6th April 2022 > > IPCC.
tl;dr
The IPCC takes a negative stance towards cryptos.
Market Snap (at time of writing)
Market Wrap
Treasuries selling off to the tune of nearly 2 percentage points in the face of new sanctions against Russia, including a ban on coal imports into the EU.
Whilst energy prices are increasing (exacerbated in the UK because of government interference in the energy market via the price cap, interference that guarantees higher prices for everyone over a medium timeframe) I note that my key measure of inflation - the price of a pint of milk in the shop opposite my house - stays resolutely unchanged at 70p.
Larry, don’t forget our bet.
I have also been making some new capital investment in IT equipment for the forthcoming establishment of the very first overseas office for Curious Cryptos Ltd. (see below).
All that IT equipment is between 20% and 35% cheaper than just a year ago. Perhaps inflationary fears are overdone?
Occasional Series – The CCC is going global!
Following successful conclusions to negotiations regarding our new overseas (*) office in Inverie, Knoydart (see CCC 26th March 2022) our very own Head of Media at Curious Cryptos Ltd., Janey de Nordwall, has accepted the additional responsibility of taking control of our international operations.
To celebrate these exciting developments, the CCC is hosting a party from 9pm this Saturday 9th April at CC Towers, Equus House, 66 Barbauld Road, London N16 0ST.
All readers of the CCC are most welcome to join in the fun and japes.
Curious Cryptos’ Commentary – Intergovernmental Panel on Climate Change (IPCC)
Critics of the IPCC maintain that it is largely an unregulated lobbying body, supported by tax dollars, with a very one-sided remit and focus, and whose main contribution to the environmental debate – its annual report – is a simple cut-and-paste exercise from some of the more stridently doomy publications, which is also shown to be frequently wrong in its predictions in a relatively short timeframe.
Without wishing to get into that debate (and please, no assumptions should be made about my own opinion in this matter), rightly or wrongly, the IPCC wields a great deal of influence, and for that reason alone we must pay attention to its musings on the topic of cryptos.
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The IPCC’s main concern is to report on the achievability or otherwise of limiting the rise of the average temperature of the Earth by 1.5°C. Their current assessment is that there is only a 50% probability of hitting this target, which suggests a certain amount of understandable fence sitting given the enormous difficulties in making such an assessment.
Behind this 50% probability lies the requirement for “… global greenhouse gas emissions to peak before 2025 at the latest and be reduced by 43% by 2030.”
Assuming we all agree that this 1.5°C ambition is the appropriate course of action, I leave it up to you to consider whether these are realistically attainable targets as we enter Q2 2022.
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Quite rightly, given its remit, the IPCC must consider the impact of developing industries and technology on its self-imposed greenhouse gas emissions targets. And right in the line of fire we find cryptos:
“The energy requirements of cryptocurrencies is also a growing concern, although considerable uncertainty exists surrounding the energy use of their underlying blockchain infrastructure. While it is clear that the energy requirements of global Bitcoin mining have grown significantly since 2017, recent literature indicates a wide range of estimates for 2020 (47 TWh to 125 TWh) due to data gaps and differences in modelling approaches.”
Those two qualifications – data gaps and differences in modelling - are highly instructive. They are doing a lot of heavy lifting, which may or may not be justified.
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The impact of such assessments by a globally recognised body that is at the heart of the environmental debate can potentially be very negative.
We saw recently that the new legislation enacted by the EU, Markets in Capital Assets (MiCA), was close to being turned into an attempt to “ban” Proof-of-Work coins, notably BTC, from the European arena (see CCC 14th & 15th March 2022).
Commentary like this from the IPCC will inevitably cause more anguish and angst to be directed towards cryptos in general.
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(*) Not strictly overseas but you can only get there by boat or a 2-day hike.
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