply: 8.32 million / 22 million

Dash, forked from Bitcoin protocol, today is one of the most adopted alt-coins in the market. As it uses the hashing algorithm X11, it is much easier to mine this cryptocurrency. Also, it is an ASIC-friendly digital currency. Dash mining has a high hash rate, but low electricity consumption.   

As of September 11, 2018, Dash has a market cap of $1.53 billion.

The Future of Cryptocurrency Mining

Cryptocurrency miners need to be prepared for the new era of digital currency. Hobbyists mining from their basements and small entities might have to bow out, as cryptocurrency mining is no longer feasible without a proper and competitive set-up and a reliable supply of electricity.

Canada has emerged as a great destination for crypto miners. Not only does the country offer them cheap and regular supply of electricity, but companies like JV Driver help them establish an ideal mobile data center for efficient cryptocurrency mining operations.

Companies ready to expand move to places that provide them with a cost-effective proposition, and adapt quickly to the changes in the lucrative cryptocurrency market.  

Crypto Mining: After the Bubble Bursts, Get Ready for the Boom

2017 will forever be remembered as the year of the digital gold rush.

Cryptocurrency mania had reached unbelievable heights by mid-December as everyone rushed, whether to invest in cryptocurrency or mine it, in the hopes of making some quick money. But just as the going was getting too good to be true, in 2018 the rates of cryptocurrencies plunged, and it was getting harder and harder to sustain crypto mining due to diminishing results – miners found themselves spending more for less reward.

So, are these digital miners eventually going to abandon their search like the miners of the California Gold Rush?

Even though headlines are screaming themselves hoarse claiming the crypto mining bubble has burst, a lot of industry insiders claim otherwise.

Venture capitalist Bill Tai put it best when in an interview he said that last year, “the bitcoin mining industry was this mysterious dark cottage industry, and it’s about to grow up and about to have elements of institutional scalability at all levels”. As cryptocurrencies evolve, so have the miners – they’re no longer tech students mining out of their dorm rooms; cryptocurrency mining is becoming a real business that a lot of big players are eager to get a piece of.

Bitcoin mining laptop with cryptocurrency earningsSource: Photo by Iradaturrahmat on Pixabay

The Evolution of Cryptocurrency Mining

Cryptocurrency mining has come a long way from its inception back in 2009 when Satoshi Nakamoto created Bitcoin. It was made in such a way that anyone could help verify Bitcoin transactions and get rewarded with Bitcoins for it. People around the world were using their computer’s central processing units (CPUs) to mine Bitcoin. Eventually they realized they could no longer make profits through their CPUs, so miners moved to graphics processing units (GPUs). This move would create ripples in the PC gaming community as the prices of the graphic cards they usually put in their gaming computers skyrocketed due to miners buying all the available graphics cards on the market.  

The gaming community is slowly returning back to normal, as GPUs are being replaced by application-specific integrated circuit (ASIC) mining. But as Bitcoin mining evolved, so did the many hurdles that lay in its path.

As miners started to mine on a larger scale, they realized they needed not just machines with high computing power, but they also had to choose the location where they would setup very carefully. While China was the go-to location for a while, miners soon had to look elsewhere because of government restrictions, as the country is actively trying to restrict the amount of power being used up by mining firms.

Circuit board showing computer hardware used for cryptocurrency miningSource: Photo by Johannes Plenio on Unsplash

Canada: The New Hub of Crypto Mining

Canada, the miners soon realized, fit the bill perfectly. The Great White North had everything they were looking for. The country has vast areas of land, a cool climate (the computers get insanely hot as they chip away at those blockchain puzzles), low cost electricity, high speed internet and a government that is welcoming towards cryptocurrency mining firms.

Players like JV Driver are even offering plug-and-play crypto mining facilities; a completely self-contained mining solution, which can be easily set up, and only requires a suitable location and internet access. We’ve successfully helped deploy over 500 Petahash of computing power just in the last year. When it comes to crypto mining, it’s a much-needed game changer that proves it’s not all gloom and doom as some of the headlines claim.

The Future of Crypto Mining

Cryptocurrency mining will continue to change in the coming year and beyond. Right now, it resembles the 90s dot com frenzy where ambitious business plans were woven out of pure speculation and based on new technology that most people didn’t even understand properly, namely the internet. From its disorganized beginnings arose a superpower that dominates all industry and financial markets today.

Cryptocurrencies and crypto mining are not going anywhere anytime soon. Even with multiple countries introducing stricter regulations, the future of crypto mining looks bright. The slump in cryptocurrency prices is not indicative of a dying technology, in fact just the opposite: it reveals a new technology that’s just finding its feet. As it evolves into a formal structured industry, it’s likely to gain scale and security, and the ones at the helm of this digital ship could be the ones calling the shots in the future.

