Bitcoin miners receive just USD 0.10 for every terahash they invest on the network. On June 11^th, the hashprice break began, accumulating falls of 23% in a few hours.

The drop in the prices of crypto assets severely hurt the profitability of Bitcoin (BTC) mining. After several days of stability, it lost its resistance and returned to figures not seen since the COVID-19 pandemic began.

According to the analytics firm Hashrate Index, the hashprice is at a daily average of USD 0.10 (10 US cents). That represents a drop of 23 % compared to last week when the indicator was above USD 0.132.

The hashprice is the estimated value a Bitcoin miner receives for each terahash invested on the network. That index correlates positively with the price, shedding light on the profitability of Bitcoin mining. Each new transaction block added to the leading ledger of the network (blockchain) causes the indicator to change.

Bitcoin mining profitability was significantly stable from early May to the first ten days of June. On June 11^th, it became evident that a break made the indicator collapse, leading to a crisis in the small-scale mining industry.

The hashprice fell back to just 10 US cents when BTC dropped by 7% from its USD 29,000 barrier to hover around USD 23,700.

The decline in the price of Bitcoin comes amid escalating inflation in the US, which set 40-year records and reached 8.6% in May. The price dropped by 25% over the past week due to the correlation between BTC and the traditional market.

The Participation of Mining Equipment on the Network Continues to Rise

The Bitcoin mining activity remains an important market niche despite its low profitability. Data from Hashrate Index suggests that the mining difficulty and hash rate continue to rise.

Mining difficulty is the mechanism regulating the issuance of Bitcoin, adjusted every 2,016 blocks mined. It increases or decreases depending on the participation of mining equipment on the network. For example, the indicator last rose by 30.28 trillion (T), a figure no higher than its last record. However, it makes it evident that a significant amount of hardware operates in favor of the security and maintenance of the network.

The Bitcoin hash rate or computing power, the existing capacity to process transactions on the network, is 230 EH/s on average. That is close to its last 235 EH/s record and suggests further work in favor of Bitcoin despite the little gains.

The rising participation shows miners know that Bitcoin can appreciate, as operator Fernando Grijalba recently stated.

Hodler sentiment seems to indicate that investors are unwilling to sell their coins. However, miners will have no choice but to show resilience since the bearish market is latent if the trend continues.

Bitcoin is trading at around USD 23,282 and has accumulated a USD 22.2% loss over the last week. While its daily trading volume is above USD 63,80 billion, its market capitalization is about 444,49 billion, according to CoinGecko.

By Alexander Salazar

Developers want to harm users as little as possible before the merger occurs. This activity had already suffered too much delay.

The difficulty bomb, which will sharpen the final details for Ethereum mining with proof of work (PoW), could get enabled in the first half of August. This procedure is what the network developers would use to make the merger happen.

With the Ethereum difficulty bomb, developers intend to set a difficulty so high that it will become an impossible task to achieve the mining of a new block. This activity will allow proof-of-work mining to stop its activities, which will result in all new blocks getting generated on Ethereum 2.0, which will work on proof-of-stake (PoS) after the combination happens.

The EIP-5133 now appears online but has not yet faced a voting procedure. Its creation date is June 1, and its creators are the developers Tomasz Kajetan Stanczak, Eric Marti Haynes, and Josh Klopfenstein.

According to this new proposal, the difficulty bomb should get enabled before August reaches its first half. The EIP also highlighted that it is possible that the computing power could crash before The Merge occurs; these events need to get considered when setting up the schedule for this period.

This delay got predicted without a definite date. The argument for this postponement was to give the customers, who create the software for the nodes to link with the network, time to get the required updates ready for the merge.

According to Marius Van Wijden, one of the most significant roles in the Ethereum environment, these actions will not impact the work achieved for the merge.

All of the above got debated and agreed upon in the most recent Ethereum Dev Calls, which are meetings that the developers of this network have periodically. These sessions put on-the-table situations linked to the development of the network. The last one so far is that of Friday, June 10, 2022, and can get found in full on YouTube or in written format on GitHub.

Testnets Go Ahead with the Combination Procedure

On the other hand, the developers talk about timelines and procedures to achieve the transition to Ethereum 2.0 while testnets serve as a rehearsal stage so that every detail goes according to plan.

On June 8, the merge got achieved on the Ropsten test net. The test net went from PoW to PoS in the process. The fact was considered a significant advance considering the subsequent tests and the final merger, planned to occur sometime in the year’s second half.

The next stage will rely on generating the Beacon Chain in the Sepolia test net. This action will get carried out on June 20, as Crypto Gucci highlighted via his Twitter account.

The Beacon Chain will take the lead as the original shard of the new blockchain. The main net already counts on its Beacon Chain since 2020, and the goal of 400,000 validators with funds blocked in its smart contract got recently approached.

By: Jenson Nuñez

New York has approved a bill to ban Bitcoin mining operations that allegedly harm the environment with carbon emissions. A law circulating in the US Senate aims to treat crypto assets as commodities.

This week, two relevant legal movements have impacted the cryptocurrency market in the United States. Even though there has not been any noted effect on prices, experts highlight the importance of those steps to regulate the sector. New York has stressed the environmental harm of mining processes, while a law circulating in the US Senate aims to treat cryptocurrencies as commodities.

Blockchains using a proof-of-work (PoW) consensus mechanism have been controversial, as critics point to excessive power consumption and inefficient use of resources. Meanwhile, proponents argue that their heightened security and decentralization features justify the high energy use.

New York lawmakers have recently approved a bill to ban some Bitcoin mining operations that use high levels of carbon. Julius Baer experts comment this shows that the environmental footprint of digital assets remains a priority for regulators and investors.

The United States has most of the Bitcoin hash rate (mining difficulty) worldwide, indicating that most miners are in the country. Therefore, those experts think any possible regulatory measure could propagate and set a precedent for bans in other states.

The mining of cryptocurrencies could occur anywhere, and the prevailing regulatory environment and electricity costs are the primary driver of location decisions. The proposed law could lead several large-scale miners to leave the state for more crypto-friendly places, discouraging blockchain technology in New York.

Cryptocurrency miners and companies might migrate from New York, but lawmakers and regulators still focus on the relative sustainability of those assets. They believe that the negative environmental impact of cryptocurrencies is an exaggeration due to the sharp focus on Bitcoin.

They conclude that developers of decentralized apps (dApps) seek other mechanisms, like a proof-of-stake consensus, for greater scalability. They consider they are the primary beneficiaries of decentralized finance (DeFi).

Proposal for the CFTC to Regulate Cryptocurrencies

The US Senate is studying the bipartisan law introduced by Democratic Senator Kirsten Gillibrand and Republican Senator Cynthia Lummis. They belong to the Agriculture Committee and the Senate Banking Committee, respectively.

This bill, called the Responsible Financial Innovation Act, places the Commodity Futures Trading Commission (CFTC) as the primary regulator. Lark Davis, an analyst at Wealth Mastery, says this federal agency will regulate many cryptocurrencies instead of the SEC.

Despite not knowing what to do with DeFi and NFT (non-fungible tokens), Davis thinks that transactions below USD 200 will be exempt from taxes. That will encourage retailers to adopt crypto assets as there is regulation for stablecoins and protection for self-custody wallets.

Marcus Sotiriou, an analyst at GlobalBlock, says this will motivate those merchants deterred by that tax issue. In addition, the support for stablecoins will provide confidence to many investors, especially after the recent events with UST.

The expert considers that this bill would provide the regulatory clarity many institutions seek before investing. Although the Senate has not yet approved it, he believes it holds great promise for potential investors.

By Alexander Salazar