Bitcoin has been making headlines lately, as its price continues to rise, and the hash rate of the network has reached all-time highs. According to data aggregator YCharts, Bitcoin’s network hash rate hit 398 terahashes per second (TH/s) on March 23, a significant increase from 335.32 TH/s on March 26. This surge in hash rate is being attributed to various factors, including unused mining inventory coming online, new facilities going live, and entrepreneurs finding cheap sources of mining.
Sam Wouters, a research analyst at Bitcoin financial service provider River Financial, believes that the recent spike in hash rate is linked to the inventory of mining hardware that was brought online last year. He notes that while Bitcoin’s price was low, miners brought as much inventory online as possible, and the network reached maximum capacity. However, with the recent price surge and some time passing, more inventory has been able to go online, leading to the spike in hash rate.
Wouters also suggests that Hydro models are starting to enter the market, with “250+ TH/s per machine, which adds tremendous hash rate.” Similarly, a March 20 analysis from investment banking company Stifel shared a similar sentiment, speculating that miners are bringing hardware back online, which is leading to the increase in hash rate.
One company that is benefitting from the recent surge in hash rate is TeraWulf, a US-based Bitcoin mining company. According to its CEO, Ammar Khan, TeraWulf has been able to continue mining Bitcoin at lower price levels due to its efficient mining fleets. Khan explains that some have speculated that lower prices forced miners to shut down their rigs and wait for the BTC price to improve, but TeraWulf has been able to continue mining due to their low-cost energy sites.
Khan also notes that TeraWulf has the opportunity to expand its capacity by 80 MW at LMD and 50 MW at Nautilus. He believes that the recent price movement is an indication of the long-term value of the ability to expand at low-cost energy sites. However, he does not expect the network hash rate to continue to increase through the first half of the year, as there is a lag between when investment decisions are made and when that capacity comes online.
In conclusion, while the exact reason for the recent spike in hash rate is unclear, it is evident that Bitcoin mining is becoming increasingly profitable, and miners are taking advantage of the current market conditions. As more companies enter the market, and more inventory comes online, it will be interesting to see how the hash rate continues to evolve and how it impacts the price of Bitcoin.
Publicly-listed Bitcoin (BTC) mining firm Argo Blockchain has reported an increase in its daily Bitcoin production for the month of February, despite a significant spike in network difficulty. According to the operational update released on March 7, Argo mined 162 Bitcoin or BTC equivalents during the month, translating to a daily production rate of 5.7 BTC. This is a 7% increase from the 5.4 BTC per day produced in January.
Bitcoin mining difficulty is a measure that defines how hard it is to mine a BTC block. It requires more hash rate or additional computing power to verify transactions and mine new coins. In February, the BTC network difficulty surged to new all-time highs, hitting a difficulty rate of 43 trillion on Feb. 25, as per data from Blockchain.com.
Despite the network difficulty spike, Argo’s production rate has increased, thanks to the company’s investment in new mining equipment and a focus on increasing efficiency. The news comes amid the industry anticipating the next Bitcoin difficulty adjustment expected to occur on March 10. According to data from BTC.com, the next difficulty is estimated to reach 43.4 trillion.
Argo Blockchain sold its flagship mining facility Helios to Mike Novogratz’s crypto investment firm Galaxy Digital amid the tough crypto market of 2022. However, despite the sale, Argo has continued to mine using Galaxy’s facility, and its production rate has been steadily increasing. Months before the transaction, Argo’s monthly BTC mining generated more than 200 BTC.
Argo is not the only mining firm that seems unaffected by the BTC difficulty spike in February. Other miners like Cipher Mining produced 16% more Bitcoin over January, and Marathon Digital increased its average daily Bitcoin produced by 10% compared to January. However, Hut 8 mining firm saw its daily Bitcoin production rate drop from 6 BTC in January to 5.6 BTC in February.