Here’s How Crypto Mining Works

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In 2017, Bitcoin brought worldwide attention to the cryptocurrency market, as it soared from a modest $1,000 USD per Bitcoin, to almost $20,000 USD by the end of the year. Before then, cryptocurrencies were rarely talked about, except in the online circles which followed their growth. Since then, they have become a household idea, talked about everywhere from the office, to the dinner table.

However, most of the talk still surrounds the question, “Is cryptocurrency a bubble? Will the bottom fall out and it all disappear?”  

Let’s look at the financial facts of cryptocurrency’s most prominent coin, Bitcoin.

There have been three major bull-runs during Bitcoin’s historic run.

    • One from $5.00 to $200, for a 40X increase.
    • One from $70 to $1,100, for a 15X increase.
    • One from $1,100 to $20,000, for an 18X increase.

And every single time a run was over and the market adjusting, Bitcoin was pronounced dead. What happened? It would go on to have a bigger and stronger run than ever before.

There are even some major investors who, right now, are predicting the next run to hit $700,000 and replace gold.

We at JV Driver believe those who don’t take advantage of this emerging new industry will wish they had the foresight to invest in it.

Okay, let’s say you’re convinced. You’re interested in Bitcoin and other cryptocurrencies, so what’s the next step? Do you purchase Bitcoins directly, as an investment, or do you invest in mining?

We’ll break that down, but first, let’s answer the question:

Cryptocurrency mining — what is it and how does it work?

There are a few ways to acquire a cryptocurrency:

  • You can accept them for goods and services.
  • You can buy them online at sites like Bitit, Coinbase, PayBis, Cubits, or exchanges.
  • You can purchase them from various ATMs wherever you’re located.
  • You can find someone with coins, who wishes to trade them for traditional currency.
  • You could participate in a mining pool.
  • You could build your own mining rig and solo mine them.

For the purposes of this article, and as the title of it suggest, we’ll be focusing on mining cryptocoins.


The process of mining a new coin is something more akin to a raffle draw, than anything else. Your mining rig spends computational power looking for solutions to certain mathematical problems, and is awarded a “block” of coins whenever it’s the first computer to succeed.  

The solving of these mathematical problems serves as validation and security of encrypted online transactions, for controlling the amount of coins on the market, and for introducing new coins.

For example, the reward for solving a Bitcoin, which is mined every 10 minutes, is 25 Bitcoins. In the first four years of its inception, 10,499,889.80231183 Bitcoins were created. Every four years after this, the available amount will half, until a total of 20,999,839.77085749 are mined.

Finally, the difficulty of mining Bitcoins is calculated every 2016 blocks, and is based upon the time it took to generate the previous 2016 blocks, aiming to stay around the 10-minute mark.

Cryptocurrencies: to mine, or to buy?

Valery Vavilov says it depends on the location (and Canada is a very, very good location), but bitcoin mining is profitable down to a price of USD $2,500 – $3,000 per Bitcoin, and at the time of writing this, BTC sits at over $9,000.

Another article, by Vikram Arun, which goes into the nitty gritty of the calculations, states the cost of mining a Bitcoin is somewhere around $1,800 – $2,800 USD, so anything over that would be profitable.

And as we stated earlier, the price of Bitcoin seems to have nowhere to go but up.


So is it profitable? It is. Especially if you live in Canada.

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Blockchain Update: Why Canada Is the next Big Spot for Cryptocurrency Mining

On August 18, 2008, the domain “bitcoin.org” was registered, and in January of 2009, Satoshi Nakamoto, Bitcoin’s founder, mined the first ever block on the chain, known as the genesis block. Since then, the total market capitalization of cryptocurrencies has grown to over 600 billion USD, with more than 1,300 digital currencies in existence.

But where does a Bitcoin, or any other cryptocurrency, come from?

But first, what is crypto mining?

Whenever there is a transaction of a cryptocoin, it is validated by a blockchain. A blockchain is a continually growing list of records, called blocks, which are linked and secured using cryptography.

The miner uses her computer to process the validation of the transaction by solving an algorithm. For her effort, a successful miner obtains a portion of the cryptocurrency as a reward.

Because of that “reward” for the transaction, mining operations, which are mobile data centers, are cropping up all over the world.

Why Canada is the next big spot for Bitcoin mining and cryptocurrencies.

As the algorithms that miners have to solve get more difficult, the mining operations get more energy intensive, generating more heat, and taking up more physical space. For those reasons and more, Canada is an up-and-coming destination for the world’s prime cryptocurrency operations.

Photo Credit: Bloomberg Technology

“Canada is about to become a central source,” explained Cole Diamond, CEO of Coinsquare, one of Canada’s leading cryptocurrency exchanges. “I think there’s definitely a rush happening now. I think we’re going to have a significant amount of mining in the next few months.”

