Although it has been more than two months since the Bitcoin network was halved, the cryptocurrency mining industry is still recovering from the frenzied pace of events that followed. Rising retail prices pushed up Bitcoin (BTC) and Ether (ETH) prices, causing mixed feelings among crypto miners.
The COVID-19 pandemic has also left its mark on the industry, forcing dozens of rallies to either shut down or shift focus from Bitcoin with mounting mining woes to less complex altcoins that follow Big Daddy through the cryptocurrency.
The upcoming release of Ethereum 2.0 provides a source of reflection for all miners on their goal of maintaining profitability in light of the challenges posed by the mining hardware market. With Bitcoin halving and the coronavirus pandemic spreading, private miners were left behind, but large producers have suffered as well. Will the upcoming Ethereum update make things worse for miners, or is it just another milestone that they will be easy to adapt to?
Less, but still at work
The halving of bitcoins resulted in a major cleanup for the mining market, as small miners lost all sense of being left behind, but the near-complete disappearance of private farms was not followed by a major decline in large agglomerations.
Alejandro de la Torre, vice president of Poolin Mining, said that 15% to 30% of private miners who produce bitcoin hash rates are under tremendous pressure to stay afloat and gradually shut down. In the short term, the retail rate is also expected to decline to 20% with an average daily decline of 6.5%. In general, the hash rate was set after being cut in half from 135 SBs per second to 98 SBs, or a 27% decrease. But this did not affect interest in cryptocurrencies, as institutions flooded the derivatives market, and bitcoin options increased by 1,200% in two weeks.
The Chinese factor in the statistical realm cannot be ignored – Chinese pools account for up to 65% of the total bitcoin hash frequency. The epidemic has affected the domestic mining industry and forced more than 40 factories to cut supplies. The delays have had a serious impact on all miners, as older versions of mining platforms cannot be replaced with newer hardware that can increase hash, offset half the reward and increase complexity.
Bitcoin’s fall in May from $ 10,500 to $ 8,100 shut down nearly 2.3 million Antminer S9 mining platforms, which was clearly reflected in the low hash rate in China, where most of the old mining equipment became unprofitable. Sold for scrap.
Not everything is bad
While the rapid spread of the coronavirus epidemic in early 2020 affected supply chains and shut down the largest manufacturers of mining equipment, the unrest did not last long as companies in China and South Korea, home to the largest manufacturers, quickly resumed shipments. Bitmain started shipping chips made in Taiwan and Korea from Malaysia, Whatsminer launched a new model to make up for lost time and profits.
After reopening in February, Hangzhou-based Canaan also announced the launch of the AvalonMiner 1066 Pro, its latest chip at 55 TWh.
Powerry, a 100-megawatt cryptocurrency mining operator, announced that it is expanding its capacity by placing a $ 20 million order for new mining operations. The hardware will be provided by Bitmain and MicroBt, and the farm will be donated to Genesis Mining’s HEXA crypto mining program.
Thus, it can be concluded that even expanding the impact of the epidemic on the world will not have a significant impact on manufacturers of mining programs, who will have to provide more new mining platforms for miners who want to keep up with the industry. Requirements. The most to expect in the event of a new wave of the epidemic is delays in delivery and high prices for equipment, which will only benefit manufacturers.
The epidemic has not affected the operations of the largest Chinese mining farms, as any breach could undermine the pace of fragmentation of the Bitcoin network. But even the worst outages across China are unlikely to result in heavy losses as other miners seize the opportunity and keep the hash rate stable. A potential drop in the hash rate of major currencies due to Chinese farm closures will make mining digital money nearly twice as easy, and the profitability of mining will double.
What about ether and composition?
On the other hand, altcurrency volatility could play into the hands of miners. As the price of Bitcoin rises, other digital assets track it faster, improving the economy.