Argo Blockchain has been focusing on expanding its operations to capitalize on the increasing demand for Bitcoin mining services. The company recently announced plans to establish a Bitcoin mining facility in West Texas, which is expected to have a capacity of up to 200 megawatts and is slated to begin operations in Q4 2022.
In conclusion, despite the network difficulty spike, Argo Blockchain’s focus on increasing efficiency and investment in new equipment has led to an increase in its daily Bitcoin production rate. The company’s expansion plans and investment in new facilities suggest that it is well-positioned to capitalize on the growing demand for Bitcoin mining services.
Bitcoin (BTC) is a digital currency that is renowned for its durability, security, and dependability. A new block is added to the network on average every ten minutes, and the miner who successfully creates the block is rewarded with 6.25 Bitcoin, which is equivalent to almost $130,000.
On the other hand, the Bitcoin blockchain is known to sometimes spring a surprise on both watchers and players.
Nodes around the network confirmed the existence of a totally empty block at the height of 776,339 blocks. The fact that the block was uploaded to the Bitcoin network with no transactions included caused considerable consternation among those involved in the cryptocurrency industry. What precisely is meant by the term “empty block,” and how does this phenomenon occur?
To begin, while the presence of an empty block on the network may at first seem peculiar, this kind of thing is really rather common. Block 774486 was the location where it happened a little more than two weeks ago to the day.
Miners are encouraged to mine blocks as rapidly as possible, and as a result, they may mine a block even if they have not yet received any transactions that they may include in the block. When this occurs, the block will continue to be empty.
The following justification may be found in the Bitcoin mempool, which is the primary location for doing research on the Bitcoin blockchain: “When a new block is located, mining pools will give miners a block template that does not include any transactions. This will allow them to begin the search for the next block as quickly as possible. They immediately transmit a block template that is complete with transactions; but, a complete block template is a larger data transfer and reaches miners after a little longer period of time.
“During this interim period, which is often no more than one to two seconds, miners sometimes get fortunate and discover a new block utilizing the empty block template,”
In essence, mining a template was a case of “getting fortunate” for the miners. The Bitcoin block with the height of 776,389 was added to the chain just a few seconds after the block that came before it, which had the height of 776,488. However, Block 776,388 received an additional 0.086 BTC in fees, which is equivalent to around $1,854. This amount was added to the block reward of 6.25 BTC, which is approximately $135,247.
Even when there are no transactions in an empty block, the miner is still rewarded with freshly created bitcoins as part of the block reward. As a result, the reward for Block 776,389 was 6.25 Bitcoin and there were no transaction fees. The winning miner was Binance Pool, which contributed as much as 12% to the overall hash rate of the network.
It is essential to emphasize the fact that empty blocks do not provide a challenge for the network. Mining empty blocks still results in the production of the coin creation transaction, sometimes referred to as the coinbase transaction. This transaction ensures that Bitcoin is on track to meet its goal of having 21 million Bitcoins in circulation.
The proportion of vacant blocks on the network is often between between 1% and 2%, as seen by the statistics provided by BitInfoCharts. Given the proliferation of “ordinals” on Bitcoin, also known as the capacity to permanently carve photos, data, and marks into the blockchain, this statistic is even more shocking in light of its current state.
The increase in ordinals has led to various queries and even some anxiety among the Bitcoin community, and only lately the very first cases of pornography were documented.
As more and more image aficionados compete to have their work included in the Bitcoin blockchain, the mempool has become a more congested place, and block space has become a disputed resource.
According to a new analysis from Hashrate Index, the first production update of 2023 from publicly listed Bitcoin (BTC) mining companies reveals a consistent increase in hash rate and a surge in BTC production compared to the previous month. These findings are based on a comparison with the previous month.
