The mining industry is preparing for the event with new equipment and staff reduction. The hash rate all-time high has been broken several times this year, reaching 147 EH/s.
There remain less than two months before May 11th, the expected date for the third Bitcoin halving to occur. The reduction by half of the rewards per mined block will occur at the height of block 630,000.
At the time of writing this article, bitcoinblockhalf.com indicates that 8,787 blocks are remaining to reach the halving. At a rate of about 144 blocks mined per day, according to the calculations of the aforementioned portal, miners would be reaching block 630,000 on the scheduled date.
One of the reasons for the high expectations regarding the event is the reduction of the reward to miners from 12.5 BTC per block to 6.25 BTC. This has led the industry dedicated to the mining in Bitcoin to take measures in advance.
Another reason is that the market and analysts are waiting for possible repercussions on the price. These would be based on the movements that have occurred in the previous halving.
Concerning, the expectation is that older equipment will lose its profitability. In this respect, mining equipment manufacturing companies have created new products. That is the case of Bitmain, which announced the launch of its AntMiner S19 and S19 pro models, precisely for May this year.
The price of BTC might also put the Bitcoin mining industry at risk after the halving, according to a report by the firm. According to the document, the operating cost of mining one BTC could double after the reduction of rewards, going to about USD 12,525.
The price of each BTC is currently below USD 8,000, which would compromise the profitability of miners in that scenario. Farms have already begun to replace their obsolete equipment, and area companies have opted to reduce their staff.
Hash Rate All-Time Highs
Some analysts have estimated a possible exodus of Bitcoin miners before and after the halving. However, the accumulated hash rate on the network has not stopped growing until now.
Beyond the constant fluctuations, the all-time high of this hash rate has been exceeded on several occasions this year. In January, the high was 127 exahashes per second (EH/s). In early March, the new mark was set at 147 EH/s, according to data from statoshi.info.
Regarding the price, there has been certain skepticism among analysts, especially considering that an in-depth analysis requires more data. However, historical data about previous events will possibly anticipate significant increases in the price of BTC.
The performance of the price of Bitcoin has been positive in 2020, particularly in January, when it was the best in 7 years. Besides, despite the fall in international markets and the cryptocurrency market itself, Bitcoin has remained above 7% so far this year.
Bitcoin has not had one of the best returns among the main cryptocurrencies in the first months of 2020. However, it is still necessary to wait to see what will happen after the reduction of mining rewards.
By Willmen Blanco