Galaxy

Bitcoin

when

<p>The digital drumbeats of the Bitcoin world are echoing a stark warning: the upcoming Bitcoin halving could spell a computational cold winter for about 20% of its mining power. With the halving set to slash rewards from 6.25 <a href="https://www.cryptopolitan.com/bitcoin-surpasses-52000-mark/" data-type="post" data-id="466209" rel="noopener noreferrer nofollow">BTC</a> to a mere 3.125 BTC per block, miners are scrambling to tweak their operations. This is a potential seismic shift that could see a significant chunk of the network’s hash rate going AWOL.<a href="https://blockworks.co/news/bitcoin-halving-miners-hashrate-offline" rel="noopener noreferrer nofollow" target="_blank"> </a></p>
<p>Galaxy Digital’s brainiacs have crunched the numbers and foresee a bleak scenario where up to 20% of the hash rate, contributed by eight specific models of mining rigs, could take a bow and exit stage left at halving time. These aren’t your run-of-the-mill ASICs but include the likes of M20S, M32, and the S17, among others. The analysis paints a picture of an industry at a crossroads, where efficiency and cost reduction are survival strategies.</p>
<h2 class="wp-block-heading" id="the-bitcoin-hash-rate-hemorrhage">The Bitcoin Hash Rate Hemorrhage</h2>
<p>As we stand at the edge of this digital precipice, the hash rate—a measure of the network’s computational horsepower—is hovering around 515 exahashes per second (EH/s). But this robust number masks a vulnerable underbelly, susceptible to the impending halving shockwave. Galaxy’s sleuths predict that the old guard of ASIC models might not withstand the halved rewards, especially when factoring in a Bitcoin price of $45,000 and transaction fees making up a mere 15% of the rewards.</p>
<p>The breakeven point for these digital workhorses is alarmingly sensitive to fluctuations in Bitcoin price and transaction fee income. It’s a high-stakes game of digital roulette, where the outcome could see a significant hash rate decline, rendering some miners’ efforts unprofitable. This is about the shifting sands of mining power dynamics, with potentially cheaper power locations inheriting the ASICs mantle.</p>
<h2 class="wp-block-heading" id="a-landscape-transformed">A Landscape Transformed</h2>
<p>The Bitcoin mining ecosystem is akin to a wild west of digital frontierism, with miners constantly vying for a profitable edge. Riot Platforms and Bitfarms, among others, have been on a buying spree, amassing a formidable arsenal of mining hardware in anticipation of the halving. This gold rush of investment highlights a sector betting big on its ability to weather the storm.</p>
<p>Yet, not all miners are created equal. Compass Point Research &amp; Trading’s Chase White chimes in with a slightly less dire prediction, suggesting a hash rate dip to 500 EH/s post-halving—a testament to the resilience and adaptability of the sector. However, this optimism doesn’t extend to all miners. Those without the luxury of low-cost power or efficient mining fleets may find themselves edged out, a digital Darwinism at play.</p>
<p>The halving is more than a mere adjustment; it’s a catalyst for evolution within the Bitcoin mining ecosystem. As the dust settles, we may see a leaner, more efficient network emerge, albeit at the cost of those unable to adapt. This isn’t just about the survival of the fittest but a reshaping of the mining landscape, where efficiency and adaptability are king.</p>

Why 20% of Bitcoin’s hash rate might vanish post-halving

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