Canada has lots of open and cheap land.

It’s no secret — Canada is large. It’s the second largest country in the world, with 9,984,670 sq. km. The other four countries in the top five?

  1. Russia: 17,098,242 sq. km
  2. Canada: 9,984,670 sq. km
  3. United States: 9,826,675 sq. km
  4. China: 9,596,960 sq. km
  5. Brazil: 8,514,877 sq. km

What are the populations of all five countries?

  1. China: 1,379,000,000
  2. United States: 323,100,000
  3. Brazil: 207,700,000
  4. Russia: 144,526,636
  5. Canada: 36,290,000

What do you notice? Canada is a massive country with an extremely low population. In other words, the country is largely composed of free and open space to create the infrastructure for mining cryptocurrencies.

There are rural towns all over Canada with open land, cheap energy, and a thirst for new, money-injecting industries, just waiting for the infrastructure to be built.

Canada is cryptocurrency friendly, while other major countries with available land are not.

In early 2018, Chinese cryptocurrency regulators created new rules, stifling mining operations and forcing some of the largest crypto miners, like BTC.TOP and Bitmain, out of the country.

“There’s an enormous amount of digital currency miners that are moving their operations from China to Canada and they don’t want to move again,” Diamond said. “China seems to be taking a position where they want to ban digital currencies as we currently know them. I don’t think anybody would believe Canada would take an aggressive approach to whether or not mining should be allowed here.”

Russia, on the other hand, is aiming to better regulate cryptocurrencies by the summer of 2018, causing investors and miners to flee the country.

“The Central Bank is against the legalization of this type of digital currency (that can be exchanged), since in this case, citizens can start actively investing in cryptocurrencies, not taking into account possible risks,” said Anatoly Aksakov, Chair of the State Duma Committee for the Financial Market.

On the flipside, Canada has taken significant steps to welcome miners, blockchain technology, and cryptocurrencies. They’ve even adopted a new initiative that will explore how blockchain technology can be used to help make government research grants and funding information more transparent to the outside public.

The Quebec factor — cheap mining energy.

As cryptocurrency mining becomes more common, mining operations must expend more energy to validate each transaction, causing massive spikes in energy-usage.

“What’s happening is, with the increasing profitability more and more people start to mine and and fight over the reward, and that’s when you ramp up mining facilities to make money. And that’s why the facilities grow, and the energy consumption grows,” explained Marco Marcovici, cryptocurrency expert and advisor to the hydro-powered crypto-mining company, HydroMiner.

Harald Vranken, associate professor at Netherlands’ Open University, studied the energy draw of a social bitcoin earlier this year, and put the mining of a single bitcoin in the 100MW to 500MW range, while Digiconomist’s projections are around 3.4GW.

So, where do miners get their cheap energy in Canada? Enter Quebec Hydro, which offers some of the lowest electricity rates in North America. They claim that Quebec produces a surplus of 100 terawatt-hours over 10 years, which is the equivalent surplus energy it would take to power 6,000,000 homes.

And they don’t hide their desire to attract more of the world’s largest players in blockchain:

“Of the world’s top five largest blockchain players, we have at least three or four,” David Vincent, Director of Business Development at Hydro Quebec distribution, said in an interview with Reuters.  

Low average temperatures in Canada solve heat issue for cryptocurrency miners.

The amount of heat that is generated from a cryptocurrency mine is incredibly high, meaning places with low mean temperatures are ideal for mining infrastructure.

“Cooling is a big factor, it’s very important that it has the right cooling there or else you have to be able to equip a power plant in order to use the energy. That’s a big investment and you have to do it in the right spot,” said Marcovici.

 

JV Driver Fabricators — your next supplier of cryptocurrency mining infrastructure: Mobile Data Centers.

JVDF has established itself as a leader in the design, engineering, supply chain, fabrication and deployment of mobile data centers currently used in cryptocurrency mining operations and infrastructure.

Our mobile mining units, which have a full-sized data center, allow for easy access to the network and mining can be readily purchased at Petahash scale with a complete self-contained mining solution, including easy set-up, requiring only a suitable location with an affordable power source and Internet access.

We have played a prominent role in deploying close to 500 Petahash of computing power in 2017 that is actively mining today. In 2018 we expect this to increase to 1,500 Petahash.

With the ability to negotiate wholesale line pricing from utility companies, coupled with JVDF’s expertise, we’re able to deploy very attractive modular units for bitcoin and cryptocurrency miners.

The next Gold Rush — cryptocurrency mining.

Photo Credit: Bloomberg Quint

As a summary, you can see that only three countries on this list have the combined “favourable” conditions for cryptocurrency power usage (Canada, Iceland, and Switzerland), but only one country also has the available land, positive government encouragement, and the JV Driver Fabricators factor: Canada.

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