The month of November gave rise to yet another serious problem for Bitcoin in which the coin’s hashpower had dropped significantly. Bitcoin’s present hashpower is edging low even though it rose as high as 236 EH/s.
BTCs Hashrate Edges Down Further
Cripple-down impact overtook the crypto industry when it became obvious at the commencing of November that FTX was nearing its collapse.
The impact was so devastating that though November has ended, the entire crypto-economy continues to gradually shrink.
Before FTX’s bankruptcy news surfaced, Bitcoin was swapping hands at a price range of $20,000.
On the other hand, Bitcoin’s hashrate was smoothly operating with the hashpower in and around 270 to 290 EH/s.
Currently, Bitcoin’s value has shrunk by more than $3,000 and continues its struggle toward achieving a round figure of $17,000.
However, not only the value of Bitcoin is shrinking but also its hashrate as well is also collapsing. The hashrate had slid down to an average of 200 EH/s which reduction happened on 26th November.
On the day when FTX’s bankruptcy news surfaced, Bitcoin’s hashrate saw a huge boost and went as high as 347.16 EH/s.
Since then BTC’s hashrate has been dropping with an exception on 12th November 2022 when miners took hashpower to 347.16 EH/s.
Causes behind Hashpower Reduction
Due to value declines, reduction in hashpower, and huge electricity costs, Bitcoin miners have been incurring losses.
Currently, mining a Bitcoin is costing miners an amount that is roughly $60 more than its spot market value.
For instance, miners have been spending $16,956 as electricity costs against 1 unit production of Bitcoin. However, the spot market value of Bitcoin is less than the production cost i.e. $16,897.
This shows that though there are no profits from Bitcoin miners instead they had been spending extra sums on production. Financially speaking, Bitcoin mining is no longer a fruitful and rewarding business venture.
Prominent Miners Holding Ground Firmly
However, miners are not as demoralized as they should be but are in fact putting in efforts for bettering Bitcoin’s hashrate.
On the contrary, on 2nd December 2022, miners managed to increase the hashpower from 200 EH/s to approximately 236 EH/s.
Resultantly, several miners have shut down their Bitcoin mining activities because they cannot afford to spend more and earn less. Currently, the load of Bitcoin mining activities is borne by prominent miners.
It seems that for further days miners would not be able to see fewer production costs against Bitcoin’s spot value.
This looks quite true because, on the other side of the picture, serious difficulty decline is taking place in minting Bitcoins.
Experts are expecting that a major reduction between 6% and 8% is likely to take place by 5th December 2022.
If the expected becomes reality, then any difficulty range, between 6% and 8%, would become Bitcoin’s lowest year-to-date difficulty.
In the past three days alone, Bitcoin’s difficulty has dropped by a percentage of approximately 80 EH/s.
Bitcoin in Trade Markets
As of this present writing, a Bitcoin value surge came which then boosted Bitcoin’s spot market value. Now the coin is trading at the spot market value of $17,197.
This means a sigh of relief for Bitcoin. However, the profits are still not as good as to encourage small and medium miners to resume their mining operations.
For medium-level miners to continue with their mining operations, it is important that the trading price of Bitcoin experiences a surge very soon.
The trading price of Bitcoin needs to surge over $20,000 so it becomes profitable for investors. With the rising energy and other kinds of costs, Bitcoin mining has become an even more expensive process.
The institutional and mainstream investors have to jump in and bring in more investors so the trading price of BTC may surge significantly.