Crypto Industry News:
The European Central Bank has expressed concerns about the significant carbon footprint of PoW mining, while pointing to a possible ban on such assets.
In an article published earlier this week, bank researchers argued that Bitcoin and Ethereum both have a significant carbon footprint. Reportedly, they consume similar amounts of energy every year as medium-sized countries, including Spain and Austia.
Experts also talked about Proof-of-Stake. According to the report, a PoS-based cryptocurrency would require as much energy as a small American town with around 2,100 homes.
The article notes that the benefits Bitcoin brings to society is "questionable" while blockchain may have potential benefits. Using analogies, ECB experts described PoW as a cryptographic version of fossil fuel cars and PoS as electric vehicles.
Blockchains like Ethereum are already working on the transition from Proof-of-Work to Proof-of-Stake, where the process is expected to be completed by 2023. Meanwhile, ECB experts believe it is "unlikely" that Bitcoin will soon migrate to PoS.
Nevertheless, the article states that the transition to renewable energy requires political and social initiatives regarding energy sources and consumption. According to experts, such decisions would favor certain actions and pose a risk to the value of crypto assets.
The report also argued that PoW-based crypto assets are inconsistent with environmental, social, and governance (ESG) goals. Therefore, investors need to research whether investing in specific cryptocurrencies is in line with their ESG investment strategy.
This is why Tesla has not accepted Bitcoin as payment for goods and services as of May 2021. According to Elon Musk, the company will resume BTC payments when Bitcoin miners start using more than 50% of green energy for their operations.
Technical Market Outlook:
The ETH/USD pair had broken above the supply zone located between the levels of $1,255 - $1,281 and made a new local high at the level of $1,462 (at the time of writing the article). The momentum is at the level of 65 points already, so the bulls are now controlling the market. The intraday technical support is seen on the level of $1,319 and $1,281. The larger time frame trend remains down, however the recent breakout might be a beginning of a bigger bounce even towards the level of $1,750.
Weekly Pivot Points:
WR3 - $1,617
WR2 - $1,509
WR1 - $1,470
Weekly Pivot - $1,401
WS1 - $1,362
WS2 - $1,294
WS3 - $1,185
Trading Outlook:
The down trend on the H4, Daily and Weekly time frames had broken below the key long term technical support seen at the level of $1,420 and bears continue to make new lower lows with no problem whatsoever. So far every bounce and attempt to rally is being used to sell Ethereum for a better price by the market participants, so the bearish pressure is still high. The next target for bears is located at the levels below $1,000, like the last swing low seen at $880. Please notice, the down trend is being continued for the 13th consecutive week now.
