Impact of Bitcoin Scaling on Miners (Mining Costs after Bitcoin Halving)

08/17/2023 19:43 • AI & Tech Insights • 57 views

The scaling of Bitcoin and its impact on miners According to CCN news, the mining capacity of the Bitcoin network has significantly improved in the past few years. With the recent rise in prices and increasing hash rates, the network’s computing power is gradually returning to normal levels.

Currently, due to reasons such as fast transaction speed, low fees, and increased block size, Bitcoin mining has become more complex. This has led to misconceptions about Bitcoin scaling, with many thinking that its impact will be significant. So, what is “mining” on the Bitcoin network? It is essentially making a cryptocurrency operate more efficiently (i.e., reducing block time). However, if calculating the data volume on the blockchain is difficult and expensive, Bitcoin cannot process this data to meet the requirements of the Proof of Work consensus algorithm. Therefore, when adjusting the difficulty to 5 times per second to determine if Bitcoin can be effectively mined, a significant amount of electricity is required to confirm the entire process. This ensures the security of the system while consuming substantial energy to maintain system security.

Mining Costs after Bitcoin Halving

Note: This article is from CYBTC.com and has been authorized for reposting by Odaily Star Planet Daily.

According to the calculation model of mining costs after Bitcoin halving, the current computing power is approximately 7 exahashes (EH/s) per second, which is still considerable based on the current market performance. However, after the recent increase in BTC prices, factors such as difficulty adjustment and the addition of new and old machines have led to excess power supply and continuously rising electricity costs. It is estimated that the next block reward will be around 12.5 BTC. Therefore, considering the current situation, the decline in the network’s computing power after halving may have reached its highest historical level or even exceeded the average of the 1CO era. As a result, the Bitcoin network is expected to continue experiencing relatively high growth in computing power in the near future. This means that mining business will gradually become one of the mainstream industries, which will drive the entire cryptocurrency market to new heights. However, with more people entering the digital asset industry, the demand for Bitcoin mining is also increasing. To further improve the stability of computing power, a more reliable and secure platform is needed, one that can better support transactions, reduce transaction frictions, and lower costs to maintain operational efficiency. In addition, the price of Bitcoin has recently experienced a significant decline because there has been no single breakthrough in the market since May this year. The price remained low until this week when it dropped below $10,000 again, causing some relief. In the weeks before and after the halving, the overall market value of Bitcoin has reached nearly $1 billion. What are the main reasons behind this recent rise in Bitcoin price? Here are two main factors:

Firstly, the enhanced economic benefits brought by the decrease in Bitcoin production. On one hand, as Bitcoin prices rebound and combined with the increasing value of Bitcoin itself, governments worldwide have begun to gradually relax their regulatory measures on virtual currency exchanges or over-the-counter trading platforms. On the other hand, Bitcoin mining still faces some issues, such as certain mining companies not being able to profit due to insufficient operational scale and high transaction fees. For example, in the past year, Bitmain Technologies Inc., a subsidiary of Bitmain, purchased 20,000 Antminer S19 Pro mining machines and applied for the registration of stock registration book as a listed company to the U.S. Securities and Exchange Commission; another example is that this company holds approximately one million shares of Bitcoin and is listed on Nasdaq. In addition, Bitmain’s mining pool, Antpool, stated, “By introducing compliant custody services, we can help miners mitigate risks.” It is estimated that as of mid-April 2020, the institution had a Bitcoin reserve of at least $2 billion. The bull market at the end of 2018 made investors rethink their investment choices. However,

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Impact of Bitcoin Scaling on Miners (Mining Costs after Bitcoin Halving)

Mining Costs after Bitcoin Halving

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