The continuing crash of the Bitcoin share price (BTC) puts the network under pressure. Miners in particular are struggling with the consequences of the collapse.
The Bitcoin share price (BTC) is still shaken by the international uncertainty caused by the coronavirus epidemic. In the last 24 hours it has fallen by almost 8 percent. The crypto currency is thus currently at 4,864 US dollars.
One group that is particularly affected by the current Bitcoin exchange rate crash is the Bitcoin Miners. The so-called "miners" ensure that Bitcoin's block chain is continued by means of applied computer computing power. In doing so, the computers use the proof-of-work mechanism in the network to achieve consensus. For each successfully prospected block they receive 12.5 BTC units. This reward is halved at fixed intervals: every 210,000 blocks. Due to this increasing reduction in supply, Bitcoin is considered deflationary.
Hash rate, Bitcoin price and mining
The Bitcoin Hash Rate shows how diligently the miners are digging during all this. This indicator rose steadily in the weeks and months before the crash. Since the next halving is due in May, miners around the world seemed to want to stock up on as many BTC units as possible at "low cost".
According to information available to the industry magazine Coindesk, since September mining companies have increasingly supplied themselves with new equipment in order to position themselves as prominently as possible in this competition. Since old equipment was no longer profitable, the largest companies have invested at least $500 million in new equipment, Coindesk continued.
The fact that the Bitcoin price has now halved before Mining Halving, however, is also presenting the prospectors with financial bottlenecks. After all, their only income - apart from a share of transaction fees - is the Bitcoin units they receive for successfully mined blocks. This means that they have to cope not only with the aforementioned equipment, but also with a not inconsiderable amount of electricity consumption.
Mining equipment sales declining
This has also affected the hash rate - the amount of computational effort required to mine new coins has dropped from 118 EH/s to 108 EH/s since last week. As Coindesk further reports, sales have also fallen in this context. For example, monthly sales of mining equipment manufacturer 3logic have halved from 5,000 to 2,500 units since October last year.
