Is Bitcoin Sphere in A Similar Situation As The Fall of 2018?
Amid the recent bitcoin crash, Mao Shixing, founder of F2Pool, currently the world’s largest bitcoin mining pool, published the latest list of the “shutdown price” below which crypto mining machines have to be shut down for lack of profitability.
According to Mao, at the current mining difficulty, older mining models including Whatsminer’s M3 and Avalon A741 have already reached the shutdown price; Ebit E9+, Antminer T9+, Avalon A821 and Antminer S9, once the most efficient miners, are on the verge of shutting down if bitcoin price further drops to $7,500.
While the calculation above has not yet included hardware purchase cost, mining pool fees, and maintenance, the actual shutdown price thus should be much higher.
The shutdown price update from F2Pool reminds us of the situation last year where bitcoin price dropped from the $6,000 range down to the $3,000 range since mid-November, rendering huge amount of mining machines unprofitable and dumped like scrap as rainy season (when cheap electricity is guaranteed by the abundant hydropower) happened to come to an end at that time. As a result, bitcoin hashrate plunged almost by half from a year high of around 60E in the last two months of 2018.
While the latest price plummet this time did not seems to influence the bitcoin hashrate. Data showed that that hashrate metric immediately reversed and remains on its upward trajectory after a temporary dip which many guessed a result of new machine upgrade. It indicates that miners are remaining confident in the bitcoin price rally.
After all, they are more likely to dedicate more resources to the computer intensive process that secures the network and processes transactions if they are bullish on price. Miners would likely scale back operations if a price slide is expected. That explains why many believe prices follow hash rate and increasing hashrate might hint at price gains.
While some observers think that influenced by the upcoming Bitcoin’s 2020 halving, it is only when those hashrate at high costs is obsolete could bitcoin price goes up this time. The hashrate surge over the past few months points to more mining machines being operating on the network. With the delivery of huge amount of 50T+ miners by the end of the year, bitcoin is expecting another hashrate spike, will bitcoin price rally along with it? Leave your comment below.