For miners, 2019 is the worst year in five years. The profitability of Bitcoin mining has not been so low for many years. Worse still, BTC excavation has been loss-making for a long time. Despite this, the miners did not capitulate. What are they waiting for?
The oldest cryptovolt, Bitcoin (BTC), has not had a good run lately. After reaching its peak in June this year at the level of about USD 13.8 thousand, BTC went down by over 47%, to the level of USD 7.2 thousand. Such a significant depreciation had a significant impact on the profitability of coin production.
BitBay resigned from Monero because of his anonymity.
Miners not worried about falling BTC prices
Due to unfavourable market prices, most large miners this year have been extracting coins at break-even or even at a loss due to unfavourable market prices. Contrary to expectations, this did not lead to their capitulation, but on the contrary, the miners doubled their efforts to make the best use of the time remaining until halving (scheduled for May 2020), i.e. halving the unit’s production awards from the current 12.5 BTC to only 6.25 BTC.
Bitcoin has fallen below $8,000, what’s next? – Last promotion in 2019?
The chart published by Charles Edwards shows two periods during which miners continued to produce Bitcoin even though BTC prices fell below break-even. According to Edwards, the last 12 months have been the least profitable period for miners in five years.
Bitcoin miners are hurting.
The last 12 months has been the least profitable in all of the prior 5 years to be a Bitcoin miner.
There's blood on the streets.
… stay tuned … pic.twitter.com/zFXBabhLcp
— Charles Edwards (@caprioleio) December 12, 2019
Although Bitcoin mining has been below break-even in recent months, miners have not stopped mining. According to experts, large miners have made very high profits in the past, so they have the means to continue their business, even when it is not profitable. They can simply wait out the period when the sale of the earned coins is unprofitable, hoping to increase their value in the future.
It is also worth noting that it is difficult to estimate the price at which the extraction of cryptocurrency is profitable. There is no consensus on this issue, but the current estimates assume a profitability price between USD 7,000 and USD 8,000. However, with lower electricity prices, miners can afford to dig BTC at much lower prices. It is estimated that the break-even point for Chinese hydroelectric power plants is 3.5 thousand dollars. Therefore, it is likely that some mines are still profitable and have a more favourable ratio of expenses to Bitcoin’s market prices.
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