In January, the vast majority of public miners raised their output of bitcoin, with CleanSpark increasing their production by a whopping 50 percent to achieve a record monthly production of 697 Bitcoins. Core Scientific, the most prolific Bitcoin miner, attained a total of 1,527 coins mined during the month of January. Riot, the second-most prolific Bitcoin miner, mined a total of 740 Bitcoins over the same time period.
Both Marathon and Cipher have experienced considerable gains in Bitcoin output, with Marathon hitting 687 Bitcoins created and Cipher reaching 343 Bitcoins generated. This compares to 475 and 225 Bitcoins generated respectively in December.
In January, improved weather conditions and more steady costs for energy helped miners increase their productivity, according to the analysis of a Bitcoin mining expert named Jaran Mellerud. “During the month of December, a winter storm swept throughout the continent of North America, which resulted in soaring power bills and intermittently caused many of these businesses to scale down their operations. Miners were able to reach a greater up-time since power costs were able to stabilize throughout the month of January thanks to the improvement in the weather.
The majority of public miners saw their hash rates grow in January, but at a more gradual pace than was anticipated. Cipher, a company located in Texas, is the one notable exception; it increased its hash rate by more than 50 percent, reaching 4.3 EH/s. “During this bad market, Cipher has been working very hard to develop, and I anticipate that the firm will meet its hashrate objective of 6 EH/s of self-mining capacity by the end of the first quarter of 2023,” Mellerud stated.
After completing a number of mergers and acquisitions in the latter half of 2022, CleanSpark was able to increase its hash rate to 6.6 EH/s, up from 6.2 EH/s in December. Additionally, in January, Hive saw growth, as seen by an increase in its hash rate of approximately 30 percent, which went from 2.1 to 2.7 EH/s. According to Mellerud, the CEO of Hive, the firm is continually modernizing its GPU fleet with ASICs, the majority of which are in-house developed Buzzminers.
Additionally, Core Scientific has continued to increase its hash rate, which jumped from 15.7 EH/s in December to 17 EH/s in January. The bankruptcy proceedings of the company are expected to have an effect on the figures; these proceedings include a deal with the New York Digital Investment Group (NYDIG) to pay off an outstanding debt of $38.6 million by handing over more than 27,000 mining machines used as collateral; these machines represent 18% of Core Scientific rigs. The figures are expected to be impacted by the bankruptcy proceedings of the company.
After many months of struggling financially as a result of rising power bills and falling Bitcoin prices, Core Scientific filed for Chapter 11 bankruptcy on December 21 in an effort to restructure its obligations and get a fresh start.
Mellerud also brought out the fact that “these corporations have, on more than one occasion, extended the deadline of their ambitious hashrate growth promises.” The majority of them have intentions to significantly boost their hashrate that they are now running by the end of the second quarter of this year. At this pace, it is probable that the majority of them will be forced to postpone their growth plans until even farther into the future.
The linked mining ecosystems have been fighting for their very existence for the last year, and their efforts are starting to pay off as Bitcoin (BTC) begins to show signs of a modest bull run. Mining incentives and transaction fees contributed to an income boost for the Bitcoin mining community that was almost fifty percent higher during the first month of 2023.
Since October 2020, Bitcoin mining income fell below $14 million for the first time on December 28, 2022, when it reached $13.6 million. Because of this, in addition to increasing energy costs caused by geopolitical tensions, mining businesses were put under a significant amount of financial strain, which ultimately led to some of them going out of business.
As indicated in the following graph, the cryptocurrency mining business had a revenue increase of fifty percent measured in terms of United States dollars. This gain occurred as Bitcoin remained in an advantageous position for a sustained recovery.
Within a month’s time, earnings from bitcoin mining almost doubled from its starting point of $15.3 million on January 1 to approximately $23 million.
The hash rate is continually breaking new records as more miners join the effort to provide power to and ensure the safety of the decentralised Bitcoin network. At the time this article was written, the Bitcoin hash rate was somewhere in the neighbourhood of 300 exahashes per second.
