Hut 8 Shuts Down Canadian Facility Amid Surging NFT Hopes and Record Bitcoin ETF Trading
Summary:
Bitcoin mining firm Hut 8 has permanently shut down its Drumheller, Canada facility due to rising energy costs and other operational difficulties. The approaching Bitcoin halving is expected to give a boost to the nonfungible token (NFT) market. Meanwhile, spot Bitcoin exchange-traded funds (ETFs) in the U.S. marked a record trading volume of $10 billion in a day, coinciding with Bitcoin's new all-time high.
Hut 8, a bitcoin mining corporation, has officially closed their facility in Drumheller, Canada, due to difficulties in the mining industry. Concurrently, the nonfunglible token (NFT) sector is hopeful for a potential increase in prices following the Bitcoin halving event, and day trades for spot Bitcoin exchange-traded funds (ETFs) have greatly increased, reaching a record $10 billion.
As a result of issues with electricity and escalating energy prices, Hut 8 is shutting down its bitcoin mining operations in Alberta, Canada. The US-based corporation announced the immediate closure of its mining site in Drumheller, Alberta, on March 6. Despite producing around 1.4% of the company's BTC, the facility required approximately 11% of its hash rate. This excessive cost led to the operation becoming untenable in the long term.
According to Asher Genoot, the CEO of Hut 8, various elements such as high energy expenses and voltage issues significantly impacted the profitability of the Drumheller site, as per their extensive analysis.
Rising energy costs, unprecedented mining difficulty, and the imminent Bitcoin halving - which will reduce block rewards by 50% - are presenting major challenges to the Bitcoin mining industry. For the first time ever, Bitcoin's price hit an all-time high before the halving event, peaking above $69,300 on March 5, then later correcting lower.
The upcoming Bitcoin halving is foreseen to not only influence crypto tokens, but also stimulate the NFT ecosystem positively, according to NFT professionals.
Oscar Franklin Tan, CFO of Atlas Development and a major contributor to the Enjin NFT platform, anticipates a rise in NFT prices following the Bitcoin halving. In his interaction with Cointelegraph, Tan stated that the halving would likely result in increased prices and volumes as part of the known cycle, lending to increased interest in NFTs alongside altcoins.
US-based spot Bitcoin ETFs reached a record trading volume day of $10 billion on March 5 as Bitcoin marked a new all-time high which dropped shortly afterward. This is a significant surge from their previous record of $7.7 billion set on February 28.
BlackRock’s ETF recorded the highest volume at $3.7 billion, followed by Grayscale and Fidelity at $2.8 billion and $2 billion, respectively. However, both BlackRock and Fidelity’s ETFs experienced around 8.6% decline throughout the trading day, with other spot Bitcoin ETFs facing similar price drops as Bitcoin touched a new all-time high of over $69,200 before plummeting over 14% to under $60,000 five hours later.
Investment advice or recommendations are not contained in this article. Considerable risk is involved in every investment and trading move, and readers are advised to carry out their personal research before making any decisions.
Additional reporting was provided by Geraint Price, Sam Bourgi, and Felix Ng.
Published At
3/6/2024 11:16:42 PM
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