This year, the top ten cryptocurrencies, including bitcoinBTC, ethereum, and others, have all plummeted, losing a collective $2 trillion (though bullish price predictions are still being made) as reported by Forbes.
Increased interest rate
As the Federal Reserve pursues a series of hawkish interest rate increases in its fight against inflation, the price of bitcoin has plunged to under $20,000 per bitcoin, down from almost $70,000 last year, and the price of ethereum has also fallen—with a $300 million game-changer still potentially unpriced. Now, billionaire and former GoogleGOOG CEO Eric Schmidt claim that chainlink, a cryptocurrency that rose to the top ten and surged until 2020, has “superior technology” and “scales better” than other cryptocurrencies like bitcoin and ethereum. Schmidt admitted, “I’m traditionally a sceptic,” alongside Chainlink Labs cofounder Sergey Nazarov at the SmartCon conference this week in New York, according to Decrypt. In December of last year, Schmidt began working as a strategic advisor for Chainlink Labs.
To connect data to blockchains, Chainlink uses oracles. It was created to assist clumsy, unwieldy decentralised networks scale. However, since reaching an all-time high in May of last year, the price of Chainlink’s link cryptocurrency has fallen by more than 80%, exceeding drops in the price of bitcoin, ethereum, and other significant cryptocurrencies.
Web3, the notion that a decentralised, blockchain-based internet will eventually replace Silicon Valley’s web 2.0, which is dominated by companies like Google and Facebook’s Meta, is “not normal,” according to Schmidt, who also cautioned that ethereum-like smart contract blockchains are “poor in their capabilities” and that sky-high expectations have recently gotten “a little ahead of reality.”
The long-awaited September merge upgrade of Ethereum, which saw the cryptocurrency switch from the energy-guzzling proof-of-work consensus model used by Bitcoin to the more energy-efficient proof-of-stake model, was hailed by Schmidt as “a sign that [the crypto] industry is getting its act together.” In the meanwhile, Schmidt issued a warning that impending cryptocurrency legislation might arrive too soon. Schmidt advised against requesting regulation too soon.
Setting up enforcement
Following the enormous bitcoin, ethereum, and cryptocurrency price surge of 2021, governments and regulators all over the world have started drafting legislation that some worry may suffocate the sector and innovation in the crypto space.
After the White House Office of Science and Technology suggested that bitcoin might be outlawed last month, the Biden administration directed U.S. government agencies to step up enforcement of bitcoin and other cryptocurrencies, potentially putting the $1 trillion market on a collision course with regulators.
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