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The difficulty of mining will affect the future price of the currency

2019-01-15 18:07

      Every year at the beginning of the new year, the currency circle mines will predict how the price of the currency will go this year. There is a bull market saying that there is also a saying that the bear market will continue. But seeking truth from facts, we will analyze some of the relevant factors affecting the future price of the currency through the difficulty of mining. Does the hash rate (a measure of mining power) really affect the price of Bitcoin? The answer is yes. In the medium and long term, the hash rate can be regarded as a neutral indicator of fundamental analysis, but the relationship between the two is not a simple positive correlation. Let's briefly analyze it.


      The rise in the price of coins will undoubtedly attract large amounts of capital and mining machines into the mining industry, which will drive the increase in the computing power of the whole network and the difficulty of mining. At the same time, the increase in hash rate means that the cost of mining each bitcoin is higher, so the corresponding The price of the currency will also rise, so the two markets are basically in sync, and the bitcoin price increase is higher than the hash rate.

      Secondly, from 2009 to the present, the hash rate has soared by 30 billion times, and has continuously refreshed the historical high. The soaring of the hash rate and the sharp increase in the difficulty of mining have made the mining revenue of a single machine almost every two months. Halve. When the mining capacity is excessive, the rising rate of the hash rate will evolve into the sinking cost of the miners, and as the profit is squeezed, the miners may also sell bitcoin, which will lead to the cooling of the bitcoin price. However, due to factors such as industry layout, the hash value has a certain lag relative to the bitcoin price, so the hash rate will not follow the bitcoin price, and the overall sideways will continue to rise slowly. Because the price of bitcoin falls, the price of mining machines will also go down all the way. For example, the ant mining machine s9 was more than 10,000 in the previous year, and now it has fallen to several thousand. The reduction of mining cost makes the miners still maintain a good return on investment. rate.

      Many currency analysts have tried to calculate the price depreciation of Bitcoin miners' balance of payments, hoping to provide support for bitcoin prices. Earlier, well-known cryptocurrency research companies considered the threshold to be around $8,000. The result of well-known investment banks was that the breakeven points of large miners and retail miners were $50,000 and $8,600, respectively. In any case, in the eyes of many analysts, bitcoin prices are only over $5,000, and miners can make money.

      But in fact, they can't accurately measure the key factors affecting mining costs, such as mining electricity charges. If the price of electricity is lower, the price will be lower. Judging from the recent sideways hikes, the threshold for Bitcoin prices has probably been touched. For miners who mine through cheap electricity bills, their break-even points will be lower. For example, the RHY overseas mines selected by the miners under the bear market, the RHY mine has a large 900MW in the Middle East and Georgia. Mines, electricity costs as low as 0.3 yuan per kWh, mining machinery leasing and computing lease mining business is widely selected and supported by miners. Because the miners are under this cheap electricity bill, their rich mining revenues are no problem in defending against the current depressed currency.

      And now the market is slowly improving. Since the second half of 2018, bitcoin prices have once again stopped falling and fluctuated, and the hash rate has gradually leveled again, and the difficulty of mining has been flattened. By 2019, the two were basically in the silent period of both sides. The last time this situation was presented was in 2015. From January 2015, the price of the currency stopped falling and the hash rate gradually leveled off. The two sides were almost simultaneously sideways for 10 months, followed by a hash rate. Regaining the climb, and the bitcoin price has also experienced a rebound, back step, breakthrough start-up phase, opened a round of bull market, whether this year's history will repeat itself, let us wait and see.