However, in an effort to find a solution to the problem, efforts are being made to source greener energy to power Bitcoin mining operations. A mining business in Malawi, which is a landlocked nation in southern Africa, has only lately begun tapping into a supply of stranded energy there.
Erik Hersman, co-founder and CEO of Gridless, made the following statement in reference to the initiative’s overall impact: “The power developer had built these powerhouses a few years ago, but they weren’t able to expand to more families because they’re barely profitable and couldn’t afford to buy more metres to connect more families. Now, because of this initiative, they are able to expand to more families.” Because of our agreement, they were able to instantly purchase 200 more metres, which enabled them to connect more households.
In addition, the Bitcoin mining operation has a minimal impact on the surrounding ecosystem since it is entirely powered by hydroelectricity derived from rivers.
According to data from mining pool 2miners, Ethereum Classic’s hash rate has experienced a 200% growth in the last 30 days, jumping to now at its all-time high of 64 TH/s from 30 TH/s on August 15.
Ethereum Classic has hit an all-time high hash rate of 65.49 terahashes per second (TH/s), having grown more than 40% during September ahead of The Merge.
Hash rate refers to the computational power used to mine a cryptocurrency on a proof-of-work blockchain. Cryptocurrencies such as Bitcoin, Ethereum Classic, and Ether (before the merge) use a proof-of-work system, which requires lots of powerful computers and energy to process transactions.
Today, Ethereum is set to make its long-awaited shift from its proof-of-work consensus to an energy-friendly proof-of-stake blockchain consensus mechanism.
Ethereum’s move to shut down its proof-of-work consensus is set to leave Ether miners with potentially nothing to do. So, miners have announced their intent to migrate to Ethereum Classic, amongst several other proof-of-work blockchains.
These miners plan to mine Ethereum Classic and other compatible coins like Ravencoin. According to 2Miners, mining on Ethereum Classic and others like Ravencoin and Ergo is the “safest post-Merge strategy” at least in the first few days after the Ethereum Merge event.
“Currently, the most profitable coins after Ethereum are Ravencoin, Firo, Cortex, Ergo, Aeternity, Beam, Bitcoin Gold, Ethereum Classic, and Callisto,” 2Miners elaborated.
The Merge Getting Ready
The mass migration of crypto miners to Ethereum Classic has been one of the major driving forces pushing its hashrate to reach new highs.
As a result, the Ethereum Classic’s native cryptocurrency (ETC) was also up by 7.53%, trading at $38.12 at the time of writing.
In July, AntPool, a mining pool based in China and owned by Bitmain, signalled support for Ethereum Classic and injected a $10 million investment in the ecosystem. Ethermine, the world’s largest Ether (ETH) mining pool, also announced support for Ethereum Classic.
Ethereum Classic’s algorithm, Ethash is compatible with equipment used for mining Ethereum. Due to this, ETC can be mined using the same GPU and ASIC machines designed for Ethereum mining.
Ethereum is about to change its consensus from proof of work to proof of stake, an update called The Merge. The upgrade is estimated to take place around 4:23 UTC on Thursday, late into the evening of September 15.
Bitcoin (BTC) seems to be on everyone’s mind lately as the world recently witnessed the price of BTC take a rather unexpected bearish turn this month. On January 21, 2022, Bitcoin reached six-month lows, sinking below $40,000 for the first time in months.
While some panicked, other industry experts pointed out that the Bitcoin network has become verifiably stronger than ever before. The growth of the Bitcoin network has become apparent, as hash rate figures for BTC continue to set new highs this month. For example, on Jan. 22, the BTC network recorded an all-time high of 26.643 trillion with an average hash rate of 190.71 exahash per second (EH/s).
The hash rate will continue to grow, which is a good thing
Samir Tabar, chief strategy officer at Bit Digital — a publicly listed Bitcoin miner — told Cointelegraph that the BTC hash rate refers to the amount of computing power being contributed to the network at any given time. Tabar explained that when it comes to Bitcoin mining, a higher hash rate equates to a good hash rate. “The more computing power going towards maintaining a network, the more secure it will be and the more transactions it will be able to handle,” said Tabar.
