Bitcoin miners have not capitulated yet, but Bitcoin is setting new price records.
By Helen Parts, Cointelegraph
Editor: Wuzhu, Golden Finance
Bitcoin, the largest cryptocurrency by market capitalization, experienced its first halving 12 years ago, reducing block rewards from 50 BTC to 25 BTC.
Since then, Bitcoin's block reward (the incentive for crypto miners to verify Bitcoin transactions and protect the network) has gone through three halvings, shrunk to 3.125 BTC, and the block reward for new coins introduced to the market has shrunk to 3.125 BTC. The supply of mined BTC has been severely limited.
Bitcoin is trading close to its all-time high of around $99,600, set on November 22, due in part to the fourth halving event in April.
Bitcoin halving date and block reward. Source: BitDegree
As the community celebrates Bitcoin's first halving, this article reviews some of BTC's major historical milestones and changes in the mining ecosystem.
1.2 million Bitcoins yet to be mined
As of November 27, there are 19.8 million BTC in circulation, and 1.2 million BTC will be mined until the supply limit of 21 million is reached.
The supply of Bitcoin is limited to 21 million, which is one of the fundamental principles of the Bitcoin network and is designed to provide scarcity of the asset.
Total amount of Bitcoin in circulation. Source: Blockchain.com
Although the amount of 1.2 million BTC is small compared to the number of Bitcoins mined, the mining process for the remaining BTC will require more time and energy from miners due to the reduced reward and increased mining difficulty. There is a need.
According to MinerStat, Bitcoin mining difficulty is currently 102.3 trillion, which crossed the 100 trillion mark for the first time on November 5th. The next Bitcoin mining difficulty adjustment is scheduled to occur on December 2nd.
Bitcoin sets new price record as miners are far from capitulating
Despite the challenges posed by the increasing difficulty of Bitcoin mining and low block rewards, Bitcoin miners are not giving up as the crypto market continues to rise.
As of this writing, Bitcoin is trading at $95,364, up 154% over the past year, according to CoinGecko. Also, since Bitcoin's halving on April 20, 2024, the price of this cryptocurrency has increased significantly, increasing its value by about 45%.
According to a report from European cryptocurrency investment firm CoinShares, Bitcoin miners are taking steps to cut costs and deploy artificial intelligence, despite the rise in Bitcoin prices in 2024 and the increase in block rewards denominated in USD. He is said to be teaching the following.
“The Bitcoin mining industry has faced significant challenges this year, with both revenues and hash prices declining,” CoinShares said in its October mining report.
In July, when BTC was trading around $56,500, Bitcoin mining company TeraWulf considered consolidation due to low profit margins.
Some large crypto mining companies, such as Marathon Digital, sold large quantities of their mined BTC after the fourth quarter of this year, citing the need to improve efficiency and remain competitive. Marathon has also become an active buyer of Bitcoin, and in August announced the issuance of $250 million in convertible bonds.
Meanwhile, El Salvador is stepping up efforts to find alternative Bitcoin mining methods using geothermal volcanic energy.
Author: Golden Auction
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