Jul 2 – Maybe we needn’t worry so much about that mysterious “data center”, believed to be a cryptocurrency mining facility, slated for the Morgantown Industrial Park after all.
Because for the last month and a half, the cryptocurrency has been in free fall.
It started in May when a type of stablecoin collapsed. Stablecoins are cryptocurrencies that are pegged to real-world assets and/or are supposed to hold a dollar-for-dollar exchange (one crypto unit equals one US dollar). terraUSD was an experimental stablecoin that was based on an algorithm, but the algorithm failed and the coin crashed, valued at $0 and taking its sister cryptocurrency Luna with it.
This, in turn, set off a chain reaction that has decimated the value of even well-established coins like Bitcoin, which, at the time of writing, had fallen to less than $19,500 per coin from a high of almost $69,000 per coin. currency in the past year.
The cryptocurrency crisis has also had effects in the real world. Thriving crypto firms have initiated mass layoffs and rescinded job offers, with some even freezing withdrawals when they went into the red. Investors, especially those who did not get in early and/or had only invested a few thousand, have lost half or more of their investments. And one company had to shut down a data mining facility because it cost more to keep it running than the value of the cryptocurrency it generated. As we have discussed before, crypto mining operations require tons of energy not only to power the many computers that solve equations, but also to keep them cool.
It’s the latter that makes us wonder if the MIP-watching crypto mining facility might change its mind.
That said, many crypto-bros who got into the ground floor aren’t too worried. Some are even excited to see the coin hit a bear market, because it is driving less trustworthy cryptocurrencies out of the game. According to a recent CNBC article, there are about 19,000 cryptocurrencies and dozens of blockchain platforms. (Blockchain is the underlying mathematical equations and brain teasers that give cryptocurrencies value. Crypto mining facilities solve blockchain equations to unlock new coins and record them in a ledger so they aren’t double-spent.) Various sources compare the current crypto crash to the dot-com crash of the late 1990s: “weak” companies and fraudsters will be wiped out and “strong” ones will become the Amazons and eBay of tomorrow.
Even if crypto recovers, as it probably will, if not in a few months then at least a few years, we still hope that the current market volatility will be enough to dissuade any company from building a crypto “data center” here. .