BitMEX He believes that Bitcoin's hash rate will drop 30%. The cryptocurrency exchange itself confirms that, due to lack of data, the report should be seen as nothing more than speculation.
Cryptocurrency exchange BitMEX released a report trying to determine the impact of Bitcoin's next halving, slated for May.
Given Bitcoin's constant price and excluding transaction fees, cryptocurrency mining industry revenue should drop by approximately 50%. However, it turned out that this does not necessarily apply to the network hash rate.
The decrease in the hash rate of the Bitcoin blockchain network is determined not only by a decrease in block rewards for mining, but also by the relationship between the complexity adjustment mechanism and the structure of the mining industry.
The exchange suggests that based on the existing industry structure and the assumption that the price of Bitcoin will not change, halving the profitability of mining can lead to a decrease in the network hash rate by approximately 30 -35%.
Meanwhile, the difficulty of mining Bitcoin has already reached record lows due to the inability of the most capitalized cryptocurrency to return to February values.
Incidentally, in early February, the Bitcoin hashrate hit new records. The blockchain network hash rate peaked at 123,011,832 quintillion hashes per second.
Until the end
In general, in the short term, mining farms should continue working if their income exceeds the total marginal cost of production, that is, the income is higher than the costs, which vary according to the volume of mining.
However, anyone using the Antminer S9 miner or an older generation, priced in the $ 5,000- $ 4,000 range, suffers losses, unless the cost of electricity falls below 4 cents / kWh.
Of course, in essence, mining is becoming unprofitable, but while the company contributes to fixed costs, it is rational to keep the business open.
If Bitcoin can bounce back above the $ 10,000 mark before May's halving, the mining industry will likely continue to grow exponentially and reveal much more information to the public about the nature of the reduction in bitcoin's block production.
Bitcoin and unfulfilled dreams
It's worth noting that due to limited information on halving (May halving will be only the third halving in bitcoin's history), the forecast for the trade is purely speculative.
However, BitMEX believes that with current Bitcoin price indicators, the Bitcoin blockchain network hash rate will likely decrease by 30-35%. At the same time, the exchange expects the bitcoin price to not change much.
According to a Coin Metrics study, the pressure from miners in the form of Bitcoin mass sales is likely to continue to mount. This will connect with upcoming halving with Bitcoin Cash (BCH) and Bitcoin SV (BSV), which are planned well in advance of Bitcoin (BTC).