Record-Breaking Hash Rate in Q1 2024: Bitcoin Miners Reactivate Old Machinery Amid Price Surge
Summary:
Crypto miners have reactivated their old mining machinery due to the surge in Bitcoin's price, contributing to a record-breaking hash rate in Q1. The increase in Bitcoin's hash rate is on par with its price rise, and the deployment of modern mining equipment has also contributed. Despite a fall in transaction fees, miner revenues reached a new all-time high. A waiting strategy is being adopted by miners before the halving event, leading to the stabilization of ASIC machine costs.
The surge in Bitcoin's price to a new peak in March may have prompted crypto-miners to reactivate their previously unprofitable crypto-mining machinery, leading to a record-breaking hash rate during Q1. This is according to Nico Smid of Digital Mining Solutions, shared in the company's first quarterly review of Bitcoin mining on April 2. Bitcoin's hash price movement seems to be synced with the currency's price shift, which as of writing, has risen 56.8% in 2024 to $66,280. The revival of these old Bitcoin miners possibly lead to a 14.7% boost in Bitcoin's hash rate since the beginning of the year. Basically, this growth is comparable to adding approximately 375,000 Antminers S21 200 TH/s to the network. The introduction of modern-gen mining gear like the Bitmain S21 also contributed to the first quarter's hash rate growth. On a 7-day moving average, the highest Bitcoin hash rate was 631 exahashes per second (EH/s), recorded on March 11, slightly before Bitcoin outdid its past highest ever price of $68,990. Bitcoin then set a new record price of $73,738 on March 14, as per CoinGecko. Intriguingly, Smid pointed out that miner revenues peaked on March 10 despite transaction fees consistently slipping since the beginning of the month. This scenario is less appealing to miners used to high transaction fees. Meanwhile, the price of application-specific integrated circuit (ASIC) machines seems to have stabilized while many Bitcoin miners are refraining from new investments due to the upcoming halving event. Miners seem to be in a 'wait and see' mode in light of the impending halving event, says Smid. This was evidenced in an ASIC Jungle survey that revealed 65% of users are delaying the acquisition of new mining equipment until after the halving. The Bitcoin halving is currently set for April 20, where the block rewards for miners will be reduced from 6.25 BTC ($414,000) to 3.125 BTC ($212,000) at today's rates. It has been noticed that substance abuse among crypto traders is accelerating, as reported by a magazine.
Published At
4/4/2024 5:40:46 AM
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