As such, the recent hash rate figures for Bitcoin are extremely notable, even with the price of BTC being down. Peter Wall, CEO of crypto mining firm Argo Blockchain, told Cointelegraph that he wasn’t surprised to see the BTC hash rate hit close to 200 EH/s. Wall further stated that even with events that have recently disrupted BTC mining hash rate like the political upheaval in Kazakhstan, the hash rate will continue to grow higher each month:
“Argo Blockchain’s mining margin last year in 2021, which is our revenue minus our direct costs, was over 80%. It was a very good year for miners. In 2020, where BTC prices were much lower, our margin was 41%. So, this year I think we will still see strong margins in the space despite the recent drop in the price of Bitcoin and the increase in the hash rate.”
Darin Feinstein, co-founder and co-chairman of Core Scientific — a major publicly-traded blockchain infrastructure provider — told Cointelegraph that based on previous Bitcoin mining hash rate data, the BTC network grew by 200% following the mass exodus of miners from China:
“The Bitcoin network one year ago was approximately 143 EH/s. Following the mining ban in China, the network fell to 63 EH/s. Today, the hash rate has grown to approximately 198 EH/s. This recent increase represents three important metrics. One, it represents a 130 EH hash rate increase on the network. Two, it represents 130 EH of new hosting infrastructure and primarily new generation hardware deployment and three, this deployment has taken place in geographic regions that use far cleaner energy than the energy used in China.”
With this in mind, Feinstein noted that even though the BTC network has hit all-time highs in terms of EH/s, due to the massive improvements in miner chip technology and geographic distribution away from China, the network is now the most efficient and sustainable than it has ever been. Feinstein added that this data is important because it shows how much energy every terahash uses, which is generally represented by a metric called jules/terahash. He noted that this ratio has fallen greatly over the last several years, demonstrating a major increase in mining energy efficiency.
Michael Levitt, co-founder chairman and CEO of Core Scientific, told Cointelegraph that he fully anticipates for the BTC global hash rate to continue growing at an aggressive pace.
However, Levitt mentioned that this growth is dependent on the price of Bitcoin moving forward, along with the success of the infrastructure currently being built. “The amount of infrastructure expected will be challenged by global supply chain issues,” he remarked.
Feinstein added that infrastructure is the biggest challenge when it comes to mining Bitcoin. “The bottlenecks for Bitcoin mining are land, energy, equipment, and lastly, infrastructure. There is plenty of ASIC hardware to be purchased, energy and land are also readily available, but miners need a place to plug in power, and, historically, that is where miners run into issues,” he commented.
North America has become one of the world’s largest Bitcoin mining hubs, as per data from the Cambridge Bitcoin Electricity Consumption Index, which shows that 35% of the average monthly BTC hash rate comes from the United States, while 10% comes from Canada. Wall explained that North America has taken the lead as a global Bitcoin mining hub for a number of reasons. “This is the case due to the region’s crypto-friendly jurisdiction, its stable regulatory environment, pro-innovation nature and, most importantly, access to the most important thing miners need — low-cost power, preferably renewable.”
Wall elaborated that the low costs of power in the U.S. have been significant for miners, especially when organizations tap into the right part of the power grid. “We’ve seen significant growth in Texas over the last 12 months,” he said.
Cointelegraph previously reported that the Bitcoin mining industry in Texas consumed around 500 to 1,000 megawatts (MW) of power during Nov. 2021. The Electric Reliability Council of Texas reportedly anticipates that demand could increase as much as fivefold by 2023 and has planned an additional 3,000 to 5,000 MW.
