Category Archives: Blockchain

Bitcoin has risen in price to a record 50 thousand dollars. In six months, it grew by 350%

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The cost of bitcoin at the auction on February 16 reached a record high of 50 thousand dollars. Half a year ago, the cryptocurrency was worth about 11 thousand dollars. Since that time, its value has increased by 350%.

The rapid growth of quotations began in the fall of 2020. Back in October, Bitcoin was worth about $ 11,000, and in December, its value exceeded $ 20,000. In January, quotes exceeded $ 40,000.

After that, bitcoin’s cost returned to the level of 33 thousand dollars, but in February, there was a recent jump in the rate. The auction was influenced by the news that the car manufacturer Tesla has invested $ 1.5 billion in bitcoin and will accept cryptocurrency as payment.

How Bitcoin grew in price during the coronavirus?
Bitcoin began to rise noticeably in March 2020 after the outbreak of the coronavirus pandemic. In connection with the coronavirus’s spread, the governments of various countries have introduced restrictive measures, which led to a slowdown in business activity.

The US and EU have decided to stimulate their economies with additional spending. Many investors believe that massive stimulus measures will weaken the euro and dollar. There are also fears that an increase in money supply will lead to an acceleration in inflation. Against the backdrop of these concerns, investments in bitcoins have increased, the supply of which is limited.

Also, experts and investors expect the use of cryptocurrencies in the traditional financial system to increase. The decisions of individual companies indicate this. For example, earlier payment services Square and PayPal, which about 300 million people in total use, added the ability to buy cryptocurrencies to their applications.

The previous maximum of quotations was recorded in December 2017, when the cost of bitcoin was approaching the $ 20 thousand mark. Then the quotes rose sharply in a few weeks, and then there was a collapse, and in a few months, bitcoin fell in price to 3.2 thousand dollars.
However, the current growth is different from what happened in 2017. At that time, the cryptocurrency was bought mainly by private investors from Asia, and now institutional investors and large companies, mainly from the USA and Europe, participate in trading.

Some experts still consider bitcoin as a “bubble,” the value of which will collapse sooner or later. Even investors anticipating the growth of quotes warn that cryptocurrency trading remains exceptionally volatile, and sharp price fluctuations should be expected.

However, questions remain as to whether cryptocurrencies have any value. Some experts fear that investments in bitcoin and its analogs may be lost.

Challenges of the digital era

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In today’s era of digitalization, data has surpassed oil in becoming the world’s most valuable resource. It is a strategic asset, commonly referred to as a “new currency”. A testimonial to this is the fact that the five highest valued listed companies in the world are all technology and digital market operators. Their impressive valuations are largely a result of extensive consumer data aggregation, which fuels machine learning and revenue generating processes. While the possibilities of what can be done with data are endless, it’s important to consider the significant privacy, political and legal concerns that have developed as a result of corporate data processing in recent years.

The most important issues surrounding data gathering are neither technological, nor commercial, but rather legal and social. They center around the fundamental right to privacy, safeguarded on an international level by Article 12 of the Universal Declaration of Human Rights. While we also have national protections in place, it is clear that the existing privacy laws are no longer fit for their original intended purpose. Despite constantly increasing volumes of personal information handled by private companies, privacy standards are deteriorating. Consumers, often unaware of the actual value of their online contributions to data mining algorithms, are being deprived of any bargaining power. With limited options to meaningfully opt-out, they have little choice but to accept arcane and non-negotiable privacy policies. One study found that an average internet user would need over 30 working days per year just to read through them. Such information overload, in combination with several other factors, leads individuals to progressively lose control over their digital identities.

 

 

There are also profound concerns about accountability of tech giants. The possibility of surveillance, profiling and hacks are just some of the triggers that have contributed to the case of serious public anxiety that we feel today. In 2018, hackers were able to access the private information of over 150 million users of MyFitnessPal. The Cambridge Analytica scandal was an even more striking example of how access to large datasets may allow private companies to peddle misinformation, thereby undermining democratic processes.

Beyond strict data protection concerns, there is an important interplay with law and fair competition. A significant peculiarity of online services is that they are often provided at “zero price”. This is due to the network effects in dual-sided business models, where cross-financing is enabled by revenue made through advertising and by trading information with data brokers. As a result, the concentration of user data can entrench market power and contribute to higher barriers to entry. Data-driven mergers often occur in order to eliminate nascent competitors, yielding serious exclusionary effects in extremely highly concentrated digital markets. Consequently, there is little incentive for the incumbents to innovate and provide users with optimal privacy protection. Given these negative developments as well as the industry’s general tendency towards monopolization, a wholesome regulatory reform seems inevitable. The EU General Data Protection Regulation and California’s Consumer Protection Act are the best examples of increased awareness surrounding the issues of privacy and transparency of tech giants. They also give hope for greater scrutiny of digital market operators worldwide. Yet, there is no doubt that technological innovations can increase productivity, accelerate business processes and automate mundane tasks. Indeed, it was technological tools such as Zoom, Microsoft Teams or Skype that allowed us to continue working and studying, despite the global pandemic. Thus, it is important to

Overall, while there is a clear need for global action to mitigate some of the risks, we must be careful not to squelch innovation and opportunities of the digital age. Ultimately, it is all about the balance between embracing innovation and effectively safeguarding fundamental rights and freedoms.

Sources:

1. M. Vestager, ‘Competition in a big data world’, DLD 16, Munich, 17 January 2016.

2. A.M. McDonald, L.F. Cranor, ‘The Cost of Reading Privacy Policies’ (2008) 4 I/S: A Journal of Law and Policy for the Information Society.

3. G. Colangelo, M. Maggiolino, ‘Data Protection in Attention Markets: Protecting Privacy through Competition?’ (2017) 8 Journal of European Competition Law & Practice.

4. A.D. Chirita, ‘Data-Driven Mergers Under EU Competition Law’ in The Future of Commercial Law: Ways Forward for Harmonisation, J. Linarelli & O. Akseli (Hart Publishing, 2019), p. 51.