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Cryptocurrencies continue lower as Polygon shows potential

Cryptocurrencies continue lower as Polygon shows potential

Bitcoin once again traded lower on Friday by 4.2%. Bitcoin’s dominance of the overall market capitalization came in as a freakishly identical integer of 42.22% of the entire digital asset space. As of 4:30 PM, Eastern Standard Time Bitcoin is down another 4.2%, with futures trading at $35,400. Bitcoin is not bleeding alone, instead of leading the entire cornucopia of cryptocurrencies into a very bloodied bearish day for Bitcoin and its many talented offspring.

With BTC trading at approximately $35,400, one might naïvely assume that bitcoin has held up relatively well after taking a cliff dive to support lying at the $30,000 area. However, this month might as well be December on the North Pole. So far, this ‘winter’ took the entire digital asset economy sharply and swiftly to pricing around half the all-time highs. In the last month, Bitcoin has lost almost 40% in value, and for the majority of coins, the declines were essentially equal.

All coins felt the brunt of the storm except for maybe 2% made up of Cardano and another proof-of-stake cryptocurrency known as Polygon or Matic, which is essentially an extremely fast sidechain already operating on Ethereum 2.0. but Coinmarketcap.com explains it better than me “Polygon (previously Matic Network) is the first well-structured, easy-to-use platform for Ethereum scaling and infrastructure development. Its core component is Polygon SDK, a modular, flexible framework that supports building multiple types of applications. Using Polygon, one can create optimistic rollup chains, ZK rollup chains, stand alone chains or any other kind of infra required by the developer. Polygon effectively transforms Ethereum into a full-fledged multi-chain system (aka Internet of Blockchains). This multi-chain system is akin to other ones such as Polkadot, Cosmos, Avalanche etc. with the advantages of Ethereum’s security, vibrant ecosystem and openness”.

Cardano (ADA) gained 4% over the last month. Polygon was the only other coin to gain value this last month with a sizable market cap. Polygon (MATIC) gained nearly 90% in value during the previous 30 days. It is poised to become a shining star showing its true potential when all other coins fail to hold onto gains. These coins are the cream of the crop that utilize a proof-of-stake consensus rather than a proof-of-work algorithm like Bitcoin and many others. This is significant because PoS requires a fraction of the electricity to authorize and validate transactions. These cryptos built on PoS are likely to outperform in the future due to environmental concerns over Bitcoin’s energy consumption which has become a hot topic since Elon musk raised concerns over this issue making bitcoin no longer a method for purchasing Tesla cars. Of course Tesla’s themselves are not as green as you may think. Depending on where you live, you may be charging your batteries off a fossil fuel-driven power grid. There is also the environmental impact and carbon emissions of mining the lithium and other rare earth metals needed to create these batteries. And speaking of fiat currencies, no one can say precisely the carbon footprint of a single dollar bill because there are so much different ways fiat currencies deplete use the energy. It only takes a small imagination to conclude that it outweighs the footprint of Bitcoin. A recent report showed that the annual consumption of power from Bitcoin mining is 8.27 terawatt-hours per year, more than Ireland and other tiny nations. Nevertheless, this number is only an eighth of what data centers in the U.S. consume annually, and the global production of fiat currencies stands at 11 terawatt-hours per year.

Nevertheless, the impact on the environment, will likely be a topic that only increases in influence over the coming years. This gives Polygon and other PoS coins a leg up over the competition.

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