Wall elaborated that many miners are moving to Texas due to the fact that the state operates its own power grid that consists of a high degree of power from sustainable generation sources, but needs more flexible demand, or load:
“Miners can provide a consistent load that is flexible. It’s also helpful that Texas has demand response programs in place, where miners will shut down and give power back to the grid when there is high demand. This makes the grid more resilient.”
Benefits such as these have prompted Argo Blockchain to build its next 200 MW facility in Dickens County, west Texas, directly next to a 5.5-gigawatt substation. “There is a lot of congestion at that substation and they need local load to relieve it. The power from west Texas needs to go a long way to reach major urban cities like Dallas and Houston. But, if we can use that energy much closer to where it’s being generated, that relieves the congestion,” remarked Wall.
By drawing power from a nearby substation, Argo Blockchain is demonstrating the use of sustainable energy. According to Wall, the mining company has been carbon negative since 2020. This is important, as Tabar stated that a massive environmental, social and governance movement is currently facing the crypto mining industry:
“Miners must draw from clean sources of power or else they will be regulated out of business. It can’t always be about the cheapest sources of power. Miners will eventually suffer valuation discounts if they use dirty power, even if that source is cheap.”
The perks of going public
A rush of mining firms to go public is another trend the Bitcoin mining industry is likely to witness this year. Most recently, Texas-based Bitcoin mining company Rhodium announced plans to offer 7.69 million shares at $12–$14 each in an initial public offering (IPO).
Core Scientific went public on Jan. 20 after merging with Power & Digital Infrastructure Acquisition in a SPAC transaction. Although shares of Core Scientific have
Over the previous year, Ether (ETH) has increased in value to the point that it significantly outperformed Bitcoin (BTC) in terms of returns. The rise of Ethereum has made mining on its network more lucrative over time. This appears to have resulted in additional miners, resulting in an expansion of the network’s hash rate.
The hash rate for Ethereum has hit a new high, approaching record levels of 1.11 PH/s according to data from Glassnodes on Jan. 27. The previous ATH was reached previously on Jan. 13, when the ETH price fell from $4,460 to $3,160.
Source: Glassnodes
When the hash rate rises, it indicates that more nodes are joining the network, and the network is becoming more decentralized. As a result, such an increase helps to cement blockchain security. However, if the hash rate is too low, it may be detrimental to the network since there would be fewer nodes, resulting in slow transactions and less security.
In December 2021, Ethereum network participants implemented the Arrow Glacier upgrade, which pushed back the switch to proof of stake consensus. It also means that Ethereum mining has a long way to go before it comes to an end. A transition from the proof of work (PoW) algorithm to the Proof of Stake (PoS) algorithm is required before reaching ETH2, which is referred to as The Merge. At that moment, the difficulty bomb will go off, essentially shutting down ETH mining and putting the network into an “ice age” that lasts until the switch is completed.
After the switch to proof-of-stake, however, ETH will no longer be mined; instead, transactions will be validated by staking on special nodes.
Presently, the network’s hash rate has increased past one petahash. The number is equivalent to around 1,000 TH/s and indicates that the network’s hash rate has risen more than 66,000% since March 2016, when it began being recorded on the network.
Related:Bitcoin hash rate jumps to ATH as Jack Dorsey confirms Block’s mining system
As reported by Cointelegraph, the Ethereum Foundation criticized the branding of Eth2, saying it did not adequately reflect what was going on with the network during its round of upgrades. “ETH2” and the terminology used to distinguish a proof-of-stake chain from a proof-of-work chain may be phased out in the near future, according to the post.
We’ve removed all uses of ‘Eth2’ terminology on https://t.co/v9gxnMUQFz
Find out why https://t.co/84uJXSD4q1
— ethereum.org (@ethdotorg) January 24, 2022
Among the reasons for the shift are a bad mental model for first-time users, scam prevention, inclusion, and stake clarity. The switch from a PoW to a PoS consensus mechanism is scheduled to occur in the second or third quarter of this year.
