Bitcoin (BTC) is defying the trend of “miners follow the money” - as the price continues to unravel, and burrows even below $6,000, mining is as active as ever.
BTC prices have been down 75%, and in the meantime, hashing power came online, to increase BTC mining by more than 300%. BTC hashing power is now more than 43 million TH/s, three times higher compared to the levels at the start of 2018. The trend has accelerated in the past two months, while BTC Prices slid from $9,000 to $6,000 and below - mining almost doubled its pace lately.
Miners have shared that for some, BTC is getting worryingly close to breakeven levels. It is unknown what happens if miners work solely for profit, without altruistic mining. What is even more curious, is that since the start of 2018, Bitcoin transactions have stagnated below 200,000 in 24 hours, consistently 4-5 times lower than Ethereum transactions. With increased mining, each transaction is much more expensive in electricity and equipment utilized.
Because mining pays out, some believe it would stop the decline in BTC prices. For some miners, breakeven is a bit lower, though, at $4,400. This means that even at current prices, it may be slightly feasible to continue mining.
At the moment, the crypto market is almost at equilibrium, based on modeled behavior. However, there is no unified opinion for breakeven prices for mining, as not all hashing power has come online at the same time and at the same rate. Mining farms also have different costs.
Just as mining is at an all-time peak, and BTC is teetering, with talks of a drop as low as $1,000, there are also speculations of a possible change in proof-of-work algorithm. Such a move would render all ASICs redundant, and have Bitcoin mined in a totally different model.
In the meantime, the trading profile of BTC has changed. The Japanese Yen has a share of 65%, with dollar and USDT volumes continuing to slide. Bitcoin’s share of the crypto market trading has also lowered, to 27%. As altcoins slide, it seems fewer buyers are parking their funds in BTC, instead choosing to protect their positions with the fixed-priced Tether (USDT).