Long time we have been hearing the opinions of many people about the Halving and its possible consequences in the valuation of Bitcoin. However, in this opportunity we will focus on the opinions of some experts on what that might involve mining Bitcoin after the Halving for the miners. First of all, what’s most evident is that the miners will receive less reward for their effort, because the protocol reduces the reward of the block to the half. That is to say, to undermine Bitcoin might not be as lucrative if there is not a greater change in the prices or decrease the costs. The reward is the amount of criptomoneda who receive the miners when validated with success a new block. This is done by solving mathematical problems too complex with your hardware mining. Minar Bitcoin typically large electricity costs, so they need one way or another to obtain more benefits than costs to be profitable.
Contents
Background of the Halving of Bitcoin that approaches
When he launched Bitcoin in 2009, the miners were receiving 50 BTC per block. Therefore, we generated a total of 10.500.000 BTC before the next Halving in mid-November of 2012. There, the miners began to receive 25 BTC for each block. The next Halving of Bitcoin happened on the 6th of July 2016, when there were 420.000 blocks and the miners began to raise to 12.5 BTC per new block. As you know, this is the current rate. The next Halving will reduce the reward by half once more, leaving the reward for each block is 6.25 BTC. It is expected that the final Halving of Bitcoin happen at some time in the year 2140, when extracted 21 million Bitcoin, which is the top scheduled. Once that happens, the miners will no longer receive rewards per block, but will keep the remaining source of revenue: the fees paid by transactions, which also raise.
Minar Bitcoin today: How is it done?
At this point, most of the mining of Bitcoin is done by giants such as Bitmain, the renowned company with its headquarters in China. Bitmain valid blocks with thousands of machines extremely powerful and consume a lot of energy. These machines are called miners of integrated circuits. The same are much more efficient in comparison with the basic settings used by the individual miners. Therefore, to undermine Bitcoin in large quantities, is almost the exclusive task of the farms of mining. What is expected normally after a process of Halving is the increase in the price of Bitcoin, as has historically been the case. So, many miners are stimulated with the expectation of future benefit. This does not take much time, since it is expected that the Halving will occur in may, but the reality is a little uncertain for the miners. Also, notice how it has changed the dynamics of the mining industry of Bitcoin since the last Halving. Currently, there are more miners in 2016. In addition, the mining of Bitcoin has come out of places like China and have come to countries like Kazakhstan and Iran, for the costs of electricity relatively low. So look currently sites for mining Bitcoin in mass. After the Halving of Bitcoin will become more urgent to update and increase efficiency of existing technologies for this work. Individual miners could not adapt.
What do the experts say about the expectations of the miners of Bitcoin after the Halving?
Recently, in a podcast of CoinDesk, Ethan Vera, head of finance Luxor Technologies, gave his opinion on the matter. It is worth mentioning that Luxor Technologies is one of the groups of mining cryptocurrencies largest in north America. The fall of 12 march changed the landscape of many miners while they were waiting for returns from the Halving of Bitcoin. Many of them responded, but others were not able to continue because “the benefits did not”, according to Vera. The result of this event was a significant drop in the hashrate. To this we can add the opinion of the CEO of Delta Exchange, Pankaj Balani, who explained that the miners are not even expected these circumstances. Instead, they were accumulating Bitcoin expecting that the value of the same increased during the Halving. When generated this fall, the panorama changed a little bit for the miners, since it mixes the natural consequences of a reduction to half of his reward with a market decline. Without delving much, it represented loss for many individual miners. However, Vera also stressed that those miners that were able to overcome the crisis now have less competitors and it is positive in a certain way. In addition, with the recent gradually recover the price of Bitcoin, many miners kept the optimism about the future after the Halving.
The miners break through when it is beneficial for them to do so
Talk of the hashrate it is important to understand the future of the mining of Bitcoin. It is expected that with the Halving, the hashrate is lower. Vera estimates that it will generate a drop of 30 hexahashrate in the short term, but do not think this is a real concern for Bitcoin. In terms of the broader implications, estimated that in great part the network will remain secure. In may of 2019, only a year ago, the rate of hexahash was 45, and questioned a lot of the security of the network at that time. However, Bitcoin is maintained for many months. On the other hand, what you will see if you recognize it as something that could have more impact is that, “many miners are on the verge of being burned financially.” This refers to the possible effects of the collapse of the global economy, and the loss of the march 12, situations that perhaps many miners cannot handle. In consequence, probably many will leave the community of Bitcoin.
Additional considerations
In summary, market factors will determine who makes money and who does not, there is a real way to fight against that. That’s why the benefits of the mining after the Halving will depend on whether the market follows the historical trend, or if it varies by what is happening in the world with the COVID-19. That is to say, the miners are subject to the risk that things will not go as they had hoped and they lose their investment. That’s why, Vera ensures that you will need some tools for the miners to reduce that risk.
“I hope to see more funding for the hashrate to move forward, and that the miners may have a more long-term, similar to what happens with other industries.”Ethan Vera, Luxor Technologies.
Many experts speak of the financing of the hashrate, but others speak of the existence of mining machines more economic and with more capacity. In addition, it is important to consider the amount of machines that may be available in the market as a determinant of the hashrate of the network in general. However, Vera ensures that miners of Bitcoin should focus on how to optimize the value of the hashrate produced. That is to say, they must answer the question “how do I get more value for the hashrate that genre?”. Especially after the Halving of Bitcoin.
Conclusion
The miners that remain in the market are not willing to lose and maintain their faith in the historical development of prices after an episode of Halving. Therefore, stay very alert of what is happening now with the Halving of Bitcoin Cash. However, we must take into consideration the alternatives of response that you can have the miners in case things do not go as they had hoped after the Halving. The mention of Vera in the podcast are just some of the possibilities. Many factors can affect the increase or decrease of mining after the Halving, but we believe that one of the most crucial has to do precisely with the development of machines more efficient.