Altcoins Talks - Cryptocurrency Forum
Crypto Discussion Forum => Cryptocurrency discussions => Topic started by: Ezzi on May 23, 2021, 11:20:53 AM
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Miners are shutting down their hardware all over the world. It all started with European miners. Bitcoin has become unprofitable to mine.
It is worth noting that since 2016 they have been periodically scared. Then it turns out that they did not really mean a ban and in general it is about those who steal electricity. The hash rate has really decreased, only it began to decline on May 13, because that day the difficulty was recalculated and it increased from 20t to 25t. The price collapse was also observed. Naturally, someone turned off the equipment and continues to turn it off, because it became unprofitable. The next recalculation is only after 6d 20h. The difficulty will decrease accordingly, and the lost income will be slightly compensated.
All I mean is that after this news, no one rushed to turn off everything and sell, otherwise we would have seen an even greater outflow of capacities, tk. China owns 65% of all capacity in the btc network.
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Even if miners stop mining bitcoins, it will not happen so quickly. They need some time to comprehend the situation, think about which cryptocurrency to switch mining to and what to do in general in this situation. And they will not rush to make a decision. Some are probably still hoping that the fall in prices will not be as long as it was in 2018-2020. Therefore, this process can take many months.
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I am just wondering why miners never stopped mining Bitcoin when the price was just $5,000 or even at $10,000? Does it mean it was then profitable to mine at $10,000 yet is not anymore profitable when the price is at $30,000 on average? Upon checking CMC the price of Bitcoin is at $38,000 and there is a possibility of it reaching back $40,000 soon. Maybe there will be some miners that may choose to shift but we can never say that majority of miners are doing it.
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The market rebound at the start of the week has been partly assisted by comments from Elon Musk that he has been in talks with bitcoin miners about renewable energy solutions.
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I am just wondering why miners never stopped mining Bitcoin when the price was just $5,000 or even at $10,000? Does it mean it was then profitable to mine at $10,000 yet is not anymore profitable when the price is at $30,000 on average?
Indeed, it's the main point for those who are thinking that miner will stop mining at correction market. Maybe, OP discribed those miners who are small and don't have that much new and updated mining equipment or having old mining equipments which are consuming more electricity more than expected. That's why they're leaving this mining space, but miners from china is shifting from china to other countries so that they can continue their mining without any type of problem. Also those miners are trying to use renewable engries to continue their process so that it won't have effect on our environment.
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Specially large miners or mining farms won't stop mining even now they are in losses. I don't think they are in losses and won't stop because $38k rate is enough to cover their costs. One year ago, mining costs was around $10k. But early miners were gainers. From now, small miners can stop mining because their generating costs can be higher than large miners. Hence larger miners can use renewable energy to save energy costs that is impossible for small miners.
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First of all, I don't believe miners are not profitable when BTC price is above $30K. We still know that right after the halving, the average cost to mine 1 BTC is around $7.5K.
Currently, Chinese miners are having to move their mining systems out of China to find other countries, the hashrate will decrease in the short term and other miners will have a chance to receive more BTC.
I believe this upheaval in the mining market will give Bitcoin greater decentralization than before when most of the network's power is not in China's hands.
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One of the main reasons for the global Bitcoin market crashing is due to the high cost of fuel. However, fuel costs in Bitcoin are not linked to Bitcoin crushing, and the Chinese government has decided to keep the Bitcoin market in check so as not to over-invest in Bitcoin due to the high price of Bitcoin. Elon Musk and the Chinese government are one of the main tools for bitcoin crushing, the cost of bitcoin mining is not responsible for bitcoin crushing.
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Even if the miners stop mining new miners will arise to start mining and making more profit. Thats how the system works. But even if all miners eventually stops the the mining btc will not die. It is decentralized and has a big community so the holders will decide what to do next if something like this situation arise in future.
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Since the government banned bitcoin mining in China, according to official statistics, bitcoin mining there has dropped to zero percent. The hashrate moved to other countries, most of all, bitcoin began to be mined in the USA, Russia, Canada, Kazakhstan. That is, in general, the ban on bitcoin mining in China did not affect the popularity and price of bitcoin. As soon as this problem is settled, another and more serious one appears on the horizon. Sweden recently asked the European Union to ban the mining of cryptocurrencies that use the energy-intensive PoW algorithm. Given the gravity of the climate change situation, such a ban is likely to be adopted. After the EU, this initiative is likely to be supported by the United States and other countries. How will such events affect Bitcoin?
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But I can see at the end of 2021 BTC mining hash rate is at its peak. Miners are not leaving they just shifted because certain countries ban BTC mining like China and Iran. This leads to that hash rate fall but now it's totally recovered and increasing day by day. There is still a lot of firms that are mining BTC every day.
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Even if the miners stop mining new miners will arise to start mining and making more profit. Thats how the system works. But even if all miners eventually stops the the mining btc will not die. It is decentralized and has a big community so the holders will decide what to do next if something like this situation arise in future.
I live very close to China, where miners turn off their equipment. I think that Chinese miners will move to neighboring countries such as Kazakhstan, Russia, Uzbekistan, Kyrgyzstan. They will pay tax for the use of mining in the countries. The course will not change in any way, everything will be as before. They will restore mining equipment in other countries.